Will the Rainbow Coalition Wreck the Economy?

ReefBreak

Quick one for y'all. Spotted this question on the cover of a magzine in a shop at lunchtime (can't remember which one).

Mailman

It's not as though the current coalitions policies have helped the economy.
In the last 5 years due to policies pursued by this government we have lost our competitive advantage in Europe and will have problems retaining investment in the country especially when lower cost countries like the Czech republic, Poland and Hungary enter the EU.
I mean it's not like we have got a significantly better quality of life we just pay more for everything.

This question is reminiscent of the questions the Conservative party put to the english electorate in the early 90s when they couldn't think of compelling reasons to re-elect them for another term after scandal after scandal. All questions were along the line of Do you trust Lefties in government. Sort of better the devil you know arguement which is a sign of desperation and cynicism.

I wish to state I don't suggest that this is ReefBreak's motive for posting the question tough.

smiles

Will they? Future?

Seems like mailman's reply is talking about present/past....

rephrase the question?

<< Fio >>

smiles

Originally posted by Mailman
It's not as though the current coalitions policies have helped the economy.
In the last 5 years due to policies pursued by this government we have lost our competitive advantage in Europe and will have problems retaining investment in the country especially when lower cost countries like the Czech republic, Poland and Hungary enter the EU.

what policys have deliberatly (or even adversely) made us lose out competitive advantage?

Are you saying that we should discourage other countries from entering the EU because we're afraid of competition?

I mean it's not like we have got a significantly better quality of life we just pay more for everything.

I think there is plenty of evidence that we have a better quality of life, if not why are people immigrating and not emmigrating? Life they did years ago?

<< Fio >>

sceptre

Originally posted by ReefBreak
Quick one for y'all. Spotted this question on the cover of a magzine in a shop at lunchtime (can't remember which one).

Business and Finance I think. Got it in the post, haven't looked at it yet.

mike65

Which rainbow coalition are we talking about FG/Labour/Green?
plus or minus PD, Independants, Socialist Workers, Sinn Fein (:eek:) etc?

The next government will almost certainly be the current one
for good or ill, but its worth noting the so-called Celtic Tigger
phase started under a FG/Labour/DL government.

No government now or ever will jack up corporation tax or income tax outside a national emergency type situation. Its not the done thing.

People are plainly richer than they were on the whole but whether the "quality" of life is better is another matter, ask people on waiting lists...

Mike.

bonkey

Originally posted by mike65
No government now or ever will jack up corporation tax or income tax outside a national emergency type situation. Its not the done thing.

I would have thought it was the done thing. Ireland, and pretty much every other nation in the world has done it in the past, and i see no reason why they wont do it in the future.

Unless by "national emergency" you mean that the government doesnt have enough money to get through the following year.

People are plainly richer than they were on the whole but whether the "quality" of life is better is another matter, ask people on waiting lists...

People on waiting lists are not a highly representative cross-section for "quality of life". While not everyone is better off to the same degree, the vast majority of the country has seen an improvement in their quality of life.

I think it would be unfair to say that because you can find some small number of cases where life has not improved that we, as a nation, are not enjoying a better quality of life.

No-one ever suggested that life was perfect. There are still waiting lists, there are still homeless, there are still unemployed, yadda yadda yadda. However, the overall picture is better, and indeed the numbers of people who fall into these "wanting" categories has (by and large) decreased.

You can argue that we have not done as much as we could have with our newfound wealth, and I wouldnt necessarily disagree, but you have to acknowledge that we have seen a large number of improvements because of it.

jc

mike65

"It is not the done thing in an Anglo-American style free market, bonkey otherwise fair enough points, things have improved though eaten bread is soon forgotten. I wish we had actually had less emphisis on tax redutions myself, I think most of us can cope with 25% on a the typical industrial wage.

BTW "national emergency" could be anything the government wants it to be!

Back to quality, I think people expect more from services these days so folks get pissed off and grumpy quicker whereas before they might have just shugged thier shoulders and said "that's Ireland for you" or words to that effect. Anyway back on topic
I think the days of radical and possibly reckles shifts in economic
policy are over its about "steady as she goes" now.

Even the Seinners or SWP would discover that pretty quickly.

Mike.

Mailman

Infrastructure or lack of it.

Digital infrastructure of lack of it.

Inability to open up practically any other major market you care to think of.

Spiralling public spending

Rampant inflation leading to spiralling salaries that business have to meet as long as they operate from Ireland.

You'll note that I'm not looking at this from a lefties perspective.

As for quality of life - if you find yourself with a ruptured appendix and your admitted to hospital as an emergency you'll find yourself on a trolley in hospital irrespective of whether your and A B or C.

If you need to get from one side of Dublin to the other you'll be in a Jam irrespective of whether you drive a Starlet of an Lexus LS430.

bonkey

Originally posted by Mailman
Infrastructure or lack of it.

This is not an example of policy failure over the last 5 years. This is an example of lack of funds, coupled with policy failure over the last 20 years.

You cannot change a poor infrastructure into a good one in five years, no matter how much money you have. Blaming this on the actions of the recent governments is misguided. At the end of the day, what could they have done? Decide to spend all of the surplus we had in improving our infrastructure? Not only would this still not have been enough money, but it would also have meant none of the improvements we have seen, and a deliberate ignoring of all the other issues you also raise.

As a follow on :

If you need to get from one side of Dublin to the other you'll be in a Jam irrespective of whether you drive a Starlet of an Lexus LS430.

Here, we have a case to say that the decrease in taxation, leading to more money in the pockets of the people led to a greater than expected rise in car-ownsership.

Add to that the burgeoning of industry in and around Dublin, which was key to our economic revivial and you had an inevitable increase in traffic leading to jams.

Yes - some bad decisions were made - such as the repeated failure to decide on how to progress with the LUAS project, the docks tunnel, and the restructuring of public transport in general. However, these decisions were often being held up because of legitimate concerns - it wasnt all timewasting. If you examine the traffic-growth in Dublin, it was already critical before the government had any money for major restructuring, and it has consistently managed to grow faster than analysts predictions, which is the reason that rethinks were necessary.

