Are we austere enough?

rumour

SBP yesterday, apparently the austerity programme announced by the government is nowhere near austere enough, according to the bond desk of leading French bank Société Générale.

Economic austerity on wikipedia describes a policy whilst the oxford dictionary definition is as follows:

(of living conditions or a way of life) having no comforts or luxuries]

Combining the economic policy and definition I fail to see how any of what is being proposed in the four year plan or by the opposition can be described as austere. I'll list a few examples below:

• We still intend to maintain deficits even with the four year plan. Borrowing to live beyond your means is hardly austere.Especially when in 2003 we could operate a fully functional optimistic state on 30bn a year. (details all here) In 7 years the population has not grown by 73%, but the nations spending has. It’s hardly austere to get that back on track. That's only 7 years ago. This can be fixed.

• The policies from those in charge do not affect on a personal level those in charge. Therefore they are not really austere. Cutting social welfare (admittedly it is a big bill and should not be more attractive than work) is easy and those that advocate it are not living from it. So this move is not austere. Austere would be a cut in PS salaries and numbers back to a point below what they were in 2003 which is the last time we could pay for ourselves. That in my mind would be the state imposing some austerity on itself.

• Increasing Tax's may seem marketable as austere but is in my mind an expansion of the state. It’s a grab for more money to what end? To assist the policy of austerity. Hardly as by any definition I can find no real austerity has been imposed. This is infact the opposite of austerity. Additionally it puts at risk the state’s ability to generate the 30bn a year it so vitally needs.
This is generally where the markets seem to be heading, the SBP article while unpalatable is a candid rational analysis that if you were conducting your affairs on a personal level, would have no problem in comprehending and let alone putting into action.

Contrast that with the consistent demands from our politicians to those lending us money (markets, ECB, IMF.....anybody), that it's just too difficult you will have to give me more money. Fianna Fail, Labour, Fine Gael and Sinn Fein, all of them are delivering this message while at the same time saying what is being done is austere. This is simply not credible, it is now being translated into interest rates and terms and conditions from our lenders.

Our predicament will never get better until the institutions of the state address living within the means available to them. The way I see it increasing tax's is a social question for another day, the question we must answer of ourselves is if we are prepared to live within our means and not by some waffle but by demonstrating it. The effect of the four year plan combined with its imposition by external bodies means that in four years we may be able to stand on our own two feet but crucially as a nation we will still not have demonstrated that we are capable of imposing the discipline ourselves. Conceivably it will take much longer than that to secure loans for this country without the lender knowing the EU or IMF will underwrite the loan.

A consequence I believe we will never be afforded the opportunity to make the banks pay or take a loss until we can demonstrate we can function without them. Daily for the last three years and again in today’s IT, we scold the banks while remaining addicted to borrowing from them. Our 4yr plan does nothing more than demonstrate our inability to confront reality and that is from Fianna Fail, all the others say are telling us it doesn't have to be as bad.

Notwithstanding this the private sector is performing and achieving targets for the state. It has gone through a massive restructuring in the last three years. In a fragile world economy where the private sector is securing vital income for Ireland it seems a policy of madness alone to adopt a 'grab' policy of increased taxes.

200,000+ people have been made redundant in the private sector they have had pay cuts and are becoming more competitive as is evidenced by our export figures. Now the public sector argument that they too have had pay cuts for me just doesn’t stand up. The public sector wages bill has remained somewhat consistent for the last three years despite all sorts of rhetoric however income tax receipts have fallen. details all here Logically to me that suggests the private sector have taken wage reductions as otherwise the public sector wage bill would have fallen but it has not. A 20,000 reduction in the numbers due to natural loss and even a 30% cut in politician’s wages are not austere. They still have the untouched expenses of around 3-4K per month which is the equivalent of a 60-70k salary on top of the salary, never mind the pension. Austerity is much more than that when the average private sector employee wage is 37K. Here's a graph for some clarity:


Looking at all this and approaching an election who realistically is proposing a way out of our predicament?
I expect many here will agree with this however I am fairly despondent to realise that Sinn Fein are growing in support along with Labour. If we do not act responsibly in this election it will really be ten years or more before we get out of this mess.
And I haven’t even discussed the banking bill.

