Tax on this, tax on that...

OU812

OK, so we have the property tax, it's here & it's sticking around.

We also have the upcoming Water charges, & Broadcasting charge (should probably be called receiving charge, but not my call) we also have out bin charges.

So why aren't these all lumped in together in one charge & revenue collect the whole bloody lot ?

And.. why are they called "Charge" & not "Tax" does that difference give it any special powers ?

The whole "charge" thing does my head in. They're very obviously taxes.

NIMAN

Everyone pays taxes, in every country. Some are higher than ours, others are lower. Thats life.

Re: the water charge, personally I think its needed and a good idea. Its a very valuable resource and peoples use of it should be metered.

Hard to lump them all together as some people may have to pay one but be exempt from another, and there are too many permutations to work out if doing one payment.

Re: the broadcasting charge, to be fair in this case the TV licence will be scrapped and this brought in, so harsh to count this as an additional charge.

Captain Chaos

NIMAN wrote: »

Re: the broadcasting charge, to be fair in this case the TV licence will be scrapped and this brought in, so harsh to count this as an additional charge.

It is because now you have to pay this even if you don't own a TV. It's a blanket charge/tax as you have to pay it if you have a TV, broadband, radio, mobile phone or are cable of using and any of the above services in theory.

It has to be illegal and contested in an EU court.

jank

We haveall these taxes to pay for large government. People should start to question do we need such a large spending state?

paul71

Services for this, services for that.

Why don't the government stop providing me with hospitals for my elderly parents, schools for my children, social welfare if I lose my job, housing if I lose my home, Garda to protect my home and family, roads to drive on.

Opps, maybe I should think about that a little more.

jank

If you think government is thre to provides living for everyone then you can complain about taxes!

paul71

paul71 wrote: »

Services for this, services for that.

Why don't the government stop providing me with hospitals for my elderly parents, schools for my children, social welfare if I lose my job, housing if I lose my home, Garda to protect my home and family, roads to drive on.

Opps, maybe I should think about that a little more.

To be fair, whilst I agree that taxes are part and parcel of life, and I'm aware of our deficit, etc. and realise a lot of the money taken from us is 'dead money' that won't actually fund anything, the state of some of the services is pretty dire at the moment.

When you see things like Ambulances being taken off the roads and Gardaí getting constant cuts it kinda makes you wonder "will taking that ambulance off the road really make much difference to our national debt?" and kinda makes me lose confidence.


That said, I suppose the cost of an ambulance off the road may be a small saving, but when it's added to many other small savings, they all add up.


(Ambulance off the road is a random example, based on Drogheda's current situation wherein we're losing an ambulance as far as I know).

paul71

Yep, ambulances being taken off the road, Garda stations being closed are the stark reality of what we are faced with, and it is not easy to stomach KKV. But look at the current budget deficit and you realise that the cuts have only just begun.

http://www.finance.gov.ie/documents/exchequerstatements/2012/exchfinaldec.pdf

That is 10 billion more spent then we get in tax which is 39.5 billion.

We are 3 years into a 10 year process of fixing the mess we made of our own affairs and if people don't realise that there is no fantasy pot of gold in the form of oil off our coast, or that the trokia are not our enemy and are in fact the only thing keeping government services running the result will be The Cottage and the Lourdes in Drogheda closing and not just ambulances servicing them.

OU812

Ok, I think this had got derailed.

If anyone can answer te above without complaining about cuts, I'd appreciate it.

* apart from niman who made some good points

PCPhoto

OU812 wrote: »

OK, so we have the property tax, it's here & it's sticking around.

We also have the upcoming Water charges, & Broadcasting charge (should probably be called receiving charge, but not my call) we also have out bin charges.

So why aren't these all lumped in together in one charge & revenue collect the whole bloody lot ?

And.. why are they called "Charge" & not "Tax" does that difference give it any special powers ?

Why are they not all lumped together - because there are some exceptions where some people qualify and others dont and also because people do not notice a little tax here and a little tax there ...so if people could see the actual amount they are paying the government there would be riots (especially as its use seems to be wasted)

They are called "charge" and not "tax" because subconsciously you see a charge as a fee for something and have no problem paying it and you see a tax as a burden - its so you subconsciously dont realise how much you are paying.

