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Could Ireland economy collapse permanently?

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  • Registered Users Posts: 2,314 ✭✭✭KyussB


    Geuze wrote: »
    Your repeated suggestion of a Job Guarantee program deserves its own thread.

    I would like to know more about it.
    ...
    Ireland's ratio of "Unemployed per Job Vacancy" was 26:1 back in 2012 - and in the West of Ireland it's presently 22:1.
    Cheap labour will certainly fill that '1' more readily - but there'll still be the other ~20x unemployed.

    Long Term Unemployment - and Very Long Term Unemployment - are certainly real things that the majority who experience it, do so from no fault of their own. Unfortunately, economic narratives tend to pile responsibility for this onto individuals, when it is really a macroeconomic problem.

    With a Job Guarantee, government expenditure would indirectly boost Aggregate Demand and private sector employment, yes (part of its purpose, in achieving recovery and winding down workers on the JG) - but of course, it's primary ability to create jobs, is through direct public employment - directed into any number of necessary (in many cases urgent) projects that the government can undertake.

    Unemployment payments would still exist alongside the JG - so what the JG would do, is provide a far more objective headcount, for people that are voluntarily unwilling to work. From there, more conservative folk than me might advocate cutting their unemployment payments, with easy justification - but that's not what I personally advocate - doing that would, however, perfectly provide a way to end the varieties of welfare fraud you list, permanently.

    I haven't read it (there are a bunch of recent prominent books on things I go on about all the time - I should read them to see that they are worth recommending) - but the author who wrote this is a well known one, among economists who champion a JG:
    https://www.amazon.co.uk/Case-Job-Guarantee-Pavlina-Tcherneva/dp/1509542108/


  • Registered Users Posts: 12,993 ✭✭✭✭Geuze


    EkO3QkGX0AEjtx5?format=png&name=medium


  • Registered Users Posts: 2,314 ✭✭✭KyussB


    Geuze wrote: »
    If we had been balancing our budget, we wouldn't have a 200bn public debt, pre-COVID.

    The 200bn public debt shows that we have run deficits year after year.

    All Govts have a bias towards deficits, due to politics.

    Bertie Ahern could not say no to requests from unions.

    We have rarely run surpluses.

    You seem to be suggesting that we have has austerity very often - this is false.

    I would love if we had what you suggest - a sensible fiscal policy, with politicians wanting to balance Budgets. Alas, we do not, as TDs want to be re-elected, and so are happy to run deficits.

    We are not Germany.

    We have had fiscal deficits most years since 1975, I must check how many years we ran a surplus since 1975.
    That's 200 billion in the Private Sector that wouldn't be there otherwise (ignoring foreign sector).

    When I say austerity/budget-balancing - I'm including having a tendency towards balancing the budget without reaching it, when the economy is below Full Output.

    Deficits are the normal state of affairs, yes - that's the correct way to run the economy. Deficits aren't the goal, though - they should just be an incidental side effect, of maintaining Full Output, Full Employment, and stable inflation.

    I don't understand why you would view an arbitrary accounting balance as sensible or a good thing - that would be treating government finances like household/personal finances, when they don't operate like that.

    Germany sets economic policy based on having an artificially depreciated currency, Ireland sets economic policy based on having an artificially appreciated currency - that's the imbalance the Euro without a central government creates, as there is no regional redistribution of revenue/spending, proportional to what national governments do - so it would be pretty inadvisable for us to operate government finances the same way as Germany.


  • Registered Users Posts: 12,993 ✭✭✭✭Geuze


    KyussB wrote: »

    With a Job Guarantee, government expenditure would indirectly boost Aggregate Demand and private sector employment, yes (part of its purpose, in achieving recovery and winding down workers on the JG) - but of course, it's primary ability to create jobs, is through direct public employment - directed into any number of necessary (in many cases urgent) projects that the government can undertake.


    The LT unemployed may refuse to take up jobs, as they currently do.