Japer

Excellent post. What I cannot really understand is why the IMF / EU come in here, and allow our government to borrow our childrens wealth to spend largely on public expenditure and social welfare, when our public expenditure and social welfare is already higher than any of the G8 countries which are lending us the money? Why should taxpayers abroad give people here in this country considerably more money than the equivalent people in their own countries get ?

RobbieTheRobber

OP I assume you realise your graph uses obsolete data and as such is as useful as showing us a picture of snow white and the seven dwarves

Japer

RobbieTheRobber wrote: »

OP I assume you realise your graph uses obsolete data and as such is as useful as showing us a picture of snow white and the seven dwarves

It goes from 1998 to 2008. Its a lot more useful than " picture of snow white and the seven dwarves " it shows what happened in those years. Yes I know the public sector have taken a relatively small cut in wages since then , but most people in the private sector have also taken cuts, and hundreds of thousands have seen their income cut, their self-employment or business fail, lost their jobs, their pensions decimated etc.

RobbieTheRobber

Japer wrote: »

It goes from 1998 to 2008. Its a lot more useful than " picture of snow white and the seven dwarves " it shows what happened in those years. Yes I know the public sector have taken a relatively small cut in wages since then , but most people in the private sector have also taken cuts, and hundreds of thousands have seen their income cut, their self-employment or business fail, lost their jobs, their pensions decimated etc.

Ok japer, so in the above graph can you show me the line which shows unemployed peoples earnings, becasue they are neither private nor public sector.

Sleepy

I don't think we are tbh.

I've yet to hear a solid suggestion to consolidate Local Authorities into Regional Authorities, Merge or Close Quangos etc. coming from anywhere other than boards.ie

Sure, proper reform of the Public Sector will result in thousands of redundancies, most of which will happen to people who have done nothing to deserve losing their jobs but it has to be done imho. Sure, most of these people will end up on the dole and local demand for products and services will drop but we're better off paying someone dole than paying them four or five times that amount to do an unnecessary job.

Those former PS workers joining the hundreds of thousands already on the dole lines will often have better prospects than their former private-sector equivalents thanks to their former employers generosity with respects to paying for courses and qualifications, exam leave etc. as well as the nature of many of their positions having been in I.T., Finance etc. where activity in the real economy hasn't been hurt too badly.

Here, they'd face the same options as the rest of the current live register: re-train, emmigrate, become an entrepeneur or wallow on less and less welfare until we're somewhat in line with our EU neighbours.

With current expenditure under control, the government of the day should then be in a position to spend more on capital projects which could help attract investment or otherwise drive job creation in the real economy.

Sleepy

RobbieTheRobber wrote: »

Ok japer, so in the above graph can you show me the line which shows unemployed peoples earnings, becasue they are neither private nor public sector.

It's safe to say that an inclusion of the unemployed and an update of the graph would show an even wider gap since most of the unemployed have come from the private sector.

rumour

RobbieTheRobber wrote: »

OP I assume you realise your graph uses obsolete data and as such is as useful as showing us a picture of snow white and the seven dwarves

How is it obsolete???
Have the figures in the CSO been altered which were used to compile the graph?

There were two points in posting that particular graph.

1. The 2003 Public Sector average wage is what the 2009 average Private sector wage is. So that level of adjustment is not austere by any standard unless the cavaet is that the public sector must be treated as more priviliged.
2. TD's unvouched expenses are by in large equal to the average private sector persons income. The TD's salary are on top of this. if you look at either definition of austerity none of the political parties are proposing anything near that for themselves.

So I fail to comphrehend your dismissive tone.

