In this Jackson Hole paper, Carmen Reinhart and Vincent Reinhart find that the negative impact of severe financial crises on macroeconomic performance is long lasting, with real house prices remaining below the previous peak a decade after the crash, unemployment remaining at an elevated level and a cumulatively-large decline in GDP growth.
The Irish Times reports:
For example, the latest official breakdown on the 423 highest earners in the State showed that for 189 individuals who earned €500,000 or more in 2008, the average tax rate was 19.86 per cent.
I’m afraid this isn’t true. This report does not relate to the 423 highest earners in the State, as I’ve written about here, here and here. It only relates to a subset of the highest earners who would have paid less than 20 percent because of tax loopholes but who are not doing so now because of the introduction of a minimum rate.
To be fair, I don’t blame the journalists because the relevant document is so poorly written. At this point, however, I really think the folks in the Department of Finance responsible for this report should consider issuing an official clarification.
Update: In comments, Joseph O’Toole reckons I’m being mean to the Department of Finance because this is a Revenue Commissioners report. Well, I found the report here on the Department’s website, which suggests that they are responsible for its release. But, yes, the report is put together by Revenue Commissioners staff. So let me rephrase my point: Whoever is responsible for this report might think about issuing a clarification.
The international media are gradually noticing that our plethora of banking sector policies have not worked to restore the Irish banking sector to health but are threatening the health of the public finances. An editorial piece from the Financial Times is highly critical. It concludes:
It is time to staunch the bleeding. As Irish state guarantees near their expiry date, some banks will not be able to refinance their balances. The government should prepare insolvent banks for forced debt-for-equity swaps, which would instantly recapitalise the banks in question and cap the government’s exposure. This cannot be done frivolously; European institutions are exposed and EU partners must be consulted. But someone must put an end to the practice of handing banks blank cheques. Some Irish pluckiness would benefit us all.
I take it the FT will now be dropped from the long list of august international institutions that the government rolls out to claim support its banking policies.
De Volkskrant has a piece on Ireland, transgoogled here.
They start by saying that Ireland was a role model for austerity at the start of the year, but is now a reason for concern. They give two reasons, the first of which is the unknown but large cost of saving the banks. Secondly, they do not believe that the government will deliver in the next budget.