New Statesman article on Ireland and FF

An article in the latest New Statesman outlines the economic and fiscal policies of Fianna Fáil that has us where we are today.

Failed by Fianna – New Statesman

[…] The cuts announced in December aim to reduce state spending by €4bn this year, but the overall plan is to slash it by €15bn within four years. As total expenditure by the Dublin exchequer was just under €60bn last year, this means that the Irish state is set to shrink by a full quarter in less than half a decade.

At least two generations look destined to pay a painful price for the follies of the golden circles whose scams, swindles and con jobs have lumbered Ireland with zombie banks that make RBS and HBOS look relatively vibrant. Anglo Irish alone may swallow over €30bn of public cash, equivalent to the total revenues collected by the Irish exchequer in the whole of last year.

more below…

[…] Dublin’s fragile coalition government seems far more spooked by the danger of international investors downgrading their country’s credit rating (which would make the cost of borrowing substantially higher) and the spectre of the IMF seizing the financial reins. Dublin is determined to distinguish Ireland from Greece, whose continued profligacy threatens to destabilise the entire eurozone.

[Additional Reading: Greece calls in IMF to help sort out massive debt]

The NS piece is a decent potrait of recent events, albeit one written for an audience not heavily informed on current affairs in Ireland. (Though I’ve never heard an Irish politician being referred to as “Iron Brian”).

The description of Boom-time Ireland as “a land of spivs and speculators and a manufacturing outpost for American multinationals” is concise and accurate. As is the comment “Ireland’s economic miracle was always somewhat hallucinatory, because these US firms… used it as an Atlantic tax haven and route to the EU marketplace”.

One also has to agree “most welfare recipients probably won’t be any worse off [following the Decemeber budget], as the slight fall in their benefits will be offset by the steep fall in prices that Ireland is now experiencing”. Though I would note ‘most’ is a numeric term in this context. AK comments on this topic below

Unfortunately, the New Statesman writer has missed (or ignored) the recent u-turn on elements of the ‘progressive’ pay cuts proposed for the public sector, which would add some context to that paragraph. Overall though, worth the read, and a damning verdict on the Irish Government of the last decade from an influential overseas magazine.

Guido‘s comment on the piece is, as some would expect, a slanted simplification of the situation (can’t Ireland and the UK both be in economic meltdown concurrently?) which misses the point entirely to get a cheap dig in at the British Government. Suppose, can hardly blame him, they haven’t exactly covered themselves in glory over there either.

One thought on “New Statesman article on Ireland and FF”

  1. I know I will probably be in the minority, but I personally believe that cutting welfare rates across the board, rather than tackling the inefficiencies in the system was a huge mistake.

    I thing we can all agree that most of the S.W vote will be spent on basic everyday things, same as any other sector, and yes I know that some people may know someone who may choose to spend their SW payments on alternative pursuits, but by and large a great percentage of this 21bn euro will be spent wisely.

    If there are some people abusing the system then it is the job of government to have enough checks and balances in place to catch and severely punish those people.

    Cutting the allowance of compliant beneficiaries, without fixing the problem is an amateur response to a serious problem.

    For a lot of SW recipients, the reduction of 6% in 9 Months, will mean the difference between having life assurance, and not having it, and/or having house contents insurance, or not.

    It will also mean buying cheaper non Irish food, in non Irish supermarkets, in order to make up the difference.
    What will, spending the bulk of 21bn euro, on non irish goods, in foreign multi national supermarkets do for Irish jobs, or for the national coffers.?

    There is also data to show that people who have a lower income threshold, whether they in employment or not, do not benefit as much from selective reductioins in supermarkets, ( which is what they are ) as those who can afford to purchase the top brands.

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