RobbieTheRobber

rumour wrote: »

How is it obsolete???
Have the figures in the CSO been altered which were used to compile the graph?

Yes they have changed! what with them being 2008 figures and this being 2010

There were two points in posting that particular graph.

1. The 2003 PS average wage is what the 2009 average Private sector wage is. So that level of adjustment is not austere by any standard unless the cavaet is that the public sector must be treated as more priviliged.
2. TD's unvouched expenses are by in large equal to the average private sector persons income. The TD's salary are on top of this. if you look at either definition of austerity none of the political parties are proposing anything near that for themselves.

So I fail to comphrehend your dismissive tone

What has 2003 and 2009 got to do with facts provided in 2008

RobbieTheRobber

Sleepy wrote: »

It's safe to say that an inclusion of the unemployed and an update of the graph would show an even wider gap since most of the unemployed have come from the private sector.

Come from indeed, perhaps.

Part of most definetly not!

So I fail to see why a group of people who are not working are continously being bunched with a seperate group of people who are differntiated by what sector they work for.

danbohan

RobbieTheRobber wrote: »

Come from indeed, perhaps.

Part of most definetly not!

So I fail to see why a group of people who are not working are continously being bunched with a seperate group of people who are differntiated by what sector they work for.

what perhaps about it ? how many public sector workers are unemployed or are you even in denial about that too ?
hopefully if we ask same question in 2012 we shall get an answer like 70,000 then at least the country might be starting to rebuild

rumour

@ Sleepy

I couldn't agree more. I acknowledge that most of the people in the economy forum will see the logic but for me its all about seeing a route out of our problems.

Personally i think we need to decouple the state from the banks (i.e. make the government run independent of borrowing) prove we can do this for a certain period and then we become a place for inward investment with growth opportunity. This is already somewhere over four years away.

With the IMF and EU here any investment will have to be somewhat underwritten by them which ensures we will only really be the third party any the deal. The quicker we can extract ourselves from this scenario the better.

I also think we are somewhat in a race against time which no one here wants to talk about. The SBP post article really is the position of the whole of Europe with France and Germany driving it. Both countries face a massive challange over the next decade, their pension problems will only get bigger. Their economies are now booming and their banks are filling up again. Where to lend to now to secure a return for their shareholders?
If they don't invest it somewhere they will loose share value. Merkel wants to make sure bondholders carry a risk, why buy these bonds when there are less risky environments to buy them. Such is the dependency on taxation in both france and germany that any fundamental change to their income sources (eg corporation tax) and they too will become risky countries.
How does France and Germany reconcile competing on the tax front and deliverying enormous services to its citizens. I don't know when this will come to a head but its on its way. The sooner we can get rid of our borrowing dependency the better but it would be suicidal for our small economy to think taxation is the panacea.

RobbieTheRobber

danbohan wrote: »

what perhaps about it ? how many public sector workers are unemployed or are you even in denial about that too ?
hopefully if we ask same question in 2012 we shall get an answer like 70,000 then at least the country might be starting to rebuild

Ok becasue everyone seems incapable of understanding this concept im going to state it nice and simples ok.


current number of private sector workers unemployed = 0
current number of public sector workers unemployed = 0

you see the reason both numbers are zero is to be in either sector one must be in employment. The status of being unemployed if to be in any sector would most likley be the public sector as the government is paying you. :rolleyes:

rumour

RobbieTheRobber wrote: »

Yes they have changed! what with them being 2008 figures and this being 2010.

No the figures have not used in the graph have not changed.

There are figures to add for 2009 & 2010 which are available in the links I posted in the OP if you care to have a look. Secondly please explain having checked the links how the public sector wage bill for 2009 remained more or less the same as 2008 with only a marginal change in 2010. How is this? It is certainly not austerity by any means.

RobbieTheRobber wrote: »

What has 2003 and 2009 got to do with facts provided in 2008

Again you would have to check the links I provided in my OP to understand this. The graph is only an illustrative graphic in terms of wages. When you have had time to check some facts what do you think happens to the graph for 2009 & 2010?

