I think the first report is high quality and presents important information well. This should be seen as a complement to other quarterly reports like the (gasp) government funded ESRI ones. A welcome addition in my view.
The diagram on page 8 of the Quarterly Economic Observer 2012 suggests combining various sources to create a Five-Year Capital Investment Stimulus.
On a previous thread the nature of ‘austerity’ was discussed, and actually prior to that I was looking at comparisons of Ireland, Latvia, Iceland and Greece to see how they were all doing.
The IMF has an interview piece featuring Mark Griffiths, IMF mission chief to Latvia, in which he says:
“We have worked closely with the World Bank to find ways to protect the poor. Under the program, the government has increased guaranteed minimum-income payments, abolished healthcare co-payments for the most vulnerable, increased funds for emergency housing support for low-income households, and protected schooling for 5–6 year olds. We also encouraged the government to introduce a public works program, financed by the European Social Fund, to give jobs to people who wanted to work but were unable to find employment.
“It’s important that the Latvian government does not phase out these programs too quickly. Although they were seen as emergency measures, unemployment remains at close to 15 percent, and Europe is at risk of recession. For these reasons, it will take a long time for Latvia to lower its unemployment rate to the 6 percent we saw in the boom years, and the social safety net will remain important.”
The bit, “We also encouraged the government to introduce a public works program, financed by the European Social Fund, to give jobs to people who wanted to work but were unable to find employment.” particularly caught my attention.
There is a pdf which discusses that shift in the use of ESF funds in Latvia, which I can’t link.
The current ESF funds cycle runs to to 2013, so:
(a) Can these funds be shifted in the current cycle, and
(b) Can they be reworked for the next cycle?
- Building a microeconomic model of the Republic of Ireland income distribution using microdata from the CSO’s Survey on Income and Living Conditions (SILC). The model will serve as a basis for examining and simulating policy options and changes to incomes, taxation, welfare and earnings policies.
- Building a macroeconomic model of the Republic of Ireland which we will use to provide recurring projections and commentary on the major macroeconomic indicators. These will be incorporated into future editions of the Quarterly Economic Observer (QEO) from later in 2012.
Interesting & Well intentioned quarterly but in a country that trys to save money by not recruiting Gardai how can we have a rational employment programme ?
We have a non optimum currency as illustrated by the differences between N.I. & R.o.I (although I guess they have a much larger police force / civil service relative to their population)
For example I cannot see how we can have a vibrant labour intensive horticultural industry when we can import fruit so cheaply.
I agree fiscal policey & investment is poorly targeted in Anglo countries since the beginning of time really - they just don’t do rational planning & infrastructure spending but much of this has been privatised anyway with Dirigisme a dirty French word now even in France.
As for their energy policey goals it seems very scatter gun like - not focused on our balance of payments central problem - oil.
Sure Electricity production from NG is a major problem but it pails into insignificance when looking at our oil problem - & besides the NG / electricity pit we have dug for ourselfs can only be really solved via a Nuclear programme and we are as far away from getting that on line as ever in our History.
The low hanging fruit is our oil central heating problem which has become a plague on most of our houses - especially rural and sub rural dwellings.
We need to get away from the Duncan Stewartisation of the debate - you don’t need to spend 20,000 euros via a bank loan to upgrade your house to a energy nirvana.
A more basic insulation + more importantly a heating fuel switchover from oil to wood stoves is needed in all homes with absurdly expensive oil central heating.
Keeping it simple stupid nearly always gets more bangs for your buck.
I don’t want to see any absurd solar power ventures in Ireland just because it is trendy ….. anything solar north & south of the tropics of Cancer & Capricorn is absurd never mind this cloudy +51 degree sod.
Nearly all remaining fixed capital Transport resourses should be directed towards putting Tram stuff on rails which the EIB is very familiar with in French towns of Cork size & above
However shorter rural lines which are still intact(not cut by Roads) such as Youghal / Foynes / New Ross should be considered given their much lower capital inputs….. (little or no bridge building & no urban disruption)
Large single railcar units such of the X73500 variety would be appropriate for Foynes / New Ross / Rosslare Europort /Portrush Coleraine /Antrim Lisburn line http://www.youtube.com/watch?v=MJk3NbV2iHQ
Although out of production perhaps Alstrom could be persuaded to produce a dozen+ units for the Irish Gauge market.
Small elegant solutions such as building a Pedestrian bridge linking Plunkett station closer to Waterford bus station would be money well spent also.
A major rethink of Rail cargo for heavy liquids such as Beer and oil is needed.
Tax policey favouring only the most efficient cars (-90Grams KM)
Thanks Gavin - at least you know its not a imposter on the other end…..
Reducing energy intensity does create jobs but requires initial fiscal support & planning - but the Dole requires fiscal support also……
For instance the old New Ross line terminates at the wrong side of the town , so you would need a mini bus and therefore extra bus driver to integrate with a rail service and transport people around a very Hilly New Ross town(they probally need a service anyway) but its not really that complicated - its simple really - so it can be done simply.
Also New Ross has tourist potential as the town is not completly wrecked by over development.
Many tourists prefer to travel by train anyhow -old fashioned car touring is now dying in Ireland.
That line would possibly be much busier in summer so you possibly could need a Single rail car to work the Winter months and a 2 railcar unit for the summer months.
However planning needs to be integrated in Waterford and elsewhere - they need a pedestrian bridge(possibly closed to the elements) to link Waterford train & bus station.
