IBEC: Driving Ireland’s Recovery Post author By Philip Lane Post date April 18, 2012 IBEC’s ideas are laid out here. Categories In Uncategorized 107 Comments on IBEC: Driving Ireland’s Recovery ← Vacancy: Director General of Central Statistics Office → Yet more on water meters 107 replies on “IBEC: Driving Ireland’s Recovery” @Philip Lane As I work in the private sector, I read the document looking for any concrete proposals on how to get out of the mess we are in. Regretably I did not find any. A lot of generalizations and aspirations but little else. PS: Coalface update: There has been a further very significant downturn in the construction sector of the economy during April, right throughout the country. The lack of activity is almost eerie! @Joseph Ryan As I also work in the private sector, I read the document looking for any concrete proposals on how to get out of the mess we are in. Regretably, like you, I did not find any. A lot of generalizations and aspirations but little else…. … other than the government should do this, ‘someone’ should do that, IBEC will do a lot of talking, er, that’s it. When I see a serious concrete plan, with tangible deliverables, named accountability and ownership for elements of it, hard dates, etc. then I will start to believe it’s something more than a puff piece. Oh yes… and show me the money. You kind of need resources to make plans work. This is a puff piece, written by someone trying to justify their (probably elevated) salary. @ Joseph A lot of is aspirational alright. No harm to see some positivity for a change though. To be fair they did publish some decent proposals on ways to stimulate domestic economy a few weeks back. Following on from Joseph Ryan’s initial comment, let’s look at what IBEC precisely plans to do: Domestic demand: – set out …a range of proposals (what or where are they?) – provide imporved market intelligence (surely this is a business opportunity for the private sector – not a role for a representative body? And are all these businesses so dumb they don’t know their markets?) – contribute to debate (we have ‘debate’ coming out of our ears, but no policy decision-influencing debate) – work… on perceptions and process around credit availability (why don’t we create the optical illusion that things are better than they are?) Europe – advocate that Ireland remains at the core of the EU project (Ireland is at the intersection of the trans-Atlantic economic space and the EU economic space. Its unresolved failures of democratic governance – and the subsequent, inevitable economic disaster – have put it on the ‘debtor side of the fundamental divide in the EU. Action, rather than advocacy, is required to put Ireland at the ‘core’.) – influence the [EU] policy debate [to] focus on growth-enhancing measures (why is the focus always on what others should do, but not on what Ireland should do to help itself?) – Leverage Ireland’s presidency of the Council to promote the interests and reputation of Irish business (Blowing bubbles at the Council will only pee off other countries and will not repair the reputational damage Irish business people did themselves all on their own. Why not look within?) – Work to restore and enhance Ireland’s repuation internationally (same as above and throw in the the rest of Official Ireland as well) Job Creation – promote policy and legislation refrom to reduce business and employment costs (why do not look at the non-labour costs the sheltered sectors impose – or would that upset too mnay IBEC members?) – prioritise education and R&D (will IBEC contribute hard cash to this – or is this for the plebs paying general taxation? – advocate a growth and job friendly approach to tax policy (a big part of the problem to date is low taxation, a narrow tax base and excessively high ‘point-of use’ charges for infrastructure and utility services – and many IBEC members benefitted greatly and undeservedly from this approach. We need less rather than more of this.) – ensure..excellent management capacity (if businesses can’t do this themselves they don’t deserve to be in business) Public Services (This section is so surreal it almost defies comment except perhaps for:) – work with regulators … to improve effectiveness and efficiency (Let’s help them to gouge even more out of final consumers) The government machines produces some choice BS and the trades unions are no slouches in this respect either , but there should be some sort of award for this because it’s the best or worst (depending on taste) I’ve seen to date. @Paul H Perhaps I should improve effectiveness and efficiency of my new smart R&D end product high technology eco-friendly machine and leverage its flexibility by having it collect hot air and BS from IBEC, unions, government departments..the whole lot? I wasted three pages on this piece of astrological pap. Its pathetic. The authors come across as being as dumb as ditchwater – in respect of our real economic and financial situation. That’s kinda serious, given the provenance of this epistle is Confederation House. “A target is something un-attainable, but not un-inspirational”. with apologies to W. Arthur Lewis [1979 Economics Prize Lecture] After suffering one of the biggest collapses known in the post world war universe because of our openness to global capital flows their solution is to make us even more “dynamic” & open as they like to say !!! The 1990s was not sustainable…… we had a huge domestic credit bubble in those days … it was focused slightly more on cars then on houses but it was a huge credit bubble none the less , especially after 1994 / 95 Our export /tourist growth in the 1990s was based on unsustainable credit growth abroad also. Looking at March airport movements now……… Dublin is down – 3.6 % from 2011 March numbers. Cork is down – 8% Shannon down – 3.2% Hello anybody home ? The Credit boom era is over…. get over it. This means shock horror there is little point in trying to repeat the 1990s which were a huge anomaly. We cannot afford to enrich bankers & sheiks by tapping into recycled petro $ flows……….they are drying up anyway I am afraid. In the 70s despite oil shocks the BTUs grew and thus the petro $ss could be recycled back to the western banks to blow it on being dynamic, now they can’t afford to be dynamic (waste resourses) The only “development” can come from a internal wealth generating capacity and reduction of energy input costs. Think of Ardnacrusha without 1930s Bus growth in Ireland but please no more wind farm subsidies. When Sterling devalues again to bring more Steel Industry back from Asia we will be out of here anyway…….. its that or Donkeys as the medium of exchange ,crushings the remaining rump domestic economy. Our post 1979 monetary policey has been a disaster for the domestic economy …… somehow sustained by multinationals & FG Farmer transfers which they wish to keep at all costs. Even if you have to drink your own P…….. @Brumpy, Can you scale up a prototype to such a huge processing capacity that rapidly? “Adapt the growth model that worked in the 1990s”. “The state and its households are burdened with potentially crippling debts”. Aren’t they connected? Ireland was a size AA in 1995. Lots of frilly tops. The debt implants went in from 97 on By 2005 the country was DDD (reverse scale to S&P) The boys loved it but it was unsustainable . The economy was as PJ Harvey said in another context “ spilling over like a heavy loaded fruit tree” Now the implants are out . How to grow the economy with a broken credit machine @Seafoid You print and print and print. They are lighting the furnaces again at teeside. SSI UK Aims To Expand Teesside Steel Plant Capacity – CEO Published April 16, 2012 Dow Jones Newswires LONDON – The U.K. arm of Thailand’s Sahaviriya Steel Industries PCL (SSI.TH), or SSI, wants to boost steel output from its Teesside, U.K. steel plant beyond its current capacity, marking a break from other European steelmakers who have been curtailing production. This marks a significant reversal of fortune for the plant, which restarted its blast furnace Sunday after a two-year hiatus; only two years ago the plant seemed to teeter on the brink of a permanent shutdown after its previous owner, India’s Tata Steel Ltd. (500470.BY), partly shut down the plant due to weak demand and then sold it to SSI in 2011. “No plant that’s been mothballed or closed in the integrated steel works in the U.K. has ever restarted again,” said Phil Dreyden, Chief Executive of SSI UK. “Everybody associated with the business had a tear in their eye because this was the realization of a dream…I think there was various points along the way when nobody thought it was going to happen.” SSI UK is restarting a blast furnace at a time when many other European steelmaker have either temporarily idled their production capacity or permanently shutdown blast furnaces due to anemic steel demand. Dreyden accredits the company’s decision to restart the plant’s only blast furnace to its unique business model in which all of SSI UK’s 3.6 million metric tons of annual steel slab production capacity will used to make finished steel products at SSI’s Thai operations for sale in the fast-growing South East Asian market. Steel demand in South East Asia, particularly in the automotive and household appliance sectors, continues to grow at a robust pace compared to slower growth in Europe. Dreyden said that “the vulnerability of their [the parent company’s] business is that they need slab to make it work.” SSI needs up to 4 million tons of slab annually to feed its hot roll milling capacity in Thailand and sources all of its needs from a 30 million ton a year, globally traded slab steel market, Dreyden said. SSI considered building its own integrated steel plant in Thailand but stumbled upon permitting difficulties, which prompted it to hunt for an existing plant, he added. SSI acquired the Teesside plant in March 2011 for about $470 million and then spent another $290 million to realign the furnace among other things, resulting in a total cost of about $800 million for about 4 million tons of production capacity. This compares to about $5 billion to build a new 5 million-ton-a-year steel plant, he noted. “They always felt that Teesside strategically had all the things that are required for a world class steel facility,” he said. He noted that U.K. labor costs are competitive and transportation costs are not that much different from buying slab in the Black Sea region or Brazil. SSI UK this year will focus on ramping up to full production capacity before contemplating further debottlenecking operations to increase its output to 4.2 million tons of steel slab production within the next two to three years, Dreyden said. SSI UK is considering producing high end steel plates for customers in the future, although much will depend on how such sales will impact SSI’s bottom line. Although the future looks bright, Dreyden said one key challenge for Teesside will be obtaining the requisite EU carbon allowances or permits that it needs starting next year to keep Teesside operational.” I must say I find this thread a bit weird. It’s basically about a promotional brochure which is of course honourably produced by staff, who cannot present anything that could be perceived as not consistent with the views of its main member companies, in particular MNCs. To coincide with IBEC’s