Retrospectives- Spain, Sweden and Italy

Retrospective on Sheila (Clabby) Schottland “Til Death Do They Part: Spain’s Love Affair with the Cigarette” from Modern Spain Emerges Perspectives on Business and Economics, Volume 23 2005 Sheila (Clabby) Schottland ‘05 is now employed as an Executive Brand Management Consultant in NYC. Have Spain’s anti-smoking programs been successful since their creation in 2005? In 2005, Spain created multiple anti-smoking programs, including a heavy tax on cigarettes and a five-year plan of attack to be put into legislation. The plan, set to begin that year, aimed to impose restrictions on smoking locations, such as in the workplace. In 2010, the plan was modified to include restaurants, bars, and public transportation as non-smoking locations, which ultimately “successfully reduced the number of smokers from 28.1% of the population in 2003 to 19.8% in 2020” (World Health Organization, 2022). Spain has been working since 2010’s modification to create a new antismoking plan that would further increase taxes on tobacco, include new non-smoking areas, and completely remove logos from cigarette packs. However, while this new Comprehensive Plan for Prevention and Control of Smoking 2021–2025 was supposed to be enacted in 2021, it has yet to complete the administrative process because of issues with the COVID-19 crisis, child hepatitis and the monkeypox virus (Soto, 2022). While the official plan has been delayed indefinitely, it has not impeded all of Spain’s anti-smoking progress. As of 2022, “Spain is among a few countries in the WHO European Region which bans tobacco use in all indoor public places, and health campaigners and policy-makers are leading the way to extend smoke-free zones to outdoor spaces, including the country’s sunny beaches” (World Health Organization, 2022). Spain’s continuous efforts and modifications have shown that the country’s programs are on track to be even more successful. How has Spain’s view of smoking changed since 2005? After the reign of Francisco Franco, the people of Spain came to view smoking as liberating and a sign of freedom. Due to an increase in income, the Spanish population had the ability to purchase more luxury goods, such as tobacco and alcohol, which led to an increase in those purchases. However, although Spain’s government became more conscious of the problem in its state, smoking is still a big issue in the country today. Despite the numerous programs that have been implemented, “almost every fifth adult and adolescent smokes—18% of adults smoked tobacco in 2020 and 21% of adolescents aged 15 –16 smoked cigarettes in 2019” (World Health Organization, 2022). While the smoking rates in Spain have not decreased significantly, the COVID-19 pandemic has resulted in citizens’ being more cautious about how smoking affects their health. The Spanish Society of Epidemiology points out that there’s a “higher risk of SARS-Cov-2 transmission due to smoking in outdoor public places, mainly because of the emission of droplets and their diffusion with smoke or other aerosols” (Fernández & Martínez, 2020). References Fernández, Esteve & Martínez, Christina (2020). Spain: COVID-19 prompts smoking regulation in streets and terraces. blogs.bmj.com/tc/spain-covid-19-promptssmoking-regulation-in-streets-and-terraces/. Soto, Álvaro (2022). The new anti-smoking plan in Spain has already been delayed by over a year. www.surinenglish.com/spain/antismoking-plan-spain/. World Health Organization (2022). The role of the public in changing norms: smoke-free beaches in Spain. www.who.int/europe/news/item/. Retrospective by Sidney Jankanish ’23, Political Science and International Relations . June 2023 Spain, Sweden, Italy Edition Martindale Retrospectives Martindale Center for the Study of Private Enterprise Lehigh University College of Business Rauch Business Center, 621 Taylor Street, Bethlehem, PA 18015-3117 Tel: +1.610.758.4771 | Fax: +1.610.758.6549 | www.lehigh.edu/martindale