What surprises me is the huge amounts of public monies which are paying out which should be cut but because its all about the numbers (money) the most valuable services are cut.

A sensible approach would be to cut excessive expenses - make the cuts from the top down, politicians should lead by example - remove all foreign travel - video conference if possible, remove all ministers drivers, let the public see that the ministers are hurting and the general public will not have an issue with paying necessary taxes and charges - instead what OUR government have done is ...make cuts, tell the ordinary citizens that we all need to make cuts/sacrafices, its all part of a long term plan...but they continue with their lifestyles.

if the government had any balls they would remove half of the civil servants who are not qualified for their jobs, they would not allow developers to get paid by NAMA or at least they would give them an ordinary salary instead of the celtic tiger paypacket, they would adjust the legal system, adjust the political system, remove the seanad, a massive cull on expenses.

A couple of examples: remove free legal aid - have it as a subsidised legal aid so that those in receipt of social welfare actually pay for coming before the courts, of course there is always the exception if someone does not have any income but if they have any source - have the money deducted at source, if they can get revenue to implement the household tax database then it shouldn't be that difficult to deduct at source for social welfare recipients (MAKE CRIMINALS PAY UP - of course no payment penalty if a person is found not guilty), this has a two-fold effect,
1. it reduces the states legal bill
2. it forces criminals to pay something towards the state - it also forces career criminals to break the law more often and increase their risk of getting caught.(assuming we still have gardai on the streets)

Forget automatic remission - I know there was a recent report saying it should be increased from 25% to 33% ...but that recommendation is simply so criminals spend less time inside and more time on the streets, its simply to reduce the amount of money spent on holding criminals and does nothing to stop or even reduce crime...if anything it would increase crime - going by our current recidivist rate (depending on whose statistics you go by it could be as high as 60%).
Why should a criminal AUTOMATICALLY have their sentence reduced without showing any remorse, or making any effort to change ? because the government wants to lower their expenditure but that doesn't solve the issue of crime in this country....and in my opinion is a terrible idea.
if remission is to be increased, make the people in prison complete courses to qualify for remission, let them show they want to improve, that way you can keep those that dont want to change their ways in prison for their full term and those that are willing to change ...get rewarded !

On the subject of prison did you know that Revenue/Social Welfare treat a persons time in prison as a period of unemployment - so those in receipt of social welfare that go into prison actually benefit financially from their time there !! ... why not stop social welfare for those in prison simply put - if they break the laws of the state why should the state support them ??

I could go on for hours and hours the country needs reform on a massive level and the people in power at the moment simply have other vested interests or no interest in changing the country for the better and are only concerned with public perception and financial status of the country.

(just on a side note: I was told recently that there was a state in USA which had a sudden drop in crime rates and all the various departments and initiatives were claiming it was because we did this or we did that ....no-one could definitively say that any one single thing caused the drop in crime ..until someone pointed out that 15yrs previous the state legalised abortion !! - I'm not pro/anti abortion but it is a point that was raised to me a number of weeks ago and in theory it made sense, but then again ...in USA they have a system which does not promote having excessive amounts of kids)

KyussBishop

NIMAN wrote: »

Re: the water charge, personally I think its needed and a good idea. Its a very valuable resource and peoples use of it should be metered.

I would agree with this to an extent, but the taxes here seem to be a precursor to privatization (with the public subsidizing infrastructural changes that will allow this), which makes me dead-set against it.

NIMAN wrote: »

Re: the broadcasting charge, to be fair in this case the TV licence will be scrapped and this brought in, so harsh to count this as an additional charge.

The broadcasting charge is really an Internet tax, because they are making you pay for having Internet access; I'm against that, because 1: It would be very easy to make RTE a subscription-based service online instead, and 2: If they are going to tax me for Internet access, I want them to use the money to provide a free national broadband service, not churn out dross on RTE (which I never watch).