CEO Conference last November, IBEC and PwC, the Big 4 accounting firm, published a report which indicated that employment levels would be back at pre-crisis levels by 2016, as exports continue to grow and domestic firms start exporting new services and products. In the same week, Ernst & Young, another Big 4 firm, said the jobs level will not be back to 2007 levels until 2030. I wrote then: “It is delusional to expect an improvement in competitiveness to trigger a big rise in exports in the short term. Chairborne experts do not appreciate how challenging it is to develop new export markets. The number of Irish SMEs exporting is low compared with other similar economies. There are few markets that are not intensely competitive.” Now, I just wish to provide an illustration of the difficulty of presenting a contrarian view despite the crash, that would debunk much of what is presented here today. Some weeks ago I was contacted by a member of an international media organisation. For many years I have had an interest in US corporate tax issues and MNCs. With the to and fro, I did some digging myself and for example saw what Apple’s Cork operation was charging into its Southeast Asian operation to minimise the main Singapore corp. tax rate of 17% and so on. So last week I published the article in which I highlighted the jobless exports surge of over 60% in real terms since 2000 and the claim that at least a third of services exports were ‘overstated’ — it was an understated term for the booking of revenues arising in other countries that are unrelated to activity in Ireland e.g data implying Microsoft’s Irish worker can produce revenues of $27m per head compared with S&P 500 companies in the US having revenue per head of $420,000 is ridiculous. The goods exports data are also suspect. It appears that we are not really interested in the truth. You might think that a claim that a significant amount of headline exports are dodgy coupled with the related reality on the ground that jobs in the sector are below the 1999 level, would merit investigation but this is conservative Ireland and who would want to give credibility to someone who could be dismissed as an ‘online blogger’? I sent a summary with the original piece to the business desks of the Irish Independent, Irish Times and Irish Examiner. They of course get lots of material and so on. It wasn’t news. I did make clear that every fact could be credibly factchecked with original resources. A contributor here replied saying he was wondering if it should be a guest post. I said go-ahead. That was that as I guess on second-thoughts my claims were viewed as incendiary. That’s what it was like also during the bubble if you bothered to sail against the wind. So the exports data IS dodgy; the biggest goods sector can increase its exports by 50% in 7 years without adding any jobs while American data for Irish MNCs shows a big jump in ‘wholesale trade.’ So production data may also be dodgy because of the pass-through of product with little if any processing; investment is outsized compared with jobs, which impacts both GDP and GNP. Even if we say all Facebook income outside the US and Canada is an Irish export because of some accounting work in Dublin, then just over 4,000 direct jobs account for almost a third of services exports. So back to the IBEC promo, should we really ask why we can have ‘rocket’ growth, if we had all the impressive headline numbers but end up with no additional jobs — for anyone wondering this was also the case in those magic days of 2000-2007. Productivity and other competitiveness indicators are also related to the other suspect data and are also dodgy. The pervasive spin is a disservice to the country. Irish Economy 2012: At least a third of value of Irish services exports is overstated http://www.finfacts.ie/irishfinancenews/article_1024185.shtml The IMF expects Europe’s banks to deleverage to the tune of $2.6tn over the next 12 months http://www.ft.com/cms/s/0/00078672-8952-11e1-bed0-00144feab49a.html#ixzz1sPL6pNoM Perfect for an export driven recovery @MH Sshhhh….Ajay is in town and we wouldn’t want to upset him. @Michael Henningan I thought that the state broadcaster had assisted in letting the country know that a central bank board member from the no-regulation, asset bubble years had labled you “not a person of standing”? I agree that there are no fresh ideas in this report. There is also no acknowledgment that any growth I’m the economy will bring about a corresponding growth in debt. A debt free source of digital money would undoubtedly help return us to growth without corresponding debt. Paul Ferguson Sensible Money Lovely graph here of Ireland bouncing along the years at 90% of real 2008 GDP http://im.media.ft.com/content/images/49d27906-88bc-11e1-a526-00144feab49a.img?width=851&height=223&title=&desc=Martin%20Wolf%20charts @michael hennigan +10 Admirable, informative and insightful contribution by yourself as usual. Regrettably it will disappear from the Official radar as just inconvenient chatter. In many ways that sanctioned reaction is what sustains IBEC codology. The insiders know it is fragrant stuff for the tables of the government and the IDA, but the system of well oiled amplification ensures an uncritical reception. With all the blather about recovery in the air, I wonder has anyone of the megaphonic chorus ever bothered to read the famous but doomed Telesis Report. Good Newz Pharmaceuticals firm Mylan will invest up to €76m for five years totaling to €380m to expand its operations in Dublin and Galway and will add more than 500 new positions to its Irish workforce by 2016. … “This investment in Mylan’s Irish operations and the growth of our capabilities in the country demonstrate our continued commitment to and confidence in our respiratory franchise and injectables platform, both of which are among Mylan’s many long-term growth drivers,” said Mylan CEO Heather Bresch. http://www.siliconrepublic.com/careers/item/26781-mylan-to-create-500-new-job Bad Newz/Good Newz Soma will no longer be available on the medical card, and will be subject to VAT at 50%. Pharma stocks soar. When you burn through this amount of resourses for a negative yield then it time to return to the design philosophy of keeping it simple stupid. http://www.youtube.com/watch?v=5RPug82XrFU re IBEC Report Labour productivity on p.6 & 2006 data – modern vs indigenous Therein lies a story! The reader is referred to Hennigan, a man ‘still standing’. Amazing the way these ‘capital flows’ keep cropping up in strange places! Don’t suppose there’s any chance of getting them ‘metered’ at the mo though! The mid evolution of the design. Form follows function or function follows form ? http://www.youtube.com/watch?v=jOJntJYuBAQ I attended this event in the Aviva this morning. The document is a strategy/vision document outlining what IBEC intends to do for the year. The document was presented to members and there was a good discussion about the ambition for Irish business. The main idea was about what Ireland could aspire to and how business could lead this recovery. It looked at Ireland’s potential growth rate, the concept of Ireland as a region within Europe and how IBEC can be more effective for its members. It is not meant to be a set of concrete proposals aimed at driving recovery. @Paul Hunt I was rather dismayed at some of your critical comments. It is possible that you misunderstood what this document is. In any event your resorting to ridicule and satire was in poor taste. A few points. 1. “what or where are they?” As a previous poster already pointed out IBEC already published proposals recently in relation to the domestic economy. 2. “surely this is a business opportunity for the private sector – not a role for a representative body and are all these businesses so dumb they don’t know their markets?” Why would IBEC not provide improved market intelligence to its members? It would be rather inefficient of firms to source this data from elsewhere in the private sector if they are already paying membership fees to IBEC. If IBEC want to provide additional services to their members, I am sure the members will welcome it. 3. “we have ‘debate’ coming out of our ears, but no policy decision-influencing debate” Why do you, or anyone else for that matter, post on this blog if that is the case. The best way to reach the most effective policy decision is through respectful debate and discussion with all stakeholders. Debate isn’t just a platform for academics. The more who contribute to the debate the better, especially if the debate becomes too one sided, or too negative in the case of Ireland. If IBEC want to contribute more to this debate then they are welcome to. Indeed, given their proximity to issues affecting all types of business, its perspective should be welcomed. This growth we all desire needs to come from somewhere. 4. “why is the focus always on what others should do, but not on what Ireland should do to help itself?” Of course Ireland should help itself first and foremost. Irish firms, those that continue to survive, have made substantial and sometimes painful competitiveness adjustments since 2009. These adjustments have allowed them to compete, and to capture market share in export markets. Households and workers have also made serious adjustments as we are all aware. However, to ignore what happens in Europe would be foolhardy particularly in this crisis and given the supports we are currently receiving. It is patently obvious that Ireland should leverage its upcoming presidency of the EU. Why shouldn’t we? It is an ideal time to set an agenda that relates to issues of importance to Ireland. 5. “why do not look at the non-labour costs the sheltered sectors impose – or would that upset too mnay IBEC members?” I agree completely. The document said “business and employment costs”, why do you assume this excludes non-labour costs. Business costs of course include non-labour costs, including the sheltered sectors. 6.”will IBEC contribute hard cash to this – or is this for the plebs paying general taxation?” I would assume not but what is the relevance of that. You either agree that R&D and Education should be prioritised or you don’t? If you don’t, why? Take Finland who suffered a similar crash in the 1980’s – they prioritised education and now lead most international rankings in education. What is wrong with Ireland aspiring to this? 7. “a big part of the problem to date is low taxation, a narrow tax base and excessively high ‘point-of use’ charges for infrastructure and utility services – and many IBEC members benefitted greatly and undeservedly from this approach. We need less rather than more of this” The document aspires to a growth and job friendly approach to tax policy. I saw no mention of low taxation in the document. As I am sure you are aware high marginal tax rates reduce the incentives to work. Corporation tax increases have the most harmful effect on growth and introducing a properly defined property tax is least damaging to growth. A growth and job friendly approach to tax policy should ensure marginal tax rates and corporate tax rates don’t go any higher. If government requires additional revenue from taxation it should do so through a properly defined property tax. Of course we all want taxes to be lower but we need to be realistic. 