Referendum to be held on European fiscal compact

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Originally Posted by born2bwild

Stealing:
At the height of the boom the biggest earners paid a maximum tax rate of 12.5% while the likes of us paid 20% on a good day.

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Huh? People at the top weren't taxed heavily enough but these figures are nonsense.

Yes, I presume he's referring to the corporation tax. There are all kinds of crappy loopholes at the top though: get paid in shares, borrow against the asset for cash, and how much tax do you really pay? Even when you cash in on them, you only pay 30%.

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Originally Posted by John83

Yes, I presume he's referring to the corporation tax. There are all kinds of crappy loopholes at the top though: get paid in shares, borrow against the asset for cash, and how much tax do you really pay? Even when you cash in on them, you only pay 30%.

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There are loopholes for individuals (not as many as people think), but people with large incomes are actually taxed quite heavily in this state. The Irish tax system is actually very steeply progressive considering what a low base it starts from. People in the middle get hammered, obviously, but the marginal rate does keep going up.

[If anyone read my second paragraph there, don't mind me. I was talking nonsense.]

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Originally Posted by Charlie Darwin

There are loopholes for individuals (not as many as people think), but people with large incomes are actually taxed quite heavily in this state. The Irish tax system is actually very steeply progressive considering what a low base it starts from. People in the middle get hammered, obviously, but the marginal rate does keep going up.

[If anyone read my second paragraph there, don't mind me. I was talking nonsense.]

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Yeah, I've read that too, in several articles over quite some time. I find it hilarious that it's always the top x% earners pay X% of the tax, but it's never said what percentage of the total income they are paid.

Furthermore, there's been this bull about "broadening the tax base" recently, which seems to be Duckspeak for "introduce more regressive taxation".

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Originally Posted by John83

There are all kinds of crappy loopholes at the top though [...] and how much tax do you really pay?

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Ask Peewee Flynn maybe? :p

However, the notion that the rich pay no tax is nonsense. You can see that here (go into the year of your choice, and then Income Distribution Statistics). In 2009, for example, 0.26% of PAYE workers earned E275k or more (table IDS5). They earned 4.08% of all the income that PAYE workers earned, and paid 10.83% of all PAYE tax. They paid an average effective tax rate of 34% (this isn't stated as such in the report, but you can work it out by dividing total tax by total pay). The average industrial wage (around E700 per week - let's call it E35k per year); people there paid an average effective tax rate of 5½% (obviously a married couple on E35k between them would have twice the tax credits, which will reduce their tax bill a fair amount).

In 2004 - a year at the height of the boom, as born2bwild suggested - 0.17% of PAYE workers earned more than E275k. They earned 2.70% of all PAYE income, and paid 5.89% of all PAYE tax - an average effective tax rate of 33%. Meanwhile, those on E35k paid an average effective tax rate of 11%.

So not only is it not true that the high earners are paying less tax, but the between 2004 and 2009, it was the low earners are the ones who gained from new tax legislation - widened tax credit and standard bands mainly.

12½% - as others have noted - is the Corporation Tax rate and has nothing to do with personal tax rates. If the point is that companies pay less tax than people, well then the refutation is that without that tax rate, they maybe wouldn't be here at all.

So moving on to born2bwild's other points -

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Originally Posted by born2bwild

Borrowing by ordinary people wasn't at the core of what made this mess

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It really, really was. Look at mortgage debt, how far it's gone up. Look at personal debt - car debt and credit card debt and general bank debt. E3bn in credit card debt?! E172bn in personal debt?! You think that isn't at the core of this mess? Maybe we were forced to all buy our boom-time house* rather than renting?

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Originally Posted by born2bwild

Nosiree, it was stealing and stupidity.

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This is true, as noted above. Stupidity is E172bn of personal debt - E35k for every single person in the country, from newborn babies to pensioners who, you'd imagine, should be nicely cash-flush after a lifetime's hard working. Stealing is paying without paying. Racking up debt, in other words. And then maybe looking for to be let off.

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Originally Posted by born2bwild

Stealing:
At the height of the boom the biggest earners paid a maximum tax rate of 12.5% while the likes of us paid 20% on a good day.

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Not true, as we've seen.

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Originally Posted by born2bwild

Stealing:
When it turned out that no-one would lend them money anymore because the banks' liabilities were about to drag the whole country under, FF, supported by every mainstream party in the country decided to guarantee those liabilities. This stealing is stealing from our children and their children.

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The state and the people really aren't that separable. Why had the banks borrowed too much? Because we borrowed too much. I borrowed to buy nice and expensive things from you - expensive in part to pay your high wages. We're all responsible for this. Some more than others, sure, but the notion that this is all somehow someone else's fault and that I deserve all my money from the olden days is nonsense.

* - like me, before people start accusing me of being too smug

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Originally Posted by pineapple stu

However, the notion that the rich pay no tax is nonsense. You can see that here (go into the year of your choice, and then Income Distribution Statistics). In 2009, for example, 0.26% of PAYE workers earned E275k or more (table IDS5). They earned 4.08% of all the income that PAYE workers earned, and paid 10.83% of all PAYE tax. They paid an average effective tax rate of 34% (this isn't stated as such in the report, but you can work it out by dividing total tax by total pay). The average industrial wage (around E700 per week - let's call it E35k per year); people there paid an average effective tax rate of 5½% (obviously a married couple on E35k between them would have twice the tax credits, which will reduce their tax bill a fair amount).

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That's PAYE - not really surprsing the numbers work out like that. Self-employed is where it's at. That, and - as I mentioned - salary and bonuses in shares, at reduced rates where required to avoid tax (not an Irish example, but Apple famously paid Steve $1 a year, plus a special category of stock). Thanks for finding that number though; as I said, I've read a number of newspaper reports which didn't.

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Originally Posted by John83

That's PAYE - not really surprsing the numbers work out like that. Self-employed is where it's at.

