Is Joan Burton mad?

Sleepy

Or just stupid?

http://www.irishexaminer.com/archives/2013/0617/world/fg-resists-calls-for-minimum-wage-rise-234284.html

Calling for an increase to minimum wage in the middle of a recession? There's certainly no argument that the premium for working a minimum wage job over one's welfare entitlements is currently too small to entice many off the live register but surely the answer to this is to tighten up our welfare rates where necessary rather than opting for a measure that would lead to job losses?

She can be both

Good loser

She failed to do her job in the last two budgets and, with talk like this, is looking to do the same this time.

She should stick to her day job instead of baiting FG.

Expect Keaveney will be in to support her.

mariaalice

Her point ( I had a thread about this before ) is that employers who pay min wages to a family are being subsidise by the availably of family income supplement, and that perhaps this needs to be looked at. I would imagine its a very complex area and that the interplay between social welfare supports and wage rates is very hard to get right.

goose2005

At the moment, companies can pay employees an amount that no-one could possibly live on, and the welfare system has to step in to keep their employees alive.

Count Dooku

Or she wants to have more people unemployed and more job for her department
Or she decided to remind about herself that she always was and always will be left wing populist capable for waffling only without any thought about consequences

intellectual dosser

Mad Popular it seems...

bumper234

She basically knows that Labour (the party for the people lol) are ****ed, They will soon be going the way of the PD,s and the Greens and will disappear from the political coal face for years to come after selling their souls for a little bit of power. She knows come election time that Labour will be routed and therefore she is now and for the next couple of years going to slowly change position.

Soon you will see her openly opposing FG and even going against Gilmore. This will finally come to a head and she will throw down a vote of no confidence in Gilmore and oust him as leader, She will then pull Labour out of government forcing a general election while all of the time claiming that Labour had to do this for the Irish people.

Scortho

goose2005 wrote: »

At the moment, companies can pay employees an amount that no-one could possibly live on, and the welfare system has to step in to keep their employees alive.

Which is wrong.
That said, increase the minimum wage, employer can't afford to employ as many people as before, therefore redundancies and hey presto, they're now totally reliant on welfare.

Increasing minimum wage by 1 euro doesn't just increase minimum wage.
It increases wider demand for wage rises outside of minimum wage.
So your person on a wage of 12 euro an hour now wants a proportional wage rise.

Finally it's looking like the government and Joan especially have woken up to the fact that many people are better off not working on minimum wage. Her solution is right to increase the difference between minimum wage jobs and welfare, but increasing minimum wage will just reduce any potential new jobs being created.

RATM

Sleepy wrote: »

Or just stupid?

http://www.irishexaminer.com/archives/2013/0617/world/fg-resists-calls-for-minimum-wage-rise-234284.html

Calling for an increase to minimum wage in the middle of a recession? There's certainly no argument that the premium for working a minimum wage job over one's welfare entitlements is currently too small to entice many off the live register but surely the answer to this is to tighten up our welfare rates where necessary rather than opting for a measure that would lead to job losses?

But why so ? Why is it that welfare should contract rather than wages going up ?

Since this recession has started the price of everyday utilities has risen and risen. ESB, Gas, Health Insurance have all seen annual 10-15% increases for the last four years, making them now about 40-50% dearer than they were back in 2007-8. Petrol and diesel have also gone up significantly, so has things like Cable/Sky tv, cost of food, post stamps, bus & train fares, motorway tolls and so on. Practically everything that people need on a day to day basis has risen in cost during this recession. But wages have largely dropped for a majority of people in the economy.

A €1 rise in the minimum wage will mean that those working will be better off than those on the dole and will thus incentivise working over claiming benefits. If you cut the dole all you do is make things life more expensive for those on it with no net benefit to those who work and pay taxes, they are just left to suffer the burden the higher costs of living in this economy.

