Will we need a second bailout?

I am making this specific.

Will we need a second bail out.

Will the main banks be nationalised,.. cant recapitalise, mortgage debts.

comongethappy

mariaalice wrote: »

I am making this specific.

Will we need a second bail out.

Will the main banks be nationalised,.. cant recapitalise, mortgage debts.

I'm going to say no....

But we won't know till October.

Geuze

mariaalice wrote: »

I am making this specific.

Will we need a second bail out.

Will the main banks be nationalised,.. cant recapitalise, mortgage debts.

No, we won't need a second bailout.

Govts only need to borrow from the IMF when they are frozen out of regular bond markets.

We can now borrow over 10y at 2.5% in the bond market.


The main banks have been nationalised already.

AIB, ptsb, BoI, EBS, Anglo, Irish Nationwide were all recapitalised by the State.

K-9

Geuze wrote: »

No, we won't need a second bailout.

Govts only need to borrow from the IMF when they are frozen out of regular bond markets.

We can now borrow over 10y at 2.5% in the bond market.


The main banks have been nationalised already.

AIB, ptsb, BoI, EBS, Anglo, Irish Nationwide were all recapitalised by the State.

I suppose until we know what size the hole is it's hard to call either way. It definitely seems there is a reluctance on banks to recognise the size of the mortage problem, interest only and "investment" mortages from the bubble especially. While banks concentrated on increasing deposits and improving liquidity they didn't want to write off more debt than they had to.

I'm not sure if the part of the bail out that was specifically set out for banks was ever used. If it wasn't it seems a mistake to me due to lack of political will.

Sand

The government also appears to still be holding out hope for retroactive recapitalisation of the Irish banks by the ESM. It is unclear why, as small children who believe in Santa were smart enough to know the Germans would never agree.

The Germans keep telling us they wont agree, in a variety of different languages and yet the government persists with planning on the assumption they will get a second bailout. See this morning's Irish Times.

Ireland has ‘no chance’ of deal on legacy bank debt, says senior German politician
Economics spokesman for Merkel’s party says ESM is ‘only for an emergency’

Ireland has “no chance” of securing a deal on its legacy bank debt, one of the most influential figures in German politics has told The Irish Times.
Joachim Pfeiffer, who is the economic policy spokesman for the parliamentary group of the ruling Christian Democrats, said the euro zone’s new bailout fund had not been established for nor would be it used for retroactive bank recapitalisation.

“There is no chance Ireland’s legacy assets will be paid by the European Stability Mechanism (ESM). This instrument is only an instrument for emergency.”

His comments appear to punch a hole in the Government’s long-standing campaign to be compensated for the €25 billion it pumped into Bank of Ireland and Allied Irish Banks at the height of the crisis.

Dr Pfeiffer was in Dublin yesterday to speak at an event hosted by the German-Irish Chamber of Industry and Commerce.

The German politician said the rules governing the ESM regime had “already been decided” and that the €60 billion fund would only be used for future bank rescues. “If you look at the text, there is no possibility of retroactivity.”

Home-made bubbles
Dr Pfeiffer said the financial meltdown in Ireland “did not fall from heaven . . . there were bubbles in the real estate sector, there were bubbles in the banking sector and all of this was home-made”.
If the ESM was to be used retroactively to compensate Ireland, he said other countries such as Greece, Spain, Portugal and potentially Italy would want similar compensation.

He said Ireland’s debt burden had already been substantially reduced through the extension of its troika loans and via the Anglo promissory note deal.
Last night, a spokesman for the Department of Finance insisted European leaders had agreed that retrospective recapitalisation would be decided on a case-by-case basis and that this was clearly laid out in the agreement establishing the ESM.

“The agreement now in place gives us the option of applying to the ESM for a retrospective direct recapitalisation of the Irish banks. An application can only occur after the single supervisory Mechanism is operational, most likely towards the end of this year.”

