The public finance situation in Italy and to a lesser extent France has brought the long- simmering issue of the European Union’s fiscal rules, their enforcement, and even their ultimate rationale, back to the front burner of euro-area governance. In all the heated polemic, however, a vital piece of the jigsaw has gone missing. The debate and the tortuous negotiations between the European Commission and the Italian government over the latter’s 2019 budget plans focused solely on numerical targets, and, concretely, on decimal points of the nominal and structural deficit ratios to GDP, on the progress (or lack thereof) toward the Fiscal Compact’s medium-term objective, on whether public debt reduction was set to proceed at the stipulated pace, and on the applicability of complex “flexibility clauses” and other provisions set out in the 220 pages of the Vade Mecum on the Stability and Growth Pact 2018 Edition.

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