People keep talking about cutting the dole as the solution to our problems. I think instead the solution is ensuring that prices in Ireland become competitive. At the moment we paying 40% above the EU average for electricity, ourselves and Greece are in joint 1st position. We pay amongst the highest prices in Europe for prescription medicines, when the Dept of Health actually just 'asked' for a saving the pharma industry suddenly lopped a few hundred million euro off their bills. How many other instances of over spending are present in the Irish economy ? A lot I would say, the very fact that our energy, a ultility that all of us need both domestically and commercially, is 40% higher than the EU average speak volumes. Economies get stronger on cheap energy but in our case we are being strangled with the highest costs in the EU. If our energy costs are higher than 26 other countries that means the cost of any goods we manufacture are more expensive on the export market and thus in turn making our exports less competitive to EU equivalents which in turn means less exports. What the ESB and Bord Gais up to ? Why are we paying 40% more than the EU average for electricity ? Look at them before you go trying to make the unemployed poorer, the vast majority of whom would love to be working and earning their own money in an economy that is someway competitive.

Sleepy

Increasing minimum wage will make us less competitive, not moreso. As Scortho points out, it will lead to knock on raises across the board.

Why should welfare decrease? Because for many, it's a disincentive to work. It's significantly higher than the cost of survival in Ireland and that's all welfare was ever designed to support: survival. I'd agree that it needs more stratification e.g. high decreases for those living at home with parents or living in lower cost areas (e.g. rural areas are much cheaper to live in than urban), lower decreases or possibly even increases for those supporting large families etc. A total overhaul of welfare could save millions without negatively effecting recipients (e.g. scrap childrens allowance, replacing it with higher welfare rates for dependents and tax credits for those in employment, replacing rent allowance with long-term rental contracts between state and landlord, etc.).

While it may be facetious of ISME to claim such an increase would lead to employers being forced to let staff go on any wide-scale level, it may have that result in some small businesses and will certainly impact on any decision to increase numbers. Lets face it, the most problematic element of our Live Register isn't the young graduates leaving college, it's the former site-labourers and retail assistants that left school at 16 to join the Celtic Tiger workforce. Those that haven't up-skilled by now are either incapable or unwilling to do so and, as such, will only ever really be able to apply for minimum wage roles until they do. They're never getting large salaries for being unskilled workers in Ireland again (unless we find another bubble to over-inflate). Every extra euro added to the minimum wage makes it harder for employers to justify taking them on and as long as our welfare system provides as comfortable a lifestyle as it can do (or even luxurious a lifestyle when gamed appropriately) they have little incentive to upskill themselves or work for minimum wage.

Godge

Implicit in Burton's speech is an acceptance that the current crossover between social welfare and the minimum wage is a disincentive to work. This is the first time a Labour Minister has acknowledged that and it is a welcome result. The discussion now needs to move on to discuss the policy options to deal with this problem. These include:

(1) Increase the minimum wage
(2) reduce social welfare benefits.

Ms. Burton obviously favours the first option which is fair enough from her perspective. The second option is obviously on the table in budget talks which explains why she raised the issue. It offers many different ways of doing things.

Is there another policy option I am missing?

[Jackass]

The only reason I can think of for doing this would be to increase the incentive to work.

I would have thought reducing the rate of social welfare would have been the more sensible route to take in achieving this however, but for the political survival instinct superseeding the rational economic process.

I really does amaze me how we have a system (the world, in general) where we expect people making economic decisions to be people who also need to be popular, as the biggest obstacle to sensible economics is sensible politics.

Same reason that got us here in the first place, Bertie treating the national purse like a vote purchasing fund, we're now faced with fixing it but not willing to inflict the measures that are required due to wanting to win a next election that inevitably will be lost anyway when all the people who bleed FF will come back out and vote them back in in the hopes of the worst being over.

fly_agaric

[Jackass] wrote: »

I really does amaze me how we have a system (the world, in general) where we expect people making economic decisions to be people who also need to be popular, as the biggest obstacle to sensible economics is sensible politics

Only problem with that is economics is not really a hard science.
There's a large political (and probably moral/philosophical) basis that underpins the choices between economic policies. We can see it in Ireland even with the budget constraints we are operating under from outside. We have to cut spending or raise tax...what should be the balance between the two, what do we cut & what do we tax etc? If we sell assets to raise money how do we go about that? If a country is to be democratic, elected officials who need to win votes will have to have say when it comes to choosing the policies. Best that can be done is to educate people IMO.

Count Dooku

RATM wrote: »

But why so ? Why is it that welfare should contract rather than wages going up ?

