Labour After Gilmore

[Macy]

AS opposed to FF which bankrupt the country, or fg/lab with the inspirational idea of taxing ordinary people to the hilt. Both a masterclass in economics

What choice did the current Government have, because FF/ Greens had bankrupted the State (partly due to the bank guarantee that SF voted for), and left the new Government in an IMF programme? It's delusional to think any combination of Government would've or could've done anything different at that stage. A wealth tax wouldn't and isn't enough to plug the hole.

[pineapple stu]

Yes, I accept your first comment was not an attack.

So you accept that "Sinn Féin's economic policies are scarily nonsensical" wasn't an attack?

Would you like to address the point so? Osarusan can back up his stance in due course, but there's no reason why you can't back up your view to the contrary.

For the record, I agree with osarusan. Here's SF's alternative budget. On page 5, they say that they'd only cut E2.5bn from the budget, not E3.1bn. The budget deficit needs to be cut as quickly as possible; holding back on it is no good. Here's an example to demonstrate this -

In 2009, our deficit was E20bn. Then plan was to cut the deficit by E3bn a year. That means -

• 2009 deficit - 20bn
• 2010 deficit - 17bn
• 2011 deficit - 14bn
• 2012 deficit - 11bn
• 2013 deficit - 8bn
• 2014 deficit - 5bn
• 2015 deficit - 2bn

Total additional deficit since the bust - 77bn.

Let's say FG had really been nasty and made big cuts at the start - 10bn a year. So 2010 - 10bn. 2011 - breakeven. Additional deficit - 30bn. Savings - 47bn. Of course it would have hurt the economy, but then the adjustment would have been over. Would the effect have been E30bn? Hardly.

But what SF want to do is slow this deficit reduction. Let's see what would have happened if we'd cut E2.5bn per year (SF's proposal) instead of the current E3bn -

• 2009 deficit - 20bn
• 2010 deficit - 17.5bn
• 2011 deficit - 15bn
• 2012 deficit - 12.5bn
• 2013 deficit - 10bn
• 2014 deficit - 7.5bn
• 2015 deficit - 5bn
• 2016 deficit - 2.5bn

That's 90bn. So an additional E13bn just by slowing the cuts! E13,000,000,000 is an awful lot of money to borrow for no good reason, and that's before you factor in the additional interest costs on borrowing all of that. That's an extra E2,900 for every single person in the country, before interest. They don't mention that in their manifesto, do they?

I actually agree with some bits they have, but that's only to be expected. Reducing mortgage interest allowance against rental income to 40% should reduce interest in rental properties, and so reduce demand and allow prices to fall. But it'd also be likely to raise rents in the medium term as people need to cover their investment. Not mentioned either, of course.

Just as an obvious example which is overlooked. The bank guarantee was bad, but we need to reduce our deficit as quickly as possible. If anything, we're doing it too slowly at the moment. What we don't need is populist nonsense about how we can reduce it even slower. We can't.

(Though tbh, my gut feeling is that the country is utterly FUBARed anyway, and the only reason it appears otherwise at the moment is the mortgage arrears issue, which is incomprehensibly massive. While no-one seems willing to tackle that problem - and while the people are still guaranteeing everyone's unpaid mortgages - bailout II can only be around the corner.)

[bennocelt]

What choice did the current Government have, because FF/ Greens had bankrupted the State (partly due to the bank guarantee that SF voted for), and left the new Government in an IMF programme? It's delusional to think any combination of Government would've or could've done anything different at that stage. A wealth tax wouldn't and isn't enough to plug the hole.

Ireland isnt Albania, the country is still generating billions of euros every year.
So tax the ordinary people but dont touch those at the top! That's not very enlightening.

Ireland is a very divided nation, and it still has an awful lot of wealthy individuals that could be paying a higher rate of tax. People who voted for SF (and Labour) dont want be paying unfair taxes that are just going straight to service debts built up by the banks.
And I always find it strange that corporation tax is untouchable, but go ahead tax away on the workers and people who cant afford swf at the moment.
Jesus we dont have to paying so much banking debt back, which is not our debt anyway. Greece defaulted and is still in the club, getting better deals than our yes men in Europe.
Its delusional to pay back debts that isnt your own, and please dont tell me we are in all this together!

