The people of this country elected the current Government into office partially based on promises that everyone realistically knew they couldn’t keep, it was an anti FF vote that won the day for FG/LAB. We as a people have to take responsibility for electing FF time after time again because they kept dishing out the goodies. The real culprits responsible for the sorry state of affairs we find ourselves in can be laid at the feet of our unelected ‘permanent’ government – the Higher Management of the Civil Service who were weak and didn’t stand up to the Politicians to keep a tighter reign on fiscal policy and enforce tighter regulation (to keep the Banks in check).

You would think we were broke and borrowing near 20bn a year what with all these cuts

Madness

Why do we all have to take responsibility for electing FG/FF/Labour? Not all of us voted for those parties. If you have a problem with those parties and if you voted for them, then sure, take responsibility. But I personally will not take responsibility for someone else’s actions, especially seeing as how I have never voted for any of those three parties.

Ah delusion at it’s finest right here! Grow up guys, the government are not corrupt and I am sick of the same stupid responses from people like ” they should cut back their fat salaries” because that would get rid of ireland’s deficit.
These cuts have to happen, Ireland does not have any money!! The money needs to come from somewhere and cutting the “corrupt government” salaries ain’t going to cut it.

Irish people need to face reality, these cuts have to happen because ireland is broke, grow up, stop complaining or leave the country.

Francis,

“grow up, stop complaining or leave the country.”

is bang out of order.

We have every right to assess and criticise the government’s work – it’s an essential part of a healthy democracy. If you’re willing to put blind faith in the government, then you deserve everything you get.

Ye couch complainers ain’t going to change a thing. If ye know so much and are so critical of the government, why don’t you not work in government so. The irish government have experts from around the globe with tenure in worlds top universities trying to solve this problem. Trust me, any “solution” ye have taught of has been discussed by these guys.

it is hard to find a money solution in a country that has no money. The irish are compulsive complainers so I am not surprised the uneducated are up in arms over this.

Alternative solutions may have been “taught” of and dismissed for political reasons, which may or may not be valid.

It’s up to us to put pressure on our elected representatives to make full disclosure of their reasoning in these matters and to judge them accordingly.

We can write to our TDs, attend clinics, organise and get out to protest. Not saying that this would have any practical effect, but it’s better than nothing.

If you’re happy to put your faith in the government and their “experts”, operating behind closed doors, then you obviously haven’t been paying much attention to what’s happened over the past decade or so.

I’d thank you not to dismiss critics as uneducated, either.

@Dave
They have to cut capital spending because it’s the easiest option politically. I don’t agree with it, as it creates jobs, but I can see the politics of it. They have the IMF deal, they have the Croke Park deal. Those deals basically set the agenda for what the governent does. Lots of areas for spending cuts are off the table. But anyone suggesting that spending need not be cut at all is just spouting populist rubbish.

You can argue about a VAT increase versus an income tax increase, but all I know is that they will take more money out of my pocket in some way, and I knew that well before the last election. Taxes will go up, spending will go down. Anyone saying that it’s a big shock that 2 parties in government who promised to stick to the IMF deal before the election are making spending cuts are a bit soft in the head.

There is no golden bullet to avoid the fact that the government has a huge deficit even beyond the bank debt mess. The only way the country will be sovereign again if it balances the books. And again I’d say that anyone who thinks we can balance the books while having 2007 levels of spending is not being realistic.

More TINA, Neil … There Is No Alternative.

Of course there are alternatives.

I am suggesting that taking a more confrontational stance on the issues of junior bondholders might free up some cash. I am also suggesting that a more belligerent stance towards the IMF and ECB, combined with a credible threat of voluntary default, might improve our bargaining position and maybe allow us to roll back on some of the more onerous conditions of these deals, allow us at least some degree of self-determination.

And even if we’re to accept the “debt” and its conditions, why not raise taxation on the wealthier portions of society? It seems that most of the measures will hit equally hard across the board – I don’t think it’s unreasonable to ask those who have the means to pay proportionately more. The book can be balanced in many ways.

After all, who are the Government supposed to be working for, us or the IMF? Of course, my feeling is that Fine Gael are ideologically pretty comfortable with all that’s happening here, still can’t understand what Labour are doing, Faustian pact if there ever was one.