‘Potential returns’
“Any application for retrospective recapitalisation will be considered in light of the potential returns to the State from alternative options for realising the value of the State’s bank holdings,” he added.
The ESM’s direct bank recapitalisation instrument will come into effect in November when the European Central Bank takes over supervision of euro zone banks.
Minister for Finance Michael Noonan has indicated the Government will make an application when the mechanism becomes operational but not necessarily this year.
Dr Pfeiffer, who also held a short meeting yesterday with Taoiseach Enda Kenny, said the euro zone debt crisis was not yet over but that Ireland was “now firmly on the right track”.
He said Ireland was an example to other countries in how it had accepted the burdens of its financial past, increased its competitiveness through lowering its labour costs and reformed its tax code.
“If you look to Italy and France, especially to France, I don’t see them as being on the right track.”

The TL;DR version is:

1. Germany will never, ever, ever, ever, ever, ever, ever, ever, ever agree to bailout Ireland, Greece, Spain, Portugal or even Italy from the kindness of its heart. They will only ever do so if they feel their own national interests are in immediate peril and even then they will hesitate and dawdle.
2. As Enda Kenny dumbly told Europe at every opportunity, Germany is convinced that the problem was an Irish one. Not a European one. So it is right and proper that we take on the costs of solving it.
3. The DoF is still bleating on about what they *thought* was agreed back in 2012. It seems they cant accept they fooled themselves when the Germans agreed to let the Irish make a request that the Germans could then deny.

No Pants

Would it have killed you to have included the words second bailout in the thread title?

Sand

Cut backs.

steveblack

It depends who is in power, FG will tax us to the hilt to make debt repayments.
Who knows if the other political parties will be the same.

realitykeeper

Geuze wrote: »

No, we won't need a second bailout.

Govts only need to borrow from the IMF when they are frozen out of regular bond markets.

This assumes the bond markets will not collapse. If that were to happen, the IMF/World Bank would not have the funds to help - at least not without causing hyperinflation in all the major currencies. As far as I know, an international bond market collapse has never happened but it could happen either as a follow on from a collapse in the stock market or if the perceived safety of the bond markets come into question.

On a side note, the German Vice Chancellor said last week that there will be no retro bailout for Ireland because it was our housing bubble and it was our governments decision to bailout the banks. The Vice Chancellor is correct - a fact that should have been obvious from the beginning.

Perhaps now Minister Noonan will acknowledge the stupidity of his actions and begin to systematically reverse every decision he made so that private debt can revert the the institutions and individuals who acquired it.

daveohdave

We will when the Double Irish loophole is closed, since absolutely nothing is being done to prepare for the eventuality. Not that we'll get it.

ZeroThreat

anyone with a modicum of sense will have left this country by that stage.

realitykeeper

realitykeeper wrote: »

This assumes the bond markets will not collapse. If that were to happen, the IMF/World Bank would not have the funds to help - at least not without causing hyperinflation in all the major currencies. As far as I know, an international bond market collapse has never happened but it could happen either as a follow on from a collapse in the stock market or if the perceived safety of the bond markets come into question.

On a side note, the German Vice Chancellor said last week that there will be no retro bailout for Ireland because it was our housing bubble and it was our governments decision to bailout the banks. The Vice Chancellor is correct - a fact that should have been obvious from the beginning.

Perhaps now Minister Noonan will acknowledge the stupidity of his actions and begin to systematically reverse every decision he made so that private debt can revert the the institutions and individuals who acquired it.

Why would the bond markets collapse? at this time, I am not talking about the could haves or in the distant future. I am going to buy...Money and Tough love: on tour with the IMF, I listened to the author being interviewed and he has some really interesting things to say.

realitykeeper

mariaalice wrote: »

Why would the bond markets collapse? at this time, I am not talking about the could haves or in the distant future. I am going to buy...Money and Tough love: on tour with the IMF, I listened to the author being interviewed and he has some really interesting things to say.