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Self-employed numbers are in the same link - go to table IDS2 where, in 2009, 2.84% of self-employed people including proprietary directors earned E275k+. They paid 24.76% of all self-employed tax at an effective rate of 25.7%. So better than PAYE, but those on E35k also fared (marginally) better, with a 5.1% effective rate. I imagine part of the reduction is the fact that simply doing an Income Tax return means you're more likely to make claims for medical expenses, bin charges, charitable donations, etc. The figures, I think, are taken from Income Tax returns; don't know how they account for stuff like share payments, etc. But still, the rich aren't exactly getting away lightly here.

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Originally Posted by pineapple stu

Self-employed numbers are in the same link - go to table IDS2 where, in 2009, 2.84% of self-employed people including proprietary directors earned E275k+. They paid 24.76% of all self-employed tax at an effective rate of 25.7%. So better than PAYE, but those on E35k also fared (marginally) better, with a 5.1% effective rate. I imagine part of the reduction is the fact that simply doing an Income Tax return means you're more likely to make claims for medical expenses, bin charges, charitable donations, etc. The figures, I think, are taken from Income Tax returns; don't know how they account for stuff like share payments, etc. But still, the rich aren't exactly getting away lightly here.

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It might look that way to you, but that 5% you quoted for 35k doesn't account for the cost of living. Pay rent, food and bills for a family of four and run a car (which can be a necessity for work) out of that, and tell me again why paying 26% of €250,000 is a relatively high tax rate.

I know what you're saying alright, but I think - and I don't have any back-up on this, so I'll happily stand corrected - that high-value mortgages are disproportionately in trouble. People on high salaries just spend more. Getting into debt is how you make money, after all (I remember an old boss saying that the one thing he enjoyed more than spending money was spending someone else's money). So for right or for wrong, it's too simplistic to say "Sure E250k is loads of money; we'll just take all the tax off the high earners".

I've no particular problems with, say, tax takes going up a flat percentage rate across all tax bands. And the OP was saying not that 26% was too low, but that the high earners were paying close on half the rate that the low earners were paying. So I think I've refuted that.

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Originally Posted by pineapple stu

This is true, as noted above. Stupidity is E172bn of personal debt - E35k for every single person in the country, from newborn babies to pensioners who, you'd imagine, should be nicely cash-flush after a lifetime's hard working. Stealing is paying without paying. Racking up debt, in other words. And then maybe looking for to be let off.

The state and the people really aren't that separable. Why had the banks borrowed too much? Because we borrowed too much. I borrowed to buy nice and expensive things from you - expensive in part to pay your high wages. We're all responsible for this. Some more than others, sure, but the notion that this is all somehow someone else's fault and that I deserve all my money from the olden days is nonsense.

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Agree here, Ireland as a whole was rotten, and remember FF were voted in 3 times with everyone knowing full well how corrupt they were

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Originally Posted by John83

Yeah, I've read that too, in several articles over quite some time. I find it hilarious that it's always the top x% earners pay X% of the tax, but it's never said what percentage of the total income they are paid.

Furthermore, there's been this bull about "broadening the tax base" recently, which seems to be Duckspeak for "introduce more regressive taxation".

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There is actually logic to it though. Broadening the tax base might just be a euphemism for desperately seeking money, but if we'd had a broader tax base to begin with the economy would have been able to weather the crash better.

The tax base is actually very strictly progressive, right up to the top of the ladder:

Attachment 1860
Source

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Originally Posted by born2bwild

You shouldn't accept it, although, to be honest, all that I'm doing is complaining and accepting it.

If they want my vote then I want at least the return of my 600eu.

I'm too tired after working 2 people's jobs and besides, I'm off to Tolka to do some stewarding.

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Always good to do stewarding when you're not tired.

Just being tired is a nice complaint though. 15% of the nation don't have a job, and many of those have to try to find work elsewhere. That's what I call tiring, never mind stressful.

Everyone is responsible for the financial position the state is in. Some more than others, but the nation was one big credit card for 15 years, and is only now realising that the cash they borrowed has to be paid back. You're not going to get your €600pm back, but even if you did, it should have no bearing on your vote, one way or the other.

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Originally Posted by bennocelt

Agree here, Ireland as a whole was rotten, and remember FF were voted in 3 times with everyone knowing full well how corrupt they were

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FF led governments haven't had more than 50% of the vote since the Spring tide FF-Labour coalition. The current Government is the first one since to have 50% plus of the vote. I like to blame the dumbass irish electorate as much as the next man, but the over use of 3 seaters means it's not that often that a Government has over 50% of the vote.

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Originally Posted by Macy

FF led governments haven't had more than 50% of the vote since the Spring tide FF-Labour coalition. The current Government is the first one since to have 50% plus of the vote. I like to blame the dumbass irish electorate as much as the next man, but the over use of 3 seaters means it's not that often that a Government has over 50% of the vote.

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True but then thats democracy, and some moan and dont even bother to vote at all
plus fg are a lighter shade of ff, and voting for labour is a a joke as well

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Originally Posted by pineapple stu

Ask Peewee Flynn maybe? :p

However, the notion that the rich pay no tax is nonsense. You can see that here (go into the year of your choice, and then Income Distribution Statistics). In 2009, for example, 0.26% of PAYE workers earned E275k or more (table IDS5). They earned 4.08% of all the income that PAYE workers earned, and paid 10.83% of all PAYE tax. They paid an average effective tax rate of 34% (this isn't stated as such in the report, but you can work it out by dividing total tax by total pay). The average industrial wage (around E700 per week - let's call it E35k per year); people there paid an average effective tax rate of 5½% (obviously a married couple on E35k between them would have twice the tax credits, which will reduce their tax bill a fair amount).

In 2004 - a year at the height of the boom, as born2bwild suggested - 0.17% of PAYE workers earned more than E275k. They earned 2.70% of all PAYE income, and paid 5.89% of all PAYE tax - an average effective tax rate of 33%. Meanwhile, those on E35k paid an average effective tax rate of 11%.