The essential point is we earn 30bn as a state this year and are spending 52bn. In 2003 we earned 31bn and spent approx 30bn. Reducing spending to 2003 levels is not austere, a reduction below that would be austere.

By extension if public sector pay were reduced to below 2003 levels we could claim to have an austerity programme.

rumour

RobbieTheRobber wrote: »

Ok becasue everyone seems incapable of understanding this concept im going to state it nice and simples ok.


current number of private sector workers unemployed = 0
current number of public sector workers unemployed = 0

you see the reason both numbers are zero is to be in either sector one must be in employment. The status of being unemployed if to be in any sector would most likley be the public sector as the government is paying you. :rolleyes:

While this is enlightening whats the relevance to austerity?

Certainly it would be useful to have a graph of expenditure related to the unemployed. This is not as easy as it sounds to find as the live register does not constitute unemployed in all circumstances. So you must examine the fall in income tax and the expenditure on wages in the public sector to decipher some real figures. I don't know why it is like this, I'd say deliberately confusing and it does seem incredibly convenient for political massaging.

On an aside I think the state does have a duty to provide social welfare for the unemployed more than it does to provide high PS salaries. However if that welfare becomes more attractive than being employed it ceases to be welfare and becomes source of income for doing nothing. I do not agree with that.

RobbieTheRobber

rumour wrote: »

While this is enlightening whats the relevance to austerity?

Ok Rumour, heres some clues as to what my comment might be regarding!

But you should ask yourself questiosn to get the clue.
IS there a post i quoted in that comment?
IS the comment quoted perhaps relevant to my answer?

fliball123

RobbieTheRobber wrote: »

Ok becasue everyone seems incapable of understanding this concept im going to state it nice and simples ok.


current number of private sector workers unemployed = 0
current number of public sector workers unemployed = 0

you see the reason both numbers are zero is to be in either sector one must be in employment. The status of being unemployed if to be in any sector would most likley be the public sector as the government is paying you. :rolleyes:

Robbie stop clowning around the poster means people who have been made unemployed what sector did they come from

ardmacha

Usual ill argued PS bashing, like the proposal to reduce the renumeration of people who work to 2003 levels without reducing the renumeration of people who do not work to 2003 levels. Then followed by the usual ignoring of the pension levy to get a false total of the savings already achieved. This has been pointed out numerous times here on this forum, but the usual suspects pop up with misleading statistics again and again and again. Ad nauseam in every sense of the word.

GNP is at 2005 levels, PS pay has been cut to 2005 levels except at a lowest ranks. The €30m you propose is one quarter of GNP a level at which is it is impossible for a modern European state to operate.

If you want the State to withdraw from subsidised third level education, hospitals etc and let people pay for these things themselves then make that case. If you want to eliminate comprehensive unemployment benefit etc, then propose this. But do not pretend that these can be available without the State making up more than 25% of the economy.

The reason the State cannot pay for itself as it did in 2005 is because
a) then it was taxing property transactions instead of the normal things normal countries tax
b) there are now a larger number of people drawing social welfare.

a) needs to be addressed immediately by the introduction of normal taxation system where most people pay some income tax, where people pay annual property taxes and where the rich cannot eliminate all of their taxation by using allowances and shelters.

RobbieTheRobber

fliball123 wrote: »

Robbie stop clowning around the poster means people who have been made unemployed what sector did they come from

That is not what the poster means or says so I dont see how I am either wrong or clowning around!

fliball123

ardmacha wrote: »

Usual ill argued PS bashing, like the proposal to reduce the renumeration of people who work to 2003 levels without reducing the renumeration of people who do not work to 2003 levels. Then followed by the usual ignoring of the pension levy to get a false total of the savings already achieved. This has been pointed out numerous times here on this forum, but the usual suspects pop up with misleading statistics again and again and again. Ad nauseam in every sense of the word.