8.”Let’s help them gouge even more out of final consumers.” I am not sure how you came to this conclusion. If you owned a business then you would know that some regulation (or “red tape”) is a persistent issue for business. This has nothing to do with gouging money out of anyone. Regulation is needed in many sectors but it should be implemented in such a way so as not to impose unwarranted restrictions on business and consumers. A good example of this is the WEEE legislation which was transposed over and above the requirements of the Directive. Surely if there are issues in other areas such as competition or energy that are causing problems for business it is useful for regulators to know these issues. 9. “why don’t we create the optical illusion that things are better than they are?)” Why would IBEC want to create an illusion that access to credit is not a business issue if their members are telling them something different? I don’t follow your logic. It is entirely the opposite of what you say. Access to credit is serious problem for some firms, and there has been suggestions from some quarters that demand for credit is low and isn’t as big a problem. If IBEC’s membership is telling them something different it is imperative that their representative body highlights this issue at a national level. What is unreasonable about this? @DOD “In addition to the financial incentives provided by the IDA, Udaras Na Gaeltachta, a regional economic development agency that provides specialized support for Irish-speaking communities, assisted with the support of these expansion efforts. Mylan’s operations in Ireland include Gerard Laboratories and Bioniche Pharma. The global company ranks among the leading generic and specialty pharmaceutical companies in the world and provides products to customers in approximately 150 countries and territories. The company maintains one of the industry’s broadest and highest quality product portfolios supported by a robust product pipeline; operates one of the world’s largest active pharmaceutical ingredient manufacturers; and runs a specialty business focused on respiratory, allergy and psychiatric therapies. For more information about Mylan, please visit http://www.mylan.com. Wonder how much it cost us? Should replace some of the lost sales from patent expiration…or will it? @ Paddy: “The document aspires to a growth and job friendly approach to tax policy. I saw no mention of low taxation in the document. As I am sure you are aware high marginal tax rates reduce the incentives to work. Corporation tax increases have the most harmful effect on growth and introducing a properly defined property tax is least damaging to growth. A growth and job friendly approach to tax policy should ensure marginal tax rates and corporate tax rates don’t go any higher. If government requires additional revenue from taxation it should do so through a properly defined property tax.” Marginal tax rates reduce the incentive to work. How? Evidence? Corporation tax increases have the MOST harmful effect on growth. How? Evidence? A properly defined property tax is LEAST damaging to growth. How? Evidence? Paddy, (no offense), but could you please get real about taxation and government expenditures. They are way out of whack. Now why would that be, then? This economic and fiscal twin disaster we have is not due to the fairies at the bottom of my garden. It has a structural, human constructed cause. Attempting to undo the damage is akin to having ones leg amputated in order to stop advancing necrosis. Done early enough it is successful. But the patient is crippled. Take you choice. Fatal toxemia, or hobbling about. Its Domestic Economy 101 Paddy. No taxes. No services. So what services need to be curtailed? Is that it? For whose benefit? To what effect? So we increase taxes. For what? How about IBEC demand fiscal responsibility of our legislators, and insist on NO tax breaks, NO writeoffs, or any allowances whatsoever, for anyone (business or personal). Now that would do what to ‘growth’? But whose growth Paddy? Whose growth? Both IBEC and a great many citizens in this state have a very unpleasant ‘Come to Jesus Moment’ in front of them, in respect of their over-inflated expectations as to what our Government can achieve. Growth, as they knew it is gone. And it is not coming back – ever! John Gapper begins an interesting article in the FT today: ‘Sometimes the most obvious and tempting strategy is the stupidest.’ It’s on Argentina’s seizure of a Spanish-controlled oil firm. It’s easy to set multi-decade aspirations but it’s interesting that the members of the same policy/business elite will not call out failure when it’s staring them in the face. The innovation policy is a central part of enterprise policy. We’re told most new FDI projects today have an ‘R&D’ element. That of course covers a multitude because of the tax credit and detail is not published. Calling a call centre a ‘centre of excellence’ creates a lot of possibilities. Of course the education system is very important but there is nowhere where university research has created a high tech jobs engine. The OECD says there is “little evidence of success” in the commercialisation of university research. Two years after its publication, the Innovation Taskforce Report is rarely mentioned these days. How could the 28-strong group comprising university presidents, an academic from Stanford University, senior public policymakers, MNC managers, lawyers and accountants from top firms and a small number of entrepreneurs, have been collectively so stupid to believe that in a decade, up to the equivalent of a third of the high tech jobs in Silicon Valley, 235,000, could be created in Ireland? – – that’s in a sector where the survial rate is 30% in 7 years and where there is a small domestic market. For one, dissenters weren’t welcome. Trying to clone Silicon Valley is not new. Nikita Khrushchev is more famous for thumping a table at a UN security council meeting with his shoe, than his interest in computing. Like many others, he did try and set up a clone of Silicon Valley. However, the one successful example is linked to the Soviet Union when the influx in 1991 of 1m mainly highly skilled immigrants from the collapsed empire, allied with the defence industry research base, resulted in the development of a successful high technology industry in Israel. @ All An interview with George Soros to cheer everyone up! http://www.lemonde.fr/economie/article/2012/04/18/pour-george-soros-les-dirigeants-europeens-menent-l-europe-a-sa-perte_1687103_3234.html @ Paddy The general tone of this blog is iconoclastic, especially when contributors are disagreeing vehemently with one another. In general, however, the tolerance level of the “waffle quotient” everywhere in the country has fallen noticebly. This can only be a good thing! Some very unpleasant realities have to be confronted, the recent performance of the government simply serving to underline that the “same old, same old” approach no longer works. @Paddy, I can see you’re a bit cross with me – and probably more than a bit because you seem to have put a lot of effort in to dissecting my comment, but I think I understand why. I know there are many, many people who want the best for Ireland, but, unfortunately they don’t seem to understand why it’s in the mess it’s in – and what needs to be done to extricate it. The reason I comment on this blog is to provide bits of information to any interested readers on parts of the Irish economy where I have some limited knowledge and competence to make some assertions. As for influencing policy-makers, believe me I’ve tried for the last decade and it hasn’t made a blind bit of difference. I’ve tried the presentation of facts, evidence and analysis, the use of sweet reason, politeness, deference, careful argumentation, made submissions, you name it, with politicians, officials, regulators, academics, consultants, the media, what have you, and it’s proved a total and utter waste of time. The amount of effort many of these denizens of Official Ireland put in to creating and sustaining optical illusions and attempting to suspend disbelief so as to avoid confronting the underlying reality and the key problems is truly remarkable. If a small fraction of this effort were put in to tackling the glaringly obvious problems we’d have reached the ‘sunlit uplands’ by now. For example, when a particularly contentious issue arises, such as this water industry reform, the contortions performed by those with some knowledge and competence and who might be required or feel obliged to review or comment on what is proposed is a wonder to behold. Many people in Official Ireland know precisely what the problems are – and what solutions are required. But it profits them to remain silent or to murmer their unease ‘sotto voce’ behind the scenes. Conversely, it would cost them if they were to speak out clearly and publicly. Specifically, I made a submission to this public consulation on water industry reform which is unlikley to see the light of day. Can you imagine the furore if the ‘independent’ ESRI made a submission along the lines of the one I made? The principal reason for all this is that I am not a ‘person of standing’, as David Begg so efortlessly put down Michael Hennigan. So all I’m left is trying to inform interested citizens and ridiculing the delusions of Official Ireland. Shiver me shibboleths, another wallop of non sequitors from overpaid boys of IBEC. “The economy has already restored competitiveness within the common currency” Well, yeah, sort of, if you take into account 15% unemployment who’ll work for nothing with salary cuts for those in employment to pipe money to the banks, NAMA and continued recycling of debt from the banks onto taxpayers; but only if we get a second bailout and ignore the economy is bankrupt? Some are doing well out of it, farmers, IBEC orchestra on Titanic, without views on reshaping debt. @ All As our main trading partner, the UK, seems to have disappeared from the radar, this excellent article by John Palmer provides a useful reminder. http://www.social-europe.eu/2012/04/the-uk-a-perplexed-and-divided-observer-of-the-euro-crisis/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+SEJColumns+%28Social+Europe+Journal+%C2%BB+Columns%29 De paper reported today the Western relief road around Carrigaline will be built for the cost of 15 M !!! My God , will they ever learn , we have enough houses & roads to keep us going for a Century. Indeed we can’t even maintain what we have got. Some other weird road to nowhere is being built near Apple computers on Corks Northside. Have people seen the decline & aging of the car fleet ?? Its a old 20th century technology. Cork need to get a start on its badly needed Tram for the city. With the old Albert station to Rochestown station route the first segment of this tram line. (the line is mainly intact) http://www.geograph.ie/photo/76470 http://www.geograph.ie/photo/76745 http://www.geograph.ie/photo/76747 @DOCM, The current Tory parliamentary party is probably the most Eurosceptic ever; the right-wing press has fed rampant Europhobia; and the centre-left organs have been totally lily-livered. But there is a fundamental conflict in perceptions. An Englishman believes he is free unless he consents via the democratic process to have his liberty curtailed. Everything is permitted unless legally