KyussBishop

A wider point on taxes: Governance over Ireland doesn't stop at our national government, it goes right up to the EU; while there is a lack of proper governance at an EU level, with no real recovery policies being put in place, our economy will be left saddled with debt and our taxes/expenditure will keep on increasing.

There is nothing our government can do, other than petition the EU to implement some actual recovery policies (which it looks like the EU will never do, because of Germany), or to consider more desperate actions like leaving the single currency to get back sovereign control over our currency (which we will be forced to do eventually anyway, if/when the single currency breaks up).

So it pretty much boils down to:
1: Exit now, and take a massive fall in standard of living, and deal with economic chaos for a number of years, before getting back on our feet (but with the possibility of the pain being shared equitably, with the opportunity for early full employment with the right governance), or
2: Sit tight and watch austerity further destroy our public services and cause wider social/economic damage, fruitlessly petitioning the EU for recovery policies, thus waiting for the single currency to eventually end, forcing us to exit anyway, leading to the same problem as '1'.

An eventual dissolution of the Euro is not completely certain mind, but it is looking increasingly likely; if it is going to happen anyway, we've got to ask ourselves what is there to gain by delaying it?

murphaph

Captain Chaos wrote: »

It is because now you have to pay this even if you don't own a TV. It's a blanket charge/tax as you have to pay it if you have a TV, broadband, radio, mobile phone or are cable of using and any of the above services in theory.

It has to be illegal and contested in an EU court.

Germany introduced this wretched charge in January, replacing the old licence system. I hate paying for stuff I absolutely never watch. I'm sure Germany and Ireland aren't the only ones charging a universal fee for state broadcasting, so if it is illegal a challenge is likely, even if not originating in Ireland.

Suryavarman

paul71 wrote: »

Services for this, services for that.

Why don't the government stop providing me with hospitals for my elderly parents, schools for my children, social welfare if I lose my job, housing if I lose my home, Garda to protect my home and family, roads to drive on.

Opps, maybe I should think about that a little more.

Yes because the only way any of these services could be provided is by the government :rolleyes:

paul71

Suryavarman wrote: »

Yes because the only way any of these services could be provided is by the government :rolleyes:

Actually, thats a fair point Suryavarman, but you would still have to pay for them if they were previded privately.

G Power

tell me again why people are still accepting all these stealth taxes so we can pay back debts that had absolutely nothing to do with any of the 99% of ordinary joe soaps??

Suryavarman

paul71 wrote: »

Actually, thats a fair point Suryavarman, but you would still have to pay for them if they were previded privately.

Yes we would still have to pay for those services. But that is not to say we would still have to pay such high amounts or receive such low standards of service for our money.

Phoebas

G Power wrote: »

tell me again why people are still accepting all these stealth taxes so we can pay back debts that had absolutely nothing to do with any of the 99% of ordinary joe soaps??

Deficit denier.

Suryavarman

G Power wrote: »

tell me again why people are still accepting all these stealth taxes so we can pay back debts that had absolutely nothing to do with any of the 99% of ordinary joe soaps??

These debts have something to do with anybody that had money in a bank at the time of the bailouts. If the banks weren't bailed out then people would still be worse off as they would have lost some of their savings.

We would still be paying higher taxes anyway as we would still have to deal with an enormous government deficit.

This is not to say that I approve of any of this. But it is naive to think that the only reason the government is increasing taxes is to benefit a few bondholders and bank managers or the "1%".

Suryavarman

Suryavarman wrote: »

Yes because the only way any of these services could be provided is by the government :rolleyes:

Sounds like you want an American-style system here. No thanks.

Suryavarman

Karsini wrote: »

Sounds like you want an American-style system here. No thanks.

What's the difference between an American style system and the one we have here?

Suryavarman

Suryavarman wrote: »

What's the difference between an American style system and the one we have here?

Very few publicly owned services over there (and the Republicans would probably offload it all if they thought they'd get away with it.)

To use paul71's post as a reference: Private healthcare absolutely disgusts me, putting a price on a human life. And could we seriously have a private police service? If all the roads were private you'd be paying tolls nearly everywhere you went.