So not only is it not true that the high earners are paying less tax, but the between 2004 and 2009, it was the low earners are the ones who gained from new tax legislation - widened tax credit and standard bands mainly.

12½% - as others have noted - is the Corporation Tax rate and has nothing to do with personal tax rates. If the point is that companies pay less tax than people, well then the refutation is that without that tax rate, they maybe wouldn't be here at all.

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The 12% corporate tax rate is precisely my point when I mentioned 'stealing'.

China has a corporation tax of 25%. The US has one of 39.5%. The Eurozone average is 30.4%

12.5% is stealing and we should increase it significantly. It falls to 9.6% when allowances, reliefs and exemptions are taken into account. The truth is we're living in a tax haven - according to the CSO's statistics on the repatriation of profits by multinationals over the period 1995 to 2007 there was an increase from 5 billion to nearly 30 billion per year. Of course, no matter how much pain gets inflicted on us we can never, ever compete with the Poles or Lithuanians in the race to the bottom that we, the Cayman Islands of the North Atlantic, have initiated with these economic policies.

Perhaps you might have a word with the straw man floating around in your head but my point was not that the rich pay no tax - my point is that the rich do not pay enough. And when I talk about 'rich' I do not mean 'high-paid' civil servants on 150,000-200,000 pa (although I fail to see why anyone should legally earn more than 150,000 pa) I mean the super rich -we have over eighteen thousand people with over 800,000 or more to spend (this wealth does not include the value of the family home).

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Originally Posted by pineapple stu

So moving on to Pineapplestu's other points -

It really, really was. Look at mortgage debt, how far it's gone up. Look at personal debt - car debt and credit card debt and general bank debt. E3bn in credit card debt?!E172bn in personal debt?! You think that isn't at the core of this mess? Maybe we were forced to all buy our boom-time house* rather than renting?

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It really, really wasn't. The ordinary people who borrowed to buy a home in an artificially inflated property market are not responsible for this mess. Wittingly or unwittingly the thrust of your argument is to apologise for an economic system that never had the best interests of the citizens of this republic anywhere near its list of priorities. People bought crazily-priced houses because they had to have somewhere to live - they bought overpriced health insurance because our health system was and is a mess, they bought cars, cars and more cars because our public transport system is a disgrace.

Meanwhile, citizens were encouraged to become mini-property speculators - according to the Department of the Environment's statistics on the Ownership Status of Borrowers property bought for investment ran at a rate almost double that of property bought to be lived in. These people are not 'ordinary people'. To make matters worse, landlords still get the dole in the form of Rent Supplement to the tune of 500million eu. Private landlords are being subsidised by me and you to prey on the poorest citizens of this republic.

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Originally Posted by pineapple stu

This is true, as noted above. Stupidity is E172bn of personal debt - E35k for every single person in the country, from newborn babies to pensioners who, you'd imagine, should be nicely cash-flush after a lifetime's hard working. Stealing is paying without paying. Racking up debt, in other words. And then maybe looking for to be let off.


Not true, as we've seen.


The state and the people really aren't that separable. Why had the banks borrowed too much? Because we borrowed too much. I borrowed to buy nice and expensive things from you - expensive in part to pay your high wages. We're all responsible for this. Some more than others, sure, but the notion that this is all somehow someone else's fault and that I deserve all my money from the olden days is nonsense.

* - like me, before people start accusing me of being too smug

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I think the difference between me and you is that you accept the neoliberal economic structures and ideologies that have ruined our society. I do not. You easily use 'we' when I see no 'we' - except when I'm watching the international football team. 'We' did not rack up the debt that has shamed and defiled this republic. I do not screw the state for rent supplement to support my investments. I did not default on my multi-billion euro investment loans to the banks - yet the job of actually keeping up my payments on my mortgage has been made very difficult because others did and the gombeen men from the tent at the Galway Races decided to hit me with the bill.

I do not accept the lies about keeping 'our' corporation tax at an effective rate of 9% (Google pays 3%!!!!!).

Actually, come to think of it, if the krauts do put an increase in that to the EU average on the table I might consider voting yes. Add on statutes prohibiting all state subsidies to private landlords, a means-tested property tax (put the Rottweilers from the dole fraud squad on the job), an personal income limit of 150,000 - 200, 000 and I'll warm to the idea even more.

And believe me, I feel far from smug.

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Originally Posted by born2bwild

It really, really wasn't. The ordinary people who borrowed to buy a home in an artificially inflated property market are not responsible for this mess. Wittingly or unwittingly the thrust of your argument is to apologise for an economic system that never had the best interests of the citizens of this republic anywhere near its list of priorities. People bought crazily-priced houses because they had to have somewhere to live - they bought overpriced health insurance because our health system was and is a mess, they bought cars, cars and more cars because our public transport system is a disgrace.

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They bought homes in Sunny Beach, China, New Zealand etc, because Paddies are obsessed with buying and owning properties. They bought new cars every year, not because of the transport network, but because Paddy down the road bought his. They went to places in the Third World for their weddings. They went on shopping, solely shopping trips, to New York of all places. None of that was necessary. They don't go to New York now, they go to Newry, under the guise of "saving money". By the time they get there, they have lost all the cash they "saved" on the way.

I remember when the SSIA's matured, and everyone boasting what they would do with their cash. And most of it wasn't paying off debts or buying essentials. Even as the construction sector began to collapse, and house prices began to moderate, people continued spending cash on things they couldn't afford, while the elite who think the Sun shines out of Brussels, told everyone they see a "soft landing" and they "don't foresee" a crash. Even as far back as 2007, the warning signs were everywhere, but nobody paid any attention.

Everyone got it wrong, and now you can't look for €600 back per month to buy a vote.