Investors are so worried about the pumped up equity markets that they are buying Irish and Greek bonds. (I mentioned earlier, Ireland will not get retrospective recapitalization payments for bailing out the banks). When investors throw money at bad bonds then you get a bubble in the bond market. It is now abundantly clear that the equity and bond markets of first world countries are inflated to super bubble status. Due to the ongoing borrowing of our government, every day that goes by without an economic crash is a bad day because it will make the inevitable worse when it comes.

carpejugulum

I'd like to know how a country with bloated public service and welfare system, ageing population and high unemployment and especially youth unemployment can reasonably expect to serve €180,000,000,000 of national debt, which keeps raising.
Where is the miraculous economic growth that could cover it going to come from?

hfallada

carpejugulum wrote: »

I'd like to know how a country with bloated public service and welfare system, ageing population and high unemployment and especially youth unemployment can reasonably expect to serve €180,000,000,000 of national debt, which keeps raising.
Where is the miraculous economic growth that could cover it going to come from?

Yes our population is aging. But its still one of the youngest in the EU by far. Our public sector has gradually being scaled back and wage levels are far more manageable. Unemployment is declining and is now less than 11,3%. Which is impressive considering it was nearly 15% a few years ago.

Our economy is growing and although growth is slow. It's expected to improve in the next few years. We have had 15 months of increased manufacturing, increased demand for services and we have a recovering building industry. That's were the growth will come from.

When your interest rate is only 2,5% when we issue new debt. Serving our loans won't be difficult

Icepick

hfallada wrote: »

Yes our population is aging. But its still one of the youngest in the EU by far. Our public sector has gradually being scaled back and wage levels are far more manageable. Unemployment is declining and is now less than 11,3%. Which is impressive considering it was nearly 15% a few years ago.

Our economy is growing and although growth is slow. It's expected to improve in the next few years. We have had 15 months of increased manufacturing, increased demand for services and we have a recovering building industry. That's were the growth will come from.

When your interest rate is only 2,5% when we issue new debt. Serving our loans won't be difficult

Wishful thinking will do it, as expected.

Rightwing

The banks won't need to be recapitalised. Europe's banks are in a far, far position. Portugal's biggest bank needed a bailout today.

As for the country, you can never be sure, unless you keep spending under control. For that reason, I favour more austerity.

AlekSmart

Rightwing wrote: »

The banks won't need to be recapitalised. Europe's banks are in a far, far position. Portugal's biggest bank needed a bailout today.

As for the country, you can never be sure, unless you keep spending under control. For that reason, I favour more austerity.

Do we have an "Austere" smiley ?....if not then we need one NOW !

Banco Espirito Santo....God Bless it......

http://www.theaustralian.com.au/business/wall-street-journal/portugals-central-bank-to-bail-out-troubled-lender/story-fnay3ubk-1227013285663?nk=c90403ef7bec706dacf2f6187928a387

Phew....poor oul Bondholders saved agin......drat !!

Under the €4.9 billion ($7.1bn) plan, depositors and senior bondholders will be spared, while the bank’s subordinated creditors and current shareholders will be in line for losses.

Rightwing

AlekSmart wrote: »

Do we have an "Austere" smiley ?....if not then we need one NOW !

Banco Espirito Santo....God Bless it......

http://www.theaustralian.com.au/business/wall-street-journal/portugals-central-bank-to-bail-out-troubled-lender/story-fnay3ubk-1227013285663?nk=c90403ef7bec706dacf2f6187928a387

Phew....poor oul Bondholders saved agin......drat !!

Nothing can be done about that.
Bondholders and depositers, pari passu.

Godge

mariaalice wrote: »

I am making this specific.

Will we need a second bail out.

Will the main banks be nationalised,.. cant recapitalise, mortgage debts.

No we won't, our budget deficit this year is likely to be as low as 4%. The water charges being introduced next year will get us most of the rest of the way to 3%.

Unemployment is falling, reducing the pressure on the social welfare budget, also freeing up resources to tackle the unwilling and/or unable to work.

realitykeeper wrote: »

This assumes the bond markets will not collapse. If that were to happen, the IMF/World Bank would not have the funds to help - at least not without causing hyperinflation in all the major currencies. As far as I know, an international bond market collapse has never happened but it could happen either as a follow on from a collapse in the stock market or if the perceived safety of the bond markets come into question.