If that makes me some kind of populist demagogue, then fine, I’m a populist demagogue. But it seems like plain common sense to me.

The least I expect is that we have a public debate on this, or that our leaders come out and justify why they’re doing what they’re doing, without reference to TINA.

Sorry, when I say “It seems that most of the measures will hit equally hard across the board”, I obviously mean that they’ll cost the same to everyone, and disproportionately affect the poorer sections of society.

Coffee. Stat.

I keep on hearing this ‘threaten them with us unilterally defaulting and they’ll roll over and wipe out all our debts”. But how can you seriously do that unless the Irish people are fully informed that unilateral default = 30% reduction in SW and PS pay overnight, and are still fully behind it?

You can’t threaten default unless a broad spectrum of Irish society has come out in favour of it, because without that everyone will know you’re just bluffing (and you could forget about ever getting back into the bond markets after being seen to make idle threats about defaulting on your debts).

Will the Irish unions come out in favour of default and devaluation? Will their members back a scenario where there is no IMF money to help pay their wages?

We’re getting 10bn net in financing (20bn deficit minus 10bn in debt repayments) from the IMF etc right now. And no, a ‘wealth tax’ won’t cover that 10bn. Not even Sinn Feins proposals give you anything like 10bn.

Well, from where I’m seeing it, the threat of default is about the best weapon we have, maybe the only one – I think it’s surprising that it’s so readily dismissed. Obviously, it’s not without consequences, but I think it’s about time that we think it through as a realistic policy option.

This idea of being good boys at the top of the EU class, lining up to take our medicine, regardless of its effects, really isn’t good enough. The only ones in whose interests it is are the financial markets.

We don’t even have the option to purchase our own debt in the secondary market, it’s just not good enough.

Nobody’s saying that a wealth tax is some kind of panacea, it’s just amoretti equitable way of sharing the pain … if we are to take the pain as a given.

Like I say, my greatest concern in all of this is the government’s unwillingness to debate or even justify their policy decisions, getting mightily sick of TINA at this stage.

@Niall
If you think it’s horrible that we are ruled by the financial markets then exactly what kind of scenario do you envisage that we are not?

People are complaining about cuts in spending and increases in taxes now.
What level of government spending will there be if Ireland had no access to borrowing at all?

We’re getting 20bn from the IMF, to pay debt interest with 10bn and use the other 10bn rest to pay PS and SW.
Do you think we’ll still get 20bn from the IMF if we were only going to pay interest of 5bn because we refused to pay the rest? No, we wouldn’t. And if you idly burn the bond markets then you can’t expect to go back there cap in hand later and get a good deal on borrowing.

If the Irish unions come out in favour of Ireland defaulting and only spending what it takes in, then the governent can threathen default. But I don’t see turkeys voting for Xmas anytime soon.

Personally I don’t see how an Irish government can do anything but the steady as she goes approach of taking the cheap IMF financing while reducing the budget deficit to the point where we could get our own financing on the bondmarkets.

Lots of people seem to want to vent their frustration that it is no longer 2007 and see some kind of aggresive action like unilaterally defaulting. But I surely don’t want a government throwing the dice on something because they’re pissed off with the world.

@Neil
Something you said has struck a chord with me.

‘You can’t threaten default unless a broad spectrum of society has come out in favour of it,…’

Is that why there was so much huha about the proposal to hold a referendum in Greece on the proposed bailout deal? Do I remember it being said that 60% of Greek society would reject it?

Makes me think that there’s a big scare in the financial markets that democracy might get in the way of austerity
and self determination might ruin their plans.

Damn keyboard!

What I’m getting at here is that there is little to argue with in what you are saying but I find it totally unacceptable that financial markets can hold countries to ransom and threaten sovereignty, What use is a complex system of market networks between countries that are insolvent and insecure. The serpent’s just eating at it’s own tail.

This is the thing. Rather than reining in the markets as having been the root cause of our current problems, it seems that we’re intent on feeding them even further, and handing away even more power.

It’s like we’ve been diagnosed with an acute dose of snake oil poisoning, and the prescription is another large dose of snake oil.