GNP is at 2005 levels, PS pay has been cut to 2005 levels except at a lowest ranks. The €30m you propose is one quarter of GNP a level at which is it is impossible for a modern European state to operate.

If you want the State to withdraw from subsidised third level education, hospitals etc and let people pay for these things themselves then make that case. If you want to eliminate comprehensive unemployment benefit etc, then propose this. But do not pretend that these can be available without the State making up more than 25% of the economy.

The reason the State cannot pay for itself as it did in 2005 is because
a) then it was taxing property transactions instead of the normal things normal countries tax
b) there are now a larger number of people drawing social welfare.

a) needs to be addressed immediately by the introduction of normal taxation system where most people pay some income tax, where people pay annual property taxes and where the rich cannot eliminate all of their taxation by using allowances and shelters.

And yet the p.s is still overpaid by other eu country standards and by comparisons with the private sector. Listen I was a big p.s basher and I believe they are overpaid. So instead of bashing I intend to let my vote do the talking Fine Gael seem to be the only party who will are talking sense..

Abolish the seanad
cutting TD numbers
and cutting P.S wage back a bit
and culling 150 quangos this according to one of the politicians (cant remmber his name) on primetime during the week

Scofflaw

RobbieTheRobber wrote: »

Ok becasue everyone seems incapable of understanding this concept im going to state it nice and simples ok.


current number of private sector works unemployed = 0
current number of public sector works unemployed = 0

you see the reason both numbers are zero is to be in either sector one must be in employment. The status of being unemployed if to be in any sector would most likley be the public sector as the government is paying you. :rolleyes:

Without wishing to drag the thread off-topic, that's very obviously both simplistic and meaningless.

1. Both the Irish private sector and the Irish public sector need to become more competitive. That is the goal, not specifically the reduction of anybody's wages.

2. Both sectors have large labour costs as a component of their current costs.

3. Both sectors seek to reduce their labour costs by shrinkage (redundancies) and wage reduction, while increasing productivity through better working arrangements.

4. The balance of these aspects in the two sectors is, however, different.

5. The public sector uses fewer redundancies, and therefore makes its labour cost reductions largely through wage reduction, and relies on productivity increases through redeployment and new working practices.

3. The private sector primarily uses redundancies of the least productive rather than wage reductions. More broadly across the sector less productive companies go out of business entirely, which also results in redundancies and an increase in average productivity.

So if we take a cartoon example:

Start with:

1. a public sector employing 100,000 people at an average of €25k/annum through 1 'business'. Total wage bill: €2.5bn. Output: 250m. Productivity per €1000 = 100. Work done per worker = 2500. Work done by worker per €1000 of salary = 100.

2. a private sector employing 100,000 people at an average of €25k/annum through 10,000 businesses. Total wage bill: €2.5bn. Output: 250m. Productivity per €1000 = 100. Work done per worker = 2500. Work done by worker per €1000 of salary = 100.

Public sector productivity gains: reduction of workforce by 2,500, wage decrease of 15%. Total wage bill: €2.072bn. Average wage €21.25k. Assume same output through improved working practices. Productivity per €1000 = 120.67. Work done per worker = 2564 (2.5% increase). Work done by worker per €1000 of salary = 120.66. Redundancy risk = 2.5%.

Private sector productivity gains: reduction of workforce by 12,500, wage decrease of 5%. Total wage bill: €2.078bn. Average wage €23.75k. Assume same output through improved working practices. Productivity per €1000 = 120.3. Work done per worker = 2857 (14.3% increase). Work done by worker per €1000 of salary = 120.3. Redundancy risk = 12.5%.

So, in this example, both the public and the private sector have achieved similar productivity gains, but have done it in very different ways. Comparing the wages is pointless, since the way productivity gains are made in the two sectors is different. The public sector worker sees a smaller overall increase in their workload, but a larger drop in their salary, while the private sector worker sees a larger increase in their workload and a smaller drop in salary, but a much larger chance of redundancy.