There are some government services we have that we probably don't really need to have in public hands, but we certainly shouldn't offload everything.

paul71

G Power wrote: »

tell me again why people are still accepting all these stealth taxes so we can pay back debts that had absolutely nothing to do with any of the 99% of ordinary joe soaps??

Because the 70% of the national debt had nothing to do with the banks and everything to do with the ordinary Joe Soap, and 100% of the current deficit of 10.5 billion a year is to do with the ordinary Joe soap.

Karsini

Karsini wrote: »

Private healthcare absolutely disgusts me, putting a price on a human life.

Poor use of rhetoric there really, such silly arguments can be made about any system. Keeps cropping up in the UK where a family will be campaigning for the NHS to fund some new cancer drug for a loved one. Whether or not to carry out non life-saving treatments and procedures often just comes down to whatever's cheapest, fixing the problem now or ongoing, low-level treatment.
There's always a bottom line and there's always a price to be paid. Or not paid.

ArmaniJeanss

Karsini wrote: »

Private healthcare absolutely disgusts me, putting a price on a human life.

If little Timmys lifesaving operation costs 10 Euro, I think we'll all agree it's a justifiable spend.
If however it costs the entire GDP of the country then equally I think we'll all agree its not a justified spend and Timmy will die.

So by definition there is some cut-off spend point at or below which it is worthwhile and beyond which it is not justified.

Unpalatable stuff perhaps, but there is a 'price on a human life'.

KyussBishop

paul71 wrote: »

Because the 70% of the national debt had nothing to do with the banks and everything to do with the ordinary Joe Soap, and 100% of the current deficit of 10.5 billion a year is to do with the ordinary Joe soap.

Actually the deficit is largely to do with the economic crisis causing large scale unemployment, and thus a loss of tax revenue; this largely is a problem created by the banks.

ManMade

OU812 wrote: »

1.So why aren't these all lumped in together in one charge & revenue collect the whole bloody lot ?

2.And.. why are they called "Charge" & not "Tax" does that difference give it any special powers ?

1. That would mean people would see exactly what was being taken from them easily. There's got to be at least 4 different taxes on petrol. They can up each one individual and not make the headlines.

2. Pffft it's called a levy now get with the times.

Suryavarman

Karsini wrote: »

Very few publicly owned services over there (and the Republicans would probably offload it all if they thought they'd get away with it.)

To use paul71's post as a reference: Private healthcare absolutely disgusts me, putting a price on a human life. And could we seriously have a private police service? If all the roads were private you'd be paying tolls nearly everywhere you went.

There are some government services we have that we probably don't really need to have in public hands, but we certainly shouldn't offload everything.

The Republicans would offload it all if they thought they could get away with it? You obviously know very little about American politics. Take the Paul Ryan (2012 vice presidential candidate) budget proposal just passed by House Republicans. That budget wants to increase spending by $1.5 trillion by 2022. Hardly the sign of a party that wants to privatise everything.

Private healthcare is a disgrace because it puts a price on human life? hahahaha I thought you were insinuating for a second that public healthcare doesn't do exactly that. Take the example of a young child that was refused cancer treatment by the NHS and had to go to a private clinic in New York for it instead. I'm sure you would rather that young girl was dead than having a private clinic put a price on her life. That is not to say that America's healthcare system is really private, there are more government owned hospitals in America than for-profit hospitals. The government also spends the majority of healthcare dollars in America and that is before we calculate the costs imposed by government regulations on healthcare.

Why not have a private police force? We already have a rather large private security market in Ireland and An Garda Siochana aren't exactly an example of brilliance.

With government roads we currently pay 89.89 cent per litre of petrol or 55.5% to the government, then there's VRT and motor tax as well as still having to pay tolls occasionally and we get very poor quality roads for all that money. If that is the best the government can do then I'm willing to take my chances with private road companies.

KyussBishop

Yes that's all great, except for the people who can't afford private healthcare, private police, or can't afford private roads to get to work...