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Originally Posted by mypost

They bought homes in Sunny Beach, China, New Zealand etc, because Paddies are obsessed with buying and owning properties. They bought new cars every year, not because of the transport network, but because Paddy down the road bought his. They went to places in the Third World for their weddings. They went on shopping, solely shopping trips, to New York of all places. None of that was necessary. They don't go to New York now, they go to Newry, under the guise of "saving money". By the time they get there, they have lost all the cash they "saved" on the way.

I remember when the SSIA's matured, and everyone boasting what they would do with their cash. And most of it wasn't paying off debts or buying essentials. Even as the construction sector began to collapse, and house prices began to moderate, people continued spending cash on things they couldn't afford, while the elite who think the Sun shines out of Brussels, told everyone they see a "soft landing" and they "don't foresee" a crash. Even as far back as 2007, the warning signs were everywhere, but nobody paid any attention.

Everyone got it wrong, and now everyone has to face up to their responsibilities, not look for €600 back per month to buy a vote.

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Some people got it more wrong than others. Some people got it so wrong that the rest of us will be paying for their mistakes for the rest of our lives.

The cost of my vote is going up; it's not 600eu anymore - check my last post.

I'm not going to address all your points, cos otherwise we'll just end up in one of those picky threads where every sentence is quoted and analysed and re-quoted and re-analysed and the posts mushroom way out of proportion. A couple of comments though -

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Originally Posted by born2bwild

The 12½% corporate tax rate is precisely my point when I mentioned 'stealing'.

China has a corporation tax of 25%. The US has one of 39.5%. The Eurozone average is 30.4%

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Can you provide a link for that? Here's the Irish Times (granted, I've had problems with the Irish Times talking crap before) saying that the average eurozone rate is 21.8%. You say that for Ireland, this reduces to an effective rate of 9.6% (Finfacts.ie and the Irish Times both disagree, saying it's 11.9%) while France's is 8.2%. The World Bank seems to be the source, which should be reputable enough.

The problem, of course, is tax on bigger companies. And here we have a choice. We can either tax them at 12½% and make lots of money, or tax them at 20% and lose lots of money (compared to now). It comes down to elasticity in a way. Just because you double the rate doesn't mean you'll double the take. And companies being in Ireland for the tax rate means more jobs as well. Is it a race to the bottom? Quite possibly, yes. Does that mean it'd be a good thing to just double our CT rate for big companies and screw them over? No, it doesn't. We can't afford right now to lose lots of money, so increasing the tax rate would be a disaster.

Was the 12½% rate an error to begin with? Maybe. But it unquestionably boosted out economy and led to the extra E600 per month in your pocket. If you want rid of the rate, fair enough, but you can't have it both ways and say you want to keep the E600 a month as well. Ireland was always a poor, backwater, out of the way place (yes, the Brits robbing our natural resources didn't help, but still), and you can't take away the things that led us to grow and expect us to stay the same.

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Originally Posted by born2bwild

It really, really wasn't. The ordinary people who borrowed to buy a home in an artificially inflated property market are not responsible for this mess. People bought crazily-priced houses because they had to have somewhere to live - they bought overpriced health insurance because our health system was and is a mess, they bought cars, cars and more cars because our public transport system is a disgrace.

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Nothing stopped people from renting instead of borrowing half a million to buy a shoebox in Meath (and that's before we get onto ordinary people borrowing more to buy second and third houses to make even more money). Nothing forced people to borrow to buy a new car every other year when before, they were happy with a six- or seven-year-old car. Absolutely the ordinary people are to blame to an extent. E176bn in personal debt, and you reckon that's nobody's fault? I absolutely agree that people were encouraged to buy - Eddie Hobbs, for example, should be shot, and rent subsidy is a disgrace which even now is keeping house prices artificially high - but you can't go fobbing off responsibility because the big bogeyman encouraged you to borrow.

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Originally Posted by born2bwild

a personal income limit of 150,000 - 200, 000 and I'll warm to the idea even more.

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You're getting very much towards socialism here. I don't particularly have a problem with that - Cuba must be rolling around in laughter at the moment, and even North Korea are using us as an example to show the merits of their regime. But if that's the road you want to go down, then this referendum isn't really relevant. Vote socialist party (I have on occasion). Help get it to a stage where it's a majority party that can do something - that's the way the world has always worked. Make sure that if they start spouting utter nonsense about alternatives to austerity, that there are solid plans in place (and not just "For massive investment in jobs, housing, education and society instead of cuts! End the nightmare of youth unemployment!" - let's get out of debt by borrowing more! Yeah! Took our jobs!). And if you're going to propose dropping out of the euro (FWIW, I was never in favour of going in), make sure you're happy with the social effects of default and hyperinflation, cos they're not fun.

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Some people got it more wrong than others. Some people got it so wrong that the rest of us will be paying for their mistakes for the rest of our lives.

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Some people got it more wrong than others. But that doesn't mean the others can simply abdicate all responsibility.

[p]Yeah, pretty much, a workers' republic - anything else uncouples reward from work that contributes to the welfare of the whole society.

Capitalism is not working - 'returning to growth' 'returning to the markets' 'facing up to our responsibilities' - no amount of lies is going to change that basic fact.

Yup that Eddie Hobbs property porn clip has always annoyed me almost as much as people who refer to this republic as 'Ireland Inc'.

Any whiff of 'we' have to face up to 'our' responsibilities sends me into orbit, though:

http://www.youtube.com/watch?v=4-bSKsVDr_M


....Plus ça change, plus c'est la même chose[/p]

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Originally Posted by pineapple stu

Nothing stopped people from renting instead of borrowing half a million to buy a shoebox in Meath ... and rent subsidy is a disgrace which even now is keeping house prices artificially high.

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Cultural preference for property ownership because of historical abuses by landlords, plus high cost of renting (driven, as you note, by the government) made it a simple choice: **** your money into the wind forever or buy a house. The notion that the average punter should take the blame because professional money-lenders ****ed up is stupid. (As, while I'm here, are the people who believe they have a right to SKY subscriptions and help with their mortgage).

