As Fitch points out, a deepening recession could lead to greater public outcry and the rejection of austerity reforms. Italy's post-Berlusconi prime minister, Mario Monti, is currently contending with taxi strikes after proposing to give out more licenses in an attempt to increase competition, jobs and performance in the sector. Monti is also seeking to license more gas stations, notaries and pharmacies in an attempt to spur free-market competition and take power out of the hands of the relatively small few who like to keep business in the family -- literally. Just under one in five notaries are related to someone in the business, according to a Bloomberg report.
Seeing as how these unions in their current form were conceived by a fascist dictator named Benito Mussolini whose heyday was nearly a century ago, perhaps the system's a bit dated. Monti still has to get it through Parliament, and many Parliament members work in these sectors themselves and may not want to vote against their own interests within the socialist system.
Italy also benefits from Monti being a "technocrat" -- which is code for a non-politician who was parachuted in to fix things but isn't tethered to political power at his umbilical cord. Unfortunately, the rest aren't like him, as they face re-election.
Socialism and its accompanying economic devastation thrive on complexity and red tape. If something is so simple that anyone can figure it out, then a socialist is being deprived of an opportunity to make a livelihood out of simplifying or translating socialist nonsense for the layman. A whole system is built up around the complex nonsense, with everyone else getting sucked into the socialist vortex and thrown a few shingles for the sake of giving socialists and their cronies some other people over which to lord and thereby justify their parasitic existence. Before long, economic Stockholm Syndrome takes hold, and they panic at the idea of having to make a living outside of parameters defined by Mussolini.
That's the dragon Europe is now stuck having to slay.