Mass privatization always falls hardest, on those who can least afford it, and it is inherently regressive; advocating it is usually nothing to do with reducing costs or 'freeing' people from taxes (the least well off, who pay the lowest share of taxes, end up spending more), but in redistributing earnings away from government and into private hands, to give greater rent-seeking powers to rich businesspeople and financiers.

That's why the loudest proponents of such things, are those who either already have a crapload of money and want to open up rent-seeking capabilities for themselves, or who have a professional interest in justifying these policies (usually working in finance, or working their way towards it).

paul71

KyussBishop wrote: »

Actually the deficit is largely to do with the economic crisis causing large scale unemployment, and thus a loss of tax revenue; this largely is a problem created by the banks.

And the huge increase in employment 2003 - 2008 was a result of an unsustainable construction industry boom funded by irresponsible lending by banks. The increase in public spending was in turn funded by unsustainable tax receipts resulting from that false boom. Our tax base was targeted on stamp duty, VAT and income tax which relied heavily on the construction industry, therefore we have no choice but to adjust our tax base to reflect a more normal economy coupled with paring back expenditure.

The alternative is to bury our heads in the sand, continue to spend 10 billion a year more then we take in tax receipt and wait until the day that the Trokia stop funding our deficit and on that day close all services provided by the state.

KyussBishop

Even if we consider the increased public expenditure, as being down to the property boom, that is (yet again) something else caused by the banks, so it just reinforces my point.

Unless it is said that we would have permanently remained at a high level of unemployment without the property boom, people would have gotten non-construction-industry jobs, and led to a similar employment rate and taxes.

Whatever about what should be done about it (a decision which does not stop at our government, but is in the hands of the EU), it is incorrect to say that the deficit was down to the people, when all it takes is a cursory look at the economic output gap, to see that it is caused by unemployment and the resulting lack of tax income; this makes unemployment the no.1 problem that should be solved before anything else (but which is impossible without EU recovery policies, which likely won't happen).

G Power

KyussBishop wrote: »

Actually the deficit is largely to do with the economic crisis causing large scale unemployment, and thus a loss of tax revenue; this largely is a problem created by the banks.

and while we stupidly argue who is too blame people are dying or being completely crushed under austerity while those at the top still eat and drink the finest of everything, don't need to worry if they have limited amounts of oil in the tank as we all freeze our bollix off but sure maybe we can have some more austerity until people decide they've suffered enough

_Kaiser_

G Power wrote: »

and while we stupidly argue who is too blame people are dying or being completely crushed under austerity while those at the top still eat and drink the finest of everything, don't need to worry if they have limited amounts of oil in the tank as we all freeze our bollix off but sure maybe we can have some more austerity until people decide they've suffered enough

+1

The Irish mentality has shifted from "keeping up with the Joneses" to "what are they getting away with that I'm not" and "it's not my fault, it's theirs!"

This is why the government frequently floats stuff in the media that pits one side against another once again - employed v unemployed, public v private and so on.

Meanwhile of course the status quo is maintained for those making the decisions (and I'm SURE totally coincidentally the least affected by them) while the "peasants" squabble over the scraps they throw down.

Regardless of your opinion of who caused the mess, the fact that it's continuing on for so long lies solely at the feet of our "government" of teachers, publicans and solicitors - and our latest TD who's off "Chilling Out" 2 days into the job.. a job she only got because of a sympathetic story (albeit tragic yes) and name recognition (and re-enforcement of that fact at every opportunity).

What's needed here is for the Irish electorate to stop behaving like children themselves and start taking responsibility for their role in our supposed "democracy", rather than voting in these corrupt incompetents time after time based on no more than the aforementioned name recognition, or because "they fixed the road" or "mammy and daddy always voted for them" or because anything different is to be feared and dismissed - even though it should be plain to anyone that flipping between FG and FF (who might as well just merge at this stage there's so little real difference between them) has certainly not achieved the reform we so badly need.

Sadly though, I don't see it happening in my lifetime because I really think we're too young and immature as a nation to be responsible, coupled with our instinctive need to be told what to do - even when we got our Independence, we couldn't wait to hand it over again to the Church, and then the EU.