Since this recession has started the price of everyday utilities has risen and risen. ESB, Gas, Health Insurance have all seen annual 10-15% increases for the last four years, making them now about 40-50% dearer than they were back in 2007-8. Petrol and diesel have also gone up significantly, so has things like Cable/Sky tv, cost of food, post stamps, bus & train fares, motorway tolls and so on. Practically everything that people need on a day to day basis has risen in cost during this recession. But wages have largely dropped for a majority of people in the economy.

A €1 rise in the minimum wage will mean that those working will be better off than those on the dole and will thus incentivise working over claiming benefits. If you cut the dole all you do is make things life more expensive for those on it with no net benefit to those who work and pay taxes, they are just left to suffer the burden the higher costs of living in this economy.

People keep talking about cutting the dole as the solution to our problems. I think instead the solution is ensuring that prices in Ireland become competitive. At the moment we paying 40% above the EU average for electricity, ourselves and Greece are in joint 1st position. We pay amongst the highest prices in Europe for prescription medicines, when the Dept of Health actually just 'asked' for a saving the pharma industry suddenly lopped a few hundred million euro off their bills. How many other instances of over spending are present in the Irish economy ? A lot I would say, the very fact that our energy, a ultility that all of us need both domestically and commercially, is 40% higher than the EU average speak volumes. Economies get stronger on cheap energy but in our case we are being strangled with the highest costs in the EU. If our energy costs are higher than 26 other countries that means the cost of any goods we manufacture are more expensive on the export market and thus in turn making our exports less competitive to EU equivalents which in turn means less exports. What the ESB and Bord Gais up to ? Why are we paying 40% more than the EU average for electricity ? Look at them before you go trying to make the unemployed poorer, the vast majority of whom would love to be working and earning their own money in an economy that is someway competitive.

1) increase of minimum wage will only benefit those who is getting minimum wage, those who just above will gain nothing
2) minimum wage increase will only boost inflation, because a lot of shops will to compensate increase on labour cost by increasing parices
3) minimum wage increase will increase unemployment because a lot businesses simply would not be able to afford
Conclusion - proposal of minimum wage increase is pure populism and if it will happen, nobody will gain anything

She is an idiot, a dangerous idiot.

This idea comes from the same Joan Burton who renamed the awful Fianna Fail/Green Work Placement Programme
as Jobbridge then ranted and raved about their great new internship scheme was a great idea.

Seems she won`t be happy until everyone in Ireland is unemployed and dependent on the state. Maybe she is a communist, she is a left winger and some in her party were communists. Crazy but it would tick all the boxes wouldn`t it?

wildefalcon

Of course it would never occur to Joan Burton that reducing the cost of living might be smarter.

Drop the VAT rate, reduce the cost of buying and running a car, ban private medical health cover for all senior employees (and family) of the Health Service, pay for school books, reduce public sector wages across the board, close the 2000 quangos, remove employers and employees PRSI up to €40,000, punitive business rates on empty shops/offices etc.

It's not how much you earn, it's how much you have LEFT that counts.

Count Dooku

[Deleted User] wrote: »

She is an idiot, a dangerous idiot.

This idea comes from the same Joan Burton who renamed the awful Fianna Fail/Green Work Placement Programme
as Jobbridge then ranted and raved about their great new internship scheme was a great idea.

Seems she won`t be happy until everyone in Ireland is unemployed and dependent on the state. Maybe she is a communist, she is a left winger and some in her party were communists. Crazy but it would tick all the boxes wouldn`t it?

She is not an idiot, idiots are those who voting for her. She perfectly knows that everything what she tells is lie but she knows that a lot of people will prefer lie over truth only because lie sounds better and doesn't require brain effort. She is preparing for role of new leader and she needs to get an attention, so idiots who will vote for her will remember that she was waffling something when she was in office.

noodler

I don't want to come across as a bleeding heart but one point about our welfare rates:

The general JBA decreased to 188 in Budget 2011.

It has stayed steady in the last two years despite inflation.

So, typically you got a nominal decrease to 188 in 2011,

Inflation was 2.6% in 2011 which means a real fall of another 5 euro to 183

Inflation in 2012 was 1.7% which means another 3 euro fall to 180 per week.

Inflation in 2013 will be lower, estimated at 1% by the ESRI currently.