Retrospective on Yelena Pelimskaya,“Gone to Waste: The Quality of Hazardous Waste Management in Spain” from Modern Spain Emerges Perspectives on Business and Economics, Volume 23 2005 Yelena Pelimskaya '05 is now Manager Due Diligence at Cerity Partners. Has the National Plan for Waste been improved since its implementation in 2005? In 2005, the National Plan for Waste of Spain no longer seems to exist. However, a new plan has since been created in its place, as well as multiple other policies regarding related areas. In 2014, the Ministry for the Ecological Transition and the Demographic Challenge created a new program known as the State Waste Prevention Program intended to last through 2020. According to the Ministry, “Prevention in the generation of waste is the commitment of the waste policy that provides the most environmental benefits, which is why it occupies the first position in the hierarchy of waste and is key both in the roadmap to advance towards an Efficient Europe in the use of the resources of the 2020 Strategy of the European Union, as in the Waste Framework Directive” (METDC). As in 2005, waste management is still viewed as the country’s top priority environmental changes. This program also works together with the EU’s Circular Economy Action Plan towards sustainable growth. By working in tandem with the CEAP to target product life cycle, Spain’s SWPP can continue to reduce waste into the future. Has Spain taken any other steps to advance its sustainability as a country? Along with the State Waste Prevention Program, Spain has implemented regulations, legislation, and other methods of improving sustainability. In March of 2022, Spain’s parliament passed a Law on Waste and Contaminated Soil. This law is intended to ban certain chemicals in product packaging in order to prevent soil contamination with plastics and nonbiodegradable elements (Parkinson, 2022). In order to reach the goal of 50% reduction of single-use plastics by 2026, this law also supports reducing waste through the sale of bulk products, reusable containers and packages (Parkinson, 2022). Another change Spain has made towards better sustainability is the redirection of land use. By leaving forests untouched and implementing forest fire prevention policies and ecosystem recoveries, Spain has managed to turn their tree-heavy land into an effective carbon sink. “Between 2005 and 2019, Spain reduced its emissions by almost 27%, well above the EU-wide achievement of a 19% reduction” (Simões & Victoria, 2021) and have since set a goal to reach climate-neutrality by 2050. References European Commission (n.d.). Circular economy action plan.environment.ec.europa.eu/strategy/ circular-economy-action-plan. Ministry for the Ecological Transition and Demographic Challenge (n.d.). Plans and Programs. www.miteco.gob.es/es/calidad-y-evaluacionambiental/planes-y-estrategias/Planes-yProgramas. Parkinson, Lindsey (2022). Spain passes comprehensive waste reduction regulation, eases the way for reuse. Food Packaging Forum. www.foodpackagingforum.org/news/. Simões, Henrique Morgado & Victoria, Gema Andreo (2021). EU Progress on climate action— How are the member States doing?. Climate Action Research and Tracking Service. Retrospective by Sidney Jankanish ’23, Political Science and International Relations Martindale Retrospectives 2 June 2023

Retrospective on Steven Glassman, “The Swedish Pension Reform” from Sweden: The Model Welfare State Meets the Future Perspectives on Business and Economics, Volume 22, 2004 Steven Glassman ‘04 is now Director of Finance at UnitedHealthcare within its Medicare & Retirement Insurance Solutions segment. Since 2004, has Sweden’s new pension system been successful? Sweden has reformed its pension plan after the first, created in 1998, was deemed unsuccessful. The current system consists of a guaranteed pension, an income pension, and a premium pension. In other words, “a national public pension from the state, an occupational pension from your employer and any savings of your own” (Pensions Myndigheten). With the new plan came two concerns about challenges that could potentially weaken it: income inequality among the elderly and increased life expectancy. To combat income inequality, “Sweden introduced in 2021 a new pension supplement, to be financed by the central government budget, to raise low pensions by up to about 7%. This will reduce old-age income inequality to some extent” (Lis & Boulhol). To handle increasing life expectacy, the reformed pension plan increased the retirement age. The pension system is facing threat to its financial sustainability due to an automatic adjustment mechanism that is considered one of the most effective in the world. Some worried that in the wake of the pandemic the AAM would be detrimental to the pension plan. However, “Due to the strong financial returns of pension funds in 2020 and 2021 and limited decline in hours worked during the COVID -19 crisis compared to most OECD countries, the automatic adjustment mechanism is not likely to negatively affect pension indexation or entitlements in the short term” (Lis & Boulhol). How has the new pension reform affected foreigners to the country?? Due to a new European Union rule in 2017, “the guaranteed pension was classified as a ‘minimum benefit’, which is only paid to people who reside in the country that grants the benefit” (Gray, 2022). Starting January 2023, about 58,000 expatriates will no longer receive their guaranteed pension if they no longer live in the country. However, the ruling does not stop them receiving their income pension, premium pension, or supplementary pension no matter what country they move to (Pensions Myndigheten). The ruling also states that an individual will no longer receive elderly financial support or housing supplement should they vacate the country. Additionally, leaving Sweden for a long time without moving permanently will affect the country’s definition of “resident” and thus impact the pension benefits as well. References Gray, Jack (2022). Nearly 58,000 Swedish expats to no longer receive guaranteed pension. European Pensions. https:// www.europeanpensions.net/ep/Nearly-58-000Swedish-expats-to-no-longer-receive-guaranteed -pension. Lis, Maciej & Boulhol, Hervé (n.d.). OECD Pensions at a Glance 2021: How Does Sweden Compare? Organisation for Economic Co-operation and Development. Pensions Myndigheten (2022). Your pension when you move from or live outside of Sweden. www.pensionsmyndigheten.se/other-languages/ english-engelska/english-engelska/pension-when -you-move-from-or-live-outside-sweden. Retrospective by Sidney Jankanish ’23, Political Science and International Relations Martindale Retrospectives 3 June 2023