Digital infrastructure of lack of it.

This is a private enterprise, not a governmental one. The only area where the government may be at fault here is in their inability to force the unbundling of the local loop.

You may recall the massive investment made in making Ennis the "technology town" to trial a number of systems which would lead to a new digital infrastructure. The privitasation of Eircom appeared to be a smart move initially, and only in hindsight can we honestly say that this has severely hampered the development of a modern digital infrastructure.

Exactly what do you think the government should have done?

Spiralling public spending

On what? Public Spending has spiralled because we had the money and there were numerous areas where it should have been spent. Are you saying it shouldnt have been spent (which would negate any other argument in terms of improving infrastructure etc which all comes out of public spending)?

Rampant inflation leading to spiralling salaries that business have to meet as long as they operate from Ireland.

This is not true - you have it about face. Salaries increased in the private sector because it became an employees market, and because the companies could afford to meet higher demands. In the private sector, salaries were increased more steadily, with most of the large increases coming from arguments that certain groups had been unfairly treated - which in most cases was perfectly true.

The increase in salaries led to inflation - which in turn led to higher salaries. The whole idea of the various partnership aggreements by the government was to keep the public-sector salaries in check to prevent inflation. I think you will also find that for about 1/2 of the timescale you mention, our inflation was well below expected levels, and it is only recently that it has gotten out of control.

As for quality of life - if you find yourself with a ruptured appendix and your admitted to hospital as an emergency you'll find yourself on a trolley in hospital irrespective of whether your and A B or C.

This is quality of medical care, not quality of life. There is a significant difference. Quality of life includes every aspect of your lifestyle. Of course there are some areas which have not improved significantly, but taking that as an indicator of the whole is as misguided as someone trying to argue that a rise in average salaries (allowing for inflation) is proof that QOL has improved. You cannot look at an isolated aspect and draw conclusions from it.

At the end of the day, people can pick the areas which they can say are not where they want them to be, and use this as proof that things are worse. This is completely ridiculous. First of all, there is a finite amount of money to spend. Secondly, when you decide where it should have been spent, not only do you have the benefit of hindsight, but you must also say where that money should not have been allocated, and then calculate the impact of it not having been spent in that location.

In short, its simple to be an armchair critic of government policy, but even if you are the world's best economist, you wont be able to show that your spending model would definitely have resulted in any improvement over the existing one.

jc

Mailman

I'm actively involved.
I was out last night campaigning for the removal of a cartel in the insurance industry which is causing much hardship for individuals and business alike. In that respect I'm better than many who hang out here and pontificate, I actually try to do something.
You on the other hand are based in Switzerland. You are not even participating.

Inflation resulted from massive salary increases in the public sector fueling inflation, not the private sector. The private sector is self regulating and just as many of those people who got salary increases and bonuses last year find they are either out of a job this year or have salary cuts and no bonus this year.

The low level of subsidisation of Dublin Bus is criminal and that could have been attended to in the 5 years this government were in business. Buses are a cheap and quick way of sorting out infrastructure in the short term while other more fundamental changes to the infrastructure are being implemented.

There are traffic jams in Dublin because there aren't enough buses(in the short term) and population in Dublin has actually increased in the last 5 years.

Digital Infrastructure was owned by the pbulic until it was sold off and when it was sold off it became a private monopoly so this government actually had the means of solving the problem but actually created a bigger problem through privatisation and the ODTR is going to have to take decades to sort it out.

Public spending spiralled on current expenditure not capital expenditure.

QOL - You don't consider emergency rooms or traffic jams to be part of your quality of life calculations.
You don't consider having to spend a greater proportion of average income on the roof over your head as opposed to entertainment as quality of life.

bonkey

Originally posted by Mailman
I actually try to do something.
You on the other hand are based in Switzerland. You are not even participating.

Sorry - I meant the term slightly differently.

So far, all I've seen are pat little comments on the failure of the government to do A, B, and C. You have yet to explain how these objectives could have been reached, what their cost would be, where the money would have come from, and what the impact of not spending it elsewhere would have been.

It is easy to say "the government should have done ....", but its much harder to show that your "shoulda" is actually a viable solution, let alone a better one.

Inflation resulted from massive salary increases in the public sector fueling inflation, not the private sector.

So, you are saying that the government would have been better off continuing to neglect the groups who had been underpaid for years, rather than try and amend the situation where they were massively underpaid? If not, then can you point out the problem in trying to bring the salaries of the public sector into line with what they should have been?

The low level of subsidisation of Dublin Bus is criminal and that could have been attended to in the 5 years this government were in business. Buses are a cheap and quick way of sorting out infrastructure in the short term while other more fundamental changes to the infrastructure are being implemented.

If you have traffic jams, then adding more buses will simply add to the traffic jams, not reduce the number of cars on the road. You must also convince people to leave their cars at home. THey will only do this if the bus-systems match their travel-direction, which for a huge percentage of the city, it does not. The radial-based system which we currently have is horrendously limited.

It is possible that a combined effort of a massive increase in bus-numbers (ideally using smaller buses on a more frequent basis), coupled with a restructuring of the entire city-wide traffic-flow system, including removal of a large percentage of city-centre parking may have resulted in something more than a short-term improvement, but the costs to that scale would be staggering - it is not a "cheap and quick" solution. Oh - and lets not forget that the decades-old radial bus system would have to be entirely scrapped, and a completely new bus-route system devised from scratch, which would need to work from day 1 in order for it to alleviate any traffic problems. And given the pathetic salary that bus-drivers get, you would have problems finding a fleet of new drivers....but god forbid we pay them more, because increasing the public-sector salaries led to inflation which was bad, as you already argued.

Also - again - I would ask....where would the money come from? If the underinvestment was that bad, then serious amounts of cash would have been needed. What should the government not have spent money on in favour of your buses, and can you accurately predict what the impact would have been? If you can, I suggest you go into business immediately, as your ability to accurately predict future expenditure cause-and-effect would be invaluable to pretty much every nation on earth.