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Originally Posted by John83

Cultural preference for property ownership because of historical abuses by landlords, plus high cost of renting (driven, as you note, by the government) made it a simple choice: **** your money into the wind forever or buy a house.

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At least if you throw your money at the wind, you're more likely to have some chance of affording it and keeping it over your head. But you have to be seen to be owning properties in this country.

Generations of poorer Irishmen than the current crop bought their own home mypost. It shouldn't cost more than they can pay.

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Originally Posted by John83

Cultural preference for property ownership because of historical abuses by landlords, plus high cost of renting (driven, as you note, by the government) made it a simple choice: **** your money into the wind forever or buy a house. The notion that the average punter should take the blame because professional money-lenders ****ed up is stupid. (As, while I'm here, are the people who believe they have a right to SKY subscriptions and help with their mortgage).

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Doesnt excuse it, silly season when people thought that paying over 250,000 at least for a 2 bedroom in Edgworthstown or someother backwater is a good deal!

First referendum poll:

Yes 60%
No 40%

After 26% undecided excluded.

Party support

FG 30% (0)
SF 18% (+1)
FF 17% (-1)
Lab 16% (+2)
Oth 19% (-1)

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Originally Posted by John83

Cultural preference for property ownership because of historical abuses by landlords, plus high cost of renting (driven, as you note, by the government) made it a simple choice: **** your money into the wind forever or buy a house. The notion that the average punter should take the blame because professional money-lenders ****ed up is stupid. (As, while I'm here, are the people who believe they have a right to SKY subscriptions and help with their mortgage).

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I don't agree. Historic abuses by landlords happened pretty much before the time of anyone alive; I don't think I can really claim that I bought instead of rented because of de famine and what de English did to us in Black 47. Cultural preference shouldn't obscure common sense.

I agree the Government drove house prices up; Reeling in the Years 2000s makes me want to punch the screen anytime McCreevy appears. But people chose to get into hundreds of thousands of debt, and there's no point looking for someone else to blame for that. I agree that giving up the Sky Sports should be done if it helps repay mortgages.

No-one forced people to borrow half a million and get into large debt. The banks borrowed that to loan to us. It has to be repaid. There's no other real way out of this.

The Irish addiction to owning property is more or less a complete myth. Irish home ownership levels have never really been much above the EU average, even with the bubble, unprecedented growth and government policy actively encouraging ownership.

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Originally Posted by Charlie Darwin

The Irish addiction to owning property is more or less a complete myth. Irish home ownership levels have never really been much above the EU average, even with the bubble, unprecedented growth and government policy actively encouraging ownership.

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Interesting claim. Can you back it up?

@Pineapple, historical abuses created the culture, which is then passed down in the "my dad did it this way so..." line of (not really) thinking.

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Originally Posted by John83

Interesting claim. Can you back it up?

@Pineapple, historical abuses created the culture, which is then passed down in the "my dad did it this way so..." line of (not really) thinking.

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I can't find my way back to the raw data, but here's a report from last year: http://www.independent.ie/business/p...e-2813709.html

edit: here's some raw data and analysis from the source for the above article

http://dublinopinion.com/2011/07/06/...ome-ownership/

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Originally Posted by John83

@Pineapple, historical abuses created the culture, which is then passed down in the "my dad did it this way so..." line of (not really) thinking.

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I know that, but it doesn't entirely absolve people of rational thought.

Great thread lads, some excellent discussion here.

I'm voting no, primarily for the following two reasons:

1) While I would actually be in favour of enshrining some sort of budgetary responsibility in law I can not for the life of me understand why that decision can not be made in Dublin. We're a sovereign nation and ahouldn't need the help of bigger, older nations to balance our pocket money.

2) There seems to be a strong suggestion that we need to pass this referendum to allow us to go back to spending huge sums of money that we didn't have. The days of Ireland spending more than twice what it earns has to stop. We shouldn't be looking to borrow again. Ireland, as a whole, needs to tighten it's belt. The goal should be economic sustainability in the long term surely, rather than a return to the artificial prosperity of the Celtic Tiger?

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Originally Posted by pineapple stu

I don't agree. Historic abuses by landlords happened pretty much before the time of anyone alive; I don't think I can really claim that I bought instead of rented because of de famine and what de English did to us in Black 47. Cultural preference shouldn't obscure common sense.

I agree the Government drove house prices up; Reeling in the Years 2000s makes me want to punch the screen anytime McCreevy appears. But people chose to get into hundreds of thousands of debt, and there's no point looking for someone else to blame for that. I agree that giving up the Sky Sports should be done if it helps repay mortgages.

No-one forced people to borrow half a million and get into large debt. The banks borrowed that to loan to us. It has to be repaid. There's no other real way out of this.

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I think there's an awful lot of waffle spoken and written by hacks and their apes when it comes to the psychology and sociology of land ownership in this country.

The scars of the famine drove us like lemmings over the cliff of financial rectitude into the abyss of unsustainable debt.

For most people - and I include almost everyone I know in this - buying property was not a 'cultural preference'. It was not an investment opportunity. They were buying a primary residence - a home. This is a basic human right - not an historical eccentricity or pathological reflex.

For the rest - and as you ascend the ladder the level of culpability for the mess increases - the decision to buy property was state-encouraged and media-hyped greed.

The bigger the purchase, the bigger the debt, the bigger the debt, the more likely you are now to get an injection of 'socialism'.

The rest of us - the ordinary people whose only purchase was a perfectly rational decision to buy a home are having to pay for this 'socialism'.

'The banks borrowed that to loan to us' - who's this 'us'? It's not anyone I know.

I've no problem with paying my debts - there's no alternative for any responsible citizen - I have a big problem with the fact that I am paying others' debts and being told that it's 'my' responsibility to do it.