On a side note, the German Vice Chancellor said last week that there will be no retro bailout for Ireland because it was our housing bubble and it was our governments decision to bailout the banks. The Vice Chancellor is correct - a fact that should have been obvious from the beginning.

Perhaps now Minister Noonan will acknowledge the stupidity of his actions and begin to systematically reverse every decision he made so that private debt can revert the the institutions and individuals who acquired it.

You are betting on a never happened before scenario to require a second bailout. Seems fair enough as it it never happened before, it is well down the likelihood of happening ever.

carpejugulum wrote: »

I'd like to know how a country with bloated public service and welfare system, ageing population and high unemployment and especially youth unemployment can reasonably expect to serve €180,000,000,000 of national debt, which keeps raising.
Where is the miraculous economic growth that could cover it going to come from?

You are stuck back in 2010, a lot has changed since then.

Frank Lee Midere

Godge wrote: »

No we won't, our budget deficit this year is likely to be as low as 4%. The water charges being introduced next year will get us most of the rest of the way to 3%.

Unemployment is falling, reducing the pressure on the social welfare budget, also freeing up resources to tackle the unwilling and/or unable to work.




You are betting on a never happened before scenario to require a second bailout. Seems fair enough as it it never happened before, it is well down the likelihood of happening ever.



You are stuck back in 2010, a lot has changed since then.

The debt has increased since then. For sure.

golfwallah

This Irish Times article makes the point the the banks are doing slightly better than they were in 2010 but are making very little headway with the real problem of mortgage arrears:

the problem of mortgage arrears is far short of being resolved. Or even well in hand, as the banks might want us to believe. A day of reckoning can’t be too far away.

OK, they are going through the motions of trying to solve the problem, filling out the paperwork, etc., but it appears very little real progress is being made.

Ah, but then again maybe they're hoping somehow that it is really not their fault, the Germans can be blamed and / or something will turn up later down the road to save them (or us)?

goz83

Just wait for the real crash. The 2007/08 crash was a single step down into the abyss that is before us. This so called recovery is just dead cat bounce. When banks are given the ok to print away our economic energy, they are stealing the value of the numbers in our wallets and savings accounts. A proper collapse is inevitable and as an earlier poster mentioned, we certainly have not reached the bottom. Maybe that's why the banks have not ramped up repossessions since many mortgages are still not performing, but have emerged from negative equity for the time being.

Rightwing

Another bailout may just be required, if they are already planning on restoring public sector pay cuts.

Can't beat stupidity.

Head The Wall

But you can avoid it, I put my money where my mouth is and left in 2011. Best decision I have made.

It was sickening watching the waste and abuse of the system in Ireland and then getting shafted paying taxes towards it and feck all rights when you need them yourself. I'm not saying here is a perfect place but it's much better than Ireland

ZeroThreat

Head The Wall wrote: »

But you can avoid it, I put my money where my mouth is and left in 2011. Best decision I have made.

It was sickening watching the waste and abuse of the system in Ireland and then getting shafted paying taxes towards it and feck all rights when you need them yourself. I'm not saying here is a perfect place but it's much better than Ireland

Just wait till the property bubble there implodes though. It will be soon enough.

Head The Wall

That's not really going to make much difference to me. I don't feel the need to own the roof over my head, I'm happy to pay for the service of having a roof over my head

barneystinson

Head The Wall wrote: »

But you can avoid it, I put my money where my mouth is and left in 2011. Best decision I have made.

It was sickening watching the waste and abuse of the system in Ireland and then getting shafted paying taxes towards it and feck all rights when you need them yourself. I'm not saying here is a perfect place but it's much better than Ireland

Yet you persist with posting in the Irish Economy forum on Boards.ie...!

Kind of like a bitter ex...

goz83

Head The Wall wrote: »

That's not really going to make much difference to me. I don't feel the need to own the roof over my head, I'm happy to pay for the service of having a roof over my head

It might when jobs evaporate into the ether and you find yourself paying taxes over there for the same things you ran away from here.

