Further, government agencies certainly cannot convince me or anyone else trying to hold onto their hard-earned that they have the first clue what the country will need in the future, how much we should be paying for it and how we should run it.
No State agency that has been forced into market competition ever led the way in successful innovation in that market. The ones who survive do so by leveraging their political connections to fend off competition as long as they can and end up scrambling to copy the business model of the successful privates.

Proposals such as this one scare the bejaysis out of me.

The next government should make it a top priority. No chance with current corrupt cronys.

However I would like the charge for FOI requests reduced, and I think it should apply to everything the government does, with the exception of criminal investigations and maybe some Dept. Defence activities. I should be able to find out how much Bord na Móna spend on staplers.

I like the Missouri idea. With advances in IT it should be possible to put all the accounts online (not just end of year reports). This would mean the hassle of putting in a FOI request would not be needed. Then it would just be up to the journalists to look at the accounts and see how much is being spent on limo transfers or the rationale behind certain decisions.

The state of Missouri (pop 5m) put all its public spending online in a searchable datbase for $200K.

We conservatives don’t have to be as ambitious but relying on the hodge podge of FOI requests and PQs is no answer for transparency.

http://www.finfacts.ie/irishfinancenews/article_1017081.shtml

In what way would you like to see the FOI Act expanded? Did you have something specific in mind? I’m interested to hear.

Regarding ’soft’ things for long term economic growth, I would like to see the Freedom of Information act expanded. This greater openness would reduce the scope for mismanagement and increase accountability.

Also I would like city/county councils have more power. This would put less pressure on TDs to deal with local, rather than national issues.

I think expanding the Freedom of Information act would be fairly cheap and could be done during our recession. I doubt the government has much appetite for it however.

Thanks for your link above which interestingly includes the following observation…

“Presumably there is some maximum level of debt burden that a population is willing to accept, because they are paying taxes, but getting nothing in return. (Well, they did get something in return, but that was yesterday’s deficits, paying for yesterday’s generation’s benefits). Past a certain point, if the debt burden gets too high the population may refuse to pay, or may emigrate to avoid the burden, which just raises the burden on those who remain.”

The author is correct about “yesterday’s deficits” being incurred to pay for “yesterday’s generation’s benefits” but sadly, a substantial amount of our borrowing is to pay for todays generation. Fact of the matter, whether we like it or not, as a country, we are spending other peoples money and other peoples wealth. As CJH famously remarked “we are living beyond OUR means.” What I would like to know is this, who are the people who are so important that their salaries and benefits must be paid not from Irish taxes but by foreign debt?

Bad enough to be railroaded into unsustainable debt levels, to have NAMA dumped on us. However, it strains incredulity that more debt has to be piled on top just to cover their own salaries.

Debt levels are not the only reason people will leave Ireland. People will go because of the sheer scale of crony capitalism. When you have one of the most successful Irish business people, Niall Fitzgerald boss of Unilever and later Reuters telling us bluntly that he could not pursue a business career in Ireland without compromising personal principles. Obviously, we have a huge problem. http://www.irishtimes.com/newspaper/frontpage/2010/0306/1224265713249.html Mr. Fitzgerald is right we can do without these people.

Krugmans swipe at us about crony capitalism is not isolated, it is all too obvious now that citizens are saying, why bother to take risks, when I can go abroad just as Michael O’Leary did. The whole business culture from monopoly style upward only rents to the nexus between developers and banks says, “beware” of setting up business in Ireland. 10 developers dumping 17bn in loans on the tax payer, because nobody was able to tell them they were mad. Prognosis, economy to continue to shrink, debt burden to continue to grow because we still have not got politicians who can pronounce two letters of the alphabet NO.

Of course, not all high earners have the possibility of leaving. Tribunal lawyers and TDs aren’t in demand anywhere else.

