WSJ - The Truth About The Irish Economy : a No Vote will not harm

Toiletroll

The Author is Derek Scott, an economic adviser to former UK PM Tony Blair

The Mad Hatter told Alice that "words mean what you want them to mean." He would have been at home in the European Union, where "no" means "yes" and political propaganda is passed off as information. If Ireland votes No to the Lisbon Treaty, the EU will continue and Ireland will be part of it, but if they vote Yes the Irish will find they have even less leverage in Europe than today.

http://online.wsj.com/article/SB10001424052970204488304574435471966748620.html?mod=googlenews_wsj

Hmmmm ... that Article doesn't seem to correlate with those Yes For Jobs, Yes for the Economy posters

Scofflaw

Toiletroll, the whole question of the WSJ was discussed to death last time you copied a post from Politics.ie on a WSJ article. Unless matters have changed in the meantime, it remains exactly as it was then - the WSJ is backing a No, and specifically backing Ganley.

Further, if you don't have an opinion on the piece, then this is once again just low-grade campaigning copypasta.

regards,
Scofflaw

The_Minister

The Wall Street Journal is always rabidly anti-EU, and is owned by Rupert Murdoch, who strongly supports a No vote.

hatrickpatrick

^ But the question is - regardless of their political positions - is the article true or not?

sceptre

hatrickpatrick wrote: »

^ But the question is - regardless of their political positions - is the article true or not?

Second last paragraph is very questionable. Unfortunately it's the pivot paragraph on which everything else rests.

I'm not saying his headline is hogwash but for the Wall Street Journal, ostensibly reputable journal and all that, it's a very dicey paragraph, I wouldn't bet my house on it, let's put it that way. I can do a bit of an expansion on this tomorrow but it's half midnight and I have to sleep sometime.

In short though, he's questioning that people weren't given a choice on whether to join the euro (and on this he's demonstrably wrong as we accepted it when we voted on Masastricht, which presumably he isn't aware of), highlighting the fiscal restrictions of not issuing our own currency (which is true and apparent to a first year econ student, though arguably a good thing in our case), closing with saying that it's at odds with what built the celtic tiger (which is just something he threw in to knock up his word count but he's building houses on it (ironic that, considering out post 2002 economy)) and ignoring that one of the main factors keeping us fiscally in the black from 2002 to 2008 was our membership of the euro and the common currency area, as well as it also being one of the main factors keeping the IMF out of the country at the moment.

It's not a well-written article. Admittedly I do some part-time journalism but I'd have hoped to be able to write something better for a student publication than he did for the WSJ. No, wouldn't buy the paper based on that one, they have better journalists (who obviously also follow the Rupert Murdoch line as you'll have seen from other recent WSJ articles but at least they're better at it).

Actually that's everything I'd have said tomorrow minus the figures. I probably won't bother with the figures, after all, Derek Scott didn't have any when he wrote the article ignoring what I've slotted in above. The only figure I'll slot in is with regard to his earlier statement about Ireland devaluing "massively for such an open economy" in 1993. it was 10%, precisely what the French devalued by about a year or so before. Massive devaluation is what they do in Mexico. That's usually more than 10% when they do it with the peso.

Oh and as an aside with regard to the opener in the article, the Mad Hatter never told Alice "words mean what you want them to mean". Actually he was pretty picky and told her to say what she meant and to mean what she said, which Derek Scott appears to have avoided. The guy who decided that words meant precisely what he wanted them to was Humpty Dumpty. Also to Alice but different book. And we all know what happened to him. For the price of a stamp, you can let Derek Scott know.

Toiletroll

Scofflaw wrote: »

Toiletroll, the whole question of the WSJ was discussed to death last time you copied a post from Politics.ie on a WSJ article. Unless matters have changed in the meantime, it remains exactly as it was then - the WSJ is backing a No, and specifically backing Ganley.

Further, if you don't have an opinion on the piece, then this is once again just low-grade campaigning copypasta.

regards,
Scofflaw

Well the writer was advisor to previous UK Prime minister Tony Blair, who also is in the running for the unelected EU presidency...

roosh

sceptre wrote: »

Second last paragraph is very questionable. Unfortunately it's the pivot paragraph on which everything else rests.

I'm not saying his headline is hogwash but for the Wall Street Journal, ostensibly reputable journal and all that, it's a very dicey paragraph, I wouldn't bet my house on it, let's put it that way. I can do a bit of an expansion on this tomorrow but it's half midnight and I have to sleep sometime.

Would you be willing to bet your house on Lisbon being the cause of economic resurgance?

Toiletroll

mangaroosh wrote: »

Would you be willing to bet your house on Lisbon being the cause of economic resurgance?