prohibited. This belief extends to a view that, under the Napoleonic Code, citizens are free only to the extent that they can secure rights from an over-mighty state. Both views are mistaken – and ignore the broad similarities between democratic governance in the UK and that in the northern EU states. But they reinforce a widely-shared sense of English ‘exceptionalism’ – in some respects not unlike US ‘exceptionalism’. The EU badly needs a committed Britain – and Britain needs the EU, but both are drifting apart. I don’t think a Hollande win will turn the tide in the EU. Francois Mitterand tried to swim against the tide when he first won in 1981 – and had to re-learn canoe-paddling. Should give food for thought to prospective ‘no’ voters who favour closer alignment with our Anglo-Saxon cousins. These are the recent 2011 district population figures for that section of the line. City Hall A Y2011 : 804 Y2006 :869 decrease of 65 or 7.5% This area includes the infamous Elysian tower which is nearly empty at the moment. Now follow the path of the old passage west railway via the Monahan road to the Atlantic pond and the Gaelic stadium. Knockrea B Y2011 : 1,114 Y2006 :1,205 decrease of 91 or 7.5% Next stop Blackrock station Mahon A Y2011 : 4,931 Y2006 : 4,206 increase of 725 or 17.2% Next stop mahon shopping centre Mahon B Y2011 :4,843 Y2006 :4,241 increase of 602 or 14.2% Phase 1 terminus Rochestown station Douglas Y2011 :20,397 y2006 : 18,182 increase of 2,215 or 12.2% (this is however a extensive area) @Paul Hunt ‘Should give food for thought to prospective ‘no’ voters who favour closer alignment with our Anglo-Saxon cousins. Gimme a break Paul. THE reason to vote NO is that the political economic content of the so-called Fiscal Compact is sheer NONSENSE. I have yet to see an Irish economist of ‘standing’ justify its social scientific validity; obviously, because it has NONE. This challenge remains open, and the silence of said economists to rise to it is very strong evidence of its NONSENSICAL and highly dangerous nature. This is not about Anglo-Saxon – this is about Europe and European Democracy. You’re now in the running with DOCM (who lost out last month to Mr Smith from the matrixsQuidesque parish) for establishment spinner of the month. @ceteris Jobs is Jobs – if this encourages more Science grads, all the better. Soon we should be able to manufacture our own SOMA as Gaeilge! Maybe blend it with a drop of connemara poitin for a bit of a kick. @ Dork The IT backs up the case http://www.irishtimes.com/newspaper/property/2012/0419/1224314920494.html While a house in Rathdrum when they bought in 2005 was more affordable than in the suburbs of Sallynoggin or Dalkey from where they hail, what they didn’t expect was the rising cost of fuel. Now with no prospect of work closer to home, punitive petrol prices and an increasingly expensive mortgage to pay, this young family is just one of thousands caught in a perfect commuter belt storm. With their second car permanently in the driveway because they can’t afford to run it, the couple’s work and family life now revolves around commuting as cheaply as possible. “I’ve talked to my boss so that I can have roughly the same hours as my husband because of fuel,” says Kiera. “Fuel is just taking a massive chunk out of our salaries. Even with one car, it’s becoming frightening to see how much money we put in every week.” “You might have bought a house in 2007 or 2008 and your budget looked sound at the time, but in January 2009, if you were paying €142 a month for petrol, now you are paying €300. It’s crucifying people. @D O’D, “establishment spinner of the month’. That is absolutely priceless. I have Paddy from IBEC over on another thread taking me to task for poking fun at IBEC’s delusions and I’ve lost count of the number of the corners of Official Ireland where I’m ‘persona non grata’. And I’ve certainly lost count of the number of denizens of Official Ireland whose precious integrity/honesty/professionalism I’ve apparently inpugned or insulted. And, believe me, I’m equally unsparing of any nonsense I encounter in the UK or the EU, but I use the appropriate channels. This is ‘Irish Economy’, so the focus has to be on Irish economic nonsense. @Seafoid Yes very few economists calculate the costs of buying private car capital (it sits in the driveway or workplace for 22 -23 hours in the day depreciating) Trains , Trams ,Buses & taxis can work 12 hour + days. From a holistic economy perspective its better for the price of oil to rise if the money supply / wages also rise……. then the hypothetical family will have more tokens to purchase transport services , public transport would work to near maximum capacity which should at least in theory push down the costs of a Bus & train in real wage earning terms. You would get efficient good substitution as is happening in the UK although they are not producing enough fiscal money to build for this increased capacity. PS Missed some districts close to the Blackrock line. Mahon C Population Y2006 :3,477 population Y2011 :3,330 decline of 4.2% or 147 Also Passage west / monkstown would be a short drive /cycle to the Roachestown terminus (phase 1) Monkstown urban Y2006 :4,818 Y2011 :5,122 6.3% increase. If this was in France it would have been done already. Brest is a smaller town then Cork yet they will have a longer Tram line operational by the summer. http://www.youtube.com/watch?v=9-NKuIicFwk Corks linear follow the river nature makes it a very suitable city for this development , especially as the great mass of people live on the south of the river with no rail line to speak of. @Paddy “If government requires additional revenue from taxation it should do so through a properly defined property tax.” Maybe I’m missing that vision thing but it’s very hard to see a property tax bringing in EUR 15bn to close the deficit I recommend all commercial businesses be allowed market rents. Many Irish businesses are over-rented for ten years and more. @Paul Hunt ‘…so the focus has to be on Irish economic nonsense. I agree, and I support your, probably Quixotic campaign, on the sheltered sectors of gougers …. What amazes me is that you do not appear to recognize the Nonsensical, and dangerous, Economic Content of the Fiscal Compact – and blindly side with the ‘YES to this nonsense brigade’. I’m as shocked as you are that you are in line for such a spinner award … As someone who works in a construction related manufacturing business ( very little export), business is down 11.8% ( volume and value) right up to today compared to exactly the same period last year.Business intelligence from other common players in similar industries indicate same and greater levels of activity reduction. The reality is that the domestic manufacturing economy is in intensive care. The poulation and economy here cannot continue to support domestic manufacturing industry as we have known it. @Dork IBEC are driving Ireland’s recovery. They do not appear to be going by train. I am not sure the car has wheels either. @Seafoid I guess when the Chips are down they will have to adopt a more radical transport strategy. Import every old Citroen DS they can get their hands on. http://www.youtube.com/watch?v=VWiRxHJHNWc http://www.youtube.com/watch?v=4HK2nTRvm_s @DOCM Doubt if anyone in Britain wants to join the euro; its a question now of damage limitation for all concerned. Speaking of Tir na NÓ g 🙂 re the referendum, shouldn’t our present incumbents postpone the vote to see if Francoise Hollande gets his protocol written into it? Even just to save printing costs? Then of course there is the legality of any new Compact with additional protocols? We’ll need another one again to ratify the first? Perhaps refer Enda re above. The mind boggles, clear, resounding NO required to end the mess 🙁 ACEA (European automobile manufacturers Asssoc.) March car reg data. Brussels, 17/04/2012 – In March, demand for new cars in the EU* was negative for the sixth consecutive month, with a decline of 7.0% compared to March last year. While retaining their importance in terms of volumes (1,453,407 new cars), March registrations have not been at this level since 1998. Over the first quarter, the EU market shrank by 7.7%, compared to the same period a year ago, with a total of 3,312,657 new registrations. Results in March were diverse across the EU* as Italy (-26.7%), France (-23.2%) and Spain (-4.5%) saw their markets contract whereas the UK (+1.8%) and Germany (+3.4%) performed better than they did in the same month a year earlier. From January to March, contrasting performance across countries led to an overall 7.7% drop. Looking at the major markets, the German (+1.3%) and British (+0.9%) slightly expanded, while the Spanish dropped by 1.9%, and Italy (-21.0%) and France (-21.6%) faced a much sharper downturn @ Colm Another reason for No.. “The introduction of the euro has led to divergence instead of bringing about convergence. The most fragile countries of the eurozone have discovered that they are in a Third World situation, as if they were indebted in a foreign currency, with a crucial effect that there is a real risk of default. Trying to make them respect rules that don’t work just makes matters worse. Sadly, the authorities don’t understand this.” …..George Soros le Monde interview. @D O’D, You keep looking for the economists to stand up and be counted on the Fiscal Compact. They can’t, because their discipline is deficient – as well as having been subverted in various ways by the Neo-cons. They adamantly eschew political economy and the insights of institutional economics. But what is happening in Europe can only be explained by political economy and institutional economics. It would be wonderful if the governing politicians and officials there were to focus first and foremost on unwinding this Faustian pact between sovereigns and banks, but this has been the best part of 30 years in the making, it will take a long time to unwind and they just haven’t the political stomach for it. This will be a long drwan-out exercise with numerous bumps on the road. What they are focusing on, though, is reducing the power of bond market participants over sovereign governments. And this is where the fiscal compact comes in. They want to shrink the volume of sovereign debt in circulation and to make it as low risk as possible. When a sovereign gets too close to the edge of the fiscal cliff, ‘rate’ investors take fright and ‘credit’ investors, speculators, shorters and other vultures have a field day. The intent is to compel sovereigns to stay well back from the fiscal cliff. Ireland may need to stay further back from the edge of the cliff than the big players because it is a small open regional economy and will need extra fiscal space to deal with external shocks. So I have no major problems with the fiscal compact. Obviously I would prefer that the EU’s Grand Panjandrums got the finger out and got seriously stuck in to unwinding the Faustian pact between banks and sovereigns, but beggars can’t be choosers. They’ll get there eventually. In the meantime Ireland could do a huge amount to help itself by getting the cost base of the economy down and by redcuing the amount of state equity tied up inefficiently and unproductively. But it seems to be harder to get Official Ireland to focus on this than to persuade the EU’s Grand Panjandrums to get