Output and Value Added by Activity, 2002-2009 Post author By Philip Lane Post date November 29, 2012 The new CSO report is really striking in terms of the boom and bust dynamics at the sectoral level – it is here. Categories In Uncategorized 18 Comments on Output and Value Added by Activity, 2002-2009 ← Blueprint for a deep and genuine economic and monetary union → Quarterly National Household Survey 18 replies on “Output and Value Added by Activity, 2002-2009” Er, could someone get Paddy Power out of the creative industries? “Creative, arts and entertainment activities; libraries, archives, museums and other cultural activities; gambling and betting activities.” Sounds like we’ll have to take the banks out of them as well. 22 31-32 Manufacture of furniture; Other manufacturing; That is a really interesting category. It managed to hold its own in 2009. Whatever is in there it is worth developing. Furniture at least would have the advantage of a good % of native raw material. @ All FYI http://www.ft.com/intl/cms/s/0/7e5cd158-3a28-11e2-a00d-00144feabdc0.html#axzz2DYS5jq1g More grist to the mill or a case of wearing rosy-tinted spectacles ? @ DOCM I added some content to the FT report above. http://www.finfacts.ie/irishfinancenews/article_1025267.shtml @ MH A very useful addition (including the comment by Brendan Walsh). What struck me most about the two reports, however, was the low ranking of France. Peter Spiegel is in an unusualy pessimistic mood. http://www.ft.com/intl/cms/s/0/46ab11c0-3a3c-11e2-a32f-00144feabdc0.html#axzz2DYS5jq1g While I would agree with much of this, it seems to me that his prognosis is inaccurate. What the “failed” European Council on the budget revealed is the fact that none of the major players is indicating a willingness to pull down the house. Accommodating the UK on banking union would appear to be the key to keeping the show on the road. I came across a very interesting interview with James Howard Kunstler and there was one bit that seemed very relevant to the Irish economy “But first I think we need a coherent consensus on what is actually happening to us and what we might do about it. Right now we don’t have that. What we have instead is agreement about wishes and fantasies.” Read more: http://www.utne.com/Environment/Empire-of-the-Stunned.aspx?page=3#ixzz2DhJqySw4 I would include the confidence fairy and the PS salary situation in those wishes and fantasies. Kunstler’s theory is that the crash was greatly influenced by the end of cheap energy and that the housing crash is just a subset of this. Any thoughts on this? @DOCM / MH The FT piece seems to me to an unthinking and uncritical rehash of selected ‘expert’ reports that fit the agenda of the report writers and the FT. The subject matter is complex but deserves a thread on its own. But a few simple questions to begin with. How can emigration from the periphery to Germany be seen as part of any improvement in peripheral competitiveness or their state of well being? Emigration reduces aggregate demand. How does it help peripheral economies. How will labour market reforms (read the ability to fire people at will and at low cost, and to reduce wages at will) significantly transform the export capacity of peripheral nations. If low wages were the key success, Bangladesh would be booming. As most of Germany’s surplus trade is in automotive and engineered products to destinations outside of Europe, how will lowering the wages of fruit pickers in Spain or Portugal, help to compete with Germany for these export markets. When will people realise and admit, that it is the composition of Germany’s product profile, built up an retained over decades, that is the prime generator and impetus for its exports success. Add to all this the lack of an exchange rate to reflect the diverging economies and one ends up where we are. I would not accept any of this, endorsed by the EC, the same EC that has point blank refused in recent EU talks to offer one cent in labour market reforms or ‘wage’ cuts. To paraphrase Leona Helmsley, Labour reforms are for little people. @MH I did not full understand that EU monitor (time constraint, perhaps). But I do Ireland at rank 9 in 2007 and rank 14 in 2011. Am I missing something about our reforms? @ Joseph Ryan The topics you raise have been extensively debated on this blog and the only conclusion that I can draw is twofold (i) the onus to adapt behaviour is entirely on the debtors, at least until their limit is reached, and (ii) the jury is still out as to how matters will end. In medical terms, Greece is on life support while Ireland is clearly in the recovery ward. I do not know enough about Portugal to come to any opinion. There is also the curious case of the assumption earlier in the week – to which I drew attention – that the latest deal on Greece is without implications for Ireland. This assumption now seems to be changing. http://www.bloomberg.com/news/2012-11-29/noonan-examines-greek-package-as-ireland-eyes-bailout-exit-2-.html The Portuguese minister seems to have little doubt in the matter. http://www.bloomberg.com/news/2012-11-27/portugal-ireland-to-benefit-from-greek-deal-gaspar-says.html Chris Taylor also has a comment in the Daily Business Post. In general, inadequate regard is given to the distinction between the various players. The President of the European Parliament, for