The best hope for our country then realistically speaking IMO is to find the best "overseeers" we can. It's certainly not the Church, and the EU has done us no favours (and don't tell me about the grants and what not because they took their share in fishing rights and so on too). That leaves the UK as our closest neighbour and who we have more in common with really than any of our EU mainland neighbours.

Think about it, what would change? The shops, football and TV would stay the same (which covers the concerns of most of our current electorate), and while their system isn't perfect either - it has to be better than the twisted mess we made of it in not even 100 years (considering most of our laws are based on UK examples)

But because of the "800 years" nonsense and a notion of "democracy" we will no doubt continue to limp along with a system where the decisions are really (thanks to the party whip system) made by those around the cabinet table and the EU which is looking after its own interests not ours, and where the rest of our TDs are there merely to make up the numbers. That's Democracy is it?

G Power

Kaiser2000 wrote: »

Sadly though, I don't see it happening in my lifetime because I really think we're too young and immature as a nation to be responsible, coupled with our instinctive need to be told what to do - even when we got our Independence, we couldn't wait to hand it over again to the Church, and then the EU.

never ever give up hope, too many have done already and paid a heavy price for it, there are more people waking up and deciding enough is enough as each day passes

charlemont

jank wrote: »

We haveall these taxes to pay for large government. People should start to question do we need such a large spending state?

Too many people in Ireland rely on the state for employment so a sizeable amount of voters will always want the large government and high taxation.:mad:

ardmacha

That leaves the UK as our closest neighbour and who we have more in common with really than any of our EU mainland neighbours.

That's exactly the problem. That's where this property bollix came from, where young people can't afford property and they mortgage their lives away in the hope that inflation will save them. We need to have as little to do with these people as possible.

Count Dooku

KyussBishop wrote: »

Even if we consider the increased public expenditure, as being down to the property boom, that is (yet again) something else caused by the banks, so it just reinforces my point.

Not really
Main reason for present crisis is that previous government wasted money of left wing populism(benchmarking, highest welfare benefits for long term unemployed etc) instead of reinvesting it to something, which could create sustainable jobs in long term
Banks are irrelevant - it is failure of socialist policies and high taxes wont solve anything

djpbarry

KyussBishop wrote: »

Even if we consider the increased public expenditure, as being down to the property boom, that is (yet again) something else caused by the banks, so it just reinforces my point.

The banks forced successive governments to increase spending?

KyussBishop wrote: »

Whatever about what should be done about it (a decision which does not stop at our government, but is in the hands of the EU), it is incorrect to say that the deficit was down to the people, when all it takes is a cursory look at the economic output gap, to see that it is caused by unemployment and the resulting lack of tax income; this makes unemployment the no.1 problem that should be solved before anything else (but which is impossible without EU recovery policies, which likely won't happen).

You’re completely absolving the Irish public of all blame, which is ridiculous. The country went all-in on a property gamble and lost the bet. Everyone involved is in some way responsible, whether that be FF for pursuing populist policies that involved eroding the tax base and increasing welfare, the general public for believing that property prices were going to climb ever upward and so mortgaged themselves into oblivion, the banks that provided those mortgages or the guys who left school early to make easy money on a building site and are now virtually unemployable. Absolving people of responsibility ensures that the same mistakes will be made again by the next generation, because nothing will be learned.

djpbarry

ardmacha wrote: »

That's exactly the problem. That's where this property bollix came from...

The property boom is the fault of the UK? That’s original.

creedp

You’re completely absolving the Irish public of all blame, which is ridiculous. The country went all-in on a property gamble and lost the bet. Everyone involved is in some way responsible, whether that be FF for pursuing populist policies that involved eroding the tax base and increasing welfare, the general public for believing that property prices were going to climb ever upward and so mortgaged themselves into oblivion, the banks that provided those mortgages or the guys who left school early to make easy money on a building site and are now virtually unemployable. Absolving people of responsibility ensures that the same mistakes will be made again by the next generation, because nothing will be learned.[/QUOTE]