At this point, I feel that all options should be on the table – it’s not unreasonable to expect that some of the more outlandish elements of the bailout deal, like the ban from trading in secondary markets, be negotiable. If this is the point we’ve reached, then maybe default isn’t so crazy after all. Would certainly like to see the government commission an unbiased study of its feasibility and possible effects.

Niall & Neil. Both seem to know yer onions. The difference between you is either idealist/pragmatist and/or straight-forwardly ideological. Odd that you should talk of default as a weapon. Who would it be aimed at? And odd to suggest that the markets have plans. Didn’t someone left leaning recently say that the traders on international markets are young, male psychopaths? Micro-economic theory claims markets are organic, anarchic even. So who has the plan? We saw what happened when Greece and Italy looked like they were heading for default. The markets (that is, a bunch of individualistic traders trying to maximise their individual returns) plummeted. As long as the western liberal democracies (broad brush description for brevity) continue to elect centrist governments the international financial markets will have a powerful influence on political-economic decision making. The idea that one small country could hand over the decision about default to the people in a plebiscite ignores the dangers this would have for the global economy. Ireland may or may not be wealthy enough to ride that storm. Although the poorest would pay dearly here as they would across the world…

“the dangers this would have for the global economy”

That’s the weapon, right there. We demand the right to take care of ourselves first, and the markets second … or at least look after ourselves at a slightly less distant second than is the case at the moment, otherwise we’ll default and let’s see how that works out. Because the current arrangement is intolerable.

It’s aimed at the troika primarily – a reminder that sovereign nations have a place in the grand scheme of things, and more importantly that the ordinary people of sovereign nations are human beings, ends in themselves, not just numbers in a spreadsheet.

So long as the concessions we’re looking for are reasonable, and the threat has some credibility, I think it’s an option. Actually, I think it’s our only option – unless, of course, the troika allow us to soften the terms of the bailout without it having to come to this.

I wouldn’t like to go through with it, mind you , but with the way things are going, I think that the government needs to start prioritising Ireland’s interests over those of the global economic system, which seems to be coming apart at the seams, and I’m not sure that there’s anything that can be done to save it.

I don’t believe the economic dogma that the markets are some kind of information processor, magically determining the right price for everything, and that the “laws” of economics are like some kind of force of nature. Look at Black Wednesday in 1992, and try to tell me that it wasn’t an orchestrated attack on Sterling, basically a vast exercise of political power with the political aim of decoupling the UK from the rest of Europe economically.

The attacks on Spain last week bore a markedly similar character, if you ask me. The markets have their own agenda – the imposition of laissez-faire, neoliberal states all over the world.

And the IMF has priors in that regard. Look at what happened after the Asian Tigers imploded – Thailand, South Korea and … there but for the grace of God … Indonesia. Actually, I’m kinda convinced that we will eventually go the way of Indonesia.

Maybe it was the “magic of the markets”, but it looks a lot like “policy by other means” to me.

Ok, but how do you reconcile
“I don’t believe the economic dogma that the markets are some kind of information processor, magically determining the right price for everything, and that the “laws” of economics are like some kind of force of nature.”
with
“The markets have their own agenda – the imposition of laissez-faire, neoliberal states all over the world.”

Anyway, seems to me we’ve already reached that point. We’re over a barrel. While people with mortgages, private and occupational pensions might vote nationalist or left of centre, they know it’d be mad to vote for default. Not only would it make their own future rather uncertain, it’d have far worse consequences for the worst off.

A bluff just wouldn’t work. The Euro zone is big and ugly enough to call it, fully confident that Ireland would fold first.

Is this is why David Begg and Paul Sweeney from ICTU have consistently argued for a longer repayment period?

I fully realise that I’m grasping at straws here, this is what you might call blue-sky thinking, if you were that way inclined. We most certainly are over a barrel. I think we need the Sinners in power to make the bluff credible, not that it’s likely to happen. Nevertheless, I think it’s an option that should be seriously explored.

At the moment, I think that the best we can do is to cause as much disruption as possible, in terms of protests and strikes to let the government know that we’re watching them.

As for those two statements, they’re perfectly compatible – the markets have an ideology and an agenda, they’re not just some disinterested group of perfectly rational utility maximisers.