December 8, 2012
The budget of the bailiffs came this week. Further damage inflicted to the whole economy. It came in the wake of failure by Kenny and Gilmore to exact any debt forgiveness from the ECB. Occasionally we see the veil slipping. We saw it with the ‘fair budget’ mask reveal a 20% cut to the excellent people who save the state millions by tending to their loved ones in ways the state could never dream to. It was well they did not call it a ‘caring budget’ with cuts to carers being a major target of the troika’s axe.
Changes to pension pots have been marginal with many changes deferred to 2014 arguably the money in such funds untouchable and left to build up for recipients towards future reward. No harm in that but facts show the €26 million saved from carers is money that will not be spent in shops and will lose jobs. Across the board its the economic jugular of the economy that is being cut with the larger burden of the cuts being on middle-income Ireland, money that will take jobs out of the economy, no matter what they tell you to the contrary.
There were no similar cuts announced re the promissory note repayments of €3.1. This blog has previously called many times for the resignation of Professor Honahan of the Central Bank who is against the holding of a banking inquiry more detailed than he has provided. On the banking inquiry it’s all quiet on the western front in Ireland, the media have gone silent on calls for the same.
We need to get answers to the precise relationship between the CBI and the government and the IRBC (Anglo) from 2006 on to today.
“In a renegotiation, the Government should be seeking a complete write-down of the promissory note. This would require an innovative response from the CBI. We believe this will be done as the CBI has already accepted its critical role in the Anglo/IRBC debacle.”
We need to hear the progress of representatives of the government and the CBI and other interested parties eg Department of Finance in current debt negotiations.
Tom McDonnell, Michael Burke and Michael Taft write in the above:
“• In the next four years the cost of Anglo/IRBC debt will make up almost a third of all state borrowing.;
• The annual repayments will exceed the entire budget for the nation’s primary school system;
• The average annual repayment for just one year exceeds the entire cost for a next generation broadband network;
• The total cost is equivalent in scale to half of our GNP this year.”
Written over a year ago on Sep 20 2011 they called for
“The starting point should be a Government announcement this autumn that it does not intend to continue with the current promissory note payment schedule and will enter into renegotiation with the affected parties.”
For the past year instead we’ve been drip fed the mantra of deep, complex, hard negotiations with continuing deferrals of announcements following empty posturing by Enda Kenny and his failure to elicit any success on debt write down. We’ve waited long the fruits of the quiet diplomacy but the troika and Angela Merkel and european heads of government simply ignore Kenny and turn their back on debt relief for Ireland. The empty-headed approach of Fine Gael Labour has been rewarded with empty-handed indifference from Angela Merkel, the ECB and the troika.
Budget cuts are now cutting away at the muscle of Irish recovery. Fine Gael and Labour are now echoing the previous administrations mantra of Ireland on the cusp of economic recovery with salvation and recovery begun as we speak. This confidence trickery is the stuff of Irish propaganda.
But perhaps here it is incorrect to overemphasize the mendacity of Labour and Fine Gael at expense of recognition of the absence of bright individuals among both groups capable of dreaming up smart policies.
LB/FG have been converted to the beggar my neighbour malign belief that austerity will lead to jobs. Fine Gael are blue-collar bankers whose philosophy is that wealth must be preserved for the wealthy, that taxing wealth leads to loss of jobs. It’s difficult to believe that such Greenspan economics laissez-faire attitudes are at the helm of our society having been discredited in our economic collapse, but such is the resourcefulness of the insider class in Ireland.
Finance Minister Anders Borg of Sweden has successfully introduced tax cuts to stimulate the Swedish economy. While Kenny and Gilmore increase taxation at every level to hoover everything up to the central bankers in Europe as a form of austerity reparations,
While the U.S. continues to struggle with its jobs problem — unemployment is at 8.1% here — Sweden’s jobless rate has fallen to 7.5%.
Not perfect, but 7.5% is far below the euro zone average of 10.2% and significantly lower than the rates in Spain (21.7%), Portugal (12.9%) and the United Kingdom (8%), countries that Borg noted were “… arguing for large temporary stimulus.”
Under Borg, Sweden handled the downturn in the most un-European way. “While most countries in Europe borrowed massively, Borg did not. Since becoming Sweden’s finance minister, his mission has been to pare back government. His ‘stimulus’ was a permanent tax cut,” Fraser Nelson wrote last month in the Spectator.
Gilmore and Kenny by their austerity budget, their massive failure to achieve debt write down, their craven obedience to dictates imposed from abroad and filtered through a financial system in Ireland that is still pro deregulation, pro speculation, top-heavy with a political class creaming it with salaries and perks the envy of Europe, are taking Ireland on a path to ceaucescu economic ruin as they curry favour with their political, economic and financial masters.
Private banking interests seed the public arena with such figures as Kenny and Gilmore in order to protect their interests and to fight reform of a financial system that has failed all over Europe.
Its time in Ireland for a new LEUP ( Leave Euro Party ). A giant squid octopus of a budget has attached its suckers to middle Ireland destroying social and economic well-being in ways that could not have been imagined until now. The suckers hell-bent in pursuing such policies in Fine Gael and Labour are not the brightest tools in the box. Once again the Charge of the Light Brigade led by FG/LB has brought this country closer to economic ruin.
We need an inquiry into the banks looking in particular at the role of politicians and the Department of Finance and relationships between the Central Bank of Ireland and IBRC and the ECB. We need to know what the hell is going on re our debt renegotiation.
Of all the nasty ingredients in this budget, by far must be the treatment of those in negative equity. Instead of a write-down of their debt, the tens of thousands unable to pay their new property taxes, new Section 118 gives power to the taxman to deduct the property tax from any state payments to owner of the property might receive. If the property owner is unable to pay the odious tax and has to sell the property, the payments including arrears and penalties will be deducted at the point of sale of the property. They intend to cast debt onto the progeny.
Furthermore new property tax measures penalise those living in Dublin through corresponding valuations higher than country-wide rates throughout regions in Ireland. Owners of second homes will be hit for second home taxes plus a tax on a non primary residence.
But this is a budget that will boost jobs and growth. Ceucescu politics of embarrassingly disastrous decision-making still goes on on Ireland’s titanic.