After all, you were comfortable not owning the roof over your head in Ireland too

Head The Wall

barneystinson wrote: »

Yet you persist with posting in the Irish Economy forum on Boards.ie...!

Kind of like a bitter ex...

You're the one that comes across as juvenile with that comment, do I need yours or someone elses permission to convey my opinion here. No I don't and it's you that sounds bitter because you don't like when someone from outside speaks the truth

goz83 wrote: »

It might when jobs evaporate into the ether and you find yourself paying taxes over there for the same things you ran away from here.

After all, you were comfortable not owning the roof over your head in Ireland too

And so what if things change here, there is no static anymore in life, I'm a doer so you just go and do what you have to do. And not owning a house gives me the freedom to move when I need to. I consider myself in a good situation

I don't think a second bail out will be required, however I think people should consider that "recovery" will have no real effect on most of us.

The USC is here to stay, so too the current levels of taxation. The VAT rate may or may not be reduced back to 21% but for most things will remain as they are.

Harold Weiss

The Irish government will still be eating Fillet Steak and drinking Champagne while the country is on its knees.

“Charlie, Boss, the last of those lives has now been extinguished,” said Mr Ahern. “The life of the most agile and able of our political leaders is still.”

These are the same people running the country today so nothing will change until ordinary folks get involved in politics.

Bailout 2.0 will definitely happen but I don't know when.
Privatization of the country will probably happen pretty hard and fast in return.

ZeroThreat

Harold Weiss wrote: »

The Irish government will still be eating Fillet Steak and drinking Champagne while the country is on its knees.

“Charlie, Boss, the last of those lives has now been extinguished,” said Mr Ahern. “The life of the most agile and able of our political leaders is still.”

These are the same people running the country today so nothing will change until ordinary folks get involved in politics.

Bailout 2.0 will definitely happen but I don't know when.
Privatization of the country will probably happen pretty hard and fast in return.

Maybe the Germans will just buy up all the land right around the coast in return

Jim2007

Harold Weiss wrote: »

Bailout 2.0 will definitely happen but I don't know when.

And what exactly makes you so definite about that??? Especially considering the following facts as opposed to opinion:

- Irish banks T1 ratios are as good as if not better than most Euroland banks
- Ireland is an net exporting country and has been for a long time
- The mechanism under which the ECB can act as a lender of last resort has been significantly changed
- Ireland has/had a liquidity problem not an insolvency problem

jmayo

mariaalice wrote: »

I am making this specific.

Will we need a second bail out.

Will the main banks be nationalised,.. cant recapitalise, mortgage debts.

Ehh don't you mean BOI, as it is the only one which is not in state majority ownership to the best of my knowledge ?

hfallada wrote: »

Yes our population is aging. But its still one of the youngest in the EU by far. Our public sector has gradually being scaled back and wage levels are far more manageable. Unemployment is declining and is now less than 11,3%. Which is impressive considering it was nearly 15% a few years ago.

Our economy is growing and although growth is slow. It's expected to improve in the next few years. We have had 15 months of increased manufacturing, increased demand for services and we have a recovering building industry. That's were the growth will come from.

Ah yes we are going to build ourselves out of this mess. :rolleyes:

How much of our economy is FDI ?
And how long before the multinationals parent states move to close our attractiveness re tax loopholes ?
Too many states are beginning to get more than a little peeved at the likes of us depriving them of much needed taxes.
Eventually the barbed comments are going to amount to something concrete being done.

Rightwing wrote: »

The banks won't need to be recapitalised.
...

Why does that remind me of some ex regulators and governors of central banks ?

ZeroThreat

jmayo wrote: »

Ehh don't you mean BOI, as it is the only one which is not in state majority ownership to the best of my knowledge ?



Ah yes we are going to build ourselves out of this mess. :rolleyes:

How much of our economy is FDI ?
And how long before the multinationals parent states move to close our attractiveness re tax loopholes ?
Too many states are beginning to get more than a little peeved at the likes of us depriving them of much needed taxes.
Eventually the barbed comments are going to amount to something concrete being done.