Perhaps this treaty would be a good thing if it restructured the economy - starting with the corporation tax rates.

Of course, it has nothing to do with making the structure of our society fairer and more equal. Its sole intention is to paste a politico-legal framework over the already existing economic realities. In other words, it is an exercise in stating the obvious:

Countries will be forbidden from running a budget deficit of more than 60% of GDP - well, market realities dictate this anyway

Targets will be introduced to states' 'structural deficits' - Targets - well, targets are often missed.

Only those countries who sign up to the treaty will have access to the European bailout fund - isn't it our intention to get the hell out of this anyway?

The basic problem, as anyone will tell you, is that we need to square what's coming in with what's going out. According to Colm McCarthy this will happen anyway within 4-5 years. The problem is that this is being done by crucifying the people whose sole 'transgression' was to buy a place to live. The scum who caused the problem - the bankers, the investors (and I include the Eddie Hobbes wannabees in Dublin 4 etc in this), the political elite - are, generally not the ones suffering the most. Yet they are the ones shouting the loudest about 'facing up to our responsibilities'.

There is no 'we' in this mess. 'We' will get out of the current account deficit - but the solution is not 'my' solution - and, it is not this constituency's solution (LoI fans are not typically flush with cash) - it involves waves of emigration, utterly unfair taxation, two fingers to special needs kids in schools, 'hurry up and die' to any pensioner without health insurance, scapegoating of public service workers, and the appalling vista of those who earn the most (big corporations) paying the lowest rates of tax and those who borrowed the most in the boom having already been bailed out.

What difference will this treaty make? None. I'm wavering between voting no as a protest or just not voting at all.

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Originally Posted by born2bwild

I think there's an awful lot of waffle spoken and written by hacks and their apes when it comes to the psychology and sociology of land ownership in this country.

The scars of the famine drove us like lemmings over the cliff of financial rectitude into the abyss of unsustainable debt.

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Pot, kettle, &c.

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For most people - and I include almost everyone I know in this - buying property was not a 'cultural preference'. It was not an investment opportunity. They were buying a primary residence - a home. This is a basic human right - not an historical eccentricity or pathological reflex.

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It is a human right to have a place to live, not to own one. If you cannot afford to buy or rent, the state is obliged to provide you the means for basic accommodation. Owning a home is no more a human right than a steak dinner is.

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The rest of us - the ordinary people whose only purchase was a perfectly rational decision to buy a home are having to pay for this 'socialism'.

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Sorry, but there is nothing 'rational' about borrowing 10+ times your income to purchase a house. While many people felt they had no option but to buy at ridiculous prices, the fact is that they did have other options and chose not to take them. They made irrational choices, somewhat based on flawed information but mainly based on their own flawed assumptions, and you can't absolve them of that responsibility.

It's unfortunate that our country doesn't have reasonably bankruptcy legislation to a) allow these people to free themselves from mortgages they'll never repay and b) discourage this kind of predatory lending, but either way it's the taxpayer that is going to cover the losses from these loans to ordinary people.

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The basic problem, as anyone will tell you, is that we need to square what's coming in with what's going out. According to Colm McCarthy this will happen anyway within 4-5 years. The problem is that this is being done by crucifying the people whose sole 'transgression' was to buy a place to live. The scum who caused the problem - the bankers, the investors (and I include the Eddie Hobbes wannabees in Dublin 4 etc in this), the political elite - are, generally not the ones suffering the most. Yet they are the ones shouting the loudest about 'facing up to our responsibilities'.

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You're right of course, but this neither absolves individuals of responsibility for borrowing more than they could reasonably afford, nor does it negate the fact that it was this developer/bank-led borrowing that artificially accelerated the economy's rapid growth, sustaining low unemployment and high living standards.

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Originally Posted by born2bwild

For most people - and I include almost everyone I know in this - buying property was not a 'cultural preference'. [...] They were buying a primary residence - a home. This is a basic human right

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No-one has as yet addressed the point that renting was a perfectly good option to satisfy this human right. Was it expensive? Sure. But it didn't involve taking on huge debt. And that was expensive too.

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Originally Posted by born2bwild

'The banks borrowed that to loan to us' - who's this 'us'? It's not anyone I know.

I've no problem with paying my debts

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You're contradicting yourself here. Do you have debt or not? If so, this "us" is, in part, you. I highly doubt you know absolutely no-one with debt.

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Originally Posted by born2bwild

I have a big problem with the fact that I am paying others' debts

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Are you? Remember this all really came to a head when the Irish rate of borrowing went up. Suddenly, we were paying more to service the same debt. For tracker mortgages, for example, the banks lose a lot of money on them because they're committed to lending at a bit above the ECB rate (I think it is), whereas suddenly the rate at which they themselves borrow has shot up. So from borrowing at 3% and lending at 4½%, they're now borrowing at 7% and lending at 2%. That has to be paid for somehow. So for those with tracker mortgages for example, even though they're paying back what they'd committed to, they still need to pay back more to balance the books.

It's more expensive for banks to borrow the money that's been loaned to us, so it makes sense we have to pay more to repay it.

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Originally Posted by born2bwild

Perhaps this treaty would be a good thing if it restructured the economy - starting with the corporation tax rates.

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Please explain to me how Ireland would cope with the withdrawal of major multi-nationals in the country that would result from a CT increase, resulting in a loss of CT and of jobs. Did you read my previous comments about elasticity and how we need all the money we can get?

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Originally Posted by born2bwild

Countries will be forbidden from running a budget deficit of more than 60% of GDP - well, market realities dictate this anyway

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Debt of 60% of GDP, not budget deficit. Market realities clearly don't dictate this or it wouldn't have happened.

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Originally Posted by born2bwild

The basic problem, as anyone will tell you, is that we need to square what's coming in with what's going out. According to Colm McCarthy this will happen anyway within 4-5 years.

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Ah yes...