Indeed the people are in denial about Lisbon. Its looking like people overall are actually waking up to the propaganda of the yes campaigns and gaining the courage and wisdom to vote no. It has been overdone.

I mean look at the Ireland for Europe or whatever flying thousands of people over from Brussels to canvas for a yes vote. Who pays for this? YES YOU AN EU TAXPAYER! Lol... Then you get oLeary prancing around on a private jet with the EU minister for transport, talk about conflict of interests LOL.

Centralization of power for corporate interests after Lisbon. They simply want more of your money in order to manipulate you even more!

Duck Soup

I'd just make two observations. The first is that the Wall Street Journal - not surprisingly - was a cheerleader for deregulation of the markets. Their sagacity on that point is dubious.

The second is that the author, as an advisor to Tony Blair, presumably would have been one of those - along with the likes of Peter Mandelson - who pursued the 'banking is the engine of the economy' strategy. The thinking was that the UK banking sector could be a world-leading lender and thereby provide tax revenues for the government, skimmed off profits, that would be invaluable to financing public spending.

Because of Blair and Brown's banking fetish, the dull stuff like a growing manufacturing base were ignored. Result? The financial system collapse hit Britain much harder than countries with healthy manufacuring sectors, like Germany. Britain will be amongst the very last countries to emerge from recession.

So I'd advise people simply to take the WSJ and Derk Scott with a sizable pinch of salt. Their prognosticating credentials ain't great.

sceptre

mangaroosh wrote: »

Would you be willing to bet your house on Lisbon being the cause of economic resurgance?

Well, as irrelevant questions go...

If I answered that I wouldn't be sitting on the fence now would I. but that's got nothing to do with Derek Scott's poor research, which I've expanded on in an edit above.

I'm not sure which game you'd like to start playing here but I'm strictly an information provider. I'm not up for answering irrelevant questions merely because I'm illustrating how a WSJ writer couldn't be bothered to look stuff up and based his conclusion on it. In other words, don't be chasing after me with silly questions that aren't anything to do with the topic as I'm not a silly kind of guy unless the girl is wearing a feather boa.

Toiletroll

Duck Soup wrote: »

I'd just make two observations. The first is that the Wall Street Journal - not surprisingly - was a cheerleader for deregulation of the markets. Their sagacity on that point is dubious.

The second is that the author, as an advisor to Tony Blair, presumably would have been one of those - along with the likes of Peter Mandelson - who pursued the 'banking is the engine of the economy' strategy. The thinking was that the UK banking sector could be a world-leading lender and thereby provide tax revenues for the government, skimmed off profits, that would be invaluable to financing public spending.

Because of Blair and Brown's banking fetish, the dull stuff like a growing manufacturing base were ignored. Result? The financial system collapse hit Britain much harder than countries with healthy manufacuring sectors, like Germany. Britain will be amongst the very last countries to emerge from recession.

So I'd advise people simply to take the WSJ and Derk Scott with a sizable pinch of salt. Their prognosticating credentials ain't great.

Yes and dont forget that Lisbon was created during the boom getting boomier years and was not created with economic crisis in mind. The Lisbon treaty is out-dated garbage that needs to be completely remade with the specific goal of getting ALL EU countries OUT of recession and into positive growth, cutting down dependence on external nations to the EU. We have the resources WITHIN the EU to pull every EU member state OUT of recession and into a true world power situation without the Lisbon BS.

Vote NO to Lisbon, MAKE them go back to the drawing board and come up with a new treaty designed for this time and economic situation. Only then could I ever consider voting yes.

The Lisbon treaty was drafted years ago, in a different economic age. VOTE NO.

Lisbon was created with the same ideas in mind that are at the core of this current mess we find ourselves in. DON'T be fooled.

nesf

Toiletroll wrote: »

Yes and dont forget that Lisbon was created during the boom getting boomier years and was not created with economic crisis in mind. The Lisbon treaty is out-dated garbage that needs to be completely remade with the specific goal of getting ALL EU countries OUT of recession and into positive growth, cutting down dependence on external nations to the EU. We have the resources WITHIN the EU to pull every EU member state OUT of recession and into a true world power situation without the Lisbon BS.

Vote NO to Lisbon, MAKE them go back to the drawing board and come up with a new treaty designed for this time and economic situation. Only then could I ever consider voting yes.

The Lisbon treaty was drafted years ago, in a different economic age. VOTE NO.

Lisbon was created with the same ideas in mind that are at the core of this current mess we find ourselves in. DON'T be fooled.

Seriously, don't campaign in your posts and don't end them with slogans.

nesf

Toiletroll wrote: »

Well the writer was advisor to previous UK Prime minister Tony Blair, who also is in the running for the unelected EU presidency...

