Recession fiscal policy (split off from UCD)

Pride Fighter

They should just reintroduce third level fees IMO. Well for households earning over 100,000 per anum, they can afford it.




This thread was split off from another discussion in the UCD forum.

Stabshauptmann

If you start doing all this sh1te about making ppl who can afford it pay for eduaction, health etc but provide it free to everyone else (there is a case to be made for the poor, but from 20K-100K thats not poor) then you remove the incentive to earn more than 100K.
The motivation behind the cuts is threat of a recession, introducing new taxes on high earners is a bad idea in times of recession

Pride Fighter

Kaptain Redeye wrote: »

If you start doing all this sh1te about making ppl who can afford it pay for eduaction, health etc but provide it free to everyone else (there is a case to be made for the poor, but from 20K-100K thats not poor) then you remove the incentive to earn more than 100K.
The motivation behind the cuts is threat of a recession, introducing new taxes on high earners is a bad idea in times of recession

Its never a bad idea IMO, in good times or bad. Generally these people send there kids to fee paying secondary schools so another 3 years of paying 4-7k per child wont hurt them while the Universities get some much needed cash.

Stabshauptmann

Think about it, if I can have the same disposable income for working a 50 hour week as I would for a 30, where's my incentive to work the extra 20 hours? Its ludicrous. And thats what happens when you start super taxing the wealthy, they dont bother. This is bad for an economy, particularly in times of recession.

Stabshauptmann

What would be a good idea is to reduce social welfare. It saves the exchequer money and creates the incentive to work. Thats what you want in times of recession. Also cut out Quangos, catch benefit frauds, come down heavy on white collar crime - particularly tax evasion.

Finding negligible taxes on the super wealthy i.e the top 5%. Take away one of the tax avoidance schemes, though careful not enough to make it benifical to relocate and not to make them fearful.

superficies

Kpatain Redeye - taking the PD/Nixon/rationaleconomics message very seriously there...

They won't fire anyone and the salary scales won't change. They'll just reduce their PT payrole and probably some services staff--same as all the other universities. 3% is perfectly achievable.

Pride Fighter

Kaptain Redeye wrote: »

What would be a good idea is to reduce social welfare. It saves the exchequer money and creates the incentive to work. Thats what you want in times of recession. Also cut out Quangos, catch benefit frauds, come down heavy on white collar crime - particularly tax evasion.

Finding negligible taxes on the super wealthy i.e the top 5%. Take away one of the tax avoidance schemes, though careful not enough to make it beneficial to relocate and not to make them fearful.

Get a grip, lowering social welfare when there is no jobs for those people is just insane. I agree with you on the tax evasion bit, lowlifes like SIR Michael Smurfit and SIR Tony O'Reilly dont pay tax here, they should never be allowed back here unless they do. Although I dont particularly like Ryanair at least Michael O'Leary pays his taxes and contributes to the Irish tax take.

Breezer

Kaptain Redeye wrote: »

What would be a good idea is to reduce social welfare. It saves the exchequer money and creates the incentive to work. Thats what you want in times of recession

I agreed with you until you came out with this. While it may make financial sense, there has to be balance between fiscal and social policy. There'll always be people who'll abuse a system, but anyone can fall on hard times, and it's not much use having 'the incentive to work' when jobs are not as available as they once were.

Not giving in to union demands for unsustainable pay increases would be much more beneficial than cutting off the money where it is needed most.

Running an economy is not the same thing as running a country.

Also cut out Quangos, catch benefit frauds, come down heavy on white collar crime - particularly tax evasion.

I fully agree.

Ernie Ball

Kaptain Redeye wrote: »

What would be a good idea is to reduce social welfare. It saves the exchequer money and creates the incentive to work.

Why not follow your logic to the end and put an extra surtax on the poor (to give them an extra disincentive to continue being poor)?

Please, this Thatcherite/Reaganite nonsense isn't even taken seriously in the US anymore.

boomhower

Kaptain Redeye wrote: »

What would be a good idea is to reduce social welfare. It saves the exchequer money and creates the incentive to work.

that's a bit harsh! clearly you're well off and don't want anyone taking any of your moolah. i'm not gonna pretend i'm an expert on the economy, but in my opinion you take from the rich and give to the poor..
otherwise the rich get richer and the poor get poorer
(sorry for all the clichés)
i'm not saying there aren't fraudsters or people who won't work, what i amsaying is that it's not always as simple as that..
you're in college, i'm in college
when we graduate we'll have well payed jobs
the people who rely on social welfare generally don't have that(i know there are grants, but when it's not in the social mindset of an area to go to college, then most won't put the effort in..and most don't) they have it hard, they need the money
i'm going on a tangent/rant, it's late, i'm tired..
but i was really taken back by the ruthlessness of that comment!