Ultimately, there are only two points in the day when there arent enough buses. Morning and evening rush-hour. The cost of having an increase in bus-numbers simply to cater for these two peak times would not only have a massive initial cost (the number of buses needed to make a significant difference is massive when taken on a city-wide scale), but would also ensure that Dublin Bus would haemmorage money for the forseeable future - further hiking up the costs for your so-called "cheap" solution.

Still think its easy and obious? Then I'll ask this....why was billions earmarked for LUAS, when the same money could have more-than-doubled the bus-fleet in a much shorter time-frame? Could it possibly be because the experts brought in to analyse possible solutions came to the conclusion that it wouldnt work? I think you'll find that it was.

There are traffic jams in Dublin because there aren't enough buses(in the short term) and population in Dublin has actually increased in the last 5 years.

Dublin has had a traffic problem since at least the late 80's. The population changes in the past 5 years are not the problem - it ist he population changes in the last 15 years, coupled with the changing demographics of where people worked, and how they got there. As for population - I cant remember the last time Dublin didnt have an expanding population, so saying that it "actually increased in the last 5 years" is a but redundant.

QOL - You don't consider emergency rooms or traffic jams to be part of your quality of life calculations.
You don't consider having to spend a greater proportion of average income on the roof over your head as opposed to entertainment as quality of life.

Which part of You cannot look at an isolated aspect and draw conclusions from it and Quality of life includes every aspect of your lifestyle did you have a problem understanding.

I do consider these things to be part of the calculation, given that I clearly stated you must take all factors into consideration. You are taking isolated specifics to try and strengthen your case. I am pointing out that this is an invalid approach.

Mailman

When buses run only every 20 minutes to some of Dublins largest suburbs and when buses don't actually take you to locations where people actually want to go then there is a problem and people are forced to take cars.
Management in Dublin Bus are in agreement with me even if you are not and their plans for the service are limited by their budget.

The salary increases in the public sector haven't been fairly divided. Certain groups in the Public sector which have more power than others have got salary increases and others were ignored. And then other sections of the Public Sector who weren't necessarily deserving but in a position to do so flexed their muscles and got increases too. Many clerical staff and hospital staff are still underpaid, others are overpaid when you consider the service they provide and productivity concessions they surrendered for the salary increases they were given.

Outlining polices takes time and forums don't lend themselves to that as I'm not writing a reply to you solely but to the others who frequent this board as well.

The QOL issues I mentioned are major components of QOL and have a larger weighting than many other items and that is why they are mentioned so there is nothing invalid about mentioning them.
Are you telling me that if I spend 2 hours in a traffic jam everyday, have to sleep on a trolley for a week in Hospital or have no disposable income because I'm too busy paying back a mortgage or Rent are trivial when considering QOL then yes, you are right.

bonkey

Originally posted by Mailman
Management in Dublin Bus are in agreement with me even if you are not and their plans for the service are limited by their budget.

Yes, because the people who give them their budget have analysed the situation, and determined that the best use of the available funds is not the Dublin Bus expansion plans, because those plans are not sufficient.

Also, as I pointed out, you need a co-ordinated traffic plan and not just "more buses", and Dublin Bus cannot simply go it alone.

I would also suggest you look at how LUAS was funded. There were massive areas of land which belonged to Dublin Bus which were sold off. Now, if they funded LUAS by this, why didnt they use this money to fund their own plans which you claim are limited by budget?

The QOL issues I mentioned are major components of QOL and have a larger weighting than many other items and that is why they are mentioned so there is nothing invalid about mentioning them.
Are you telling me that if I spend 2 hours in a traffic jam everyday, have to sleep on a trolley for a week in Hospital or have no disposable income because I'm too busy paying back a mortgage or Rent are trivial when considering QOL then yes, you are right.

Newsflash. 2/3 of the country do not live in Dublin, and of the 1/3 who do, only a fraction are sitting in traffic jams for 2 hours. Maybe you could look at the country and at the QOL for all of its citizens, rather than cherry-picking your cases.

The last few times I had friends and family members in a hospital, they were given beds immediately, without any signficant wait, and there wasnt a patient on a trolley in sight. This included three different Dublin hospitals, and one in the west of the country. All of this was in the last 2 years.

Galway and Ennis have growing rent and increasing traffic problems, but they arent anywhere near as bad as Dublin, and the QOL in both of those towns has dramatically increased in the last decade (having lived in one, and having a sister living in the other).

Yes, Dublin has problems. I have never denied that. What I do deny is that these problems are a result of the last 5 years, or the current economic climate. They are legacies which have been growing in Dublin for decades, and the options left to the government were threefold :

1) Divert investment out of Dublin. Not having an infrastructure in place, nor the money to pay for one, this would have shot the Celtic Tiger in the head long before it was even stirring.

2) Encourage the investment in Dublin. Spend all the money made to try and offset the growing problems in Dublin, letting the rest of the country sod off and reap nothing from the new-found wealth. Get removed in next election by the majority of the population you have just ignored.

3) Encourage the investment in Dublin. Spread the money around, to try and make gradual improvements wherever possible. Look for real solutions to the problems in Dublin, which take time and planning. Put those solutions in place as monies permit.

I see the government having taken option 3. I think they have made some bad decisions, but their overall policy has been pretty much OK, and I honestly cant see any successor making radical changes to it, despite what they may claim on an election platform.

jc

Mailman

Fine Gael's and Labours opinion of funding for Dublin Bus differs from Fianna Fail's - they want a quick interim solution i.e. more buses. Heard this on broadcast panel discussion a couple of weeks ago.

More than 1/3 of the countries population live in the Greater Dublin Area so more than 1/3 of the country is interested in Dublins infrastructure problems as they are directly affected by it.