So, all the while, many in the economy complain about their own sources of income being cut but many have likely seen their income keep track with inflation at least (PS with increments, certain parts of the private sector etc).

Bear in mind also that the general inflation rate I quoted above is an average of a basket of goods, certain items like groceries (and rent) will be proportionally more important to someone on welfare and such things have increased by even more than the average rate.

Reekwind

And again Boards has shown that people find it very, very easy to complain about those less fortunate. As if a modest increase in the minimum wage, which has been frozen since 2008, would suddenly make Ireland uncompetitive.

Scortho wrote:

That said, increase the minimum wage, employer can't afford to employ as many people as before, therefore redundancies and hey presto, they're now totally reliant on welfare.

So the solution is to continue effectively subsidising those companies who pay workers the least?

Deleted User wrote:

She is an idiot, a dangerous idiot....

Seems she won`t be happy until everyone in Ireland is unemployed and dependent on the state. Maybe she is a communist, she is a left winger and some in her party were communists. Crazy but it would tick all the boxes wouldn`t it?

Yes, she's the idiot and the person who thinks that she's secretly an undercover communist agent trying to destroy Ireland is the sane and rational one

Count Dooku

Reekwind wrote: »

So the solution is to continue effectively subsidising those companies who pay workers the least?

Do you mean that everything belongs to state?
And what alternative can you propose to create jobs?

Dannyboy83

wildefalcon wrote: »

Of course it would never occur to Joan Burton that reducing the cost of living might be smarter.

Drop the VAT rate, reduce the cost of buying and running a car, ban private medical health cover for all senior employees (and family) of the Health Service, pay for school books, reduce public sector wages across the board, close the 2000 quangos, remove employers and employees PRSI up to €40,000, punitive business rates on empty shops/offices etc.

It's not how much you earn, it's how much you have LEFT that counts.

It's Labour - they cannot really support any moves which will reduce the 'Cost of Living' (and never do), as that would involve going to war with the public sector and some of the monopolies and protected classes in the private sector... so the next best alternative is to 'increase the minimum wage'.

It's Labour through and through, a short-sighted attempt to try tackle the problem while attempting to circumvent all the hard decisions concerning their core supporter base.

I acknowledge that there is a serious problem here which needs to be addressed. Just try asking St.Vincent De Paul how many working families are asking for their assistance.
But I guess this measure will make things worse.

creedp

Dannyboy83 wrote: »

It's Labour - they cannot really support any moves which will reduce the 'Cost of Living' (and never do), as that would involve going to war with the public sector and some of the monopolies and protected classes in the private sector... so the next best alternative is to 'increase the minimum wage'.

It's Labour through and through, a short-sighted attempt to try tackle the problem while attempting to circumvent all the hard decisions concerning their core supporter base.

I acknowledge that there is a serious problem here which needs to be addressed. Just try asking St.Vincent De Paul how many working families are asking for their assistance.
But I guess this measure will make things worse.

Presumably by that you don't think an additional reduction of €1bn in public sector pay agreed by Labour will translate into lower costs for the private sector. Funny how high public sector wages are blamed for the high cost of living and cost of doing business here but when pay is cut it appears to have no impact on these issue.

Godge

noodler wrote: »

I don't want to come across as a bleeding heart but one point about our welfare rates:

The general JBA decreased to 188 in Budget 2011.

It has stayed steady in the last two years despite inflation.

So, typically you got a nominal decrease to 188 in 2011,

Inflation was 2.6% in 2011 which means a real fall of another 5 euro to 183

Inflation in 2012 was 1.7% which means another 3 euro fall to 180 per week.

Inflation in 2013 will be lower, estimated at 1% by the ESRI currently.


So, all the while, many in the economy complain about their own sources of income being cut but many have likely seen their income keep track with inflation at least (PS with increments, certain parts of the private sector etc).

Bear in mind also that the general inflation rate I quoted above is an average of a basket of goods, certain items like groceries (and rent) will be proportionally more important to someone on welfare and such things have increased by even more than the average rate.

You must feel really sorry then for those public servants who were at the top of their scale in 2008 and have seen severe cuts in pay since. There are very few public servants around who are paid more than 2008 unless they got a promotion.