Stabshauptmann

boomhower wrote: »

clearly you're well off

Actually I worked all through college and cycled in from Drimnagh every day.

Stabshauptmann

Ernie Ball wrote: »

Why not follow your logic to the end and put an extra surtax on the poor (to give them an extra disincentive to continue being poor)?

Please, this Thatcherite/Reaganite nonsense isn't even taken seriously in the US anymore.

Moving from incentive to disincentive is following someone's logic?

Im neither a Thatcherite or Reaganite. The argument isnt to stomp on the poor. During the peaks of the Celtic Tiger new jobs were constantly being created, we had full employment for years - infact we had a massive influx of immigrants because there was a shortage of workers, yet somehow there were people who stayed on the Dole.

Why? Because the jobs on offer were beneath them. There are those who havent the skills to get the high flying jobs yet refuse to work the jobs available.

I believe in a strong social welfare system, free education, healthcare and transport (so long as its not tiered). Im not saying we should have an American system or anything like it, but at present you're going to have people coming out of college, not being able to get the type of jobs they hoped (if all the rumblings from the commentators are to be believed) and they'll have 2 choices: Approx [edit]330 300[/edit]a week on minimum wage or 270 in social benefits (JSA and rent allowance). I know what Id choose.


And thats assuming you get 38 hours, I rarely did when I worked minimum wage.

Can you honestly tell me that its right that somebody working a 30 hour week should have less take home pay than someone on the dole. It is a ridiculous situation.


30*8.65 = 259.50
JSA=198 + RA 70 = 268

Stabshauptmann

Breezer wrote: »

I agreed with you until you came out with this. While it may make financial sense, there has to be balance between fiscal and social policy.

Definitely. We need far better social policies

There'll always be people who'll abuse a system, but anyone can fall on hard times, and it's not much use having 'the incentive to work' when jobs are not as available as they once were.

We have on of the highest unemployment benefits. 100eur a week higher than the UK. Ofcourse people will fall on hard times. Its important that they dont fall through the cracks, that we give them enough to live on and the ability to find new jobs. But this isnt like the 1980s. There are still plenty of jobs, things are not as good as they were 5 years ago, but they are still quite good.

Not giving in to union demands for unsustainable pay increases would be much more beneficial than cutting off the money where it is needed most.

Id say that will happen too. TBH most of the cuts re: payrolls will be scaling back of budgeted bonuses, increases and recruitment.

Stabshauptmann

Pride Fighter wrote: »

I agree with you on the tax evasion bit, lowlifes like SIR Michael Smurfit and SIR Tony O'Reilly dont pay tax here, they should never be allowed back here unless they do. Although I dont particularly like Ryanair at least Michael O'Leary pays his taxes and contributes to the Irish tax take.

Thats tax avoidance, not tax evasion. They are different.

You pay tax where you are a resident, doesnt it make sense to pay taxes where you live? You first wanted to increase the tax burden on the wealthy and then get cheesed off when the wealthy move to avoid taxes they deem too high. Can you not see the blaringly obvious flaw in your arguments?

Not allowed into the country? How on earth am I the one in this conversation who looks like an extremist?!

the evil lime

boomhower wrote: »

i'm not gonna pretend i'm an expert on the economy, but in my opinion you take from the rich and give to the poor..
otherwise the rich get richer and the poor get poorer

Common opinion, usually wrong. If you take from the rich overmuch, in the long run everyone gets poorer. Their disposable income is what keeps a lot of the economy running. I can't remember the exact details, it's been a while since I did economics.

Oh, and the rich tend to get richer and the poor tend to get poorer. It's been a fairly constant trend throughout history. This is usually because the rich have a better idea of what to do with their money, or employ people who do.

boomhower

the evil lime wrote: »

Common opinion, usually wrong. If you take from the rich overmuch, in the long run everyone gets poorer.

well as i said i'm no expert, but i don't mean to bleed the rich of their money,i think an appropriate amount should only be taken from those who can afford it.

the evil lime wrote: »

Oh, and the rich tend to get richer and the poor tend to get poorer. It's been a fairly constant trend throughout history. This is usually because the rich have a better idea of what to do with their money, or employ people who do.

exactly, but how does that justify cutting their social welfare?

i dunno, maybe i'm a bit of a soft touch. i know that there are people who will take advantage etc, but i just think the idea of cutting s.w. is harsh.

sure why don't we just throw out all the refugees who are given allowance(because their status means they can't work)..sure they're only a drain!!! let's send em packing!:rolleyes:

Stabshauptmann

The_Minister wrote: »

Everyone back on topic. There is an Economics forum if you wish to continue this discussion.