Workmate with ruptured appendix spent nights on trolley in Hospital just a couple of weeks ago.
Two sisters going\gone to private maternity hospitals a long way away from them in the space of 4 weeks because they don't trust the hospitals closest to them from feedback they got from other mothers. One of my sisters deals with the health boards so she actually is quite well clued in. Eldest sister was happy to use NHS in UK to deliver child.

swiss

Firstly, the title of the thread appeals to alarmism. "Do you believe the Rainbow coalition will wreck the economy?" Is there any evidence to suggest that they will? Do you believe that their policies will cause a marked deviation in the economic fortunes of our country, or is it merely based on the premise that Fianna Fáil are doing well, so therefore any change could be calamitious?

Overall, I do not believe that Fianna Fáil have done particularly badly in the management of this country. Neither do I believe that they have managed particularly well. I think that they have been content to stay in auto-drive, listening to the advice of various economic think tanks, balancing their advice against the bleats of the electorate and lobby groups.

bonkey makes a good point. If you pinpoint an area in which the governments policy seems insufficient, you must also remember that there is no way to know what the consequences would be should an alternative route have been taken. The health service is an excellent example. The government, under scrutiny and pressure from the public have dramatically increased spending in this area over the past few years. However, waiting lists have not decreased, industrial tensions have risen and the public are suffering as a result.

In retrospect, I feel that the problems encountered are endemic to the health service itself, given the culture of managment and allocation of resources that have been in place since the health cutbacks of the 80's. One could argue that a restructuring of the management could help ensure that the bulk of extra funds would not simply be swallowed up by the payment of debt and the increase of salaries (beyond that negotiated by the PPF). However, I cannot tell what the consequences of this decision could have been. Neither do I believe that Fine Gael or Labour are willing to take the rather drastic step which I feel may be necessary to help the health service.

Therein lies the difference (or lack therof) that is perceived between the main parties in the Dáil. Fianna Fáil and Fine Gael may be ideologically opposed in a few key areas, but I think that both parties have enough sense to try to maintain the current status quo in the economy. It would be tantamount to political assassination to attempt anything else.

As for the transport issue, well I live (ATM) in Waterford city, and although the 'imp' (bus) service is adequete enough, although they frequently arrive late, and they often arrive in groups of two or three (a cliché I know). I don't profess to know the situation up in Dublin well enough to comment, aside from stating that their difficulties are evident. If there was a 'quick fix' solution I believe that it would already have been taken or attempted. As bonkey stated, the authorites have to exercise caution, and base their long term proposals on projected trends and demands, just like any business, to maximise their efficiency and value for money.

So, no, Fine Gael or any 'rainbow coalition' won't wreck our economy. That will come about due to external factors, if at all.

smiles

Originally posted by Mailman
Fine Gael's and Labours opinion of funding for Dublin Bus differs from Fianna Fail's - they want a quick interim solution i.e. more buses. Heard this on broadcast panel discussion a couple of weeks ago.

Extra buses would make rushhours easier, but what would happen to these buses during non-rush hour situations? Would the drivers simply circle for the 6/7 passengers that will get *that* bus rather than the one before or after it? Would it be economically viable for the government to invest money in such a venture, taking into account the need for more drivers, the depreciation the new buses, etc. Personally I don't think so.

If you want to listen to party propeganda then that's your choice, i'd advise you to look at those party's history for development of infrastructure, and to consider the consquences of such an investment, where will the money come for this? Increasing expenditure, maybe increasing taxes? reducing civil servants (including nurses, doctors, etc.) wages? increasing national debt? -- which is the lesser evil?

More than 1/3 of the countries population live in the Greater Dublin Area so more than 1/3 of the country is interested in Dublins infrastructure problems as they are directly affected by it.

so those of us (the mere 2/3 of the population) who live in the other areas should sit back and watch all the countries money being pumped into *one* area, while the rest of us sit by and watch?

I live just outside Drogheda, there's 4 buses (including school buses) through here a day, thats considerably less than in Dublin. I've spent the majority of my bus journeys (to and from school) over the last 6 years standing, which is not a problem some times, but when this happens everyday... well it can be a little tiring! Especially since CIE knows exactly what numbers will be on the buses beforehand. I'm sure i'm not alone, and so i think any further money being invested in Dublin Bus would need to be qualified by equal investment in other areas.

Similarily, as anyone who has been on a train on the Belfast route knows, there is not enough trains on these routes, the trains in the evenings are queued for for at least an hour and a half before the train is due to leave, and there is always people standing in the aisles, between carriages, etc.

But similarly, i know that the investment will take time, and that a valid plan has to be introduced to combat these problem (and is being worked on at the moment), more trains might help, but i don't think that that would be an adequate or reasonable result.

Workmate with ruptured appendix spent nights on trolley in Hospital just a couple of weeks ago.

Again, I think you have some magic plan where money being thrown at the hospitals will solve this problem, I disagree, there must be plans for expansion, investment and employment in the long term, rather than "quick-fix" solutions, which will only lead to the "inflation" that you are so afraid of.

Two sisters going\gone to private maternity hospitals a long way away from them in the space of 4 weeks because they don't trust the hospitals closest to them from feedback they got from other mothers. One of my sisters deals with the health boards so she actually is quite well clued in. Eldest sister was happy to use NHS in UK to deliver child.

Well, my sister is 8 months pregant with her 4th child, she is using the public health service and the local hospital. There are examples and counterexamples to everything.

I agree with Swiss in his summing up of the problems that healthcare has undergone.


Overall, I think that the current government is merely channeling the effects that years of successive governments have put into place, the Celtic Tiger (or "Tigger" as it was so nicely put :P ) was the final result for structures and initiatives that have been builing up for over 20 years (in my opinion anyway).

Originally posted by mike65I think the days of radical and possibly reckles shifts in economic policy are over its about "steady as she goes" now.

I totally agree. Any government that come in to power will merely be continuing to structure things. I do not believe in the "quick-fix" solutions that many of the parties are offering, if they were so easy and so simply why on earth aren't the other parties (expecially those currently in power) offering them? Perhaps i'm just cynical, but i try to look at the consequences and the hidden catches.