the finger out on unwinding the Faustian pact. And it’s always easier to wail about perfidious foreigners than to tackle the enemy within. @Ceterisparibus +1 Re “Sadly, the authorities don’t understand this..” I’m being kind with Tir Na N’Óg cliche, part of the problem here is the residue from our pirates of the Caribbean culture of Celtic Tiger, dem pirates still running the ship mehearties; they don’t want to let go of pipe dreams of buried gold; they should’ve been asked to walk the plank, but are above the law it would appear and now are installed in a Vichy version of government by Compact decree having handed the bill for the mess to taxpayers ? Wonder where the undermanned Anglo investigation is at now ? We’d like to see what value for money we’re getting for the ¢47 bn ? This would make you wonder”………… “The chief executive of March Gestion de Fondos, José Luis Jiménez Guajardo- Fajardo, the asset management arm of Banca March, said that he sometimes felt Germany had a vested interest in an unsettled Europe and was cashing in on bailout nerves. “Of course Germany is taking profit from this. They are paying less for their debt than ever. Because the euro is once again weak, this is very helpful for German exports abroad,” Jiménez said, calling on the country to take a back seat role in formulating the economic policy of peripheral strugglers. “I do not want to believe the Germans are playing this in a way just so they can take profit, but it seems like we have a lack of political decisionmaking [to offset this impact].” Banca March can lay claim to the title of Europe’s strongest lender after topping the list of 91 banks stress-tested by the European Banking Authority last summer for their capacity to withstand another credit crunch. Read more: http://www.irishexaminer.com/business/spanish-bank-hits-back-at-germany-191036.html#ixzz1sViry1Is Spot the trend here (European car reg press relaeases)…….its not very hard. http://www.acea.be/collection/statistics Go to :New Vehicle Registrations: Provisional Figures (ACEA Press Releases) , monthly proviosional figures new passenger cars. And yet the Dorks in Cork want to spend millions on new roads…sweet Jesus “Christine Lagarde calls on all IMF member states to “finish the job” and pledge more cash to tackle the eurozone crisis, saying that bailout funds be sent directly to banks rather than struggling countries. ” Money directly to the banks? Good grief. They are not even trying to pretend any more. @ Ceterisparibus Yep, volatility is a gift to speculators including Soros, José is making money on risky Spanish/Italian bonds; once profit is to be made on the markets. lending into the economy takes a back seat, investing in financial markets money for old rope. Eventually the ponzi pyramid of the euro with banks at its apex will crumble; an EU for the banks, by the banks, of the banks, is only on life support and won’t last. First out will gain most. Interesting even Banca March are selling off their Spanish bonds: “The fund bought one-year Spanish debt offering a 5% return in December, before selling it on again in February to buy Italian bonds.” @ Dork Euro car production needs to slim down by 1 million cars a year Check out Peugeot’s 12 month share performance @PR Guy re Madam Legarde’s quotation. ““Christine Lagarde calls on all IMF member states to “finish the job” and pledge more cash to tackle the eurozone crisis, saying that bailout funds be sent directly to banks rather than struggling countries. ” Extraordinary. Incredible. Banks in pole position ahead of sovereigns. It will take students of history to work that one out. And what extraordinary rubbish. Like General Nivelle at the battle of Aisne they have no idea when to say ‘stop, this is not working’ As for the troops on the ground, they never mattered much to the French elite or any other elite either. with Gavin O Reilly stepping down as CEO of INM will Sunday Indo actually turn some of its ire for our woes on the Troika rather than DOB?….not for another while i’d say…. @Seafoid I was joking before about bringing back a modernized 2CV but I am not so sure now – a cheap (5000 euro?) no frills 50mph 90mpg rural sardine can is looking more & more likely. They need to get rid of all those modern safety measures though …… too heavy. Strip it to the bone. Those battery powered cars are too expensive …..the price of Lithium will never come down for the masses. But perhaps young ladies will buy some with the help of Daddy …..Daddy http://www.youtube.com/watch?v=2KlWtu60lkw The only transport growth in France is trams & tram trains – its a complete reversal of the post WW 1 world really……but people seem very slow on the uptake. With Reims & Angers becoming tram towns in 2011 Brest , Dijon & La Havre will be added to the Tram list this year & Tours next year with cities such as Bordeaux , Nantes , Lyon , Montpellier greatly adding to their networks chiefly through tramtrain projects. These are the figures & projected tram figures for Bordeaux. length of network : 24.7 km (2003) / 43.3 km (2008) / 58.8 km (2013) number of stations : 53 (2003) / 89 (2008) / 124 (2013) number of trams : 44 (2003) / 70 (2008) / 90 (2013) volume of traffic : 160,000 passengers a day (2003) / 288,000 (2008) / 430,000 (2013) Truely extrodinary. Paris is of course another huge growth area. They are even thinking of bringing in cargo trams to Paris during off peak times !! IBEC video of economic recovery Just say disca busca topolino and bob’s your uncle @ Paul Hunt To take an element from another reply by you with which I agree. “But what is happening in Europe can only be explained by political economy and institutional economics”. The piece by John Palmer is accurate, in my opinion, because it sums up the fundamental contradiction in the UK position i.e pushing the idea of Europe away while at the same time being, in practice, enmeshed in it. On the other hand, the British have had centuries of practice in dealing with this conundrum. I was simply drawing attention to the need not to forget the role of the UK, given the close links between the Irish and UK economies. As Michael Hennigan has clearly demonstrated, the official statistics with regard to Ireland’s overall economic performance are dubious, to say the least. Those relating to the UK are probably the most reliable in indicating the true position. @Paul Hunt Re “But what is happening in Europe can only be explained by political economy and institutional economics”. Nope, you need to follow the money, here is another view of EMU through the ESM lens, its why you should vote against it, while you have a vote; after ESM, votes won’t matter: http://www.youtube.com/watch?v=EPcWHBPYOSU http://www.commondreams.org/view/2012/04/18-12 @docm With regard to your views of the UK position and Europe I think it is worth bearing in mind that it is an Island which is big enough and through its history, confident enough, to go its own way in classic Island-race fashion. For various reasons, Ireland does not do that. That capability and willingness to be perceived if necessary as awkward, has on occasion been extraordinarily valuable to Europe in the long term. The UK was lampooned in Europe for not joining in with the group-think of the Euro project. Saying no to it is something that Gordon Brown will get a lot of respect for in a few years. The UK position on various things may be a little curious, but the Euro-Zone by comparison is a laughing stock. PH “And this is where the fiscal compact comes in. They want to shrink the volume of sovereign debt in circulation and to make it as low risk as possible.” Yet in an effort to stop a banking catastrophe which was in turn caused by the imposition of a loose Germanic monetary policy on the EZ, along with the complete absence of regulation, the PTB in the EZ encouraged/persuaded/cajoled the peripheral sovereigns to go to the brink of bankruptcy or beyond. The last man to go would appear to be the Spaniard who it appears will have to put his sovereign signature to a check for 40% of GDP to recap his banks. One welcome outcome of this for the Germans is that they have got paid back and been replaced in the trade by the IMF/ESM/SMP/LTRO. Labrokes (the Magic Sign) could not have done a better job of laying off the bet. This particular game was always going to end up in one of three outcomes i) default by the periphery ii) a large cheque from the Germans or iii) the ECB kicking the Germans out of the print room and pressing the print button. At least one of these outcomes marks the end of the EU Grumpy is dead right. The Brits have been way too smart to get enmeshed in this. We would be doing well to try to extricate ourselves from this by voting no, preparing for a default and possible exit from the doomed currency. The only hope we have now is to force Germany to secede from the EZ and then without delay devalue the Euro. The market will do the devaluing by default. I should have avoided the last word. Poor Germany $2+ to the Deutsch Mark and Euro 1.95 to the DM. The EZ sans Germany would boom, note the German banks would be paid in depreciated Euros. Put it on the upcoming referendum, it is our only hope. Germany will have declining export markets and high unemployment. We will do the decent thing and allow them back in with the ECB in Paris, Deutsche Bank will be a shadow of its former self, the Gov’t (DE) will be running a deficit and Debt to GDP will be 120% delong.typepad.com/sdj/2012/04/the-second-phase-of-europes-second-great-depression-is-underway.html IBEC is weaving fantasies, we have to come to our senses. We really must get an arms industry in Ireland. There is so much money to be made. http://www.guardian.co.uk/world/2012/apr/19/greece-military-spending-debt-crisis @grumpy “For various reasons, Ireland does not do that.” I suppose the reason is we have no nukes. (Cannot do smileys on this machine) The midnight boggles…can you imagine Mickey and Enda in charge of nukes? That should be..the mind boggles…. @ Mickey We can have all the fantasies we like but it won’t change one damn thing… Germany is winning hands down while our guys play schoolmaster. Couldn’t resist this update… “”What it’s not about is Germany taking over Europe,” he said. Indeed. Enda was probably quite content to get a brief break from the various rumbles over the household charge, water metering and the introduction of fornication into the Dail (the word, not the actual deed, in fairness).” It’s easy to be confused these days by official morality. A garlic importer gets 6 years in jail for mislabeling the product while much bigger world-class fish get the nod for a lot worse. On Ireland’s options, whether one advocates default, exiting the euro or the more certain grim future within, the key debate that should precede all that is a recognition that bubble living standards cannot be sustained. Imelda Marcos famously said: “I get so tired of listening to one million dollars here, one million dollars there. It’s so petty.” (I was in Manila on the night in 1986 when she and her kleptocratic husband were airlifted by the Americans out of the city). In so many areas still, bubble costs remain and for example the State is the biggest customer for lawyers and doctors. It’s of course tiresome for the defenders of the status quo but some day there will be regret that bold decisions have been deferred. Teaching