Scortho

Reekwind wrote: »

And again Boards has shown that people find it very, very easy to complain about those less fortunate. As if a modest increase in the minimum wage, which has been frozen since 2008, would suddenly make Ireland uncompetitive.

So the solution is to continue effectively subsidising those companies who pay workers the least?

Yes, she's the idiot and the person who thinks that she's secretly an undercover communist agent trying to destroy Ireland is the sane and rational one

No I'd stop subsidies altogether.

SpaceTime

It's more that she (like most TDs and ministers) don't operate in the business world at all.
They're mostly former teachers, public servants, protected professions like lawyers etc. In Joan's case she's a former DIT lecturer if I'm not mistaken.

There aren't enough entrepreneurs going forward for political positions.

wildefalcon

creedp wrote: »

Presumably by that you don't think an additional reduction of €1bn in public sector pay agreed by Labour will translate into lower costs for the private sector. Funny how high public sector wages are blamed for the high cost of living and cost of doing business here but when pay is cut it appears to have no impact on these issue.

Well, it hasn't translated into lower taxes, either on production or consumption, so, no, I suppose. I'm not bashing the PS, by the way, just pointing out that it is currently very expensive, causing high taxes.

It's not the wages that cause high costs of living, it's the taxes

I also think that taxing employers for employing people is just mad.

Making transport costs (VRT/Road tax) for ordinary people among the highest in Europe makes them need more money to travel to work, in the absence of a decent public transport system.

Having a dysfunctional health system means they have to have VHI thus there is less to be spent in the local economy. Ban VHI for those in the public sector, including politicians (and their dependants) and I expect that the HSE would start working properly quite quickly.

Reduce the taxes on employment (employers PRSI), and allow employed people to take home and keep more than those on JSA etc, means that less people will be on JS, reducing the cost to the taxpayer. It's just too damn expensive to employ people in this country.

Again, not knocking those on JSA, they have to do what is right for them and their family, and if JSA makes sense for them, that's what they have to do.

BlatentCheek

SpaceTime wrote: »

There aren't enough entrepreneurs going forward for political positions.

The last entrepreneur I can remember going forward for a political position nearly got elected president before being revealed as a Fianna Fail bagman.

Through their lobby groups business people already enjoy far better access to decision making than most of the public. This may have something to do with why everyone's taxes have effectively been subsidising the minimum wage jobs they never stop boasting about "creating"

Lou.m

She is utterly mad and utterly stupid ...and she cannot string a normal sentence together ....everything comes out high pitched with an exclamation point!!!!!

What's with her intonation....sure indication of madness....

Dannyboy83

creedp wrote: »

Presumably by that you don't think an additional reduction of €1bn in public sector pay agreed by Labour will translate into lower costs for the private sector.

No, just guessing but I think that may possibly make the issue worse.
It's all coming out of the domestic economy, right?

As wildefalcon said "it hasn't translated into lower taxes".

So
i) Less money in the economy
ii) No change in cost of services, simply a reduction in borrowing
iii) No increase in net income

That doesn't reduce the cost of living or help private businesses as far as I can see.

One idea which I believe should be tried is to introduce a third tax band, then decrease the middle tax band; wealthier people would have less to save, but average people would have more to spend, and it's more likely, imo, to be spent in the domestic economy and on necessities, than to spent abroad on luxuries.

Funny how high public sector wages are blamed for the high cost of living and cost of doing business here but when pay is cut it appears to have no impact on these issue.

Why did you ignore the fact that I also commented on "some of the monopolies and protected classes in the private sector"?

creedp

Dannyboy83 wrote: »

Why did you ignore the fact that I also commented on "some of the monopolies and protected classes in the private sector"?

I didn't ignore it deliberately I just chose not to comment on it .. in the same way as you chose not to highlight that Labour has 'gone to war' and presided over cuts to some PS pay. Sorry I'm not trying making this a public/private argument (there's enough examples of that already out there) .. I'm simply making the point that cut to public expenditure have so far had no positive impact on the cost of living in this country. In fact the opposite is the case, i.e. cuts in public expenditure have coincided with significant increases in the cost of living/reductions in disposable income. These continuous cuts without corresponding measures to boost the domestic economy will simply lead to further reduction in economic activity and a further requirement to cut spend ... and the sprial will continue.