If the Govt decided in the morning to remove all speed limits and trust the Irish public to drive at safe speed in every given circumstances but warned if they drove too fast they might get killed or kill - what would happen do you think? Would the Govt be able to turn around and blame the public for not doing the right thing if death/iinjury rates went through the roof?
Of course some of the blame must be apportioned to Joe Public but to consider that the banks and he Govt are not largely to blame is not reasonable in my view. And of course if they are not to blame for making the mess, they aren't the blame for fixing the mess. So let's have to more talk of debt relief/restructuring/more leniant bankruptcy rules etc. In fact why do we need Govt and regulation in the first place.

djpbarry

creedp wrote: »

Of course some of the blame must be apportioned to Joe Public but to consider that the banks and he Govt are not largely to blame is not reasonable in my view.

I know a guy, an investment manager as it happens, who bought a 4-bed house in Maynooth with his missus (an accountant) around about 2007/08, because they thought it was a sound investment. The price tag was roughly €400k. The place is now worth less than half that.

You want to explain to me how that €200k hit that this guy and his wife have taken is not largely their own fault for making a monumentally stupid "investment"?

ardmacha

The property boom is the fault of the UK? That’s original.

Hardly original. Others have noted that we have taken the housing as investment idea from our previous currency union with Britain into a modern currency union with very different attitudes to property. And a British bank substantially inflated the Irish property boom and did as much damage as our local eejits.

creedp

djpbarry wrote: »

I know a guy, an investment manager as it happens, who bought a 4-bed house in Maynooth with his missus (an accountant) around about 2007/08, because they thought it was a sound investment. The price tag was roughly €400k. The place is now worth less than half that.

You want to explain to me how that €200k hit that this guy and his wife have taken is not largely their own fault for making a monumentally stupid "investment"?

Not everyone who bought a house was an investment manager and an accountant who were buying as a sound investment. Many, many were ordinary joes buying a home. I'm not absolving these ordinary joe's of all responsibility but I do think the Govt and the banks have to shoulder a large part of the blame.

KyussBishop

Count Dooku wrote: »

Not really
Main reason for present crisis is that previous government wasted money of left wing populism(benchmarking, highest welfare benefits for long term unemployed etc) instead of reinvesting it to something, which could create sustainable jobs in long term
Banks are irrelevant - it is failure of socialist policies and high taxes wont solve anything

While I agree that there has been a lot of inefficiency in our government over the years, the troubles with public expenditure are largely caused by the high unemployment rate reducing taxes, and the debt burden of socializing the bank losses.

It is the profligacy of the private banking industry, in overextending credit/debt, and making a large part of economic output dependent on a debt-sustained property boom (which was bound to leave significant unemployment, after going bust), which caused all of the economic problems that 1: saddled the government with great debt burdens, and 2: reduced the tax intake through unemployment and wider economic damage.

The narrative that seems to be pushed often when discussing this topic, which absolves the private banking (and financial) industry of all blame, and tries to shift it onto government, can be seen past easily enough, as it just requires looking at the scale of the problem of private debt, of the credit giving out by the banks.

KyussBishop

djpbarry wrote: »

The banks forced successive governments to increase spending?

You need to deliberately oversimplify my post to whittle it down to that.

djpbarry wrote: »

You’re completely absolving the Irish public of all blame, which is ridiculous. The country went all-in on a property gamble and lost the bet. Everyone involved is in some way responsible, whether that be FF for pursuing populist policies that involved eroding the tax base and increasing welfare, the general public for believing that property prices were going to climb ever upward and so mortgaged themselves into oblivion, the banks that provided those mortgages or the guys who left school early to make easy money on a building site and are now virtually unemployable. Absolving people of responsibility ensures that the same mistakes will be made again by the next generation, because nothing will be learned.

The Irish public in general isn't to blame, but those within the Irish public who took out unsustainable mortgages, and who participated in the property bubble, do indeed share some of the blame.

What I mainly take exception to, is pinning all of the blame onto the public, while seeming to absolve banks/finance and government of blame; more so, when people do blame 'the public', it's inaccurate to generalize and pin the blame on everyone, rather than only those involved in the property bubble.