I dont think they do. Both Ernie Ball and Pride Fighter have been online and I guess they had no comeback to why the Dole should be higher than minimum wage. Suppose it gives some people a warm fuzzy feeling to call someone else a fascist and portray yourself as a champion of the little man, but its hard to argue facts and apparently impossible to admit when you’re wrong or heaven forbid apologise…

Pride Fighter

Kaptain Redeye wrote: »

I dont think they do. Both Ernie Ball and Pride Fighter have been online and I guess they had no comeback to why the Dole should be higher than minimum wage. Suppose it gives some people a warm fuzzy feeling to call someone else a fascist and portray yourself as a champion of the little man, but its hard to argue facts and apparently impossible to admit when you’re wrong or heaven forbid apologise…

The thread is off topic enough without this type of thing. I receive all sorts of grants as I am one of those so called 'little men'. Nothing wrong with the dole level at the moment IMO. A standard working week is 38 hours not 30 so your calculations should be amended.

Stabshauptmann

The_Minister wrote: »

Everyone back on topic. There is an Economics forum if you wish to continue this discussion.

The_Minister could you please split the offending posts from the thread and move them. I'd hate for Pride Fighter to miss out on an opportunity to explain why someone on the dole should get more disposable income than someone who works 30* hours a week

* - because you often wont get the full 38. Minimum wage often comes hand in hand with flexible working conditions [sic] where your hours change every week. When I worked minimum wage I was lucky to get 25. The reason is that from a employers perspective 5 hour shifts are the most cost effective - no meal breaks. But if you want to take the 38 hours situation, explain how its fascist/ruthless to expect more than an extra 60eur when working adds so many extra expenses into your life?

Pride Fighter wrote: »

I am one of those so called 'little men'.

Grow up and dont pretend you've never heard the phrase before. I wasnt saying you were little or inferior, I was saying you're full of hot air and self importance and you're not going to let a little thing like reality stop you from insulting other people. I particularly love the way you picked a whole in the 35 hr week instead of a 38hr week and used it as a way to dance around the actual question, that was in bold no less. Fair play. Integrity.

GusherING

Kaptain Redeye,
Of course there will be a few people who stay on the dole no matter what. However, a job is a route to self-empowerment and nearly every person recognizes that. Anytime I have met an unemployed person they have never told me their job status with an ounce of pride. That's why I'm always so skeptical when I hear opinions like yourself. How come the rhetoric you're using now hasn't been in the headlines the last five years?

I think the 3% cuts are a poor way to invest in third level education. At the heart of our long-term economic plans we should be serious about upskilling our workforce through universities and other schemes. Whatever about the need for higher funding levels be they introduced through fees or state investment, investment must be maintained.

Stabshauptmann

GusherING wrote: »

Kaptain Redeye,
Of course there will be a few people who stay on the dole no matter what. However, a job is a route to self-empowerment and nearly every person recognizes that. Anytime I have met an unemployed person they have never told me their job status with an ounce of pride.

Thats the root of my argument. I well believe that there are people on the dole who want to work, but that they'd be even more embarrassed to tell you they worked in McDonalds.

That's why I'm always so skeptical when I hear opinions like yourself. How come the rhetoric you're using now hasn't been in the headlines the last five years?

Because we were enjoying an economic boom. Also what makes headlines is hardly a solid point...

I think the 3% cuts are a poor way to invest in third level education. At the heart of our long-term economic plans we should be serious about upskilling our workforce through universities and other schemes. Whatever about the need for higher funding levels be they introduced through fees or state investment, investment must be maintained.

And how do you feel about Corporate investment?

Pride Fighter

Kaptain Redeye wrote: »

The_Minister could you please split the offending posts from the thread and move them. I'd hate for Pride Fighter to miss out on an opportunity to explain why someone on the dole should get more disposable income than someone who works 30* hours a week

* - because you often wont get the full 38. Minimum wage often comes hand in hand with flexible working conditions [sic] where your hours change every week. When I worked minimum wage I was lucky to get 25. The reason is that from a employers perspective 5 hour shifts are the most cost effective - no meal breaks. But if you want to take the 38 hours situation, explain how its fascist/ruthless to expect more than an extra 60eur when working adds so many extra expenses into your life?


Grow up and dont pretend you've never heard the phrase before. I wasnt saying you were little or inferior, I was saying you're full of hot air and self importance and you're not going to let a little thing like reality stop you from insulting other people. I particularly love the way you picked a whole in the 35 hr week instead of a 38hr week and used it as a way to dance around the actual question, that was in bold no less. Fair play. Integrity.

I have insulted no one. In fact you seem to be the one with a bit of an attitude. If you feel I have insulted you, report me. Sarcasm and abrasiveness are not the type of attitudes you should strive for. So I disagree with you, so what. I have answered all of your questions and I can see we wont really agree on this. Spending cuts are inevitable in the bad times, the government should be applauded for hitting those who can afford it most, themselves and senior civil servants. Good luck anyway, I have no beef with you but your fiscal ideology, make love not war.

