Exactly who caused this economic hardship?

Nozebleed

Hi...im on the dole..not expecting to get a job anytime soon. I've never worked in the public sector...today i was talking to a few of my mates about the strike..and not one of them had anything good/positive to say about the workers who are on strike..just pure disgust. I really cant understand this.
exactly why are the public sector taking so much flack?
Is the country in the state it's in because of public sector pay?
Or are they taking all the heat because they have secure jobs??..and we all wish we were in their position?
Im confused..who exactly caused the country to fall apart?? because i dont think it was the people working in the public sector. who was it?

Liam Byrne

Fianna Fail
Their do-nothing appointees and buddies
So-called "bankers and developers" who would be more at home in a casino than an office
Greedy fvcks who overcharged everyone and wanted it all based on credit without working for it

crocro

Nozebleed wrote: »

who exactly caused the country to fall apart?

The Irish people caused the economy to crash. For the past decade, they voted for governments who promised to overspend. When they overspent, they rewarded them by re-electing them. At the last election in 2007, there was no party promising prudent spending and "let's live within our means", instead each side promised more hospital beds and prison places and no tax rises.

During the bubble, hundreds of thousands of Irish people borrowed money to pay taxes to speculate on property. The government used that windfall tax revenue to grant huge pay rises to the public sector and to massively increase welfare -dole is now 3 times the UK rate as is the basic old-age pension. The surge of borrowed stamp duty allowed them to cut income tax. When the windfall was over, the government found themselves committed to paying salaries and welfare that it couldn't afford and with very little income tax coming in.

It is not the fault of the public servants, they just went in and out of their jobs and kept getting raises and then one day the government started to reduce their pay. Reducing public sector pay in western countries is almost unheard of - the normal approach is to print extra money. As we don't have our own currency any more we don't have that option.

A responsible government would increase taxes and cut spending in a boom. Then in a recession, it can start spending again and cutting taxes to stimulate the economy. We chose to pour in more and more fuel during the boom by spending more and cutting taxes, then when the recession came, no stimulus would work as we had flooded the engine. But if the government since 2000 had had spent more moderately, would we have re-elected them?

The three main politicians who implemented the low tax/ high spending policies were McCreevy, Ahern and Cowen. Ahern and McCreevy are now gone and really Cowen should throw in the towel at this stage. Collectively, we chose these people and their policies and we must all take the blame - it's not as if this is the first time this has happened in Ireland. No matter whose fault it is, we are the ones who have to pay - it's not like Ahern has 100billion in his back pocket.

Liam Byrne

crocro wrote: »

....it's not like Ahern has 100billion in his back pocket.

Now THAT would have been SOME envelope!!!!

lmimmfn

the greed of this country caused it all to fall apart, hopefully it will be a good thing in the end and everyone will have learnt a lesson.

Scofflaw

I'm going to make an unpopular point here, which relates to the reason civil servants have job security. They have tenure to allow them to stand up to the politicians, knowing that they cannot be fired for opposing government policy. There may have been instances over the last decade that I'm not aware of, but the impression I have is that the civil service went along with government policy quite happily - which calls into question the usefulness of that tenure.

Saying "we can't do anything but carry out government policy" isn't really a defence, because the whole point of civil service tenure is to ensure that's not so.

cordially,
Scofflaw

lmimmfn

Scofflaw wrote: »

I'm going to make an unpopular point here, which relates to the reason civil servants have job security. They have tenure to allow them to stand up to the politicians, knowing that they cannot be fired for opposing government policy. There may have been instances over the last decade that I'm not aware of, but the impression I have is that the civil service went along with government policy quite happily - which calls into question the usefulness of that tenure.

cordially,
Scofflaw

nah, you hit the nail on the head, they and the unions were 110% behind government policy while in favour, yet its completely disagreeable now when the bank is broke? :rolleyes:

gollem_1975

i think Ireland will learn from this current crisis.

I suspect the old adage "rent is dead money" may become "interest is dead money"

but alas like the Irish football team last week Ireland will never have the same opportunity as we had at the start of the 00's ( I suppose in years to come we may look back and say the same about now! )

just like the flooding the country is experiencing at the moment will happen again we will also experience further economic crises in the future

we need to be creating products and services that we can export - else or in addition to we need to rebrand ourselves as a green tourist destination for foreign visitors.

we need to succeed ultimately in order to
1) provide employment to our people - we don't want things to be like the 1980's again
2) provide capital to pay off our considerable borrowings

the Ireland as high wage public sector economy model is not sustainable.