Mailman:
Inflation resulted from massive salary increases in the public sector fueling inflation, not the private sector. The private sector is self regulating and just as many of those people who got salary increases and bonuses last year find they are either out of a job this year or have salary cuts and no bonus this year.

Ok, no offense, but the idea that inflation is the result of *only* the public sector salaries is ridiculous.

Firstly there are two types of inflation, "cost-push" inflation - where increased production costs lead to increased prices. This is what you are talking about, where wage demands pushed up costs, however the idea that the private sector is "self-regulating" is only correct to a certain degree.

There are things such as the National Wage Agreements, as decided in the Programme for Prosparity and Fairness that dictate the possibly (and usually guaranteed) wage increases, however as you might remember there was uproar when the wage increases did not match place with inflation, where employees involves (public and private) demanded further increases. Now (personally) i think this is what causes a *lot* of problems, this is the "wage-price spiral", where increased wages leads to an increase in the price of a good, and this leads to the inflation of prices, which in turn causes workers to demand higher wages, and so on and so forth.

Secondly, the wage rate for a particular sector is predominatly determined by the demand and supply of labour. As most people will remember, we achieved full employment (defined as 3% unemployment, and we had at one stage about 1.5%) - such a restriction in the availabily of workers lead to higher wage demands to encourage people back to work - all contributing these wage increases. Being a public or private industry has very little to do with it, but of course it is harder to refuse wage demands if you are a public company as then you are thrown out to the media as a government initative to "starve the workers".

The second type of inflation is "demand-pull" inflation, pretty easily explained as "too much money chasing too few goods", an increase in the money supply (caused by lovely banks offering incredibly low loans to virtually anyone who wanted them as well as higher wages) means that the demand for goods all across the specrum goes up, so the goods are increased in price to a level where all goods are sold at the highest possible price. This was another huge factor in our spirialing inflation.

I'd be interested to hear how private industry doesn't affect these.

<< Fio >>

Mailman

You creating a chicken and egg problem(inflation - insufficient supply, insufficient supply - inflation) out of something unrelated.
The government had a surplus and they got rid of it by caving in and giving sections of the public sector massive pay rises which fuelled inflation. There wasn't a problem with supply and demand in the police force, prison service or education but they still got massive salary increases. These salaries are never going to come down and these people aren't going to loose their jobs.
Whereas the private sector is now shedding jobs, withholding bonuses and salary increases.
Yes, 18 months ago, analog engineers, software engineers etc.... were in short supply so salaries went up, now software engineers, web designers are dime a dozen and many don't have a job or earning considerably less - just look at the thread which you yourself contributed to 'what do you work at' or whatever to see how the real market works, plenty of people out of a job there.
Working in a non-orgainised private sector company, it is fascinating to see how the real market works. Government's capitulation on salary increases distorted the free market and forced the open market to compete with the public sector to put goodfellas pizzas in the oven - the Teachers can afford to pay £2.29 as opposed to £1.79 for a Pizza so prices go up.

Magic plan for country(5 years ago, not a quick fix, we would have seen the effect by now) - stop increasing public sector salaries and start spending money on captial expenditure.

Or perhaps everyone else here thinks it is right that a huge proportion of the public sector earn well in excess of the AVERAGE INDUSTRIAL wage. If so, what signal does that send to the economy.

I'm happy that your sister has found a public Hospital where she feels safe to deliver her child because they are few and far between.
Your reply seems to suggest that you think it is acceptable for someone to be left on a trolley in a hospital. After 5 years in government it is fair to blame them for this as they have allowed the problem of an absence of hospital beds to persist for 5 years, that's 1800 days, that's 43000 hours, that's neglect.

The greater Dublin Area now extends to Drogheda, Tullamore, Kilkenny, in short anywhere people have bought a house and choose to commute to Dublin from. I know plenty of people commuting from Tullamore or who spend a proportion of their week in both locations or who's access to affordable housing has been affected by it's proximity to our capital. That is more than 1/3 of the country's population

I think that the root of our disagreement isn't that I'm too demanding of my government but rather than you are too undemanding. You have got lobby groups and businesses out there screaming to preserve their vested interests which isn't the public's interest while the public remain silent.
Now repeat after me:
"I'm as mad as hell, and I'm not gonna take it anymore!" Network 1976

smiles

You creating a chicken and egg problem(inflation - insufficient supply, insufficient supply - inflation) out of something unrelated.

*any* basic economics book will tell you that a restriction in supply forces the price up, they are intrinsically related. I'm not even going to argue the point because i thought i explained it in sufficient detail already. I'm not saying it's the *only* factor, but it was a big one.

That chicken and egg problem is known as the "wage-price spiral" - also another basic economic principle.

The government had a surplus and they got rid of it by caving in and giving sections of the public sector massive pay rises which fuelled inflation. There wasn't a problem with supply and demand in the police force, prison service or education but they still got massive salary increases. These salaries are never going to come down and these people aren't going to loose their jobs.

It's the government, if they don't give pay rises to their workers when they can afford to then there would be complete uproar, it's not perfect, but it's not like they had much of a choice.

Whereas the private sector is now shedding jobs, withholding bonuses and salary increases.
Yes, 18 months ago, analog engineers, software engineers etc.... were in short supply so salaries went up, now software engineers, web designers are dime a dozen and many don't have a job or earning considerably less - just look at the thread which you yourself contributed to 'what do you work at' or whatever to see how the real market works, plenty of people out of a job there.
Working in a non-orgainised private sector company, it is fascinating to see how the real market works.

Wow, i'm not part of the "real world" now? (thanks for letting me know). Did i ever even imply that the situation I described was continuous? No, i was talking about the same thing you were talking about, the time when we were at the peak of inflation. At that time there was increases in salaries (as you have actually agreed).

My point was that it was not *only* the government who caused inflation, do you agree with that? [you didn't give much of a reply to that, just argued with some of my backups]

Government's capitulation on salary increases distorted the free market and forced the open market to compete with the public sector to put goodfellas pizzas in the oven - the Teachers can afford to pay £2.29 as opposed to £1.79 for a Pizza so prices go up.