is a prized profession in Finland because there is no pay premium for medicine and law but Finnish teachers earn less than their Irish counterparts. Neither is there a pay premium for the public service. The air of prevailing unreality is illustrated by the resistance of non-party TDs to losing their €41,000 annual tax-free bonanza that was first provided by Bertie Ahern in 1997 in return for voting support in the Dáil. The bubble is bust but burdens remain. @ Dork of Cork Your piece on Albert Quay is interesting. I used have some business dealings with Joe Carey, the founder of Careys, who renamed the quay ‘City Hall Quay’ for the convenience of outoftowners. City Hall officials were not pleased but could do nothing about it. I lived near Albert Road for a while and used to go to the Model School (now a courthouse) – – apparently the building plan used had been originally for a school in India. On the subject of MNCs, the once nearby Ford plant had about 7,000 people employed in 1930 — a record for a US multinational (the company was originally owned by Henry himself, not the Ford Motor Company). Irish America is often seen as being synonymous with Catholicism but Henry Ford, the son of a West Cork Protestant, had a genuine affection for Cork and did a big favour for the people there without IDA assistance!. A Patrick Ahern from Fair Lane (‘The Boys of Fair Hill’), on the northside, was his maternal adoptive grandfather. Ford’s Dearborn mansion was named ‘Fair Lane’ and ‘Fairlane’ became a Ford brand. On the subject of transport, in the 1970s, the chairman of CIÉ lived in Cork and on a Friday, he would board a train at Heuston Station and his chauffer would often have to race the train to Cork to be at Kent Station to pick him up! One of his sons confirmed the story to me a few years ago. Good Newz 500 Jobs for Cork. http://www.irishtimes.com/newspaper/breaking/2012/0420/breaking6.html @MH We could do with a few more West Cork Protestants. Excellent show on George Salter on RTE recently, Bearla agus Gaeilge – Eoghan_een does some great work at times I hear the Coveneys have taken over Mongolia! @Michael Hennigan George Salter http://www.rte.ie/player/#v=1145320 Enjoy. @MH I came across pictures of an abandoned Ford factory in Detroit last night . Cork was peripheral but even the core got the sickness in the end http://lookintomyowl.com/andrew-moore-detroit.html @DO’D: Re: “Good News” I sense that Apple may have a small problem with ‘market saturation’ and ‘margin compression’. There are some agressive competitors snapping at Apple’s heels. There are ‘techie’ problems also (those batteries!). So I might pass this matter to PR Guy for professional comment. Is this a piece of PR Hubris to distract investor attention? @Dork: Most evocative photo I have seen in many a long time: ‘The Iron Man’; p 2 of to-day’s IT. Words fail. @ MH Finland doesn’t have SAT tests either http://www.nybooks.com/articles/archives/2012/mar/22/how-and-how-not-improve-schools/ The US education system appears to be in need of improvement http://www.youtube.com/watch?v=Tb34jE-Uf6k Here’s a question. C Lagarde is suggesting “Europe’s bailout facilities” be able to recapitalise financial institutions. My understanding is that if a government recapitalises a bank it gets equity (shares) in return for same, which it can sell off later. If the European bailout funds are used to do this, who, if anyone, gets the equity? http://www.irishtimes.com/newspaper/finance/2012/0420/1224314967493.html @Tull, “This particular game was always going to end up in one of three outcomes i) default by the periphery ii) a large cheque from the Germans or iii) the ECB kicking the Germans out of the print room and pressing the print button. At least one of these outcomes marks the end of the EU” In terms of an economic analysis – and in the context of the narrow national interests of the major players (Britain included) – you are absolutely correct. But the EU was, is, and always will be much more than this. And there will be a long and bumpy grind of fixes, fudges and fiddles, but it will endure in some shape or form. And Ireland, if there was the will and suffcient honesty from the politcial classes, from the media and from the ‘public intellectuals’ has the ability, largely on its own, to recover and thrive in this context. And even if the remote possibility of apocalyse transpires the requirement to pursue this internally driven recovery is even more pressing. @D O’D, “We could do with a few more West Cork Protestants”. We’re not as few in number as you might think. But most, similar to George Salter and his family, learned to keep their heads down when the ‘walloping haros’ were abroad – and most have kept them down since. There are, unfortunately, very few of us who have held fast to genuine ‘protestant’, Lutheran principles in the political and economic sphere. @Ceterisparibus “the introduction of fornication into the Dail (the word, not the actual deed, in fairness).” I’ve never met this TD but what I’ve read so far tells me they must be living in the stone ages down in Mayo. @Gavin Kostick “C Lagarde is suggesting ” The fragrant Christine is suggesting that they stop pretending they are trying to help out the sovereign and just get straight on with the real agenda of saving as many banks and cronies as possible. On which subject, I noticed yesterday she is hobbling around on a crutch. Is this a metaphor? Only 73 days left until I temporarily give up this business for a few months to go off to the sun and write my bonkbuster set in the financial services PR business (along with some other boring stuff about communication skills to be published as an e-book). Phew what a scorcher! It will make Jackie Collins look tame. You will all be able to say that you knew me before I became famous. I will of course offer a discount on the book to anyone posting on this blog. As I recall, a certain Mr Campbell – of ‘sexing up dossiers’ fame – started out life writing porn novels. Meanwhile it’s back to the dross of finding the words to explain why one should consider paying ridiculous charges for their pension plan to the product provider and how forking out a £5k advice fee up front post-RDR to a UK broker who can barely spell the word “pension” is such a terrifically good idea. I was going to use: “because we’re worth it”…. but I see that’s already been taken. God, you can tell I’m bored today. I must stop prattling on. @Paul Hunt Hope you appreciated Blind Biddy’s aktion some time back in nailing a rake of treatises to the front door of the BundesBank. A genuine civic republican, and an awesome dissenter, is our Biddy. (-; @David, I’d be a lot happier if she had nailed her rake of treatises, appropriately targeted, on the doors of Govt. Bldgs., Govt. Depts., government agencies, economic regulators, NESC, NCC, ESRI, universities, our media barons and the legal, accounting, PR and consulting firms who profit from the generation of bullshit for all of the above. @PR guy I assume that is an IFA fee to replace comm? Charging hourly for advice was discussed years ago, have you come across that concept recently in an RDR context? How about “You’d pay an estate agent more, for less”. Comm-share? 😉 @Micheal Yes , I seem to recall hearing that story before…………pretty expensive after the Yom Kippur oil shock I imagine. The line is mostly intact from the stadium as far as Roachestown station although a few low modern road bridges could be a problem. Albert station is withen a few 100 metres of the South Mall so is pretty central and is not that far from the bus station either. Its a pleasent walk from Albert station to passage west which might create some resistance amongest the locals. You can hop on the passage west ferry and connect to Carrigaloe station which will take you back to Kent if you wish…making it a easy circut of the inner harbour. http://www.flickr.com/photos/finnyus/7068728705/ http://www.flickr.com/photos/finnyus/5458873502/ Here is my take on the complete Cork tram route using new population (electoral division) data. Is a Luas line following the River Lee south bank viable ? You better believe it baby. Ballincollig ED Y2006 : 16,308 Y2011 : 17,965 increase of 1,657 / 10.2% It would be best if the line follows the straight road(muskerry line) on the Lee Fields rather then the model farm road as it is a rail rather then bus type vehicle. However pedestrian tracks are already partially in existence behind the CIT running track which could be linked to the Tennis village which has seen substantial growth in apartments (many empty) these past few years. This area would be part of Bishoptown A – so has potential for growth in numbers Bishoptown A : Y2011 :1,326 Y2006 : 1 ,694 decline of 368 / 21.7% The next stop would be at the County hall which also has a pedestrian / cyclist footpath to the Model farm road Industrial park. This area is encompassed by the Gillabey C district. Gillabbey C :Y2011 : 1,563 Y2006 :1,620 decline of 57 /3.5% Next stop would the Old cork Prison entry point to UCC encompassing the Mardyke & Gillabbey B Mardyke Y2011 :636 Y2006 : 768 decline of 132 / 7.2% Gillabbey B Y2011 :928 Y2006 : 1,058 decline of 130 / 12.3% Second UCC stop Gillabbey A Y2011:1,941 Y2006 :1,639 increase of 302 /18.4% Next stop The law courts Washington street Centre B Y2011 : 1,935 Y2006 :1,558 increase of 377 / 24.2% Next stop Grand Parade / South mall business / crime district Centre A Y2011 : 837 Y2006 : 791 increase of 46 or 5.8% Cross the river to the old Albert quay station. City Hall A Y2011 : 804 Y2006 :869 decrease of 65 or 7.5% This area includes the infamous Elysian tower which is nearly empty at the moment. Now follow the path of the old passage west railway via the Monahan road to the Atlantic pond and the Gaelic stadium. Knockrea B Y2011 : 1,114 Y2006 :1,205 decrease of 91 or 7.5% Next stop Blackrock station Mahon A Y2011 : 4,931 Y2006 : 4,206 increase of 725 or 17.2% Next stop mahon shopping centre Mahon B Y2011 :4,843 Y2006 :4,241 increase of 602 or 14.2% Phase 1 terminus Rochestown station Douglas Y2011 :20,397 y2006 : 18,182 increase of 2,215 or 12.2% (this is however a extensive area) Phase 2 would may involve the line branching as I don’t know the condition of the tunnel However Monkstown / Passage west Urban Y2011 :5,122 increase of 6.3% since Y2006 Carrigaline Y2011 : 11,818 increase of 7.7% since Y2006 Also significant development just south of carragline with strong pop growth. And finally Templebreedy / Crosshaven which has considerable tourist / leisure potential despite some very inappropiate development during the boom Y2011 :3,491 increase of 14.1 % since 2006. @ PR Guy “Only 73 days left until I temporarily give up this business for a few months to go off to the sun and write my bonkbuster” Can’t wait. lay it on good and heavy. The brother, Conor Kostick, runs a very good ‘finish your novel’ course at the Irish Writers’ Centre with an emphasis on getting published. http://www.writerscentre.ie/html/tutors/conork.htm PS The line from Carrigaline to Crosshaven is mostly intact (footpath) although it needs considerable work I imagine. http://www.geograph.ie/photo/2388317 http://www.geograph.ie/photo/1856275 @grumpy “I assume that is an IFA fee to replace comm? Charging hourly for advice was discussed years ago, have you come across that concept recently in an RDR