|Source credit: www.irishnewsarchive.com
Ireland Four Year Plan for Budgets:
On June 05, 1997, the Irish
Independent famously ran its front page editorial titled - -
"For years we have been bled white - now it's payback time" - - a day
preceding the general election, and more than 13 years later on December 7th next, Budget Day, the
beneficiaries who have brought economic ruin in the interval, will begin to
deliver a payback to the people. Ignorant politicians, aided and abetted by
vested interests in a democracy of many shortcomings, travelled on the road to
perdition and blew the best opportunity ever, to put the Irish economy on a
sustainable course. Now the people face the real payback time in the four years,
The tale of feast and famine would be bad enough in the short history of
self-government, but this is the second time in a generation when reckless
mismanagement of the economy, has brought misery to tens of thousands of Irish
citizens while the main culprits have lived afterward on generous State
benefits for life. The epilogue is no different now as those in particular who are
not protected by one of the vested interest bodies - - mainly private sector
workers -- which have paralysed the governance of the State, will bear the brunt
of the financial rescue of the country.
The Government's announcement on
Tuesday that an overall fiscal adjustment of €15bn over the next four years is
warranted in order to achieve the target deficit of 3% of GDP by 2014, is at
least a signal of an end to denial and slow motion.
It also provides
the potential for some stability as no business would invest in a situation of
permanent crisis and uncertainty.
Besides, at the
next general election, parties cannot avoid the issue of reform of the outdated
British structures, which provides Ireland with a part-time Parliament
(Oireachtas) of 216 members where during the current crisis, most of them have
not only not inspired, but had absolutely nothing to say.
Government is assuming average annual growth of 2.7% in the period 2011-2014 and
the urgency of addressing the jobs challenge is even clear from the expectation
of much lower growth in the first year of the four-year plan.
The Economic and Social Research Institute said last week
that it expected
national income (GNP) growth of 2% and 2.25% in output
(GDP) in 2011, while Davy Research forecast on Tuesday that GNP will rise by only 1.2%
in 2011 and GDP by 1.9%.
In H1 2011, growth in US gross domestic product is expected to be close to an
annual 2% rate.
Of course it was not only politicians who were responsible for the crash of
the Celtic Tiger boom and in coming weeks, European Commissioner for Economic
and Monetary Affairs Olli Rehn will visit Dublin to brief social partners on the
financial debacle facing Ireland.
A decade ago, when Bertie Ahern, Mary Harney and Charlie McCreevy believed
that they had found the recipe for the free lunch, the European Commission and
European Central Bank were told where to get off when they censured Ireland on the need
for budgetary restraint.
Economists such as Jim
O’Leary, Dan McLaughlin, Eoin Fahy, and Alan McQuaid all called for cuts in both
the top rate of tax and the standard rate, with ABN AMRO’s Dan McLaughlin
pointing out that the old target rates for income tax of 40% and 20% should be
replaced with new medium term targets of 30% and 10% respectively.
Harney, the PD leader who was the biggest cheerleader for tax cuts in the
Cabinet, claimed that other countries would regard the Commission's censure as
of the employers' organisation IBEC, Turlough O'Sullivan, described the
censure as "alarmist", while the
trade unions' congress, ICTU, said that it appeared to be based on a
misunderstanding of the level of development in Ireland.
Crucially, an MRBI
opinion poll in the Irish Times showed that more than seven out of ten
voters believed the 2001 Budget was good for the country.
The poll, the first
since the Budget, showed a significant increase in the popularity of the
Government and a big rise in satisfaction with the coalition leaders.
Some 58% were satisfied with the Government's performance, up 15 points
since September 2000.
Harney had said in the
Dáil Budget debate in 1998:
"Cutting taxes has
been the key to Ireland's tremendous economic performance.
"We have cut taxes on labour, on capital, on companies. We have given
huge tax breaks for investment in films, in urban renewal, in the
development of tourism.
Socialists don't believe in low taxes; they believe in high taxes. Right
now the biggest threat to our continued economic prosperity comes from
Socialists, European Socialists who are envious of our low-tax regime
and who want to foist on us the kind of punitive tax rates that have
saddled them with massive unemployment. Socialism has never been very
popular in this country and the last thing we want to do now is import
it from Europe.
This Budget is another major step on the road to tax reduction and tax
reform. As long we in Ireland keep on that road we will continue to
truth is that the biggest threat to Ireland's prosperity, came not from
Socialists but from Mary Harney and her colleagues, who have brought the
misery of "massive unemployment," to
tens of thousands of people. Her fairytale economy was built on a
property boom and an exporting sector where American firms were
responsible for 90% of the total, while the derided Socialists, such as
the Finns, Swedes and Danes, have built their own world-class exporting
leading US firms: Intel, Microsoft, Oracle, Dell, Hewlett-Packard,
Pfizer, Boston Scientific, Wyeth, Eli Lilly and many others, had opened
operations in Ireland, before 1997, when McCreevy with her support, set
fire to the economy. In seven years as Minister for Enterprise, Trade
and Employment, how did the indigenous exporting sector fare under her
Irish Economy: The 2001 economic consensus that paved the road to economic ruin
Davy says Ireland was never a wealthy country; High income in 2000-2008 largely
Irish Economy: Ahern, Harney, McCreevy, Cowen and the other individuals/groups
with responsibility for the economic crash
The invisible Irish unemployed and the challenge of creating 180,000 net new
Ireland can choose a path to greatness or perdition