Is austerity urgent for our survival?

DoesNotCompute

not yet wrote: »

Oh yeah I see your point.....

What Europe has to do with it is this, We are facing 3.5 billion in cuts and taxes which will stall the economy at best. If Europe were told the 3 billion will be paid at some point 10 years down the line, it would save a lot of hardship for a lot of people.

No. The 3.5 billion in cuts is necessary to help reduce the difference between what we take in in taxes, and what we spend. Europe doesn't factor into this equation. Banking debt doesn't factor into this equation. The 3.5 billion in budget cuts and taxes are needed to balance the books.

General Atomic

DoesNotCompute wrote: »

No. The 3.5 billion in cuts is necessary to help reduce the difference between what we take in in taxes, and what we spend. Europe doesn't factor into this equation. Banking debt doesn't factor into this equation. The 3.5 billion in budget cuts and taxes are needed to balance the books.

Why is it necessary to balance the books? Why is servicing our debt more important than helping people in need in our own country? Look to Spain, Greece and, to a lesser extent, the UK if you want to see the effects of austerity in the name of debt reduction; their economies are in the toilet and continuing to fall.

Icepick

tayto lover wrote: »

To allow the Yanks avail of the low corporate tax rate the taxpayers of Ireland are being bled dry. The fact that they are getting off lightly means that we are being rode.

They owe us exactly 0 and that is what we would get if they don't invest here.

Scortho

tayto lover wrote: »

I genuinely believe that a 1 or 2 percent increase would not lead to them upping and leaving.
The semi-states are a separate entity. The Govt can prevent them from rising prices unnecessarily. They are already making huge profits.

The thing about increasing the corporate tax rate is the negative signal it would send. It forms a key part of our FDI strategy. It acts as a compensator to the multinationals for investing here. It has helped create 1000s of jobs in the country. By increasing it, we become less competitive. COmpanies carry out sustainability reviews on average every ten years. What would that signal tell them to do?
I know it'd tell me to get tha feck out of Ireland! they've gone crazy!

Corporation tax took in around 3.5 billion last year.
An extra 1.5 % would yield around 420 m.

So for the sake of 420m you want to put the jobs of 1000s of people at risk, while ignoring the excessive overspending in areas such as welfare?

tayto lover

Icepick wrote: »

They owe us exactly 0 and that is what we would get if they don't invest here.

Of course they do. We supply a good highly trained and highly educated workforce.
Don't sell yourself so short.
They are not here just for the low taxes and because they like us.

maninasia

Scortho wrote: »

The thing about increasing the corporate tax rate is the negative signal it would send. It forms a key part of our FDI strategy. It acts as a compensator to the multinationals for investing here. It has helped create 1000s of jobs in the country. By increasing it, we become less competitive. COmpanies carry out sustainability reviews on average every ten years. What would that signal tell them to do?
I know it'd tell me to get tha feck out of Ireland! they've gone crazy!

Corporation tax took in around 3.5 billion last year.
An extra 1.5 % would yield around 420 m.

So for the sake of 420m you want to put the jobs of 1000s of people at risk, while ignoring the excessive overspending in areas such as welfare?

Exactly, it's a strawman. What needs to happen is that other costs have to come down to make the local economy more competitive, rates, power, minimum wage, professional costs.

Bring the costs down, and make an incentive plan to setup businesses in Ireland (whether foreign/locals), but this time focus on small and medium size businesses.

tayto lover

Scortho wrote: »

The thing about increasing the corporate tax rate is the negative signal it would send. It forms a key part of our FDI strategy. It acts as a compensator to the multinationals for investing here. It has helped create 1000s of jobs in the country. By increasing it, we become less competitive. COmpanies carry out sustainability reviews on average every ten years. What would that signal tell them to do?
I know it'd tell me to get tha feck out of Ireland! they've gone crazy!

Corporation tax took in around 3.5 billion last year.
An extra 1.5 % would yield around 420 m.

So for the sake of 420m you want to put the jobs of 1000s of people at risk, while ignoring the excessive overspending in areas such as welfare?

First of all I was luckily never on SW in my life and hopefully won't be in the future. However it's easy for someone to say cut SW and our problems or some of them will be solved. They won't as long as prices are rising. People on SW are already on queues for Soup Kitchens daily. Cutting SW will only make their plight worse.
The Govt should be pumping money into job creation but they are not. Instead they are pumping it into a failed Banking System while continuing with the high wages and pension of the people who failed us. They should also be standing behind their people and preventing them from being fleeced by the likes of Bord Gais and the E.S.B. That 420m would go a bit of the way in creating a bit of space with mortgage defaulters too.
Until something is done about prices SW should be left alone.
I still think a rise of 1-2% in Corporate Tax would not be a bad thing and I really can't see many business closing up and moving because of it.

sparksfly

tayto lover wrote: »

To allow the Yanks avail of the low corporate tax rate the taxpayers of Ireland are being bled dry. The fact that they are getting off lightly means that we are being rode.