example, is probably a very fine fellow but his involvement in what are essentially inter-state decisions is marginal. The role played by the ECB in the context of the debate on the PNs, on the other hand, is both distinct and fundamental. As the bank never ceases to point out, there are matters within its remit, on which its position is sacrosanct and immovable, and matters which are within the remit of governments, the dividing line being established by the treaties. With regard to the latter, I agree that the efforts of Merkel and Schaeuble to prove to German voters that there is such a thing as a free lunch are running into the sand. Ireland is far from the limit it needs to reach in the area of budgetary savings and reform. Any additional assistance the country receives will not change this fact. @DOCM Ireland may be in the recovery ward but the best place to contract MRSA is in a hospital. Core bond yields are screaming that the mess will continue indefinitely . @Joseph Ryan The FT piece seems to me to an unthinking and uncritical rehash of selected ‘expert’ reports that fit the agenda of the report writers and the FT. Your willingness to engage in a discussion about economics with people whose argument is really about ensuring the political dominance of the right is remarkable but you have to notice the brick wall you run up against when you discuss the way reality diverges from the required political course (supply side reforms (zombie economics 101), entrenching the power of creditors, breaking up the power of labour, removing the political option of social democratic policies through legal constraints and “independent” pro-capital institutions like the ECB) There is a problem with your refusal to give up on the debate. Just as with those who futilely engaged with neoconservatives before the invasion of Iraq you might be lending the neoliberal cult running Europe into the ground credibility by engaging with them. These are dishonest political extremists and nothing you can say, no amount of historical example you bring to bear, no weight of reason will persuade them. They can not be persuaded, they need to be defeated. As Krugman said, this argument will not be won by reason. 7 comments for a rap at the public sector. Truly no topic is so remote that the public sector can’t be blamed somehow @ DOCM “The only thing that makes the EU move is the markets,” said one senior EU official involved in almost all these issues. “These decisions are difficult and politicians don’t like making difficult decisions if they don’t have to.” This tends to be the argument of the ECB. On the Merkel-Hollande duel, it’s interesting that Merkel seems to have a better relationship with David Cameron than she has with Hollande. @ Joseph Ryan Allianz appears to have assumed that the Irish economy was ‘balanced’ in 2007. You are correct in assuming that there is no no dawn to herald. @Anewdawn Can I blame our defeat by South Africa on the public sector? And this – http://www.telegraph.co.uk/finance/financialcrisis/9713651/ECB-wins-case-to-conceal-Greek-debt-secrets.html – it’s got the PS’s fingerprints all over it. @ MH It is hardly surprising that Merkel hits it off better with Cameron than Hollande as the latter has abandoned the policy that Sarkozy stuck to like a limpet i.e. the sacrosanct belief in the necessity of a Franco-German alliance (however mismatched) to ensure continued cooperation at an EU level. Furthermore, in relation to three core issues (i) a free international trading environment (ii) competitive and open national markets and (iii) a restricted EU budget, Germand and UK views coincide (and have never done otherwise). The situation with regard to the CAP is more nuanced. Germany would happily finance agriculture at a national level but this would, undoubtedly, mean the end of the single market for agricultural products (not to mention being in contradiction with the treaties) and cause a further deterioration in relations with France. Philip Lane has opened a dedicated thread on the two reports on which I have extracted the following in relation to France. “Overall Assessment Below average on all major indicators of fundamental health and still little action to improve the situation, France continues to fall behind Germany but also behind many of the fast-reforming crisis countries. Losing the AAA credit rating this year may not have hurt France on the financial markets but reflects the lack of action to reverse the economic and financial deterioration.” Meanwhile, the UMP is tearing itself apart in an internecine leadership dispute with the country evidently oblivious to the challenges it faces. However, all is not gloom! Germany also shares an interest with the UK in the matter of the extent of banking supervision and some kind of a deal seems likley to be cobbled together in this regard. Open Europe had an interesting note which seems to have predicted the UK negotiating position. @ MH Herewith the Open Europe link. http://www.openeurope.org.uk/Article?id=9426 @ MH The view of the veteran FT Paris correspondent. http://www.ft.com/intl/cms/s/0/a406cc9c-3ae1-11e2-bb32-00144feabdc0.html#axzz2DYS5jq1g Arnaud Montebourg, industry minister, a lawyer, will surely be busy in coming years until Hollande finds that he is a poor substitute for a ‘growth pact.’ Comments are closed.