ITALIAN PM THREATENS TO QUIT

Prime Minister Giuliano Amato yesterday warned that Italy's economic crisis was the worst since the end of World War II and said he would pack his bags if Parliament weakened his controversial austerity package.

Mr. Amato has presented an unprecedented $74 billion across-the-board package of spending cuts and taxes in order to reduce the public deficit, bolster the economy, and ease pressure on the lira.

Amato says the package hits the rich harder than the poor. But it is facing a groundswell of protest because it includes massive reductions in spending on pensions and health care - effectively dismantling part of the welfare state.