(If we wanted to follow your point above, and say that the unemployed are effectively on the public sector payroll (but produce nothing), then the unemployed of both the public sector and the private sector should be added to the public sector "wage bill". We'll assume unemployment benefit of half the average wage:

Public sector productivity gains: reduction of workforce by 2,500, wage decrease of 15%. Assume same output through improved working practices. Productivity per €1000 = 120.67

Add 15,000 unemployed @ 50% of €21.25k. Public sector "wage bill" now €2.23bn. Productivity per €1000 = 112

So, rather unfairly, unemployment reduces the overall productivity of the public sector, even as it increases the productivity of the private sector.)

Further, if one is planning forward, one should really take into account the risk of redundancy as part of one's salary. The public sector worker has a 97.5% chance of keeping their salary in any given year, so their salary is worth:

(€21.25k x 0.975)+(€10.625 x 0.025) = €20.98k (work done/€1000 = 122.2)

The private sector worker has an 87.5% chance of keeping their higher salary, so their salary is worth:

(€23.75 x 0.875)+(€10.625 x 0.125) = €22.1k (work done/€1000 = 129.2)

Mind you, that's the actual risk situation. The way people perceive risk is different - in both cases, they're more likely to use the irrational assumption that if they're unemployed their income simply ceases, which means that the public sector worker could, through fear of unemployment, be motivated to productivity of about 123.75 (about a 1% difference), while the private sector worker could be motivated to productivity of about 137.5 (about 6.5% more).

However, as long as the public sector worker is not as productive per €1000 of salary as his private sector counterpart once all those things are taken into consideration, the private sector worker has a bona fide argument that the public sector worker is not actually pulling his/her weight. We don't need an absolute comparison, all we need to look at is the changes - and as long as the public sector prefers wage reductions to redundancies, they have to make up in the former what they don't do in the latter to keep up with the private sector.

TL;DR - it's meaningless to compare private and public sector workers' wages, since the two sectors go about increasing productivity differently. Unfortunately, it is useful to compare the productivity of public sector workers in Ireland with other countries, or with the private sector (all factors considered), since there is an absolute need to reduce the public sector wage bill.

cordially,
Scofflaw

ardmacha

And yet the p.s is still overpaid by other eu country standards and by comparisons with the private sector.

Please provide statistics on this. Not isolated examples, but some evidence in general.

fliball123

RobbieTheRobber wrote: »

That is not what the poster means or says so I dont see how I am either wrong or clowning around!

The point there were making is the comparison of the live register and to which sector they have came from .

So you could realistically say that anyone who came from the private sector has taken a massive drop in wage as they are collecting the dole.

RobbieTheRobber

Scofflaw wrote: »

Without wishing to drag the thread off-topic, that's very obviously both simplistic and meaningless.

I know it weas meaningless, it was meant that way.
Mainly becasue everytime we have a discussion about the PS the first thing that is raised is that X number of people have taken the largets possible cut by losing their jobs.
I was merely pointing out that they are no longer private sector workers if they have no jobs in an effort to show how popintless it is to raise this issue every single time.

RobbieTheRobber

fliball123 wrote: »

The point there were making is the comparison of the live register and to which sector they have came from .

So you could realistically say that anyone who came from the private sector has taken a massive drop in wage as they are collecting the dole.

There was no suggestion in the comments i quoted of the live register so that was not what was meant!

rumour

ardmacha wrote: »

Usual ill argued PS bashing,.

How so? What is austere about what our four year plan delivers? It delivers a need to borrow show me any definition of austerity that includes living beyond your means. Please don't reduce this to PS bashing, that is becoming an excuse not to address real issues. The reason we have the IMF and ECB here is exactly because of our inability to discuss these issues rationally.

ardmacha wrote: »

like the proposal to reduce the renumeration of people who work to 2003 levels without reducing the renumeration of people who do not work to 2003 levels. ,.

