Referendum to be held on European fiscal compact

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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.