didnt paul mcgrafs home country get IMF assistance in the 70’s?
The EU has proved to be a disastrous thing in the long run for Ireland. The European project as it has been run over the last 20 years is a disaster full stop. Ireland has no manoevreing room over its monetary policy because it doesn’t control it. That’s the difference between Argentina, Britain in the 70s and us now. They had their own currency. We don’t. Therefore as David McWilliams said, the cuts are likely to be deeper than in a country with its own currency.
None of the government’s figures add up. 2.75% growth rates per year. Fantasy. The bank bailout will run to 100billion plus in my view. To paraphrase Fintan O’Toole, while the people are prepared to make, we are being offered as the sacrifice. Dermot McMurrough had nothing on these boys.
I thought I read somewhere that Ireland has 20-30 billion in cash on deposit, so we’ve enough cash till mid 2011 and presume there’ll still be taxes coming for next year, say another 30 billion so effectively we won’t run out cash until around this time next year when we will default. Assuming the markets are gonna give us the 2 fingers. It’s is sick mind the big financial houses of the world can effectively decide the fate of a country.
I don’t see how we can default before then unless it is organised and agreed with our overlords.
If the IMF/ECB whoever comes in will it not be the case that they will simply push through cuts to the tune of 15-18 billion over the next couple of years like Lenny & the boys want to do? Except the difference being that there will be no political interference with the IMF because they won’t give a fuck about getting re elected. And it’s in no one’s interest to put the country out of business forever because as GSH says they want they’re money back first and foremost and if the cuts implemented stop us from generating cash then no one wins.
All in all, it mightn’t be a bad thing to happen to us as we’re looking at savage cuts one way or the other. And it would be no harm for the politcal classes to see someone else running the show for a while.
I actually think we should consider having Cowan getting a flight to Londinium and asking Ms Windsor if she’d take us back. Be best for all concerned. We clearly weren’t able to handle things by ourselves.
Sure once the IMF come over and realise we’re great craic and the Guinness is great they’ll forget all about the financial mumbo jumbo and join the party.
I don’t think the EU has been disasterous, I think Ireland or the power brokers(assorted politicians and business people) within Ireland have fucked things up. The EU has given us an awful lot and much of it has been well spent but the interest were abused and now we are where we are. I don’t think it’s fair to blame membership of the EU for Irish mismanagement.
As Brian Cody found out this year… when the time comes, it will be swift, it will be blunt and you can do fcuk all about it.
Great point, and shur didnt we all have a bit craic trying for the last few decades?
your argument boils down to saying that our membership of the EU precludes us from controlling monetary policy, resulting in the necessity for outside assistance.
which ignores the fact that this is the third time in under a century that FF have bankrupted the nation.
Dev’s economic war had nothing to do with the EU
Lynch buying an election had nothing to do with the EU.
Ahern eroding the tax base, inflating property, food, energy and wages, and running the country on the back of unsustainable income streams had nothing to do with the EU.
2 out of 3 of the above examples were rectified by devaluing the punt and effectively eroding the savings and deposits in the country. now that such financial chicanery is beyond our grasp, when we actually have to grow up and start governing ourselves responsibly, we prove incapable.
budget deficits of approx 15 - 20 bn every year for the past 3 years, combined with a ludicrous bluff of a guarantee, leading to a bank bailout approaching 50 bn, are the reasons why “we are where we are”
this is not the doing of some ethereal bogeyman or a phantom corporate construct. it was our own stupidity, plain and simple. we got ourselves into this mess (or rather, FF did) and we are not capable, either intellectually or financially, of getting ourselves out of it.
[quote=“treaty_exile, post: 518330”]
our bailout won’t be quite the same, the greeks were the test case, the process has been refined slightly, looks like we get to try out ver 2.0, and pay about 6% interest for the convenience. [/quote]
Why do you and other people assume the rates will come down? Greece’s 10 year bonds are at 11.34% as I write - they actually started the day at 10.81. http://www.bloomberg.com/apps/quote?ticker=GGGB10YR:IND
If Greece’s rates didn’t come down why should Ireland’s?
The only problem with this is that they would, as you said, just be running the show for a while. They would not care about any long term social damage.
As as been said before, Ireland has gone from a nation of craftsmen, artists, scholars, poets etc into a nation of clerks for multinationals.
We put the kids in the creche and then have both parents out working for massive foreign companies who make the end money.
We’ve already lost our “irishness” so to speak. Rather than have someone build a cabinet or a chest of drawers we’ll go to IKEA. We shop in Tesco or Lidl rather than local shops.
The IMF would come in, slash and burn, get paid, the don’t need to worry about getting elected so they don’t care about damaging the nation.