Why does that remind me of some ex regulators and governors of central banks ?

Well, politicians in this country appear to be completely indifferent (or at the very worst, contempt) towards our indigenous SME sector, for whatever reasons.
This attitude will only make it all the worse the day tax dodging foreign investment dries up.

jmayo

ZeroThreat wrote: »

Well, politicians in this country appear to be completely indifferent (or at the very worst, contempt) towards our indigenous SME sector, for whatever reasons.
This attitude will only make it all the worse the day tax dodging foreign investment dries up.

It hasn't been the politicans alone.

I will always remember the fear the visit of one of major banks created in the management of a small indigenous electrical manufacturing export company.
And the wbankers knew it as they saundered arrogantly around the place.

Now compare that to the way the banks ended up flinging money at anyone involved in construction and at the developer class in particular.
Totally disgusting.

And even during the era of cheap money, manufacturing companies appear to be able to source funding more easily when some form of building was involved.

Jim2007

jmayo wrote: »

And how long before the multinationals parent states move to close our attractiveness re tax loopholes ?

That is not so easy do... If the home country pushes to hard it may force an MNC to decide to move GHQ and in addition to loosing whatever corp taxes they were getting they'd also potentially loose on payroll taxes... Take Transocean's switch to Geneva as it's HQ for example.

golfwallah

jmayo wrote: »

How much of our economy is FDI ?
And how long before the multinationals parent states move to close our attractiveness re tax loopholes ?
Too many states are beginning to get more than a little peeved at the likes of us depriving them of much needed taxes.
Eventually the barbed comments are going to amount to something concrete being done.

"Now, a group of Democrats in Congress want to make sure that any company that incorporates overseas would be barred from doing business with the government", according to this Washington Post article.

We could indeed need a 2nd bailout, if this group of democrats in the USA succeed in their efforts or if other unexpected big economic changes arise (e.g. through conflict escalation that impacts on oil prices, etc.).

But, otherwise, no - it will be business as usual, IMO.

Rightwing

golfwallah wrote: »

"Now, a group of Democrats in Congress want to make sure that any company that incorporates overseas would be barred from doing business with the government", according to this Washington Post article.

We could indeed need a 2nd bailout, if this group of democrats in the USA succeed in their efforts or if other unexpected big economic changes arise (e.g. through conflict escalation that impacts on oil prices, etc.).

But, otherwise, no - it will be business as usual, IMO.

The main thing is just to keep the budget deficit @ 0. That means controlling the PS.If they do that, no bailout, if they start giving pay rises, expect another bailout within 2-3 years.

golfwallah

Rightwing wrote: »

The main thing is just to keep the budget deficit @ 0. That means controlling the PS.If they do that, no bailout, if they start giving pay rises, expect another bailout within 2-3 years.

I don't think the word "keep" and the figure 0 are appropriate here. As far as I know, government is still deficit financing, borrowing to keep it up and will remain in this state for years to come. And all the while, they are making sounds that give some people the impression that we have turned the corner, are doing well and there is room for public pay increases, etc.

I guess that's what is to be expected when Labour minister Brendan Howlin is in charge of the purse strings!

Rightwing

golfwallah wrote: »

I don't think the word "keep" and the figure 0 are appropriate here. As far as I know, government is still deficit financing, borrowing to keep it up and will remain in this state for years to come. And all the while, they are making sounds that give some people the impression that we have turned the corner, are doing well and there is room for public pay increases, etc.

I guess that's what is to be expected when Labour minister Brendan Howlin is in charge of the purse strings!

True enough, but it is going in the right direction. I wouldn't blame Labour, the onus is also on FG.

ZeroThreat

golfwallah wrote: »

I don't think the word "keep" and the figure 0 are appropriate here. As far as I know, government is still deficit financing, borrowing to keep it up and will remain in this state for years to come. And all the while, they are making sounds that give some people the impression that we have turned the corner, are doing well and there is room for public pay increases, etc.

I guess that's what is to be expected when Labour minister Brendan Howlin is in charge of the purse strings!