The yanks are paying most of our bills through being our chief exporters and employers. Since we have not held on to much of our native industries we have a huge dependence on multinationals to keep us afloat.
Instead of "being rode" by them, Irish taxpayers (and non-taxpayers) would be living in a 3rd world country without them.
One medical multinational (the biggest in Ireland) has net annual exports worth more to the irish economy than farming, tourism, fisheries, and forestry exports combined. Add in the suppliers, contractors and various agencys that they support, along with charities, schools and community groups.
Mess with them at our peril.

tayto lover

sparksfly wrote: »

The yanks are paying most of our bills through being our chief exporters and employers. Since we have not held on to much of our native industries we have a huge dependence on multinationals to keep us afloat.
Instead of "being rode" by them, Irish taxpayers (and non-taxpayers) would be living in a 3rd world country without them.
One medical multinational (the biggest in Ireland) has net annual exports worth more to the irish economy than farming, tourism, fisheries, and forestry exports combined. Add in the suppliers, contractors and various agencys that they support, along with charities, schools and community groups.
Mess with them at our peril.

And where did I say that we were being rode by them?
We are paying more to prop up the low corporate tax is what I said. Are their profits being spent or invested here? Don't think so.

doolox

Multinationals are accountable to no one and this is a major problem when nations are trying to obtain taxes but have to consider the threat to jobs if the multinationals relocate elsewhere.

A similar situation existed in the middle ages with the Orders like the Knights Templar and the various military/religious orders which were a law onto themselves and defied the wills of the various Kings etc which existed at the time. By concerted action by all the Sovereigns the various Orders were wiped out, many in one day, A Medieval solution to a Medieval problem.

I think we are facing the decline and loss of power of the nation state and future polities will have to treat with multinationals as if they were nations themselves. A similar realism may have to apply to dealings with Gangs, Terror groups etc.

This will need increased cooperation between groups of nation states, subnational regions, community groups, trade unions etc to ensure that fair deals are conducted with jobs providers and job holders. The present system has collapsed to the extent that the balance of power lies heavily with the jobs providers and there is a distinct lack of direction or a possible solution ahead.

Probably, like many human problems there are many individual solutions for each affected individual and it will not be easy. What drives most people mad is the obviuos inequality that is now clear to many since new info technology has opened up many previously closed doors so that the lifestyles of the rich are more public than in the past.

It is only partly true that the masses are better educated than in the past because many degrees are too specialised and there is a lack of critical thinking and looking for alternatives and very little encouragement of self sufficiency in present day education.

People are not encouraged to bargain hard for a better return on their efforts and are forced to accept the present chaotic situation as "normal".

Nody

doolox wrote: »

Multinationals are accountable to no one and this is a major problem when nations are trying to obtain taxes but have to consider the threat to jobs if the multinationals relocate elsewhere.

A similar situation existed in the middle ages with the Orders like the Knights Templar and the various military/religious orders which were a law onto themselves and defied the wills of the various Kings etc which existed at the time. By concerted action by all the Sovereigns the various Orders were wiped out, many in one day, A Medieval solution to a Medieval problem.

I think we are facing the decline and loss of power of the nation state and future polities will have to treat with multinationals as if they were nations themselves. A similar realism may have to apply to dealings with Gangs, Terror groups etc.

This will need increased cooperation between groups of nation states, subnational regions, community groups, trade unions etc to ensure that fair deals are conducted with jobs providers and job holders. The present system has collapsed to the extent that the balance of power lies heavily with the jobs providers and there is a distinct lack of direction or a possible solution ahead.

Probably, like many human problems there are many individual solutions for each affected individual and it will not be easy. What drives most people mad is the obviuos inequality that is now clear to many since new info technology has opened up many previously closed doors so that the lifestyles of the rich are more public than in the past.

It is only partly true that the masses are better educated than in the past because many degrees are too specialised and there is a lack of critical thinking and looking for alternatives and very little encouragement of self sufficiency in present day education.

People are not encouraged to bargain hard for a better return on their efforts and are forced to accept the present chaotic situation as "normal".

Why do you think human nature is going to change over night? Countries are already today fighting to pull in investments, once in a country the regions are fighting for who should get it yet you expect they will all suddenly start to cooperate?

What I do expect is that things will go the Russian route of adding trade blocks in larger countries making it difficult/expensive to import (and hence motivating setting up a local factory to produce it instead). There will be more closing of tax holes (i.e. interest recharges to low tax countries as US is implementing etc.) and the medium / small countries will be left to moan and try to win the factories supporting the rest of the world as best as they can. That's already what has started today and is far more likely then a sudden change in human behaviour accross functions, countries and regions.