Ah well

Madam, – I am confused. For over a year letter-writers have been telling civil servants that our labour is over-valued and unworthy of our “bloated” salaries which average €30,000 per annum for clerical people who process claims – and are still doing so despite the industrial action.

Now it seems that the absence of that labour (even on a low-key and occasional basis) is making significant difference to the public. Our case is that we are seeking a decent, living wage in return for providing those significant services to the public.

My take home pay in the Department of Social Welfare and that of my colleagues is not significantly more than our customers are paid. In my own case, a battery of nine different levies and deductions at source halves my take-home pay to less than €13,000 per annum. I can assure our social welfare customers that I know exactly how difficult it is to survive on that kind of money. I would hope that the public would deplore the pay cuts to public servants as I deplore the moves to cut their benefit. It is the Government that has done this and not low-paid public servants.

In the recent Budget which cut our pay, the basic social welfare rate was also slashed. We and social welfare recipients have the same prize specimens to be angry at without bickering with each other. Perhaps the people who cannot contact civil servants during phone bans, etc, might contact their local Fianna Fáil/Green TDs at their clinics or cameo public appearances. I’m sure they would be happy to clarify why the modest pay adjustments that would settle our grievances are not being made, not to mention explaining the Government’s role in provoking this situation in the first place.

People on skeletal pay in the public service have no choice but to resist these cuts and the further ones planned down the line. Our actions are the forced moves in an endgame with implications for the future of all workers and the kind of society that must emerge.

There is unfortunately no way I can think of that public servants can withdraw their labour (ie public services) without affecting the public, but they are unwitting victims in a campaign of aggression launched by the Government and their friends in Ibec, the most powerful and successful trade union of them all.

By all means be angry with a broken bottle if you step on it. But the anger should be directed at the idiot who put it there in the first place. In this case, the idiots who got us here are those in comfortable ministerial office and not the ill-used drudges labouring in the foothills of the civil service. – Yours,etc,

DAVE FAY,

Leix Road,

Cabra, Dublin 7.

Nick Rowe, yesterday: “I had always known that a given debt/GDP ratio would be more worrying for a country with declining population than for a country with a growing population. There will be fewer future people to carry the same future burden. But I had never sat down to do the arithmetic, until just now. What surprised me was just how big this effect was.”

http://worthwhile.typepad.com/worthwhile_canadian_initi/2010/03/some-simple-arithmetic-of-debtgdp-and-population-growth.html

If TASC’s ideas don’t provide an incentive for the peak earning demographics, particularly those not bogged down in the property mire, not to GTFO ASAP, this problem will get steadily more apparent.

Just a aside note about phones not being answered etc. Sorry to hear about your inconvienience etc. However I would like to point out that not all public servants wish to follow the direction of the Union Leadership.

There are a number of teachers and other civil servants who are aware that the state is broke, and there is no point in rocking a fragile boat in this financial storm. However these same people have a problem, they have to follow the directions of their union. To stand out now against their fellow workers is not very endearing etc.

Most civil servants are members of a union, not because it is necessary to get into battle with the Govt, but union membership is used as a form of security against bullying by management. Teaching hours being increased by a school principle on other teachers for example, etc etc. The back side kissers always have Friday Afternoons off etc.

I would just like to point out that fact.

There is a lot of emphasis on hardware but no proposals for changing the inadequate software - - management and control systems - - which has resulted in a huge waste of money on public projects over the past decade.

There was no shortage of money for broadband during the bubble days but our record compared with Denmark has been pathetic - - they too evolved from a public telco system.

The Naas dualcarriageway was opened in 1968 and 42 years later, a motorway to Cork is still a work-in-progress.

There is €1bn annually spent on the science budget and we are oversupplying PhDs - - not always the requirement for an innovative system.

So why not fix banjaxed systems first ?

We could spend money on long term projects but how do we increase our export potential?

Just pray that the US economy returns to strong growth?

I think some short term job creation is fine, just to keep things ticking over during the downturn.