Retrospective on Irene (LaBarca) Battaglia “The Öresund Region: Sweden’s Bridge to the World” from Sweden: The Model Welfare State Meets the Future Perspectives on Business and Economics, Volume 22, 2004 Irene (LaBarca) Battaglia ‘04 is now a Senior Engineering Analyst at Van Cleef Engineering Associates, LLC. . Has the Öresund Crossing increased in popularity since the article’s publishing in 2004? Since 2004, the Öresund Crossing connecting Sweden and Denmark has gained significant popularity and is used by about 5.8 million vehicles every year (Øresundsbron). Its popularity is largely due to the implementation of season passes, commuter-specific passes, and group rates which differ in price and provide better deals. However, like much of the transportation sector, the Öresund Crossing was significantly negatively impacted due to the Coronavirus pandemic and attempts to mitigate the spread. “Road traffic on the link declined by 69 per cent in weeks 12–13 compared to the corresponding weeks last year…. Passenger car traffic declined by 74.8 per cent… while lorries exceeding 9 metres declined by 4.5 per cent. Leisure customers stayed home on the orders of the authorities and commuters worked from home due to the closure of workplaces” (Øresundsbron 2020). Since then, the bridge and its respective countries have been slowly attempting to recover. While Sweden has lifted its entry restrictions, traffic volume is nowhere near what it was in 2019 before the pandemic. Since 2004, have Sweden and Denmark collaborated to create a more cohesive system for taxation? Sweden and Denmark are currently using the tax systems they have had for decades. The systems in place lack coordination. For example, Sweden’s social security contributions make up about 10% of GDP, but Denmark does not impose social security contributions to fund social programs (Asen 2021). Additionally, both countries still maintain their own high personal income tax rates without regard for rates in the other. Finally, neither country has yet elected to adopt the euro. Although not much has changed on coordinating taxation or currency, it nevertheless appears that other factors have improved the two countries’ integration across the Öresund Region. Has the Öresund Crossing increased regional integration and economic growth as predicted by the article? The construction of the bridge has fostered economic growth on both sides due to, simultaneously, substantially increased commuting and lower commuting expenses. Additionally, “90% of commuters have helped ease the skills shortage in some sectors, generating an additional EUR 6 billion of value added in the region since the Öresund Bridge opened in 2000” (Aulnette 2018). However, there has yet to be any notably increased regional integration aside from those commuting to and from work. References Asen, Elke. (2021). Insights into the Tax Systems of Scandinavian Countries. Taxfoundation.org/ Scandinavian-countries-taxes-2021/ Øresundsbron. (2020). Coronavirus Crisis Impacts Q1-Bridge Traffic Declined 69 Per Cent in Weeks 12–13. [Press]. www.oresundsbron.com/en/info/ press/coronavirus-crisis-impacts Øresundsbron. (n.d.). Traffic Statistics 2022. www.oresundsbron.com/en/traffic-stats Retrospective by Sidney Jankanish ’23, Political Science and International Relations Martindale Retrospectives 4 June 2023