There's not enough teachers in Ireland to keep the entire pizza industry in business, the companies have to work out if by increasing price that they will still earn more despite those consumers who will not buy their goods, if we couldnt afford to pay the prices that are keeping those companies in business and earning profits then the prices wouldn't go up. Yes, inflation has forced prices up, but surely you dont think it was solely because of government pay rises?

Magic plan for country(5 years ago, not a quick fix, we would have seen the effect by now) - stop increasing public sector salaries and start spending money on captial expenditure.

Tell this to the teachers... or the nurses.... i'm sure that they would agree wholeheartedly with you. If the government increases the pay of one sector then they are forced to do so for all the others also.

The government is spending lots of money on capital expenditure, for the last 20 years in fact. What capital expenditure would have made the world so "magically" different?

Or perhaps everyone else here thinks it is right that a huge proportion of the public sector earn well in excess of the AVERAGE INDUSTRIAL wage. If so, what signal does that send to the economy.

They do, it tells the rest of the economy that we have a government that is willing to pay it's workers good wages, and that we have a buoyant economy that is continuely growing and is able to support it's workers. (after years of up to 60% tax and "tightening their belts" i think some of the workforce would appreciate this)

Your reply seems to suggest that you think it is acceptable for someone to be left on a trolley in a hospital. After 5 years in government it is fair to blame them for this as they have allowed the problem of an absence of hospital beds to persist for 5 years, that's 1800 days, that's 43000 hours, that's neglect.

I think they have initiated several plans to try and combat this. i'd also like to know where you think I said that it was acceptable to be left on a trolley for hours in a hospital, i did no such thing and if you're trying to make me into some inhuman commentor... well thats cheap tactics which i'm not even going to rise to.

The greater Dublin Area now extends to Drogheda, Tullamore, Kilkenny, in short anywhere people have bought a house and choose to commute to Dublin from. I know plenty of people commuting from Tullamore or who spend a proportion of their week in both locations or who's access to affordable housing has been affected by it's proximity to our capital. That is more than 1/3 of the country's population

and your point is?

Certainly dublin's infrastructure needs to be improved. I was not disputing that fact, i was merely saying that regardless of the proportion of people living in one are there needs to be improvements made all around the country, not just in Dublin.

My point is that maybe if there was we could see some more decentralization that is desperatly needed (and that might just aleviate some of your problems with the traffic). Long term goals (as well as short, and medium term ones) need to be addressed.

I think that the root of our disagreement isn't that I'm too demanding of my government but rather than you are too undemanding. You have got lobby groups and businesses out there screaming to preserve their vested interests which isn't the public's interest while the public remain silent.

(love the sweeping statement btw.) You have absolutely no idea what my demands from the government are, you havent even asked them so you are in absolutely no position to comment on whether i am over or underdemanding. I don't think you are overdemanding, I simply think your demands are somewhat misguided and need to be tackled in different ways. There are no simple solutions.

I think the public is anything but silent, the whole idea of these things called "elections" and "governments" is to work towards the public good. Or have I mistaken the whole idea of having a government proportionally representing the rest of the country?

If they're not working towards the public good then they wont be elected again, personally i think the exponential growth rates that have been set up and recently achieved is a good indication that many of the governments over the last ten to twenty years have been doing exactly that.

What would you demand the government do that wouldnt have catastropic results for some other sector of the economy?

Now repeat after me:
"I'm as mad as hell, and I'm not gonna take it anymore!" Network 1976

I think i'll wait until I see/figure out a good way to improve the country before i go and throw out a system that is working off fairly (but not perfectly) well. I have views, ideas and perhaps even valid points, but they're not perfect and i can see what effects some of the things i'd like to see done could have, so until i see a way to change that i wont try for a "revolution" :rolleyes:

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Sand

Inflation is an increase in the price level of an economy caused and solved by monetary policy - increase money supply and youll get inflation, regulate money supply and youll reduce inflation. Its the common thread from germanys hyperinflation to Ireland reducing its inflation by linking the punt to the deutchmark.

As far as I can tell the inflation which affected Ireland was caused primarily because the Euro fell in value against the dollar and sterling and the ECB didnt intervene to prop up its value - we import a lot from the UK and the US and they cost more of our currency to buy them all other things being equal. The government has no control over monetary policy so they cant be blamed for that.

The public sector pay rises are based on politics - personally id privatise them and let the market find the equilibrium wage as it does in other jobs, but how and ever- the public sector took a lot of cutbacks prior to the boom years, it was only politically wise and just to reward them with a decent level of pay. The keening and wailing that occured whenever the public sector went on strike made it very hard to not grant them a pay rise.

Mailman

You lecture me on economics as tough I haven't studied economics and then you completely undermine yourself by saying that you see absolutely nothing wrong with a huge proportion of the public sector employees earning substantially more than the average industrial wage. Explain how that is a tenable position and how that doesn't undermine the economy. Explain to me how the 'average' industrial worker who actually generates wealth for the country is on a lower wage than a public sector worker who doesn't actually bring any cash into this open economy despite both workers possessing essentially the same skill level in their respective fields. In any economy in the absence of a Big Mac everything has to be compared to the average industrial wage and this government have completely forgotten this.

Yes, there was inflationary pressure in the economy but it wouldn't have been so pronounced if the government hadn’t thrown money at the public sector on top of it.

Who knows, maybe you are right about teachers not eating pizza, maybe they have moved off the demand curve and now are on the demand curve for luxury food stuffs from Marks and Sparks.

While this government lost monetary control, they retained budgetary control and did have the means at their disposal to counteract inflation, yes there would have been inflation as the economy came under strain but decisions like giving more disposable income to the wealthiest sections of society instead of the poorer sections(accepted as inflationary by any economic commentator as the wealthy spend their excess less productively), not stepping into the housing market, increasing public sector pay dramatically, not opening up markets were inflationary and have compromised our long term competitiveness.