Al_Fernz

Kaptain Redeye wrote: »

The_Minister could you please split the offending posts from the thread and move them. I'd hate for Pride Fighter to miss out on an opportunity to explain why someone on the dole should get more disposable income than someone who works 30 hours a week

I agree with your point. A full-time worker should not have less money than an individual in the dole queue. Any society that rewards laziness is not desirable.

However, it has been argued that having minimum wage set in excess of the market price discourages employers from hiring. Hence, stunting productivity. This is particularly apparent in the retail sector. The large proportion of employees affected by this are individuals not eligible to receive unemployment benefits e.g. students etc. Setting the minimum wage in excess of the true market price blocks potential employees from entering the labor force. Thus, large numbers of individuals are unable to enter the labor force despite the fact that there would be a potential wage mutually agreeable to both employer and employee.

It also could be argued that high-minimum wages encourages moonlighting. Millions (billions even? [source needed]) slip through the exchequer's tax net due to moonlighting. I am in favor of a minimum wage because it discourages worker exploitation. However, the amount it is set to needs to be moderated. It is also important that there is an acceptable level of unemployment benefit such that everybody in a society should have access to food and shelter - which I regard as basic human rights.

Hence a problem arises when the minimum amount required to provide the most basic standard of living is more than the minimum wage. Individuals that are prepared to work for this minimum wage would be expected to come from a household that has other income sources (e.g. a student living at home not getting charged rent etc.). Is it fair to not let these employees enter the labour market when the Irish economy could benefit from their productivity?

The principal you have adopted in your argument is quite simplistic. The labor market is a lot more complex than individuals working 30 hours or more a week and where their income is a major factor in determining their household's standard of living. A dynamic labor market is a feature of the Irish economy. Encouraging employment is desirable. So is having a welfare system that provides households with basic human rights. The problem arises where these two overlap.

nesf

boomhower wrote: »

i'm not gonna pretend i'm an expert on the economy, but in my opinion you take from the rich and give to the poor..
otherwise the rich get richer and the poor get poorer

That's a great sentiment in theory but in practice it's not really a very good maxim. Heavily taxing the rich will only have one outcome, them leaving the country. Giving loads of money to the poor, be it in very generous dole payments or whatever will have an equally bad outcome, them sitting at home and not bothering to find employment.

As is, we have a two tier tax system and a large majority of income tax in this country doesn't come from the poor, it comes from the middle classes. The better off do contribute more cash to the coffers in this country etc. You need to balance helping the worst off with allowing people to earn what they earn. If I go to the trouble of training for a profession I should be able to reap the rewards of that effort and not just have the excess I earn over the average taken off me and given to some guy who started drawing the dole straight out of school. Equally, we can't leave the ultra rich live in mansions while the poor starve on the streets. As is, with our free education, healthcare etc I don't think the poor are badly off. Most of the people I know living on the dole have an ok standard of life. Nothing too fancy or anything but then if they wanted more they could try to get work instead of staying in and watching TV each evening.


Increasing dole payments is not the way to help the poor. It just gives them further incentives not to work which is damaging for society as a whole. Tax breaks, a lower tax bracket for low income earners, funded training schemes (Fás etc) are all far better ways of helping them help themselves. Most of the guys I know who've gotten out of the welfare trap did it through Fás and found a vocation through it. The thing is, these schemes are there, it's that there is a certain percentage of the population that just won't avail of them and prefer to stay sponging off the State. There's not much you can do about them, you can't get them off the dole without also hurting other people who genuinely need the support so it's a necessary evil but really you've got to be cynical when it comes to this "taking from the rich to give to the poor", the best thing the State can do for these people is give them options for getting off the dole and back into the workforce, any direct aid will just be abused by too many people.

shnaek

Well said, nesf. No point in my making further comment as I agree completely with you.

boomhower

nesf wrote: »

Increasing dole payments is not the way to help the poor. It just gives them further incentives not to work which is damaging for society as a whole..

i would just like to point out, i never said anything about increasing dole payments. My point was in response to a suggestion to cut them. I just think that when times get tough, we should not be cutting money from the poor in our society. That's all

nesf

boomhower wrote: »

i would just like to point out, i never said anything about increasing dole payments. My point was in response to a suggestion to cut them. I just think that when times get tough, we should not be cutting money from the poor in our society. That's all

That's a different sentiment to "taking from the rich and giving to the poor", which was what I was responding to. I wasn't trying to say that you wanted to raise dole payments, I was just trying to address that maxim, which sounds really good until you look at the consequences of implementing it in a simple fashion.

I agree with you, cutting money for the poor should be a last resort, it shouldn't be a sacred cow though.

Flamed Diving

"taking from the rich and giving to the poor"

A recipe for disaster if I ever saw one. A live experiment is being conducted as we speak in Venezuela. I watch with bated breath.