I fear that Ireland should be adapting quicker than we are doing at the moment in response to the crisis ( wages and costs need to be reduced )

easier said than done I suppose

lmimmfn

gollem_1975 wrote: »

the Ireland as high wage public sector economy model is not sustainable.

I fear that Ireland should be adapting quicker than we are doing at the moment in response to the crisis ( wages and costs need to be reduced )

easier said than done I suppose

Agree completely, id put it as the laughing stock of europe at this stage of the drama.

Darragh29

What happened was we had a hugely overheated property market, that was overheated by Fianna Fail incentivising irresponsible and reckless property development...

When we started getting concerned about this, Fianna Fail told us to relax, that we'd get a "soft landing" and all would be grand... The video here show's what we actually ended up getting instead of a "soft landing"...

https://www.youtube.com/watch?v=T0FVXCOwfkk

ei.sdraob

Darragh29 wrote: »

The video here show's what we actually ended up getting instead of a "soft landing"...

did the occupants survive?


anyways the "root" cause is Bush Jnr expanding money supply in order to deal with Dot Com bubble at turn of century and the "terrorist" threat
(worryingly Obama more than doubled $ supply in few months there and all this money is creating all sorts of asset bubbles now around the world in humongous carry trade)

now the above is the international background, and other countries were affected by this money which ended up going into property speculation

here in Ireland, now this was amplified by FF, things like no property taxes, various tax loopholes for developers and speculators, and overall encouragement of a property bubble by FFers (some of whom like Fahy have large portfolios)

the econonmy was build on strong exports in 90s (Celtic Tiger 1.0) but the housing bubble led to huge inflation (property inflation is not measured in official inflation figures) this made it increasingly expensive to do business here and businesses left (Dell) while foreign investment reduced

a positive feedback spiral resulted with wages increasing (eg. public sector demanding benchmarking), and in result everything else increasing, alot of people felt "rich" since on paper they were and borrowed against this from banks to eager to get rid of money under the new relaxed international banking code (Basel 2?)

as all bubbles go the whole pyramid scheme collapsed, with ireland being hit the strongest since we were the "drunkest"

did i miss anything?

so to answer the question, who to blame?:

* people (sheeple?)
* FF and co
* speculators (developers, BTLers, agents, banks etc)
* foreign events

all of the above had a certain degree of responsibility in perpetrating the bubble mostly for selfish reasons

anyways while we are reeling in this depression, theres are huge bubbles developing due to a flood of new money internationally (gold, green tech, property in asia, resources)

Tipp Man

Scofflaw wrote: »

I'm going to make an unpopular point here, which relates to the reason civil servants have job security. They have tenure to allow them to stand up to the politicians, knowing that they cannot be fired for opposing government policy. There may have been instances over the last decade that I'm not aware of, but the impression I have is that the civil service went along with government policy quite happily - which calls into question the usefulness of that tenure.

Saying "we can't do anything but carry out government policy" isn't really a defence, because the whole point of civil service tenure is to ensure that's not so.

cordially,
Scofflaw

How much influence can/do the relevant department officials exert on the relevant ministers??

My brother always says its the civil service running the country not the government!

P. Breathnach

Tipp Man wrote: »

How much influence can/do the relevant department officials exert on the relevant ministers??

My brother always says its the civil service running the country not the government!

It depends very much on the minister involved (less so on the civil servants because, despite what some here would suggest, senior civil servants are generally very able people with the strength of character to challenge a minister).

Some ministers leave just about everything to the civil service. That does not mean that politics has no effect on how we are governed, because the civil servants are canny enough not to give even a compliant minister things to bring to cabinet which they know would not fit coherently into the government's general policy.

At the other extreme, we have ministers who make policy with little or no recourse to department advice. It's generally not a good thing. I'm not saying that a minister should always follow department advice, but department advice should be considered. If the minister does not like the path the department is suggesting, then the officials should be asked to consider the implications of going down path Y rather than path X. In effect, there should be engagement and interaction.

In general, administration should be the preserve of public servants. Politicians meddle, often quite strongly, in the details of administration. Almost invariably, it is not to make things work better: it is for electoral reasons.