Martin Wolf. Ireland got stuffed
https://uk.news.yahoo.com/ireland-go...213654753.html

[bennocelt]

Interesting to have a look back, some called it right- LiamtillIdie, others maybe not so....
http://foot.ie/threads/147904-Election-2011-Results

[osarusan]

Osarusan can back up his stance in due course

My main issue is covered nicely by the article linked to by Charlie:

How could it make massive savings in government expenditure while decrying vicious government cutbacks? The answer was to go after anyone and anything that looks like it earns more than €100,000 per year. Hit their wages, their pensions, their assets, their holiday homes, their inheritance, and their tax bill. It sounds fair on paper to someone earning the average industrial wage and struggling to make ends meet.

But the party ignores the possible consequences of these actions. It doesn't appear to grasp the implications for foreign direct investment, employment creation, investment and the fact that people who really do have lots of money can move it, and themselves, abroad very easily.

Its most high-profile initiative, which it originally estimated could raise €800m, was a wealth tax. Sinn Fein wanted it applied to individuals with net assets (after debt is taken into account) of over €1m. It would exclude agricultural land and business assets. But everything else would be up for grabs.

People who really have a lot of money are prepared to move it. Deposits held in Irish banks help fund loans to businesses. A modest €200,000 tax put on tax exiles in 2010 saw just 24 of them pay it. That fell to 14 in 2012.

But the document remains on shaky ground elsewhere, too. It wants a new 48pc tax rate for those earning over €100,000 per year, despite figures showing that a very significant percentage of the total income tax take comes from that group already.

They go on about how their policies have been costed, but they haven't really. They've taken figures from existing tax figures, and extrapolated their own projections from them, without really figuring in the impact their tax increases will have.

It's like the LOI argument that if you have 1,000 people paying 14 quid to watch a game, you make 14,000 gross, but if you increase the price to 20 quid, you now get 20,000 gross.

[Macy]

Ireland isnt Albania, the country is still generating billions of euros every year.
So tax the ordinary people but dont touch those at the top! That's not very enlightening.

I'm not disagreeing with the theory, I'm disagreeing with how practical it would be to implement wealth taxes, high corporation taxes without other states coming on board, or a raft of other legislation (which would no doubt be challenged constitutionally).

[pineapple stu]

The elephant in the cupboard, I think, is this - 35 year mortgages being brought back for first-time buyers.

No comment from any political party, and none expected I'm sure. But it's one of the most dangerous news items in recent years - one that shows we have learned literally nothing from the bust. Even the Indo has started realising that all our eggs in the property basket is bad. We now need some political party to start legislating for caps on borrowing. Instead, Noonan is on record saying he wants to push prices up.

So basically, we're screwed whoever's in charge.

[bennocelt]

I'm not disagreeing with the theory, I'm disagreeing with how practical it would be to implement wealth taxes, high corporation taxes without other states coming on board, or a raft of other legislation (which would no doubt be challenged constitutionally).

it would be nice to think that with the recent shake up in the EU elections that all this might get some politicians to have a rethink, but many commentators have said it wont make one iota of difference. Full steam ahead for Merkel and co.
Do the hard left and right blocs even have the ability to halt any legislation/laws?

[OwlsFan]

Sinn Fein in power. The mind boggles. From my history, I recall a German party who tried to obtain power by revolutionary means and when that failed, they decided to try the ballot box method and were eventually elected as a result of an economic crisis and then kept power by the gun, never voluntarily to release it. Who knows...

Anyone who is surprised by Labour's demise, doesn't remember than this has happened in the past. FF feck up the country and FG and Labour are left holding the baby and introduce austerity measures which go down like a lead balloon with the public so FF are re-elected on the back of FG and Labour having sorted the mess out but who get no thanks from the public. The junior party in the coalition gets screwed (like the Lib Dems across the water) and so history repeats itself, the difference this time is that SF is there now to pick up Labour's vote. The SDLP have also been destroyed by SF in the North, for reasons I can't quite fathom.

So perhaps Labour might go the way of the SDLP this time.