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Originally Posted by Colm McCarthy

The Irish budget deficit will be zero, or very close to it, four or five years from now, in any plausible scenario.

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What utter drivel. How are we going to reduce from our current position of losing E1.5bn a month to breakeven in five years' time without increasing taxes across the board, to the obvious detriment of the economy?

You seem to suggest that you'd like everyone individually assessed to see how much tax they can pay - so because you don't have any debt (even though you then say you do), you should get off without paying extra. Do you realise how utterly ineffective this approach would be? You'd have to pay E600 p/m yourself just to work such a system!

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Originally Posted by born2bwild

but the solution is not 'my' solution

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What is your solution?

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Originally Posted by Charlie Darwin

Pot, kettle, &c.


It is a human right to have a place to live, not to own one. If you cannot afford to buy or rent, the state is obliged to provide you the means for basic accommodation. Owning a home is no more a human right than a steak dinner is.


Sorry, but there is nothing 'rational' about borrowing 10+ times your income to purchase a house. While many people felt they had no option but to buy at ridiculous prices, the fact is that they did have other options and chose not to take them. They made irrational choices, somewhat based on flawed information but mainly based on their own flawed assumptions, and you can't absolve them of that responsibility.

It's unfortunate that our country doesn't have reasonably bankruptcy legislation to a) allow these people to free themselves from mortgages they'll never repay and b) discourage this kind of predatory lending, but either way it's the taxpayer that is going to cover the losses from these loans to ordinary people.


You're right of course, but this neither absolves individuals of responsibility for borrowing more than they could reasonably afford, nor does it negate the fact that it was this developer/bank-led borrowing that artificially accelerated the economy's rapid growth, sustaining low unemployment and high living standards.

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Ordinary people did not inflate the property market - they bought a place to live because that was the most rational decision.

People talk about responsibility -yet, as you say, we do not as a society, take responsibility for our citizens' needs. 500 million pa on rent supplement to private landlords whose very existence as a social class is a testament to the complete and utter absolution of responsibility in how we run the country.

500eu to subsidise a parasitic social class that mushroomed because of the inflated property market 2001-2006. Who has the responsibility for that?

Going up the scale the irresponsibility becomes criminal - from the private landlord class all the way up to the super-investors who will never pay back their loans - we as a society have absolved those most culpable of responsibility.

The greatest irresponsibility is in how we actually structure the economy. A non-means tested property tax, the 12.5% maximum corporation tax, the 18,000 people in this country who we allow to have 800,000 eu and upwards to spend are some examples of just how irresponsible we are.

Individuals should not be absolved of responsibility? I agree, however, from the outset, our society is deeply and criminally irresponsible because whatever about the shoulds and should nots, the fact is that those most able to contribute, those most responsible for the economic crisis are and have been absolved of responsibility.

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Originally Posted by born2bwild

Ordinary people did not inflate the property market - they bought a place to live because that was the most rational decision.

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Prices went up because demand exceeded supply. Basic economics. So as long as people were paying the ever-higher prices, they were responsible for inflating the property market.

Charlie Darwin has argued it actually wasn't a rational decision to buy at the peak. You've not addressed that point.

(And yes, it was encouraged by banks and politicians. The latter of whom we kept voting in)

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Originally Posted by born2bwild

Ordinary people did not inflate the property market - they bought a place to live because that was the most rational decision.

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No, the most rational decision was to rent. Anybody who rented during the boom is free of mortgage debt. I'm stunned you'd even dispute this.

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People talk about responsibility -yet, as you say, we do not as a society, take responsibility for our citizens' needs. 500 million pa on rent supplement to private landlords whose very existence as a social class is a testament to the complete and utter absolution of responsibility in how we run the country.

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Yes, rent supplement is another factor that drives up prices and fuelled the speculation bubble. It's an irresponsible concept that tens of thousands of people nonetheless rely upon to exercise their basic human right to a home. It's going to take a long time to disentangle the rental market from its reliance on subsidies.

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500eu to subsidise a parasitic social class that mushroomed because of the inflated property market 2001-2006. Who has the responsibility for that?

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The government, obviously.

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Going up the scale the irresponsibility becomes criminal - from the private landlord class all the way up to the super-investors who will never pay back their loans - we as a society have absolved those most culpable of responsibility.

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We have, yes. That's not an argument for absolving ordinary people of their own responsibilities.

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Individuals should not be absolved of responsibility? I agree, however, from the outset, our society is deeply and criminally irresponsible because whatever about the shoulds and should nots, the fact is that those most able to contribute, those most responsible for the economic crisis are and have been absolved of responsibility.

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You obviously don't agree because you are actively arguing ordinary people should be absolved of responsibility for borrowing more money than they could ever reasonably afford in any economy.

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Originally Posted by pineapple stu

No-one has as yet addressed the point that renting was a perfectly good option to satisfy this human right. Was it expensive? Sure. But it didn't involve taking on huge debt. And that was expensive too.

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Renting was not a perfectly good option - landlords are capricious at best and rapacious as a rule. Who wants to rent when mortgage payments are comparable to rental payments.

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Originally Posted by pineapple stu

You're contradicting yourself here. Do you have debt or not? If so, this "us" is, in part, you. I highly doubt you know absolutely no-one with debt.

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Of course, I'm not contradicting myself - although, Pineapplestu, I suspect that between winding up to your next rhetorical flourish and playing stats tennis with the straw man in your head, you're probably missing some of the basic points of the discussion!.

Of course I'm in debt and of course, I'm paying those debts - as is right. I know few people whose failure to pay the astronomical debts precipitated the collapse of the banking system. I did have a chat with Mick Wallace one day in the cinema, though, after Wexford drew 2-2 with Cork.

Moreover, I do not know, nor do I want to know any of the mini-developer/landlord class - you might bump into a few out there in D4/UCD (I managed to avoid them when I was there - perhaps I should have got in with them - at least I'd have the rent supplement coming in now across my 'portfolio' and I wouldn't be so strapped!)