Scofflaw

Tipp Man wrote: »

How much influence can/do the relevant department officials exert on the relevant ministers??

My brother always says its the civil service running the country not the government!

That's an interesting question, but being able to influence the Minister isn't something that requires tenure. When was the last time you recall a senior civil servant saying publicly that a government policy was a bad idea?

cordially,
Scofflaw

irish_bob

Nozebleed wrote: »

Hi...im on the dole..not expecting to get a job anytime soon. I've never worked in the public sector...today i was talking to a few of my mates about the strike..and not one of them had anything good/positive to say about the workers who are on strike..just pure disgust. I really cant understand this.
exactly why are the public sector taking so much flack?
Is the country in the state it's in because of public sector pay?
Or are they taking all the heat because they have secure jobs??..and we all wish we were in their position?
Im confused..who exactly caused the country to fall apart?? because i dont think it was the people working in the public sector. who was it?

public servants claiming they shouldnt have to take pay cuts because they didnt cause the mess is about as mature as passengers on the titanic claiming they shouldnt drown because they hit no iceberg , we are all on the ship called ireland and shes going down fast

LoanShark

How about put the blame on everyone?

The people who took money to live the life, that knowingly could'nt ever afford or never thought how am I going to pay this back?

The bankers who gave that money without doing proper background checks and always had "plenty to give" and just "a wee bit more for yourself".

The Government for not keeping a closer eye on things and not have a "What If ?" Plan.

The builders for doing their damdest to squeeze every inch out of a building and then charge over the top prices for it.

And I don't blame the public sector for any of this BUT, When a country has to borrow a shedload of money just to pay wages,Then Questions have to be asked and responsibilities need to be faced.

I will say this though...

We do need a Cull in the public sector NOT in the front line, But the Pen pushers.

We need to get a grip on Capital spending.

We need to take views of prominent business people to help put ideas for recovery a new economy and have new formats of prosperity.

And speaking as a person who is on the Jobseekers Allowance, A closer look needs to be taken at those who cheat the system and they need to face heafty penalities.

Don't cut the allowances because as attractive as getting "paid" weekly sounds, €204.30 does'nt go that far..

Liam Byrne

LoanShark wrote: »

How about put the blame on everyone?

The people who took money to live the life, that knowingly could'nt ever afford or never thought how am I going to pay this back?

That doesn't include everyone. Don't tar us all with the same brush.

P. Breathnach

irish_bob wrote: »

public servants claiming they shouldnt have to take pay cuts because they didnt cause the mess is about as mature as passengers on the titanic claiming they shouldnt drown because they hit no iceberg , we are all on the ship called ireland and shes going down fast

Does every thread have to be dragged around to your particular obsession?

irish_bob

P. Breathnach wrote: »

Does every thread have to be dragged around to your particular obsession?

have you made me famous yet

Riskymove

irish_bob wrote: »

have you made me famous yet

"Obsession" by Irish Bob

the new fragrance out in time for Christmas, watch out for the TV ads!!

P. Breathnach

Riskymove wrote: »

"Obsession" by Irish Bob

the new fragrance out in time for Christmas, watch out for the TV ads!!

It gets right up your nose.

Count Dooku

Liam Byrne wrote: »

Fianna Fail
Their do-nothing appointees and buddies
So-called "bankers and developers" who would be more at home in a casino than an office
Greedy fvcks who overcharged everyone and wanted it all based on credit without working for it

I wouldn’t blame only FF
All politicians are responsible for current mess.
Dail for long time become arena for competitions in populism. Every party wants to make promises, but doesn’t want to think how to implement them.
Only full replacement of political establishment can save country

Martin 2

I'm going with the obvious here.

Ultimately, it's the government's job to manage the economy, that's part of why we elect them. They should understand how the economy works and take harsh unpopular measures when necessary to dampen inflation and maintain competitiveness instead of exacerbating them through unsustainable pay rises and giveaway budgets.
The people can accept a certain amount of responsibility for re-electing them but when there are repeated surpluses and low unemployment, the average Joe thinks things are okay, doesn't see (isn't told about) the underlying problems and won't risk change; that's what happened in the 2007 elections.

Of course the government tries to blame low ECB rates, banks and naive developers for the property bubble but other Eurozone countries have banks, naive developers and identical interest rates and managed to control their economies to a much greater extent.

At least we'll know what to do at the next general election... right?