So? It's a depressingly poorly researched piece for that newspaper.

BlitzKrieg

and its presidency of the european council not the EU.

marco_polo

nesf wrote: »

So? It's a depressingly poorly researched piece for that newspaper.

Well in fairness with the European Edition having about a sixth of the paying circulation of the Indo they probably don't have much cash for that sort of thing.

Plotician

The 'Lisbon is good for the economy' slogan has me genuinely confused.

Apart from the fact that FDI has increased since the last referendum, i have a nagging suspicion that what really happens is this:

1. A country creates favourable conditions and corporates are attracted to invest.

2. A country creates unfavourable conditions are corporates look at other options.

If we vote the treaty in does our ability to create favourable conditions become irrelevant? If we create unfavourable conditions will they stay because we voted yes.

What's happened to supply and demand, competitive trading, etc etc. Doesn't smart business practice come into the equation? Is the EU going to steer companies towards Ireland against their instinct? Is the EU going to pump money into Ireland to improve research facilities here. What is the EU ACTUALLY going to do to support the 'Lisbon is good for the economy' claim.

I can't see how ratifying the Lisbon treaty will encourage businesses to invest in Ireland particularly, especially when the EU wants to ultimately create a european level playing field.

What am i missing here?

K-9

Plotician wrote: »

Apart from the fact that FDI has increased since the last referendum, i have a nagging suspicion that what really happens is this:

FDI doesn't suddenly appear.

The vote took place in June 08. FDI is down since.

Both points have nothing to with Lisbon.

Scofflaw

Plotician wrote: »

The 'Lisbon is good for the economy' slogan has me genuinely confused.

Apart from the fact that FDI has increased since the last referendum, i have a nagging suspicion that what really happens is this:

1. A country creates favourable conditions and corporates are attracted to invest.

2. A country creates unfavourable conditions are corporates look at other options.

If we vote the treaty in does our ability to create favourable conditions become irrelevant? If we create unfavourable conditions will they stay because we voted yes.

What's happened to supply and demand, competitive trading, etc etc. Doesn't smart business practice come into the equation? Is the EU going to steer companies towards Ireland against their instinct? Is the EU going to pump money into Ireland to improve research facilities here. What is the EU ACTUALLY going to do to support the 'Lisbon is good for the economy' claim.

I can't see how ratifying the Lisbon treaty will encourage businesses to invest in Ireland particularly, especially when the EU wants to ultimately create a european level playing field.

What am i missing here?

In a nutshell, the question of whether Ireland will retain a good working relationship with Europe. A bad working relationship makes things difficult both for Ireland, and for businesses based here.

cordially,
Scofflaw

Plotician

K9. Not sure what your reply means - my confusion surrounds the 'Lisbon is good for the economy' message.

That presumably is relevant?

Plotician

Ok maybe i'm being too simple in my thinking, but if i'm selling 'bolts' cheap and offer a good service, why would a privately owned business say i'm not buying from you - you voted 'no'?

Plotician

extrapolating this a bit, if i'm selling bolts expensively what will Brussels do to ensure business is directed my way.

Or will the EU act in some protectionist manner such that fully signed up european members are better placed to sell inwards. In that case if we were competing with let's say china for example for some business in France would we be naturally excluded?

Would brussels have the power to control some of the trading practices of privately owned companies?

To my mind if we're competitive then by default markets will exist.

K-9

Plotician wrote: »

K9. Not sure what your reply means - my confusion surrounds the 'Lisbon is good for the economy' message.

That presumably is relevant?

Ach, I was just saying bringing FDI into it means little.

It comes down to Goodwill.

In Accounting terms it is an Intangible Asset, extremely hard to quantify.

I'm sure you have encountered the difference between having Goodwill and not, in your own life. It does make a difference.

Is that a threat, No, but to dismiss it as unimportant doesn't help.

Plotician

I totally agree about the goodwill aspect - it's just that i think Irish businessmen (and the Irish in general) are able to forge good relationships with others regardless of the political arena.

(We're pretty good at blagging it when we need to.)

Plotician

Maybe the 'between the lines' thing is that the EU would try to create barriers for us? I honestly don't know - just looking at it from a free market perspective.

K-9

Plotician wrote: »

I totally agree about the goodwill aspect - it's just that i think Irish businessmen (and the Irish in general) are able to forge good relationships with others regardless of the political arena.

(We're pretty good at blagging it when we need to.)

We are, and we've used the EU to good effect.

We do have goodwill, especially because we have Referenda! LOL

I don't think people are going to sway each other over this.

Goodwill is a belief, as is sovereignty!

Edit: Sovereignty is important! To avoid that straw man.