You'd almost suspect the likes of Howlin are just trying to screw us up on purpose for a laugh, since it's sometimes difficult to accept people as mind numbingly stupid as him are in the Dail.....

Then of course I remember we have 'Worzel' Wallace and pot head elected to the Dail.

Godge

Rightwing wrote: »

The main thing is just to keep the budget deficit @ 0.

And where is it required that we keep a balanced budget for ever?

Rightwing wrote: »

That means controlling the PS.If they do that, no bailout, if they start giving pay rises, expect another bailout within 2-3 years.

Since when do the public service pay all of the taxes:rolleyes:

Rightwing

Godge wrote: »

And where is it required that we keep a balanced budget for ever?

Well if you are massively in debt (which the country is), I would encourage trying to pay down this debt rather than adding to it.





Since when do the public service pay all of the taxes:rolleyes:

Public service need not feel they have to do all the heavy lifting. Just realistic wages i.e. market rates.

PeteFalk78

Rightwing wrote: »

Public service needed feel they have to do all the heavy lifting. Just realistic wages i.e. market rates.

You really have absolutely no idea what you are talking about.

Rightwing

PeteFalk78 wrote: »

You really have absolutely no idea what you are talking about.

I think I'll take that as a compliment.

Chuckle chuckle.

Godge

Rightwing wrote: »

Public service need not feel they have to do all the heavy lifting. Just realistic wages i.e. market rates.

My point went way over your head.

You said that in order to keep the deficit at 0 (your idea, not anyone else's), the PS needed to be kept in check. That is such a one-dimensional view of the public finances that it required a sarcastic response. PS wages used to be one-third of public spending, now they are about 25%. It is social welfare spending that has exploded and is causing the problem, reducing the incentive to work and enabling a comfortable long-term life on welfare.

Rightwing

Godge wrote: »

My point went way over your head.

You said that in order to keep the deficit at 0 (your idea, not anyone else's), the PS needed to be kept in check. That is such a one-dimensional view of the public finances that it required a sarcastic response. PS wages used to be one-third of public spending, now they are about 25%. It is social welfare spending that has exploded and is causing the problem, reducing the incentive to work and enabling a comfortable long-term life on welfare.

That's rubbish if ever I read it.

Social welfare bill includes OAPs, child benefit etc. The actual amount for welfare recipients is less than half that budget. (But along with PS wages, it should also be cut by 25/33% depending on need).

comongethappy

Godge wrote: »

PS wages used to be one-third of public spending, now they are about 25%.

In 2013, gov spending was around €51 billion of which a little over €17 billion was on PS renumeration.... still about 1/3.

It is social welfare spending that has exploded and is causing the problem, reducing the incentive to work and enabling a comfortable long-term life on welfare.

The S/W bill has increased by about €5 billion from 2007.
Less than 1/4 of the current €20 billion s/w bill goes towards the dole.

golfwallah

Rightwing wrote: »

True enough, but it is going in the right direction. I wouldn't blame Labour, the onus is also on FG.

It may have been going in the right direction on some fronts up to now, but few would agree that this assessment applies to availability and prices of houses in Dublin.

The way I see it, FG are beholden to Labour to remain in power. Broadly speaking, FG’s political vision is based on self-reliance with citizens taking as much responsibility as possible for their own well being, i.e. right of centre. Labour, on the other hand, tends more to a vision of the “Nanny State” with massive state intervention (or inertia as regards maintaining the status quo), i.e. left of centre.

This conflict of political philosophies has been “fused together” in the coalition that came into being after the last general election. The main thing holding them together is their shared antipathy for Fianna Fail rather than any shared ideology. The inevitable result is compromise and ineffectiveness in government.

I have no great love for either FF or FG but, I think that most observers would concede, that personal differences aside, these 2 parties have a lot more in common than with either Labour or Sinn Fein. I know it would horrify some people, but for the good of the country, it would be far better if they laid aside their personal dislikes to come together to make a coalition based on similarities in their political philosophies.

This would provide a government with a more shared vision of how things should be done so we could move forward out of the current indecision and inertia that is so apparent in the housing market.