Joe 90

General Atomic wrote: »

Why is it necessary to balance the books? Why is servicing our debt more important than helping people in need in our own country? Look to Spain, Greece and, to a lesser extent, the UK if you want to see the effects of austerity in the name of debt reduction; their economies are in the toilet and continuing to fall.

Well if you owe someone some money and you expecthope to get more loans you need to be seen to be servicing the loans you already have.

Joe 90

tayto lover wrote: »

And where did I say that we were being rode by them?
We are paying more to prop up the low corporate tax is what I said. Are their profits being spent or invested here? Don't think so.

Are their profits the biggest part of the money they take? As someone said earlier they pay wages and all the associated bits and bobs, pay rates, pay sub contractors, pay transport etc. Lots of direct costs and overheads spent in Ireland. If they did not pay a penny in corporation tax they still would be a bloody good thing for the country. I would suspect though that the big danger of them going might be high labour costs due to the high wages paid in Euros, the Euro being overvalued as a currency for Ireland.

Icepick

tayto lover wrote: »

Of course they do. We supply a good highly trained and highly educated workforce.
Don't sell yourself so short.
They are not here just for the low taxes and because they like us.

The bloated government is preventing us from selling for more.

maninasia

I think we are facing the decline and loss of power of the nation state and future polities will have to treat with multinationals as if they were nations themselves. A similar realism may have to apply to dealings with Gangs, Terror groups etc.

If you look at what happens in China or Brazil and increasingly even in the US, you can see the nation state is still very much alive and kicking.

For example you need to pay 25% import tax on any cars imported to China. In the end all the major car manufacturers were forced to open Joint Ventures with local Chinese companies to sell in the Chinese market.

Who is stronger, the multinational or the state?

In China all the large business sectors are controlled by State Owned Enterprises or enterprises with significant government backing.

Want to sell a drug or open a hospital? Need a license.
Want them to buy a train? Better manufacture it in China and transfer the tech.
Want them to buy a plane? Likewise.

With regards small countries multinationals can often play one off the other. It's not so easy with big countries with lucrative markets. They need to shut up and play ball.

PFI

Idbatterim wrote: »

I believe people should be financially rewarded for reporting welfare fraud. Obviously only if the claim turns out to be true, following the investigation...

It would be very difficult as it is widespread and most of those on JA work illegally either part or full time. Some even run their micro businesses.

frankosw

PFI wrote: »

It would be very difficult as it is widespread and most of those on JA work illegally either part or full time. Some even run their micro businesses.

They should have thier benefits removed immediatly and then fined for the money they have defrauded.

PFI

maninasia wrote: »

Bring the costs down, and make an incentive plan to setup businesses in Ireland (whether foreign/locals), but this time focus on small and medium size businesses.

It is the export-oriented companies who mainly add value to our economy, however unfortunately most of the SMEs are either locally focused or even import-oriented. So, I don't see a reason for special support.

PFI

frankosw wrote: »

They should have thier benefits removed immediatly and then fined for the money they have defrauded.

In theory they should, but in practice it would never materialise.

PFI

tayto lover wrote: »

I still think a rise of 1-2% in Corporate Tax would not be a bad thing and I really can't see many business closing up and moving because of it.

In Europe already there several destinations with lower corporate tax and lower cost base, so additional increase by 1-2%, might push many MNCs to leave Ireland for greener pastures. And should they leave we would face economic collapse.

maninasia

Very very unlikely 1-2% would cause any major issue. That's scaremongering, but you wouldn't want to go much further than that, nor look like you are changing policy.

maninasia

PFI wrote: »

It is the export-oriented companies who mainly add value to our economy, however unfortunately most of the SMEs are either locally focused or even import-oriented. So, I don't see a reason for special support.

Yes, that's what I meant to include, export oriented or internationally traded service companies.

[Jackass]

In my opinion, austerity is a tool that should only be used as a short term solution to a modest budget deficit. The scale it is being used on is absurd and the timeline makes it counter productive, actually worsening the recession rather than restoring the country to growth and output.

The economics of it make absolutely no sense and it completely contradicts economic theory. Essentially, it is taking more and more money out of an Economy that is trying to grow, forcing it to stagnate using retractionary measures rather than using expansionary measures.

Stimulus package is what is required, not austerity imo. A big chunk of funding to create Government led spending and output with credible Government policy in order to grease the cogs and get them working again and get people back into work and spending. Long term projects would also bring more stability to the market.

maninasia

What is really needed is not a catchphrase like 'austerity' but cut waste and inefficiency where it exists, reduce bloated spending projects with poor results and build a productive and yes growing economy with targeted investments.
Common sense isn't it.