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Originally Posted by pineapple stu

Are you? Remember this all really came to a head when the Irish rate of borrowing went up. Suddenly, we were paying more to service the same debt. For tracker mortgages, for example, the banks lose a lot of money on them because they're committed to lending at a bit above the ECB rate (I think it is), whereas suddenly the rate at which they themselves borrow has shot up. So from borrowing at 3% and lending at 4½%, they're now borrowing at 7% and lending at 2%. That has to be paid for somehow. So for those with tracker mortgages for example, even though they're paying back what they'd committed to, they still need to pay back more to balance the books.

It's more expensive for banks to borrow the money that's been loaned to us, so it makes sense we have to pay more to repay it.

Please explain to me how Ireland would cope with the withdrawal of major multi-nationals in the country that would result from a CT increase, resulting in a loss of CT and of jobs. Did you read my previous comments about elasticity and how we need all the money we can get?

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The banks are losing money - they should have all been let go bust. A properly nationalised bank, with statutory commitments to servicing the interests of people who need to buy the things they need (no investment properties, no flash cars they can't afford) should have been put in its place.

The multinationals will go anyway - if its profitable (in more sense than just money) for them to do so. As I pointed out, the effective corporation tax in this country lets those with the most wealth pay the least. Not only is that criminally unjust, it is self defeating as it drives a race to the bottom that we cannot win - check out the average salaries in Poland and Lithuania and you'll what I mean. They'd go anyway if the Poles could speak English and the Israelis were more interested in building a sustainable peace than persecuting the Palestinians.

The Corporation tax could easily be hiked up to the European average - especially if it was done across the board in all European States. If we don't do this - if we don't hit the wealthiest with the biggest tax bill - and we can start with our 18,000 millionaires - then our solution to their problem will continue to mean mass emigration, unemployment, poverty, broken hospitals, wretched schools and taxation that strips ordinary people of their dignity.

The only elasticity that's relevant here is the elasticity of the ordinary working class family to bear the brunt of the punishment that's being meted out to them at the moment.

Is that working for you, PS? Really?

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Originally Posted by pineapple stu

Debt of 60% of GDP, not budget deficit. Market realities clearly don't dictate this or it wouldn't have happened.

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My point was that the 'markets' won't lend to 'us' partly because 'our' debts are unsustainable in the long term - unsurprising given that 'we' did not run those debts up.

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Originally Posted by pineapple stu

Ah yes...

What utter drivel. How are we going to reduce from our current position of losing E1.5bn a month to breakeven in five years' time without increasing taxes across the board, to the obvious detriment of the economy?

You seem to suggest that you'd like everyone individually assessed to see how much tax they can pay - so because you don't have any debt (even though you then say you do), you should get off without paying extra. Do you realise how utterly ineffective this approach would be? You'd have to pay E600 p/m yourself just to work such a system!


What is your solution?

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Clearly, the idea that we're going to be out of this in 5 years' time is pie in the sky -I threw that in because that's the line being spouted by the government. I don't believe it.

I don't believe anything they say because balancing the books will never be possible unless we hike corporation taxes, cut all subsidies to the landlord class created by the property bubble, yes - means test taxation - nothing else is sustainable or fair.

The dole office stasi should be redeployed to the Revenue and sent out en masse to Foxrock, Malahide, West Cork, you know where the wealth is - responsibility begins with those most responsible for our penury.

That's the start of my solution - anything else is 'drivel' spouted by the apologists of 'our' failed and failing neoliberal economic doctrines.

What's your solution, PS? Keep going the way we are - how's that working for you?

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Originally Posted by Charlie Darwin

We have, yes. That's not an argument for absolving ordinary people of their own responsibilities.


You obviously don't agree because you are actively arguing ordinary people should be absolved of responsibility for borrowing more money than they could ever reasonably afford in any economy.

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Ordinary people should not be absolved of their responsibilities.

Pensioners, children with special needs, the unemployed, the poor, ordinary working class families are being punished because 'we' have to balance 'our' books.

Balance the books by hitting the rich (corporation tax, wealth tax, fair property taxes) - not the poor.

EDIT: Sorry, I get you now on the pot, kettle, black thing - I used the line "the scars of the famine...." as an example of "the waffle spoken and written by hack journos an their apes" it wasn't intended as a literal historical/psychological account.

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Originally Posted by born2bwild

Ordinary people should not be absolved of their responsibilities.

Pensioners, children with special needs, the unemployed, the poor, ordinary working class families are being punished because 'we' have to balance 'our' books.

Balance the books by hitting the rich (corporation tax, wealth tax, fair property taxes) - not the poor.

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So you've backtracked on more or less everything then? I agree we need to balance our budget in a way that impacts the less well-off as little as possible. Very few people would disagree.

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Originally Posted by born2bwild

Renting was not a perfectly good option - landlords are capricious at best and rapacious as a rule. Who wants to rent when mortgage payments are comparable to rental payments.

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Is this a trick question? This country is full of people who made the decision to rent rather than buy despite the fact it was more expensive and offered what seemed like less security. There are literally hundreds of thousands of us. And we've felt the exact same cutbacks and tax hikes you have.

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As I pointed out, the effective corporation tax in this country lets those with the most wealth pay the least.

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CT taxes income, not wealth.

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Not only is that criminally unjust, it is self defeating as it drives a race to the bottom that we cannot win - check out the average salaries in Poland and Lithuania and you'll what I mean. They'd go anyway if the Poles could speak English and the Israelis were more interested in building a sustainable peace than persecuting the Palestinians.

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It's not a race to the bottom. Our CT rate hasn't changed since it moved to 12.5%. It's one of many reasons we're considered a stable and predictable economy for overseas companies. Google et al could move to Latvia tomorrow and pay less tax - the fact they don't move doesn't mean we can raise taxes without any adverse effects.