context?” I think the honest answer to that is I haven’t seen a lot of evidence that UK IFA’s have pulled their act together in deciding what sort of business model they will adopt post-RDR. Lots of vague talk about a menu of pricing (e.g. it’s an offshore bond that will be 5% of premium), hourly rates in the hundreds, a single consultation fee in the thousands, a % of funds ‘under management’ (read ‘purchased’ – I don’t know where the ‘management’ bit comes in vis IFA’s quite honestly)…. etc. IFA research I’ve seen conducted over the past six months doesn’t really show a concensus view other than they want their cake and eat it – e.g. providers to enable initial adviser charging, ongoing adviser charging, adhoc adviser charging….. i.e. they want to find a way of glossing over it to the customer, just take the one cheque, get the product provider to deduct/pay them the ‘fee’ later and make sure ‘disclosure’ is buried somewhere as deep as possible in the documents (though that’s going to be tricky for them). Prior to RDR coming on the scene, hourly charging has been discussed by IFA’s for years as a way of trying to differentiate (i.e. trying to make themselves appear more upmarket) but they always arrived at the conclusion they could never make it fly with the customer. You can imagine how unhappy they are to now have it thrust upon them. Personally, I think this is great news for the consumer as it’s always been far too opaque (what gets ripped out of your premiums in commissions and charges). What is clear is that they are going to have to ask consumers to their face for a large sum of money to replace what would have been commission and I think when the consumer sees some of the sums being talked about (there was a piece of research from the FT on this back in…. February?) they are going to say, “what?” – or words to that effect. For what it’s worth, my prediction is that we are heading for a big change in channel distribution. HNW individuals will probably pay for advice as they are used to paying people to do things for them but for the majority: yer average ISA punter with 10k, single premium bod with 20k, 500 a month pension plan, etc. are all going to move to doing it themselves online, directly with the provider where possible (some products aren’t suitable for online/execution only type sales). IMHO product providers aren’t beefing up their online (or phone) presence sufficiently and they are taking too much of a (reactive) let’s wait and see what happens post-RDR – and then there will be a big rush to change everything having already spent squillions on RDR. Contract staff with web development skills and regulated products knowledge should make a killing in 2013! Anyway, suffice to say that whatever happens in the UK will eventually work its way over here. They are also going down the UK route in Holland and my colleagues in Germany say it’s a given there pretty soon. I suspect “You’d pay an estate agent more for less” would be considered a bit too downmarket for my clients 🙂 ….. …..regardless of how true it may be 🙂 🙂 @Paul Hunt “and the legal, accounting, PR and consulting firms who profit from the generation of bullshit for all of the above.” Not guilty guv….. well, not for those institutions anyway! @Gavin Kostick I’ve logged Conor’s details many thanks. @PR Guy, No intent to tar you with my broad brush. I assumed that your willingness to comment here defined you as an honourable exception that proves the rule. @Paul Hunt Text from Blind Biddy: Paul, have you checked the rivets on the door of the Law Library lately? I used the oxy-acetylene torch – all that transpired were a few shaken wigs: think I’ll use the bazooka next time. U thinkin of signing up for The Citizens’ Army? @The Dork Limerick – Foynes a walking tour – just need to get around a few squatting cattle pens and crushes here and there. Plenty of .. er .. turf .. for the steam! @PRguy There is a very small % of IFAs that are very switched on and know an awful lot of stuff about an awful lot of stuff. Tha average punter a) has little prospect of encountering one and b) probably wouldn’t be able to tell the difference anyway. The fund management outfits historically used IFAs as effectively a freelance sales and distribution department. At fund launches there would typically be a talk by the guy who was going to run the money, followed by wine and sandwiches for the audience if IFAs. Other fund managers from the firm would mingle and chat. Typically the IFAs would ask two general questions before asking how much the intermediary comm would be. b) above was always a big fly in the ‘charging for advice’ soup. @ PR guy and grumpy with bond yields on the floor and equities into year 12 of the mother of all bear markets it’s very hard to see how IFAs can justify their pound of flesh and still have the client getting back 100% of premium after x years . @seafoid A bull market in equities started in March 2009. Roubini spent the next two weeks doing the media rounds telling all and sundry it was “just a suckers’ rally”. It may or may not have ended a few weeks ago. Roubini went bullish on stocks a couple of months ago. Don’t mean to be mean to him, every one gets things wrong, but he is a handy, high profile example. @David And you can branch off on the old North Kerry line which is now the great Southern trail. http://www.southerntrail.net/whats_new.htm http://www.southerntrail.net/ Athough I personally would give the various cultural / pub activities in Rathkeale a miss. The above developments are fantastic for the area but our northern brethern may have more advanced plans. “The Downpatrick & County Down Railway has offered its backing to Down District Council’s ambitious plans for tourism in the district. A feasibility study has been approved into four key projects, the most high profile being a cable car or funicular railway from the town centre into the Mourne Mountains. It also includes a feasibility study into utilising the old railway line between Downpatrick and Newcastle. Railway chairman Michael Collins voiced his support for this study. “The Downpatrick & County Down Railway remains committed to its own extension plans to Ballydugan and the Racecourse, but we would be very interested in hearing what the council has in mind in relation to the old trackbed to Newcastle, most of which remains derelict”. He continues, “We are also pleased to see that Newcastle’s Chamber of Commerce has expressed support for the plans.” Mr. Collins explains, “The DCDR would relish being part of such a vision. In principle the provision of a potential rail link between the two towns would transform both the transport infrastructure into Newcastle and the tourist offering of both the immediate district and Northern Ireland”. “Such a line, with its breath-taking scenery, a route following the shore of Dundrum Bay and under the shadow of the Mournes, would be unparalleled by any heritage railway in the UK or Ireland,” he claims. “It would tie both towns together, develop a heritage and tourism trail unique to Ireland, and the district would enjoy significant associated economic and social benefits,” he continues, “One just has to look at the push for the extensions of lines in England such as the Bluebell Railway – a project of a similar scale to this proposal – pushed strongly by its local community and local authorities because of the benefits it will bring to the town and area” @ David O’Donnell David, Thanks for the link. It’s an impressive story. George Salter speaking his native language to an ignoramus in a pub who could not understand him, tells its own story. Two sectarian states developed on the island and it’s always welcome to have inconvenient truths puncture myths of war. In credit to Eoghan Harris, he has often highlighted this story, as has the late Peter Hart, the Canadian historian. So the State began with a civil war and presumably an exit of some business manufacturers. A few years later, American prohibition helped to end the Allman’s significant distillery in Bandon and apart from milling and 2 bottling plants, it took 40 years for a new factory to open — Sunbeam Wolsey, a textile operation. When John Ford, Henry’s grandfather arrived in Michigan in 1847, he bought land from a Henry Maybury who had emigrated before him from West Cork. The Mayburys are still involved in a number of businesses in Dunmanway, and on the night of the 1911 census, the 18 year-old Harry Maybury was staying on my great-grandfather’s estate near Dunmanway. In truth it was a parcel of rocks that was later inherited by my father. Anyone familiar with travelling on the northern route out of Bandon to Bantry, compared with via Clonakilty (God help us!) will be have noted the change in the quality of the land well east of Dunmanway. Am I off-topic? @Grumpy Maybe he’ll be vindicated in q3 ? But it’s not the best of times for investment growth is it FT a while ago “JPMorgan’s share price has been through today’s level of $35 twenty-odd times since 1997. In other words, the stock has gone nowhere for 15 years. ” Can the IFAs justify 3 % or whatever it is when investors are doing well to hold onto their money and not even the Squid could get an RoE north of 4% in a year like 2011 that started off so well ? @Paul Hunt “No intent to tar you with my broad brush” No offence taken. Glad I don’t work in the political/public sector. I’ve met a good number of politicians and with possibly one exception, my observation on all of them has been, “an ego with arms and legs sticking out.” @grumpy “There is a very small % of IFAs that are very switched on and know an awful lot of stuff about an awful lot of stuff.” This is true and it’s unfair of me to suggest otherwise. However, it is a small % and other than that it’s a shark pool (sharks in suits) and buyer beware. Mind you, the alternative – going to some incompetent in the larger banks who is desperate to make any sale to ‘meet their targets’ – can be just as fraught. I do wish schools would teach children about saving and investing. “Typically the IFAs would ask two general questions before asking how much the intermediary comm would be. ” As many as two general questions? Bloody hell you must know some polite IFA’s 🙂 @seafóid “it’s very hard to see how IFAs can justify their pound of flesh and still have the client getting back 100% of premium after x years .” I frequently hear bs about ‘return OF capital is as important to investors these days/in these turbulent times as return ON capital’. I usually translate this as ‘give me your money for a few years so that I can make some money out of it and give you back less than it was originally worth (sucker).’ Apart from the obvious depreciation (on just getting your original investment back) from inflation over however many years it’s been invested, if an IFA can’t steer you into something that offers a reasonable return that’s better than the client can go out and get themselves then maybe that IFA should think about pursuing their career elsewhere? @PR guy Low interest rates are dreadful for IFAs. At least when the banks were paying 7% on deposits and charging 9% on mortgages there was plenty of margin for everyone. The Fiscal Compact is not about austerity according to our Tanaiste in the IT today He reiterated it ”is about managing our debt, managing it in such a way that over time taxpayers’ money goes not into servicing debts but more and more into public services and targeted growth initiatives to create jobs”. I must have read the wrong document. I didn’t see anything about not paying interest on the massive borrowings we have and are continuing to accumulate Obviously, Eamon is very good at reading Treaties. And while I’m at it…just love those action plans… “Taoiseach Enda Kenny said 96 per cent of measures outlined for the first quarter have been achieved. He said 80 of 83 aspects of the plan have been implemented in the last three months. “This is just the first step in an annual plan to help rebuild our economy,” said Mr Kenny. “In the next three months we will build on actions rolled out to date and aim to deliver another 77 measures to support job creation with initiatives on business costs, broadband, procurement, red tape, industry-led innovation and much more.” Another 77… Wow. Remind me about the unemployment rate. Little wonder the ratings on government are falling off the cliff. @Ceter Irelanderescue is on the case , I have complete faith in their abilities. Shame the ECB forgot the script. http://www.youtube.com/watch?v=riMHp28_cqw PS We all know who the Blond is. Me lady …….. Me girlie. @ grumpy You have to be joking! @ grumpy Just in case that you are not cf. this rather fawning article on “the largest economy in Europe” in the FT. http://www.ft.com/intl/cms/s/0/dff3976a-8a08-11e1-87f0-00144feab49a.html#axzz1sc8qPXzV Dedicated readers will note the element of revisionism in the position of Professor Sinn. The good news is that there is evidence of the essential re-balancing in the trading relations between the countries of the EA @docm Joking about what? @ grumpy Your comment that the Eurozone, by comparison with the UK, was a “laughing stock”. The error in your assessment is the common one of imagining that the creation of the euro was anything other than a completely political undertaking with, of course, the hope that all would be for the best. Brown will be remembered only for his vain-glorious claim to have abolished boom and bust not for keeping the UK at a distance i.e. not sharing the laudable intentions of the instigators of the euro as they saw it. The error of construction in the euro was in the failure to realise that a fully functioning single market was a prerequisite, not the fact that the countries involved were not an “optimal currency area” (whatever that means). There is a good example in the FT coverage in relation to the restrictions on competition in the transport area in Germany (bus versus rail). Indeed, the provisions in relation to transport in the treaties have been suited to German requirements since the Treaty of Rome. The fundamental error of the weaker participants in the Eurozone was, and remains for many blinkered European politicians and trade unionists, the assumption that they could also play this game without having the champion of indsutrial strenght in their corner. As to the future of the euro, as it was political considerations that brought it into existence, only such considerations will be capable of maintaining it, with the necessary moves to a completed single market. @ grumpy Martin Wolf has the political aspect right, in my opinion, in a recent comment. http://www.ft.com/intl/cms/s/0/782965e6-87b1-11e1-ade2-00144feab49a.html#axzz1sZ4zrENV However, he is wrong, as Paul Hunt has pointed out in reply on another thread, in placing all the burden of adjustment on “inflexible labour markets”. It may suit some of the participants to see the conflict in this light, but the real challenge is to get rid of rent-seeking through politically driven administrative distortions of competition with which Ireland, like most EA countries, is replete. In fact, it is striking how little attention the subject of the single market gets, notably among journalists but equally so among economists. I put this down to the often mundane and heterogenous nature of the sectors that have to be tackled, combined with the fact that every country can see only the motes in the other countries’ eyes e.g. financial services in the case of the UK. @DOCM, Thank you. You have eloquently articulated what I have been banging on about for so long. I expect we will just have to keep chipping away. The penny will drop – or be forced to drop – eventually. @ Paul Hunt While I agree with you in terms of your basic analysis, it seems to me that there are many other aspects that need to be taken into consideration, not least the political constraints involved which simply wil not go away. A recent Bloomberg commentary by the editor-in-chief of Die Zeit lauding the Schroeder reforms is a case in point. Schroeder has in recent weeks re-entered the political debate and a deal of revisionism is creeping in. He is reported as being critical of Merkel’s approach implicitly by Derek Scally in today’s IT. What has not been picked up is a comment by him at a conference in Brussels regretting the “misuse” by employers in Germany of the reforms, notably the explosion in “mini-jobs”, his cautious support for the introduction of a minimum wage and acceptance of the principle that anyone in employment should be able to live from that employment. In short, in terms of internal devalulation, Germany under Schroeder and Merkel overdid it! Europe must, as the editor of Die Zeit indicates, adapt in the same way as Germany did but (i) must not over-do it and (ii) Germany cannot abscond – still less other countries in the EA – from the necessary freeing up of its economy in sectors yet untouched. http://www.bloomberg.com/news/2012-04-16/germany-reformed-its-social-model-europe-can-too.html @DOCM, I’m well aware of the political constraints, but tend to underplay them in comments here to avoid upsetting (well, at lest, too much) the economic purists. I don’t think Germany will abscond. Both the solidity and responsiveness of its democratic institutions of governance mean that the necessary changes will be made, even if grindingly slowly. Their rent-seekers are as well-embedded as those in Ireland and elsewhere, but they will be swept aside if a plurality of voters consent to a particular strategic course. The governing politicians and policy makers are seeking to reconcile the conflict between Germany’s interest in a properly functioning EU and EMU and its global strategic interests among the emerging economies in a manner that will secure the necessary popular consent. It’s the ‘policy of small steps’, initially developed by Willy Brandt in another context and now being applied by Chancellor Merkel. We just have to be patient and not do anything unforegivably stupid. @DOCM “Your comment that the Eurozone, by comparison with the UK, was a “laughing stock”. The error in your assessment is the common one of imagining that the creation of the euro was anything other than a completely political undertaking with, of course, the hope that all would be for the best.” Thanks for that. You are 100% wrong though. I have a fair amount of competence with regard to my own assessments of the Euro project. The most forceful aspect of my objections to it was precisely that the creation of the euro was a completely political undertaking – by politicians, officials and a motley assortment of unrealistically enthusiastic europhiles and business lobbyists, non of whom were remotely bothered by the fact that they had not done the work on, and did not understand, the economic and financial market distortions and risks it would entail. Lets be clear about this: people like me had this sussed from the start. The only question was how long – a few years or a few decades, it would take to dawn on the intellectually lazy drones that were taking all the decisions. “Brown will be remembered only for his vain-glorious claim to have abolished boom and bust not for keeping the UK at a distance i.e. not sharing the laudable intentions of the instigators of the euro as they saw it.” No, again you are dead wrong. Brown is, right now remembered as a bumbling fool who claimed to have abolished “Tory boom and bust”. Right now. History will reflect on his willingness to practically go to war with No 10 and the Blairites and their business lobby chums over his refusal to even contemplate entry into the Euro-Zone before there was proper convergence with the core economies. Whatever the easy shots are at Brown – and there are lots to choose from, he bothered to do the work on understanding much of the economics of currency union himself rather than concentrating on PR and relying on ‘advisors’ through being essentially clueless about the question. Contrast that with Tony Blair, Bertie Aherne, Charlie McCreevy, etc, etc, etc. Had the UK joined the Euro, there would have been a much bigger property boom, a much bigger bust, and no national central bank to lean against the deflationary consequences. Sound familiar? @ Grumpy Brown was right to stay out of the Euro but the current situation is bigger than the euro. Neoliberalism has failed and the UK economy is very heavily weighted towards a City that is bloated and dysfunctional. A restructured UK Mittelstand would still be generating income but of course the City was more important 30 years ago. And now the country can’t afford wizardry like the PFI. It will be interesting to look back 20 years from now and compare the performances of France and the UK. @ grumpy I think that we are somewhat at cross purposes, no doubt because of my rather clumsily drafted opening paragraph. You say; “The most forceful aspect of my objections to it was precisely that the creation of the euro was a completely political undertaking – by politicians, officials and a motley assortment of unrealistically enthusiastic europhiles and business lobbyists, non of whom were remotely bothered by the fact that they had not done the work on, and did not understand, the economic and financial market distortions and risks it would entail”. I have conceded this point. “As to the future of the euro, as it was political considerations that brought it into existence, only such considerations will be capable of maintaining it, with the necessary moves to a completed single market”. But my conclusion remains as stated. There is no way back! Even the UK recognises this by its agreement to contribute to strengthening the resources of the IMF (to the unconcealed fury of the Telegraph). Or to be more accurate; there are two ways back (i) a generalised collapse of the euro or (ii) a jettisoning of its weaker members. It is the latter prospect which caused even those countries not yet members to sign up to the fiscal pact (and responsible Czech politicians have indicated that they would have left the UK on its own had this been possible). As to the fate of Hibernia, one does not need much imagination to establish where some Continental “realists” see her ending up. The irony is that objectively the country is the best placed of the peripherals to avoid the outcome contemplated. The question is whether the ruling parties in Ireland (and the culprits for the mess the country is in) have the wit to persuade the electorate of this or whether it will recognise the fact on its own. My bet is on the latter as the parties in question seem quite clueless on the issues posed. So in summary- good things are nice and we want them, bad things are naughty and we dont want them Comments are closed.