Where did I say you weren't part of the real world. I pointed to a thread where you contributed a post about your current 'real' job. The thread being an example of how people in the real job market are affected by the economy and pointed out how public sector employees were immune from the effects of the real economy on the real job market.

If the government hadn't thrown money at the public sector they would have had more money for capital expenditure and while they may not have got best value by pumping large amounts of money into capital expenditure in 5 years as opposed to 10 they would have the assets in place working but pumping money into captial expenditure over 5 years is still better value than having the public sector just gobbling up money never to be seen again.

Without going into detail my feelings on decentralisation aren’t as positive as yours.

The reasons for voting amongst those who vote are often amongst the following:
1) That’s the way I always voted.
2) That's the way my family always voted
3) Sure isn't he a great lad(irrespective of how contemptable his party's politics are).
4) Sure it doesn't matter which way I vote.
5) He done me a good turn.
6) The civil war
You seem to believe that this doesn't happen or you’re just hoping I'll let it slide. I'd be surprised if 50% of people actually vote on policies and the parties know this which is why rainbow coalitions can be considered.

This thread is long enough for you to have made plenty of statements as to what you want but you haven't. It's up to you to make your voice heard and make an attempt to back it up. I’m not going to tease your beliefs from you.

Now, since you are asking, but you've already got an idea where I'm coming from here are my beliefs
Low taxation.
No double taxation.
Removal of various levies and taxes which don't bring in much revenue but cost a lot to collect. I hate inefficient taxes.
Focus on usage based taxes(bearing in mind the points above).
VAT to be brought to the EU average in 5 years.
Cuts in the lower rate of taxation before higher rate.
Re-evaluation of PPP and use of borrowing where PPP can't deliver good value.
Public sector salaries restraint.
Removal of individualisation.
Reform of the Health Boards and Medical industry to actually deliver service to the consumer (yes, investment is still needed).
Increased competition in industry and on the flip side intervention in industries where cartels obviously operate.
Removal of biased tax relief on investment resedential property which has priced first time buyers out of the market.
Underlying principle of my policies is let the market operate as long as it is working properly and keep meddling to a minimum unless it's in the publics interest to do otherwise and low taxation to increase economic activity so that you can spend money on what you actually want to buy and we'll get a smaller %tax take from a large pie but also know that if after I die my children fall on hard times there is a compassionate society there to help them along.

So I'm neither a true blue(red) socialist or a capitalist.

Supposedly the meek will inherit the earth but if you don't ask you don't get.
All I know is the major political parties are frightened of many groups but the public as a group isn’t one of them so let’s get angry.

Bard

I voted "no" because I don't believe the 'rainbow coalition' will get into power. I think Fianna Fail will head the next government once again.

smiles

You lecture me on economics as tough I haven't studied economics and then you completely undermine yourself by saying that you see absolutely nothing wrong with a huge proportion of the public sector employees earning substantially more than the average industrial wage.

I never intended to lecture you. I'm sorry if that is how it appeared, but when you say things like demand and supply *not* affecting inflation rate then i thought i should clarify (for you and for anyone else who might not have studied economics).

I think you need to read my posts from the point of view that i'm replying and offering alternative views and ideas to your own, i'm not pushing *my* ideals (of which high public sector wages aren't a part).

How am i undermining myself?

Explain how that is a tenable position and how that doesn't undermine the economy. Explain to me how the 'average' industrial worker who actually generates wealth for the country is on a lower wage than a public sector worker who doesn't actually bring any cash into this open economy despite both workers possessing essentially the same skill level in their respective fields.

I agree with the previous post here on how the public sector for years have been the people who had the lowest wages and now deserve some kind of recognition. I do however agree with the idea of benchmarking that might help to make these differences somewhat more equal.

Saying that a public sector worker doesn't generate wealth for the country is complete rubbish. I was talking to a friend of mine on this exact topic last night and what he reminded me was that the very first day of an international relations course the question was posed on "Who runs the country?" and yes it is the civil servants.

Tell me of any group of civil servants that dont generate any wealth of the country and i'll be very impressed. If anything they generate more wealth that many private industries.

(and since you have studied economics then you might recognise that i'm also talking about the Multiplier Principle which generates wealth, injections into which include Government Expenditure of which civil servant wages are a huge part)

Yes, there was inflationary pressure in the economy but it wouldn't have been so pronounced if the government hadn’t thrown money at the public sector on top of it.

There I disagree, I think that the wage increases for the publi sector were not the *biggest* cause of inflation, although they were part of it.

Who knows, maybe you are right about teachers not eating pizza, maybe they have moved off the demand curve and now are on the demand curve for luxury food stuffs from Marks and Sparks.

Whether or not teachers are well paid is one arguement i would not like to go into on this thread as it is getting very off topic, I dont think the teachers would agree with your view point however.

While this government lost monetary control, they retained budgetary control and did have the means at their disposal to counteract inflation, yes there would have been inflation as the economy came under strain but decisions like giving more disposable income to the wealthiest sections of society instead of the poorer sections(accepted as inflationary by any economic commentator as the wealthy spend their excess less productively), not stepping into the housing market, increasing public sector pay dramatically, not opening up markets were inflationary and have compromised our long term competitiveness.

Of course there were things they could have done, but hindsight is perfect vision or so they say, i think they tried to balance their actions and in the short term incubated the Celtic Tiger, but yes, our long term competitiveness has decreased, but I don't think you can lay the blame for that solely upon the government.

Where did I say you weren't part of the real world. I pointed to a thread where you contributed a post about your current 'real' job. The thread being an example of how people in the real job market are affected by the economy and pointed out how public sector employees were immune from the effects of the real economy on the real job market.

I think the idea that public sector companies are part of a seperate "non-real" (imaginary??) economy and job market is ridiculous. If the economy isn't doing well then the public sector companies wont do well either.

Without going into detail my feelings on decentralisation aren’t as positive as yours.

Indeed, agreeing to differ?