    Bear in mind, the problem isn't a lack of vacancies (pre-COVID).

    The problem is the design of the welfare state.

    My relations say to my face: "Why work?"

    They drive an Audi Q5, want for nothing, and have received 100,000 in taxpayer-financed student grants.

    Why would they bother taking up employment?

    Will the Job Guarantee replace JSA?


  • Registered Users Posts: 2,314 ✭✭✭KyussB


    Geuze wrote: »
    The LT unemployed may refuse to take up jobs, as they currently do.

    Bear in mind, the problem isn't a lack of vacancies (pre-COVID).

    The problem is the design of the welfare state.

    My relations say to my face: "Why work?"

    They drive an Audi Q5, want for nothing, and have received 100,000 in taxpayer-financed student grants.

    Why would they bother taking up employment?

    Will the Job Guarantee replace JSA?
    Report them for welfare fraud? ;) More seriously - yes, there are some 'genuine scroungers' out there - the Job Guarantee is for people who want to work, so it doesn't have to solve the problem of scroungers.

    It can be used to solve that problem quite easily though (offer them a job and cut their welfare upon repeated refusual), but I don't advocate doing that.

    No, I don't want a JG replacing unemployment payments, or being used as an excuse to kick people off of welfare. With a JG though, it will be a lot easier for Revenue to put investigators onto long term unemployed engaging in fraud, as they won't have to filter through all the people who do want work.


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  • Registered Users Posts: 28,703 ✭✭✭✭Wanderer78


    Geuze wrote:
    Presuming that "austerity" means cuts to Govt exps, you seem to be suggesting that austerity has been common during the last 50 years?

    Yes this is correct for ireland, buy there is now sufficient evidence to show, glpbally, it simply doesn't work, and in fact does an astonishing level of damage to a society. Covid is also proving this, as our health care systems struggle to deal with the virus, a critical element being from previous health care system cuts from our previous round of austerity. And how in gods name was such an act gonna solve an issue that was ultimately based in private sector financial institutions!


  • Registered Users Posts: 26 truth and logic


    A Jobs Guarantee is unlikely to work. Many people on the long term dole have mental health problems. They are only required to take up suitable work, not any and all work. No work is suitable if you have long term untreated mental health problems.

    We should just let the people who want to work, work, and those who don't want to work should be left alone pretty much.

    There's no point trying to force horses to drink water they don't want to drink.

    If we weren't aiming for full employment then we could reach our goal more easily.


  • Registered Users Posts: 8,355 ✭✭✭Cluedo Monopoly


    Geuze wrote: »
    EkO3QkGX0AEjtx5?format=png&name=medium

    Great graph

    What are they doing in the Hyacinth House?



  • Registered Users Posts: 28,703 ✭✭✭✭Wanderer78


    A Jobs Guarantee is unlikely to work. Many people on the long term dole have mental health problems. They are only required to take up suitable work, not any and all work. No work is suitable if you have long term untreated mental health problems.

    I get help from an organisation that specialises in getting people with complex disorders, work, some of which have been long term unemployed, they're also linked to other organisations that do the exact same thing, these services are based in many parts of the country, so I've no idea where you're getting your info!


  • Registered Users Posts: 2,314 ✭✭✭KyussB


    A Jobs Guarantee is unlikely to work. Many people on the long term dole have mental health problems. They are only required to take up suitable work, not any and all work. No work is suitable if you have long term untreated mental health problems.

    We should just let the people who want to work, work, and those who don't want to work should be left alone pretty much.

    There's no point trying to force horses to drink water they don't want to drink.

    If we weren't aiming for full employment then we could reach our goal more easily.
    That's exactly what the JG does - Full voluntary Employment - plus finding/creating suitable work for people.


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  • Registered Users Posts: 3,064 ✭✭✭j@utis


    Great graph
    Created in 2018... I'd love to see the 2020 version.


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