However, for the long term jobs, don’t we need to improve the infrastructure. This could be rail, broadband, or educational qualifications.

This just seems like crying over spilt milk.

Maybe a stimulus in the right areas in 2008 would have made a difference but not to the extent you are trying to argue. And I completely disagree that it is still not to late.
It is too late.

There is no way that the EU would allow us.
And even if they did we probably shouldn’t.
It seems that you are accounting the dramatic increase in Government Deficit from 2008 7.4% to 2009 12.5% on thatcherite slash and burn policy.
But the deficit was always going to increase in 2009. I think your theory of causation is weak.
The thing that makes Ireland different from many of our central European neighbors is that we had a huge stimulus from 2001-2008 when it wasn’t needed.
This stimulus included the Tax breaks given to the construction industry as well as other insders and the over generous pay deals given to mid-high end public sector employees and unlimited credit to all business and to the 20 and 30 somethings. The size and scope of these was not comparable to what happened in central Europe and they therefore can afford a stimulus now.
We cant to any great extent.
We can try to be imaginative with low cost effective jobs creation policies but in general our costs need to be reduced in a very dramatic way.
The reality is that we were spending way beyond our means for a long time. One cannot look at the growth figures over the 2000’s without first looking at the increases in private debt over the same period.

We cant afford to put money into the banking system either and I don’t think we should but thats another story.

I don’t know what transmission mechanism is at play here, what’s working or not. However the contention that a) monetary policy should have very little impact and that b) all the action is in fiscl policy, should show up in a comparison between countries.

Ireland and Spain are a case in point, having the same monetary policy, variable interest rate mortgages etc, but v different fsical policies. Why have Spain not done far better? Going back to John McHales estimated elascticities, the ‘open economy’ explanation will only go so far, particularly in the very short run.

I suppose the advantage of having a single currency with no inter-member fiscal rebalancing is perhaps a unique economic experiment which may allow us to tell the relative importance of fiscal and moneatry policy. Those who say that you simply can’t have a sustainable single currency without such inter-member fiscal flows should also have to explain why Ireland han’t fared far worse than Spain over the lat 12 months.

These macro comparisons may be interesting but isn’t it time to focus on the nitty-gritty of sustainable job creation?

Investment in infrastructure can provide jobs in the short term but where will the engine of jobs growth be?

Surely not in an unreformed public sector where for example electricity prices are among the highest in Europe?

Minister Eamonn Ryan plucks an estimate of 20,000 from the air for green tech but even so, that doesn’t answer the question.

http://www.finfacts.ie/irishfinancenews/article_1019210.shtml

…. and futher from the ‘trained economist’ …”Good, universal healthcare means that there are no ‘medical bankrupties’ and that unemployment does not have healthcare consequences.”

What school of economics is this?

According to the ‘trained’ economist on the Irish unemployed in in a comment in The New York Times “… the pain is relative. Inability to pay your mortgage and/or losing your job in Ireland does not mean destitution as it does for so many Americans. You can still have a holiday, your kids can still go to college, you can still eat well and have a few pints with your mates in the local pub while you sort out your life.” …. Makes one wonder on the ideology of the trainer - let alone the trainee!

A lot of sense but they will dismiss it as …… whatever. Getting them involved in the debate might be useful towards achieving more social justice. No one is against that? But what does it mean?

We just disagree on the practicalities of achieving that? Having a formalized way of debating the exact methods might be very constructive for all concerned.

“What is good about this article is that it is actually starting a debate” then…..

“throw your rattle around, and cry that you dont like it.”

Also, if I simply restate what is in the article and you call it a rant then ergo it appears that you are calling what is in the article a rant. Maybe you are right. I simply stripped out much of the unnecessary verbiage to leave the article a bit more naked.