Personally, I believe Goodwill is important.

nesf

Plotician wrote: »

Ok maybe i'm being too simple in my thinking, but if i'm selling 'bolts' cheap and offer a good service, why would a privately owned business say i'm not buying from you - you voted 'no'?

It's a lot more complicated than that. Think of it this way, a company thinking about a FDI investment is making a bet on a country's stability and political relations over the following decade or so. Any little niggling doubts could end up with a country going from top to second or third on the list of options and there's no prize for second place in the FDI world.

Right now with our vastly overinflated wage level we need every single advantage we can get to secure future FDI investment.

Martin 2

Plotician wrote: »

The 'Lisbon is good for the economy' slogan has me genuinely confused.

Apart from the fact that FDI has increased since the last referendum...

Any increase in FDI cannot be attributed to the last years No because
-It takes up to five years for an FDI job to be created so no extra jobs can be attributed to last year’s No as of yet.
-The effects of last year’s no are mitigated by the fact that we are having a second referendum and the hope/expectation is that we’ll vote yes
-We don’t know if any investments have been postponed or pulled as a result of the no.

Plotician wrote: »

....
1. A country creates favourable conditions and corporates are attracted to invest.

2. A country creates unfavourable conditions are corporates look at other options.

If we vote the treaty in does our ability to create favourable conditions become irrelevant? If we create unfavourable conditions will they stay because we voted yes.

What's happened to supply and demand, competitive trading, etc etc. Doesn't smart business practice come into the equation? Is the EU going to steer companies towards Ireland against their instinct? Is the EU going to pump money into Ireland to improve research facilities here. What is the EU ACTUALLY going to do to support the 'Lisbon is good for the economy' claim.

I can't see how ratifying the Lisbon treaty will encourage businesses to invest in Ireland particularly, especially when the EU wants to ultimately create a european level playing field.

What am i missing here?

Of course we can create favourable conditions for MNC’s with or without Lisbon, but you’re missing the point which is that passing Lisbon is another favourable condition. Intel and others have said that a No "will affect how Ireland continues to be perceived internationally" and that Ireland would be "cutting itself adrift from Europe". These negative perceptions affect Ireland’s ability to attract new and further investment. As Nesf already mentioned, with Ireland being a relatively high cost location we need all the advantages that we can get and passing Lisbon is one.

If ratifying Lisbon was not in the interests of Irish based MNC’s why are they supporting Lisbon, and in case you mention EU fines, they are not all facing fines?

.

ei.sdraob

@toiletroll

what do you have to say about

90.8% of independent economists (not Murdochs journalists) feel that a YES is good for economy and FDI


/

Plotician

I still think fairly simply on this one. My understanding is that the role of a political structure with regards to business is to create 'frameworks' that enable businesses to develop and flourish (e.g the corporation tax level, start up grants, investment into R&D etc).

I suspect if Ireland wasn't already in the proverbial (ie: with the risk to the cost of borrowing etc) that Lisbon and economy wouldn't even be in the same breath.

So it looks like part of the argument is about 'fixing' a relatively short term problem created by by our own ineptitude, in exchange for a political decision that amends our constitution permanently.

How stupid are we.

Scofflaw

K-9 wrote: »

Ach, I was just saying bringing FDI into it means little.

It comes down to Goodwill.

In Accounting terms it is an Intangible Asset, extremely hard to quantify.

I'm sure you have encountered the difference between having Goodwill and not, in your own life. It does make a difference.

Is that a threat, No, but to dismiss it as unimportant doesn't help.

I remember signing a contract with Adobe for the use of certain materials, that, amongst other things, stipulated that "you agree that any goodwill accruing as a result of the use of the product belongs to Adobe, and is recoverable by them". For a while, we had a 'goodwill bucket' by the door, and urged anyone who felt any goodwill as a result of the use of the Adobe products to put it in the bucket in case Adobe came to recover it.

An intangible asset, certainly, but one considered important enough for a MNC to put it in a contract.

cordially,
Scofflaw

Plotician

To some extent that's my point, that goodwill is created at the business-to-business and person-to-person level, and that where there's mutual benefit it overrides any surrounding political context.

Really we should be looking at our own cost base with a view to making us more competitive. Cut the public wage by up to 20% (from the top down in true leadership style), implement public expenditure recommendations, and to some extent let property prices find their own true level.

If we reduce our production and supply costs then we're more attractive regardless. Basically go through the pain to enable us to compete better on a global basis.

I also understand that our infrastructure investment over the last years has set us up to benefit once the economy picks up, so we should be reasonably well placed anyway?

Complex area, wonder if we'll be watching for EU goodwill and it's benefits once this week is out of the way.