Again, it was not government spending that was unsustainable during the buildup to the crisis, it was private spending and debt that was unsustainable, as well as private industry focusing too much on a property bubble (which, once it vanished, left significant unemployment and a deteriorating economy).

The post-crisis government spending became overburdened with the debt created by private banks, and with the loss of tax income generated by the economic damage (particularly unemployment); neither of these problems caused by government spending, but by private spending/debt.

KyussBishop

djpbarry wrote: »

I know a guy, an investment manager as it happens, who bought a 4-bed house in Maynooth with his missus (an accountant) around about 2007/08, because they thought it was a sound investment. The price tag was roughly €400k. The place is now worth less than half that.

You want to explain to me how that €200k hit that this guy and his wife have taken is not largely their own fault for making a monumentally stupid "investment"?

He is on the hook for his debt, and that is his responsibility, but the private banking/finance industry, as well as government, are all culpable for helping inflate house prices, thus they are culpable for a large part of his debt.

The property bubble should not have been inflated, should not have been encouraged by the banking/finance industry and government, and it should have been stopped by the private banking industry and government (there was breaching of regulations i.e. law, in private banking/finance, and a failure to enforce adequate regulations by government).

This failure (and probably corruption/fraud) by the banking/finance industry and government, automatically makes them responsible for a portion of the debt created by their inflation of the bubble.


This is partly why, both in the EU and the US, governments/banking/finanace are shít-scared of any lawsuits going after bankers (thus why they are de-facto beyond the law now); if any of that starts leading to damages or liabilities being taken from indebted homeowners, and placed on banks/government, it's going to create an incredibly messy financial situation, which will worsen their balance sheets, and may well also worsen the crisis.

Count Dooku

KyussBishop wrote: »

While I agree that there has been a lot of inefficiency in our government over the years, the troubles with public expenditure are largely caused by the high unemployment rate reducing taxes, and the debt burden of socializing the bank losses.

a) income tax take have been significantly increased despite high unemployment rate, it means that most of presently unemployed paid very little tax
b) JB + JA cost together about 3Bn, so unemployment could be easily afforded if public services were not so massively overpaid and inefficient
c) Bank debt burden been made more affordable
d) Fianna Fail is rising in polls, it means that people are not blaming so much previous government for all it failures

KyussBishop

Count Dooku wrote: »

a) income tax take have been significantly increased despite high unemployment rate, it means that most of presently unemployed paid very little tax
b) JB + JA cost together about 3Bn, so unemployment could be easily afforded if public services were not so massively overpaid and inefficient
c) Bank debt burden been made more affordable
d) Fianna Fail is rising in polls, it means that people are not blaming so much previous government for all it failures

None of that is relevant to your claim though, as it is all based on looking at government post-crisis, without looking at the pre-crisis causes of the current situation; the situation we are dealing with post-crisis is caused by 1: the socialization of bank debt and 2: the output-gap (GDP being far below potential) and associated unemployment, creating a shortfall of taxes below what there would be, if there was full employment and GDP was at full potential.

Also, the unemployment caused by the crisis (i.e. in large part caused by the private banks profligacy), does (as you say) lead to higher public expenditure post-crisis too; again, that is down to the tanking of the economy and unemployment, that private spending/debt generated.

The situation for the public finances post-crisis is certainly unsustainable, but it is incorrect to say that they (the public finances, not private) were unsustainable pre-crisis.

Pre-crisis, it is the private industry spending/debt was unsustainable, and public finances were well in order (as far as sustainability goes).

carpejugulum

KyussBishop wrote: »

Actually the deficit is largely to do with the economic crisis causing large scale unemployment, and thus a loss of tax revenue; this largely is a problem created by the banks.

Utter nonsense. Unemployment was low only because of the enormous debt incurred during the bubble years. So the tax revenue was just a bubble that needs to be paid by someone now.

carpejugulum

paul71 wrote: »

Why don't the government stop providing me ... social welfare if I lose my job

PRSI is just income tax with no real ties to your welfare entitlements. In fact, you could be paying high PRSI for years and be entitled to less than people on welfare from the cradle to the grave when you lose a job.