If you want to revisit 2007 here is a quote from the Indo Dec 03/2007 author Tom McEnaney, under the heading. “Cowen sets out on his mission for a leaner, fitter public sector”

“Brian Cowen will use the Budget in two day’s time to signal root-and-branch reform of the public sector. He will call for the public sector to become entirely focused on the needs of the public, rather than the public sector bodies or employees.” It is now 2010 and he is thinking of setting up a junior minister of public sector reform.

I had to drive to the hospital the other day to find out how someone was because the phones were not being answered. I am not a reductionist nor do I consider myself to be ideologically driven so why not just explain what you disagree with and kick off the debate you say you welcome? Constantin Gurdgiev has more than a few unkind words to say about this article over on his blog “True Economics” you might find his comments more elucidating than my “rant”.

There is absolutely nothing worth reading in your rant Robert. You simply restate what is in the article, throw your rattle around, and cry that you dont like it. Your ideologically opposed to the content. Get over it.

What is good about this article is that it is actually starting a debate. It is forcing the true ideological colour of all those economists who hide behind the veil of technical jargon to state their true normative opinion.

All we have had in this country since 2007 is a monologue of the same arguments, same voices, and same failed politicians-economists who wouldn’t shout stop in the good times.

Of course no economy can provide an identical set of variables as another; each country is a specific combination of general trends. What we can hope to do is identify those general trends and apply specific remedies to each case.

Therefore, while you are entirely correct that Belgian deficit levels are now approx. half of Ireland’s relative to GDP, it is surely worthwhile examining how that position was arrived at.

On this blog and elsewhere the majority opinion was always that Ireland’s deficit was too large to provide fiscal stimulus. But the Irish slump was a year earlier than that of the Euro Area as a whole. Ireland’s budget deficit was 7.2% of GDP in2008 (net general government borrowing). That is not qualitiatively different from the Euro Area average the following year, when their recession kicked in. The average deficit that year was 6.4% of GDP, with France a whopping 8.3%. However, the overwhelming bulk of those countries adopted fiscal stimulus packages, with France one of the biggest of all (hence the scale of the short-term blowout in the deficit).

But the EU Commission forecasts French net GGB this year at 8.2% in 2010 and falling to 7.7% in 2011. Similarly, Belgian GGB is expected to be 5.9%, 5.8% and 5.8% (incidentally, one of the reasons that Belgium is a useful comparator, aside from previously identical yields, is to overcome factors such as SOE or size bank bailout; Belgium is 2nd in the Euro Area behind Ireland for both).

For the Euro Area as a whole the profile of GGB forecasts is 6.4%, 6.9% and 6.5% out to 2011, whereas Ireland’s is 12.5%, 14.7% and 14.7%. The Euro Area adopted fiscal stimulus; Ireland a Thatcherite slash & burn. The Euro Area is expected to stabilise and lower its deficit. Ireland’s deficit is expected to increase and then ’stabilise’ at that higher level.

The architects of slash & burn need a Plan B, soon, and a little top-up of investment, ‘financed’ by more slash & burn won’t pass muster.

The antiquated public sector, which is a fossil along with its trade union movement, another fossil, and one which is merely a mutated response to the gross inefficiencies and structures of the public sector and civil sectors of our society.

We need to rationalise our education system to radicalise the way we think.

Finally, we need a proper health care system delivered for 10 billion or less.

Notice, I have left out the banking system, because soon it will be part of our political system. A political system that is already dictating the kind of banking system it requires for itself.

Going back to the article, our social scientists have identified 5 key areas that they are most concerned with and which “require fundamental reform”.

1. Our Substantial Physical Infrastructure Deficits
2. Our Poor Social Infrastructure
3. Our high levels of Income Inequality
4. Our Under performing indigenous business sector
5. Our unsustainable reliance on carbon heavy resources and activities.

Then the solutions offered;

Retraining and return to education (where most of the 28 work)
Investment in education (ditto)
Employing the strength of the public sector to create more off-balance sheet finance/debt ( Strength? and more off-balance-sheet debt?)
Use enterprise development bonds, municipal bonds, solidarity bonds (would anybody in their right mind give their money to broke councils or this government?)