What is this statement intended to communicate?

ardmacha wrote: »

Then followed by the usual ignoring of the pension levy to get a false total of the savings already achieved. This has been pointed out numerous times here on this forum, but the usual suspects pop up with misleading statistics again and again and again. Ad nauseam in every sense of the word. ,.

Ok then show me where in the department of finance website and publications a reduction in current account spending has been achieved. Additionally I would like to see the reduction on identified in public sector pay as we all know that social welfare has expanded. Apply the test of austerity to that achievement and tell me what your conclusion is. Please demonstrate austerity rather than appeal to emotive arguments.

ardmacha wrote: »

GNP is at 2005 levels, PS pay has been cut to 2005 levels except at a lowest ranks. The €30m you propose is one quarter of GNP a level at which is it is impossible for a modern European state to operate.

What drives GNP, is it private sector indiginious industry or public sector industry? The answer is incredibly difficult to verify factually from the CSO or DOF however you know as well as I do that the only growth we can generate in GNP is by indiginious companies securing income from abroad. How much of the public sector is engaged in that activity? Anyone doing it should be protected from excessive taxation. It would be my policy to incentivise growth rather than penalise it.

ardmacha wrote: »

If you want the State to withdraw from subsidised third level education, hospitals etc and let people pay for these things themselves then make that case. If you want to eliminate comprehensive unemployment benefit etc, then propose this. But do not pretend that these can be available without the State making up more than 25% of the economy.

The thing is I do want the states hospitals and the education system. But we can't afford them all at the minute, the least worst option on a pragmatic level is to reduce the pay of the employees. This would be austerity. However the state spending within what it earns is not austere, I will admit that to impose 2003 pay levels on public employees would seem austere. But so to would 200,000 redundancies in the private sector along with wage reductions. Oh thats right thast already happened, are we to ignore that now?
My opening post and other posts have stated that I believe the state should provide welfare and I believe we should provide it at the expense of everything else that the state supplies. But it should not turn into an incentive not to work by virtue of it paying more than can be generated in employment. The state should focus on getting people to work

ardmacha wrote: »

The reason the State cannot pay for itself as it did in 2005 is because
a) then it was taxing property transactions instead of the normal things normal countries tax
b) there are now a larger number of people drawing social welfare. .

That is a reason why we don't have as much money that is not a reason the state cannot operate. BTW 2003 to me should be the point of reference as it is the last time our state managed on 30bn a year, more or less what we will earn this year.

ardmacha wrote: »

a) needs to be addressed immediately by the introduction of normal taxation system where most people pay some income tax, where people pay annual property taxes and where the rich cannot eliminate all of their taxation by using allowances and shelters.

Agree almost entirely. However this is not austerity. Imposing a tax on others is not austere. How about our politicians taking a 50% plus cut in wages ( their expenses are more than the average workers salaries). That would be an example of austerity. Our target should be self sufficiency saying it is not possible and borrowing money with continually no real plan of paying it back will not last. We have run up 60bn in debt since 2008 and plan to add another 60bn by the time the four year plan is finished. Why are we doing this its insane?

rumour

RobbieTheRobber wrote: »

Ok Rumour, heres some clues as to what my comment might be regarding!

But you should ask yourself questiosn to get the clue.
IS there a post i quoted in that comment?
IS the comment quoted perhaps relevant to my answer?

Sorry still don't get it. Whats the relevance?

Scofflaw

RobbieTheRobber wrote: »

I know it weas meaningless, it was meant that way.
Mainly becasue everytime we have a discussion about the PS the first thing that is raised is that X number of people have taken the largets possible cut by losing their jobs.
I was merely pointing out that they are no longer private sector workers if they have no jobs in an effort to show how popintless it is to raise this issue every single time.

