Fiscal Compact Referendum 2012

Summary:

The Stability Treaty's proper title is "Treaty on Stability, Cooperation and Governance in the Economic and Monetary Union", and that actually pretty much describes what the treaty contains and its aims.

At a very high level, it requires that a government maintains a budget which is balanced or which is surplus, provides an automatic correction mechanism which kicks in whenever any signatory breaks the budgetary rules and basically prevents any signatory who is also a member of the eurozone from acting unilaterally on any matter that would impact the eurozone.

A slightly longer brief is here

The outcome of the vote for the eurozone is largely uncertain no matter which way it goes, as this is untested water.

The only things we can say about the impact on Ireland are;

Yes Vote: Ireland will have access to borrow from EU institutions at "reasonable" rates. The budgetary rules will mean that until we balance the books our budgets will be subject to oversight by the European Commission (not by the Germans or the French), and this will require austerity in order to bring our budget in line.
Irish Governments in future will be subject to the budgetary rules set out in the treaty

No Vote: Ireland will have limited access to borrow money, and will have to do so at much higher rates and/or much shorter terms. This will require even more severe austerity in order to increase income and reduce spending to meet the requirements of these loans. Future Governments will be free to budget however they please (within the constraints of any loan/bailout agreements that are entered into).


What voting "yes" or "no" to the treaty will not do either way:

- Guarantee Jobs
- Guarantee Investment
- Guarantee Stability (This is just an aim, not a guarantee)
- End austerity (you only have a choice of "austerity" or "more austerity")
- Allow Ireland to "burn the bondholders"
- Require the Government to scrap the Croke Park Agreement

Dades wrote: »

- Introduce cheap, over the counter abortions

Cheap, over the counter abortions ain't worth a damn unless they're mandatory, cheap, over the counter abortions.
Think of it as Swift's A Modest Proposal brought right up to date - nobody is going to do the year's worth of nursing these days, so not really suited for the stewing, roasting, baking or boiling. But a nine-month old foetus, well nourished, would nonetheless serve equally well in a fricassee, or a ragout.
Think of it as going one better than the Chinese - we'll impress the shît out of them with our no-child policy!

Did you see the latest in moronic posters?



I'm glad that they managed to get as much stupidity into one concentrated space. While it can be argued whether or not we need more or less austerity measures in the short term, I think it's pretty certain that a No vote would most likely lead to MORE austerity, not less.

They seem to have taken the usual stance of government idea = bad, and are campaigning against something without really taking into account what it actually means or involves. "Reject Home and Water Charges - Vote No" is almost criminally misleading.

Sometimes I despair at the complete abandonment of logic in favour of politics in the case of these relatively straight-forward Yes/No questions.

I know times have been tough, but anyone who thinks we're experiencing austerity is kidding themselves. The only thing we have experienced thus far is pre-boom level budgets. Austerity, we most certainly haven't. How people cannot understand this is beyond me and I really hate people spout such misleading slogans like the posters shown above.

Hard to decide on this one. On one hand financial stability through good loans should help but with the way our Governments run this country forcing their hand to make cuts to the bloated sections of our state expenses might not be the worst.

Deleted User wrote: »

Or you could say it's inflated by people staying. People leaving isn't deflating the figures, they are what they are.


Done.


I'm on the dole right and it's a bastard but I get by. The problem is people got used to the "boom" and see it as normal. Barring a (recent) mortgage I fail to see how two people working fulltime could be struggling. Not as well off? Of course, but that still isn't austerity in my book.


Nice, next time I get a few quid together I might head over for 6 months, I've seen how low prices there are.


Excellent point. Really well thought-out.

+1

We don't have austerity now, we have taxes and levy's and Slurry pit charges and household taxes and we are still paying a lot less in tax than the rest of europe.

It's amazing how the media and the population can use a word like "austerity" over and over again - if someone you knew earned 35,000 euro in a year, but borrowed another 20k to allow him to spend 55k in that year, then started to moan about austerity you'd laugh in their face.

Real austerity - ie trying to balance the Irish budget and not need to borrow to pay for all the stuff we want from the money we actually pay would be almost unimaginable. What we currently have is certainly not austerity - it's pretty much business as usual - spending money we don't have.

When you look at it it's shocking - countries continually borrow money - with no intention of ever really paying it back - our borrowing is not like a personal mortgage which eventually gets paid back - it's interest only - and when the term is up we simply borrow the same amount again.

That's not so say sometime we don't balance an annual budget - we do and some good years we mightn't add to the debt - but the debt itself is never paid down - money we borrow has interest paid on it, in all practical terms forever.

This is the international norm - the idea is to inflate the economy so that someday the 18billion or so we borrow this year will be a pittance compared to our GDP - which is a bit like advising your 18 year old son to spend as much as they want while at college as they'll earn good money when they graduate - but when they graduate - continue to tell them to borrow as much as they want because in 5 years time they'll be earning even more - the inevitable results from continuing to follow this policy should be absolutely clear to everyone - we're just about as certain of continual growth in our economy as we were in 2006 about the continuous growth in the property market.

recedite wrote: »

As we are moving in that direction, we have austerity. Maybe not severe austerity, but still austerity.
Tax increases combined with cuts in services = austerity measures.

Which is fine, except we hear a non stop drone about "austerity not working" etc. etc.

We haven't seen anything like austerity yet - we are still living well beyond our mean, and any attempts to either reduce spending or increase the tax take are met with howls of outrage from all quarters.

The point remains that Ireland is 18billion in the hole for 2012, and people with 18 billion don't believe that we could/would ever pay it back - hence they no longer will lend us money - the only people who currently will lend us 18 billion this year to pay for our "non-austerity" are other countries for various political/economic reasons of their own.

The treaty is something I personally welcome, to absolutely once and for all put a stop to national silliness where political parties compete to not just redistribute tax payers money, but also all the money they can borrow as well.

We as a country need to treat national borrowing the same was a prudent individual would, borrowing for large capital projects that make sound sense for the economy/country and having an "overdraft" to assist cash-flow when and if we need it - the rest, the day to day finances need to be pretty much wholly financed from tax revenue. I for one am quite happy that current and future governments of this country are bound by this treaty.