[dahamsta]

With absolutely no reference to any of the posts in the thread, I just want to add that the thread title makes me smile. I don't think there's any viable candidate right now that will make Labour better, but I was disgusted when he became leader and I'm delighted to see him go. He was an appalling leader, from start to finish, completely defeating the purpose of his party.

[bennocelt]

Sinn Fein in power. The mind boggles. From my history, I recall a German party who tried to obtain power by revolutionary means and when that failed, they decided to try the ballot box method and were eventually elected as a result of an economic crisis and then kept power by the gun, never voluntarily to release it. Who knows...

Anyone who is surprised by Labour's demise, doesn't remember than this has happened in the past. FF feck up the country and FG and Labour are left holding the baby and introduce austerity measures which go down like a lead balloon with the public so FF are re-elected on the back of FG and Labour having sorted the mess out but who get no thanks from the public. The junior party in the coalition gets screwed (like the Lib Dems across the water) and so history repeats itself, the difference this time is that SF is there now to pick up Labour's vote. The SDLP have also been destroyed by SF in the North, for reasons I can't quite fathom.

So perhaps Labour might go the way of the SDLP this time.

Thats funny

[OwlsFan]

I suppose the restoration of Ireland’s international reputation which is crucial for investor confidence and job creation counts for nothing. Unfortunately that comes at a cost of various new taxes but the money can't be plucked from the air. Mess ups include the removal of the medical card but when you consider the disastrous state of affairs the country was in when the coalition was elected, I think it has done a good job. They made a number of promises they couldn't keep like all politicians but they didn't realise that the position was as bad as it turned out to be.

I worry for Labour though. In the past when it was crucified at the polls, it didn't have another viable socialist party breathing down its neck. This time there is a nationalist and socialist (hmmmm sounds familiar) party to pick up the pieces. Is the damage terminal like it is for the SDLP?

[bennocelt]

Depends who you are though, ordinary people taxed to the hilt and losing medical cards and all sort of basic entitlements But yeah we have to keep our international investors happy! tsk

Home at moment, country is on a bit of a bounce no doubt but how much of that is down to FG?
They havent really radically changed anything within the country, and a new bubble is starting to emerge in Dublin!

[Macy]

Depends who you are though, ordinary people taxed to the hilt and losing medical cards and all sort of basic entitlements But yeah we have to keep our international investors happy! tsk

Home at moment, country is on a bit of a bounce no doubt but how much of that is down to FG?
They havent really radically changed anything within the country, and a new bubble is starting to emerge in Dublin!

The state was in an IMF programme, what did you (or anyone else) really expect them to do? They were always going to follow the programme, and we do now have our economic soverienty back after FF/ Greens lost it.

What other "basic entitlements" have people lost? Don't quote water, as a significant proportion of the population already pay for that anyway either through their own provision or group schemes. Medical cards were never an entitlement - unfortunately, as I believe in an NHS/ Universal Health Insurance system with equality of access. The whole thing that's bugged me about the whole medical card debate - when it was criticising the Under 6 medical card for all it wasn't right that a millionaire got it for their child, but it's apparently the worst thing ever if a millionaire with cancer loses theirs.

[bennocelt]

The state was in an IMF programme, what did you (or anyone else) really expect them to do? They were always going to follow the programme, and we do now have our economic soverienty back after FF/ Greens lost it.

What other "basic entitlements" have people lost? Don't quote water, as a significant proportion of the population already pay for that anyway either through their own provision or group schemes. Medical cards were never an entitlement - unfortunately, as I believe in an NHS/ Universal Health Insurance system with equality of access. The whole thing that's bugged me about the whole medical card debate - when it was criticising the Under 6 medical card for all it wasn't right that a millionaire got it for their child, but it's apparently the worst thing ever if a millionaire with cancer loses theirs.

Your ideas there not mine. But I would agree about the NHS style scheme.

Economic sovereignty? Give over, we have to show the boys in the EU/IMF all future budgets and take directions on what we can and cant do with our economy. I'd expect them to at least bat a little better for the country, not all agree to everything.
But the solution was to go on a big tax initiative, thats all well and good but its not a new radical approach. Fact is a lot of ordinary people in Ireland are not doing very well.
The solution: more tax. Brilliant!