Then they turn their attention to the tax system, suggesting…

A comprehensive property tax is suggested (deflationary)
End tax breaks for high earners
Extend environmental taxes (deflationary)
Add an additional tax band at the highest level (deflationary)
Look to local taxation to broaden the tax base (deflationary)

Finally, they talk about “embedding investment rather than debt into the economy while restructuring taxation and expenditure in a progressive and expansionary manner to ensure a job-rich recovery. ” (just meaningless social science speak)

Sorry to see, that some of the people who taught me over 30 years ago and put their names to this article are still hiding out in universities, they never moved on and the dearth of there combined analysis is certainly not an argument for people to go back into education.

Surely, this article is a further indictment of the education system in this country?

Then again, the updated O’Rourke-Eichengreen graph might indicate the opposite of Munchau’s remark! Of course maybe it’s the monetary stimulus that has saved us from a Greater Depression.

Or maybe other countries’ expansions have contracted our contraction, just as our contraction has contracted their expansion?!

Time for bed methinks.

“The basic exemption for 2010 is 6,430 EUR regardless of marital status with further exemptions for dependent children and a spouse. For 2010, marginal income tax starts at 25%, rises to 30% over EUR 7,900, 40% over EUR 11,240, 45% over 18,730 EUR with a top limit of 50% for incomes above EUR 34,330.”

From http://www.expatica.com/be/finance_business/tax/taxation-in-belgium-8618_8286.html?ppager=2

Right in principle because deflationary policies are proving catastrophic, wrong in detail because the proposals for raising more funds are mostly
wishful-thinking.

The claim that we can pursue a foreign borrowing-funded reflationary course a la Beglium is fatuous for two reasons:

1. The Belgian budget deficit is still only about half as big as ours relative to GDP. This means investors don’t fear national bankruptcy.

2. Belgium has a coherent tax system based on heavy income, corporate, and property taxes (with few exemptions at the lower end).

The only realistic means we have of pump-priming is thus, as some others have pointed out here, to dip into, nay liquidate, the NPRF whilst letting Anglo-Irish go to the wall. This would allow us to avoid being massacred on the international bond market. (All this guff about improving efficiency in the public service is besides the point. As Keynes pointed out, paying people to dig holes and fill them in again has the same macro-economic effects as hiring more nurses — i.e more consumer spending, more demand, and more growth etc.)

In the long run, such a course would entail dramatically lower public sector pensions (which are arguably an undeserved perk in this day and age) and much higher taxes post-recovery on all income earners (including the low paid). In Germany, someone earning 30 grand a year pays vastly more income tax than an Irish person on the same wage does. If we want to live in a social democracy, then that’s what it costs.

Politics is about choices. The Left needs to face up to the fact that its policy choices may entail just as much sacrifice as those of the Right.

I am not at all sure I am looking forward to your use of Pooh metaphors in explaining your economic views.

Perhaps you’d better stick with the Fox TV approach. It’ll be easier to deal with.

I supposed you might also consider using approaches based on reasoned argument and debate. Go on. Try it.

@Ronnie O’Toole.
Should I infer from the the data points and the Munchau reference a suspicion on your behalf that EU economies are treating deltas in spending or taxes now and later, etc., all far more equivalently (a la Ricardo) than anyone expected? Now that would be interesting.

Most non-socialists would find it difficult to make such an all-encompassing and fantastic statement as from the article:

“We must mobilise all the resources available to accomplish this transformation. We still maintain a relatively low-debt status in the euro zone, buttressed by the vast accumulated borrowings in our exchequer cash balances (over €20 billion).”

The article also states that the low tax / low spend model has failed. If our government ran a low spend model its news to me, and I would like to know what level of spending would not be considered ‘low’.