Also people may think I am crazy (?) but they should be planning a Tram link to Tramore now as withen a few Years many people will not be able to afford their cars input costs & yet will need a place to go……… this will change transport dynamics profoundly.
People are simply not prepared for a 1987 energy ration with a 2012 population.
Its hard for people to understand this now given the strange monetory dynamics of the Euro but the new Waterford bypasses are a continual waste & drain of resourses as the country is no longer suffering from a energy obesity problem but a starvation problem.
Therefore the guts & intestines of the country needs to become more efficient.
The people simply do not understand how much valuable liquid energy goes into propelling their chariots and how the Irish Neoliberal fois gras experiment is so over.
Dork, the energy predicament may well be understood by some of the folk who hang around this site. But my somewhat blinkered opinion is that most folk on the outside have no notion whatsoever about the very nasty outcome that is less than a decade from now. If they should find out … …
The 30 major oil exporters will cease to be so in about 15 years time. Their domestic consumption is approaching half their production. Their production is declining. Its not a matter of a sudden stop, but a slow suffocation. But, oneday, someday! TSWHTF.
Lets see if these ittle inconvenient facts arrive on NERI.
From here on it would help to develop analysis around the impact of different types of capital investment on employment, output and capacity. Our research confirms that the employment gains in the long-term are not negligible but less than in the short-term. An investment stimulus can act as a type of jump lead to a flat battery - the domestic economy. The real challenge is to develop over the long-term alternative sources of energy and to change existing patterns of consumption and production. No better time for private, public and European investment in green technology. Never waste a crisis.
@Brian Woods Snr
Yes in 1987 the world was in oil glut after the west built the Moneypoints of this world - reducing oil intensity..also there was much increased production.
But that investment was easy to do - it was the low hanging fruit of the day.
The monetarists blew the surplus on Grot but we can’t do anything about that now.
Transport is much more inelastic and needs proper planning also…………?
My view is to concentrate fixed capital(rail,trolleybus) expenditure into urban areas & market towns that can be saved most easily while depreciating the road network and importing only the most efficient cars(skoda greenlines) for the next 10 years to facilitate a changeover - although it ain’t going to be smooth.
Post 1987 Ireland & Spain experienced explosive Oil & Gas growth - that sure ain’t going to happen now unless China sinks.
Therefore the entire mindset of officials must change profoundly.
The Euro is a unnaturally strong currency for Ireland which has created malinvestment on the upside and no investment on the downside - the Irish for the most part just don’t know how much money is leaking out to those Saudi Princes.
High oil prices merely facilitate consumption elsewhere - we must reduce our oil money exports preferably through a return to the Punt which will encompass all oil costs not just personnel transport but if we somehow stay in the Euro through higher taxes on oil use.
(although I believe this is impossible with high personnel debt levels)
But the above transport solutions cannot bring in the Tourists which will also decline as discretionary spending evaporates.
We have a major problem on our hands Brian - its not helped by Germany rejecting Nuclear(their electricity prices are soaring and thus their discretionary spending is decreasing) and Japan currently with 52 Nuke stations off line now.
PS surprised that the Lisburn to Antrim branch line remains closed to passenger DMUs.
It would be interesting to see a recent domestic rail passenger numbers comparison between N.I. & R.o.I. - just to see if the different monetory environments on the same Island effect rail passenger numbers as they appear to be doing in Great Britain.
May 31 is a foolish date ….. it ignores developments in other parts of the EZ
The Debate in the Bundestag is ongoing - and no way will the Bundestag have voted on this by May 31 …
See: Anglela’ Korset, The SPD/GP forced compromise, the debate on the Korset including measure for growth etc …. & [Hi Olly!] the superior Wisdom of Festina Lente in this case:
Der Spiegel International Today ….
Separately, the main opposition parties on Tuesday rejected plans by Merkel’s government to push a European pact on budget discipline, the so-called fiscal pact, through parliament by June, saying more time was needed to complement it with measures to boost growth.
Dork, thanks for those thoughtful comments. Though I have a nasty suspicion that we may be having a private discussion between ourselves. Its an ALL island predicament. That’s a tad hard to get your functioning neurons around. I assume they have isolating valves on the ‘far side’ of the Irish Sea and North Channel gas interconnector. Reminds me of the saying, “When you hold a man’s testicles, his heart and mind follow”.
Though I note that Wolfie has a little (US centric) piece about the ‘E’ word in to-day’s Bus. Sect. of the IT. When a critical mass of folk grasp the awful reality that they need 2 liters of liquid hydrocarbon (not carbohydrate) fuel, per bum, per diem to keep them from squatting on Coffin Corner. Perhaps, perhaps … …
I am not hopeful. The human penchant for self-destruction is amazing.
Reading Saturday’s FT it looks like the Bundesbank is putting pressure on the ECB to limit the rather loose acceptability rules for collateral accepted in return for cheap LTRO money and that the markets don’t see LTRO as the answer- spnaih yields were up again on Friday . I wonder if the Germans will eventually be defeated by the markets and we’ll get to see investment spending in the PIIGs rather than pointless austerity without anything to take up the slack.
The unions have some good arguments against the prevailing common sense of the elites which is going nowhere.
@Tom Healy - so you think Ireland has the same low hanging fruit as the US?? It obviously has not occured to you that for example our motorways and bridges are new the USs are crumbling. And of course the only way to deal with problems (e.g. broadband) is to throw money at them. I suspect we are going to get more of this selective referencing.