O’Toole and the Government on the Pension Levy

Tonight’s Questions and Answers featured a heated exchange between Fintan O’Toole and Martin Cullen about whether the government knew how the pension levy was going to work when it was introduced. O’Toole has framed this question as being about whether the levy was applied to gross income or to net income. In his original article about this, he had asked

Is the levy a percentage of a worker’s entire income, or of that income after tax and PRSI? The answer to this question is crucial.

The article went on to heavily criticise the Taoiseach for asserting that the levy was applied to gross income and argued that this is not the case, a criticism that was repeated on Q&A.

Let me attempt to cut through the Gordian knot here and explain why both O’Toole and the Taoiseach are sure they are correct.

Continue reading “O’Toole and the Government on the Pension Levy”

Some good news

There are a small number of policy makers whose views actually matter in Europe right now, and up to recently it wasn’t clear to me that they held the right views. And so, it is extremely reassuring to read

Jean-Claude Trichet, the head of the European Central Bank, said that only emergency measures would help the world recover. “We live in non-linear times – the classic economic models and theories cannot be applied, and future development cannot be foreseen,” he said.

OK, we might query whether ‘linear’ or ‘convex’ is more appropriate, but the sense of urgency is very welcome.

A second piece of good news is the widely flagged rethink in Berlin regarding options for financing eurozone economies. If Juergen Stark wants EMU to survive in the long run, he should welcome such initiatives, since in the long run they will be necessary.

A third piece of good news is that Gordon Brown appears to be going along with Continental demands for greater regulation of financial markets. This is going to be a necessary part of any European Grand Bargain going forward, and in turn it is important that Europe speak with one voice at the London conference in April.

A European Stability Fund?

Simon Johnson has written an interesting new piece on the virtues of a European stability fund: see here.

Irish Blog Awards – Winner of Best Specialist Blog

The Irish Economy blog won the Best Specialist blog category (sponsored by iQcontent) at the Irish Blog Awards last night. I thank all the contributors and commentators for the success of this blog.  Special thanks to Agustin Benetrix for his technical contributions to setting up the site.

The full list of blog award winners can be found here.

The Irish Times Selects Us Among The Top 20 Blogs

Today’s Irish Times lists twenty ‘essential’ blogs: you can read the article here.

Below is its view of this blog:

THE IRISH ECONOMY

irisheconomy.ie

Insightful commentary on the Irish economy, from a range of experts.

Taster: “The downside of all of this is that whatever intellectual debt the ICTU document owes to [Swedish economist Jens Henrikkson] is not obvious from the document itself.

“But maybe what [David] Begg is saying is: if you want to know where we really stand, as distinct from the public posture we have to take, you’ve got to read this other stuff too.”