Mm...no, that's also a meaningless thing to say. You can't just cross people off the private sector the moment they become unemployed and use that distortion to claim that "the private sector" has suffered no loss in pay. That's a sleight of hand that confuses the sector in general with the individuals within it.

We can settle the argument by counting those who became unemployed from the public sector since, say the start of 2008 as 'public sector unemployed', and those who became unemployed from the private sector as 'private sector unemployed'. That's fair, because it indicates the probability that any given individual in either sector will have joined the unemployed, something which, as I said, needs to be factored into salaries to make a fair comparison.

Something one needs to factor in there, of course, is that SME wages have dropped on average 13.5% this year.

If we take the period Q3 2008 - Q3 2009, for which there is a CSO analysis, we can see the changes in the two sectors:

Private Sector: Q3 2008 633,700 employed - Q3 2009 573,200 employed.

Public Sector: Q3 2008 242,800 employed - Q3 2009 237,100 employed.

So of the 66,200 who lost their jobs there, 60,500 were private sector - 91.4%.

Private sector chance of unemployment = 9.6%
Public sector chance of unemployment = 2.4%

cordially,
Scofflaw

ninty9er

The 4 year plan is a walk in the park compared to real austerity. The IMF/EU are more pre-occupied with the threat of a global financial collapse than micromanaging Ireland.

We're one of the few countries that they've lent money to without leaving a permanent representative, they don't care, we're a safe bet and they don't care what we do with their money to a large extent.

RDM_83 again

There is perhaps a slight issue in that reasoning Scofflaw in that there a various gradauates (I'm thinking teachers and various types of health service workers) who would have most likely entered to the public sector workforce who never have due to the lack of hiring, since these (generally young people) are unemployed as a direct of goverment public sector reform perhaps they could be included in the figure.

rumour

Scofflaw wrote: »

Something one needs to factor in there, of course, is that SME wages have dropped on average 13.5% this year.

If we take the period Q3 2008 - Q3 2009, for which there is a CSO analysis, we can see the changes in the two sectors:

Private Sector: Q3 2008 633,700 employed - Q3 2009 573,200 employed.

Public Sector: Q3 2008 242,800 employed - Q3 2009 237,100 employed.

So of the 66,200 who lost their jobs there, 60,500 were private sector - 91.4%.

Private sector chance of unemployment = 9.6%
Public sector chance of unemployment = 2.4%

cordially,
Scofflaw

Thanks, there is a vast array of information on the CSO website and in the DOF site. Very informative if one takes the time to go through it in any detail. As with my OP I cannot find the hard evidence of austerity in action.

xavidub

With the breathtaking hypocritical arrogance that is his birthright, a French person lectures us about austerity, while his own country has been sucking at a German teat for 40 years.

rumour

xavidub wrote: »

With the breathtaking hypocritical arrogance that is his birthright, a French person lectures us about austerity, while his own country has been sucking at a German teat for 40 years.

I'm sensing a little anger there. My apolgies I screwed up the link earlier. SBP article here.

The austerity programme announced by the government is nowhere near austere enough, according to the bond desk of leading French bank Société Générale.

‘‘The public, egged on by politicians, have unrealistic expectations. They are told they are in ‘austerity’. We disagree strongly," said Ciaran O’Hagan, head of Paris Rate Research.

I don't know if Paris Rate Research is part of Societe Generale (i'll check) but Ciaran O'Hagan doesn't sound very french to me.

cleremy jarkson

Looks like the cut to social welfare payments is 5% ie. 10 euro off 196. Not exactly austerity is it?

RichardAnd

cleremy jarkson wrote: »

Looks like the cut to social welfare payments is 5% ie. 10 euro off 196. Not exactly austerity is it?

More like 9.80. But I was under the impression that 10% cuts to the scratcher were on the cards?

Guess we'll see in a few hours.

Permabear

This post has been deleted.

rumour

donegalfella wrote: »

This post has been deleted.

Please someone show me the austerity as opposed to a grab for money from any source available??