You seem to believe that this doesn't happen or you’re just hoping I'll let it slide. I'd be surprised if 50% of people actually vote on policies and the parties know this which is why rainbow coalitions can be considered.

I love hearing these things that i'm meant to believe... i'm not hoping you'll let anything slide, there is nothing that I post up here that i'm not willing to debate, reconsider and change my opinions on, i enter with my ideas and an open mind and wait and see where that gets me.

I know that people vote for the reasons you outlined, but i do think that the people of this country will reconsider their choices if the people they are voting for are making terrible decisions and destroying the economy. Perhaps you think i'm a fool, but i don't think the rest of the country are.

This thread is long enough for you to have made plenty of statements as to what you want but you haven't. It's up to you to make your voice heard and make an attempt to back it up. I’m not going to tease your beliefs from you.

You see, the problem with quoting my beliefs is that i was never asked to, this is a thread about politics and whether various parties are destroying the economy. My demands from the government have nothing to do with this, other than i hope what i want wouldnt do so.

My beliefs are long and varied, a short summary would include:
* Stabalisation of taxation and maintaining them at the current levels - in my opinion it would be a better idea to collect the money now when we are still doing well rather than lower them on the way into a partial recession and be forced to hike them back up in a time of slow growth which would do untold damage. They are at low enough levels now for people to be happy with them.
* Restructuring of the social welfare system and further individualisation of tax credits.
* Continuing reliance on wage agreements (like the PPF) and growth of such ideas.
* Further sponsoring of the IDA to encourage and reform Ireland as a more industrially based country
* Improvements in infrastructure (digital, communications and infrastructure).
* Long term investment and coninuous evaluation of the health services
* Partial privitisation of public sector companies and introduction of competition
* Reform of government spending on basic infrastructure (see next paragraph)
* Reform of 3rd level places (i.e. medicine, vet., etc.) to make sure people who are adequatly suited to certain industries are allowed in, rather than those who can achieve the best marks.

However my ideal would be a different system to the one we have now. I think it is essentially wrong to have politicians decide the course of the economy. Political decisions tend to be corrupt, and therefore cause huge problems (see any of the tribunals for back up of this point)

I believe that an independantly set-up and run consultancy that had elected officals (by the public) to make the major economic decisions, and that the officials elected must have some sound grounding in business and economics before they are even allow never the place.

Now, since you are asking, but you've already got an idea where I'm coming from here are my beliefs

Would you mind if i asked some quesitons so i can understand yours? I wouldnt like to take you up wrong.

No double taxation.
[...]
Focus on usage based taxes(bearing in mind the points above).

I'm not sure what you mean, could you explain please?

Removal of various levies and taxes which don't bring in much revenue but cost a lot to collect. I hate inefficient taxes.

hmmmm, what about the taxes which are levied to protet irish industries? or to discourage the consumption of a good or to regulate the market for an economic reason?

Underlying principle of my policies is let the market operate as long as it is working properly and keep meddling to a minimum unless it's in the publics interest to do otherwise and low taxation to increase economic activity so that you can spend money on what you actually want to buy and we'll get a smaller %tax take from a large pie but also know that if after I die my children fall on hard times there is a compassionate society there to help them along.

So I'm neither a true blue(red) socialist or a capitalist.

You're mixed, like the majority of the rest of us!

I'm not sure if i would be seen as either a socialist or a capitalist, mixed suits me best as i think policies from each best suit different sectors at different times.

Supposedly the meek will inherit the earth but if you don't ask you don't get.
All I know is the major political parties are frightened of many groups but the public as a group isn’t one of them so let’s get angry

Well thats your choice, i don't see any need to get angry as i already said.

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Mailman

You wouldn't believe the amount of fun my family had pulling the piss out of my sister-in-law who is a teacher when she started complaining about being offered 27 bucks per hour for supervision.

As for double taxation I don't like refuse charges and my views on them are detailed elsewhere.
Usage taxes are nice, the more you consume the more you pay.
If they stop charging me doubly for refuse I'd even consider them there although it is inefficient in that tagging as a payment method is very expensive to operate.
I'd prefer the abolition of motor tax(and elimination of uncivil servants) and tax added to the price of a liter of petrol. So, if you drive a gas guzzler you pay. I you like to shine your gas guzzler and never drive it you don't pay.
If you do 1000 miles in a micra then you shouldn't have to pay as much as if you do 20,000.
Seems fair and very easy to collect as your already collecting duty on petrol. Ireland is one of the cheapest places in the EU to buy petrol. Don't even mention the benefits to the environment. Of course an iron will would be needed to enforce this as business would protest bitterly.

I object to credit card and atm card charges as they are unfair especially as we live in a cashless society where employers are entitled not to pay in cash.
Doesn't it make your blood boil that the government get 19 euro for your credit card which you use only every now and then. supposedly the tax was introduced to compensate for the tax lost on cheques. You pay about 6 pence per cheque so you'd have to use your credit card a couple of hundred times in a year for it to match the potential loss on cheques. I don't even own a cheque book.

I object to the TV licence fee as 20% of the population avoid it and the cost of administration via An Post is obscene. Let me pay for quality programming through income tax or VAT. I mean the Museums get money from the state but they're not financed this way.

I dislike VRT too but I'd only tackle that after I was sure I could balance the books.

Tinkering with taxes like mortgage interest relief and stamp duty obviously work(for good or bad) as we have seen how the investors came back into the market after mortgage interest relief was re-introduced.

smiles

As for double taxation I don't like refuse charges and my views on them are detailed elsewhere.
Usage taxes are nice, the more you consume the more you pay.
If they stop charging me doubly for refuse I'd even consider them there although it is inefficient in that tagging as a payment method is very expensive to operate.

Ah, you have your views, and I think that some of the taxes you have problems with are valid, but i wont go into that kinda discusion here, i've a french oral in the morning and i really should do some more work on it. -- Wish me luck!

But the bin charges, of course, having had to pay bin charges for year simply because I live in the country means I'm a little less than sympathetic to the idea of think being a "double whamey".

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