Retrospective on Andrew Richard Bond, “Crisis, Reform and Achieving Financial Stability in the Italian Pension System” from Contradictions and Challenges in 21st Century Italy Perspectives on Business and Economics, Volume 21, 2003 Andrew Richard Bond ‘03 Has the Italian pension system changed since the article’s publication? The Italian pension system has been reformed a few times, once in 1992 and again in 1995 and 2018. Now in 2023, the Italian government is again aiming to reform the pension system in response to the immense strain the system has come under. Consistent with Bond’s discussion in Perspectives, “Italy’s pension system comprises three pillars: the state pension, occupational pensions, and private pensions” (Maunder, 2023). Some of the reforms that the Italian government desires for 2023 involve “the harmonisation of the first and second-pillar pension systems and simplifying rules for occupational pensions” (Serenelli, 2023). The hope is that the second pillar will play a greater role in the pension system overall, specifically regarding welfare and social support. “The pension reform is necessary because the measures taken in the budget law are not ‘structural’, but only for 2023, preparing for the possible overhaul of the pension system” (Maunder, 2023). Unfortunately, a majority of the pension reforms will not be enacted immediately; they have been delayed until 2024. How has recipient age been affected by the Italian pension plan? The standard pension age for men in Italy used to be 66, but it has since increased to 67 for those in both the public and private sectors. However, pension eligibility differs for women. Previously, public sector workers had to be “over 66 years of age; employees registered with social security institutions or substitute social security measures…over 62 years; self-employed workers and workers registered with the special fund for self-employment…at least 63 years and 6 months old” (etui., 2016). Then, in 2018 eligibility for each category of women workers was standardized at 66. Now, the most recent change to the pension system is the government’s decision to “allow residents to claim a state pension after making 41 years (or 42 for men) of social security contributions, regardless of age” (Maunder, 2023). References etui. (2016, September 20). Pension Reforms in Italy: Background summary. etui. www.etui.org/ covid-social-impact/italy/pension-reforms-initaly-background-summary Maunder, S. (2023, February 7). Pensions in Italy. Expatica Italy. www.expatica.com/it/finance/ retirement/pension-in-italy Serenelli, L. (2023, January 9). Italian government paves way for pension reforms. IPE. www.ipe.com/news/italian-government-pavesway-for-pension-reforms/ Retrospective by Sidney Jankanish ’23, Political Science and International Relations Martindale Retrospectives 5 June 2023

Retrospective on Sylvia (Ciesluk) Kinnicutt, “The Southern Question” from Contradictions and Challenges in 21st Century Italy Perspectives on Business and Economics, Volume 21, 2003 Sylvia (Ciesluk) Kinnicutt ‘03 is now Senior Project Leader in Business Insights. . Has Southern Italy improved economically since the article’s publication? Since the article’s publication, Northern Italy and Southern Italy both have improved substantially in economic terms. While the southern half of Italy was significantly poorer in 2003 than the north , the region has since managed to improve its infrastructure and reputation—mainly through tourism. Comparing the two, “Northern Italy, at the very top, includes the stunning Dolomites and Italian Alps, so it is ideal for winter sports and gets very cold and snowy in the winter,” while “Southern Italy…is truly Mediterranean, with warm weather for much of the year, excellent beaches, and a swath of ancient buildings and sites to discover” (Biava 2023). Over the past century, both halves of the country have experienced changes in the mix of primary industries at base of their economies. Early in the 20th century, “southern provinces like Naples and Taranto exhibited high relative levels of employment in mechanical industries, while many northern provinces had virtually no industry at all” (Righi 2022). Yet by the 1970s, the southern mechanical industries fell behind the north and eventually failed. In addition, Northern Italy was better connected to domestic and foreign markets thanks to more favorable geographic proximity. These were the primary causes of the economic disparities between the two. Today, both are heavily economically dependent upon tourism, but the north remains dependent upon manufacturing industries while the south has become much more reliant on agriculture. These differences in industries results in prices in the Northern half being much more expensive than those in the southern half. However, the emergence of the coronavirus and more recently the Russian invasion of Ukraine has caused economic issues for both the regions. While employment levels have managed to restore themselves to pre-pandemic rates, “The war in Ukraine and COVID-related disruptions to global supply chains have pushed up energy prices and intensified shortages of key products (De Haro 2022)”. In addition, GDP is forecasted to slow and plateau which could cause serious detriments to both the north and south economies. References Biava, I. (2023). Northern Italy vs Southern Italy: A detailed comparison. Boundless Roads. www.boundlessroads.com/northern-italy-vssouthern-italy/ De Haro, J. L. (2022). Italy: Staff concluding statement of the 2022 Article IV Mission. IMF. www.imf.org/en/News/Articles/2022/05/19/italy -staff-concluding-statement-of-the-2022-articleiv-mission Righi, P. (2022). The origins of Italy's north-south divide. The London School of Economics and Political Science. blogs.lse.ac.uk/ economichistory/2022/09/30/the-origins-ofitalys-north-south-divide/ Retrospective by Sidney Jankanish ’23, Political Science and International Relations Martindale Retrospectives 6 June 2023

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