The problem is that people are expecting them to “run the show” but they are a 1 tricky pony. They are not intested in rolling out broadband, building a metro or providing jobs. I would expect that they will look to get ther money the easy way and that is to raise taxes, slash spending and cull all welfare and public sector pay and pensions… Why would they want to look at any other way out?
In any case, in March, if we have to go looking for money we’ll be abel to to go to the ECB as they will give us the money at 5% as we are dong the 4 year plan that they have asked for us to do. Thats why, sadly, this budget needs to get through.
However, according to experts the bond yeild is going to keep going up becuase while they believe the willpower is there, the current government don’t have a mandate for a 4 year budget and the markets believe there will be a new government in place very soon and will they agree to the ECB calls for the 3% by 2014 deadline.
The next 6 months will be mental, but it is sad to see trains and roads clogged with depressed people going to depressing jobs for big faceless multinationals. 44 hours a week of slavery for a wage and at the end of it all there is nothing worthwhile produced as the Irish are now either public servants or private servants to multinationals here for tax breaks only.
My 2c.
Yours etc,
GSH.
Obviously it was FF that squarely got us into this mess and all of that is absolutely valid, in case you hadn’t noticed nobody is more anti-FF than me. It isn’t the EU that has bankruped the country but they will stop us from getting out of financial penury. It would be interesting to see if anybody still thinks the Euro was a good idea.
Wrote this on the farmyard last week which pretty much sums up my view:
I think serious consideration should be given to leaving both the Euro and the EU.
The European project was for many years a very good thing. The freer trade, and political and diplomatic co-operation it brought was clearly desirable. But in my view it was a big mistake to go for ever greater political and monetary integration (as opposed to co-operation).
I don’t believe the Euro can work in a situation where there are 16 separate economies, each with wildly differing needs. For it to have any chance, decision making on fiscal and monetary policy needed to be centralised. Sovereignty over all financial matters effectively needed to be handed over.
But Ireland kept enough financial sovereignty to take decisions that would completely destabilise the Euro project within a short space of time. Now the cat is out of the bag and we don’t have enough power to take decisions that will get us out of the mess because Europe would likely say “no”. The EU is actually strangling us in this particular situation.
This country liked to play the role of “good Europeans” while in being reality being anything but. It was a facade. We were Europeans in name only. Ireland swam against the tide of the European social model. Low income taxes, a narrow focus on personal wealth, rubbish public services, while at the same time paying permanent pay increases to public servants out of temporary tax increases.
Somebody on another forum described it as a “bastard child” of an ideology, a good description. If we had adopted a true European social model, ie high income taxes with a focus on sustainable growth, we’d have been in an immeasurably better state, in both meanings of the word.
This crisis now though is not about playing “good Europeans” or keeping up appearances in front of international friends. This has to be about taking decisions for the good of this country and nobody else.
Public servants are overpaid, there is no doubt, particularly politicians, judges, hospital consultants and senior civil servants, and in some cases as in the HSE, overstaffed. Overall labour costs are too high. But the public sector pay bill is not the cause of the country’s fiscal crisis. That distinction for that falls squarely on the banks.
Ireland cannot pay this debt. Constantin Gurdgiev said yesterday that by 2015, every working person will have a public debt of over E130k, and that’s without mortgage, loan and credit card debt factored in. These bank debts masquerading as sovereign debt should be defaulted on. I’m aware that some bondholders have already been repaid by the way.
It’s late in the day now but I would screw the banks and their remaining unpaid senior bondholders and if necessary set up new ones. If that means leaving the EU and the Euro, then so be it.
A sovereign default is also an option. The IMF would have to come in, but let’s face it, they’re coming in anyway.
Argentina defaulted, and then defended itself by standing up to the IMF, a move that took courage. They were on their own in that. But they benefitted in the long run. As I said previously, Iceland shut down their banks and set up new ones - their bondholders were screwed. But I would be confident that they will emerge from this a lot quicker as a result.
Poke holes in that if you want but I don’t think we’d be in a worse a scenario at the end of it. Anyway what’s happening now IS the worst case scenario.
sorry, i should have been clearer
greece obtain funding from the EFSF at 5%, that was the terms of the deal they struck
their yields on existing government debt have increased since, but on the secondary market only, the same as ours
this only becomes an issue when you try and sell more debt, which we plan to do in early 2011, and the greeks won’t be doing til 2014 or so, when they hope to be in a better position to sell.
The 6% wil be for funds from an EU/IMF fund. Civil servants will be taking the brunt of the pain anyway so I’m not so worried. Things aren’t all that bad in financial services (apart from the obvious).
If you read below (and we don’t have our own currency to devalue) I reckon we’re just about at the first stage. The paragraph below is just after the IMF pledged the bailout funds.
“The IMF coupled its largesse with the condition that the Argentine government maintain its severe monetary policy and continue to tighten its fiscal policy by eliminating its budget deficit. (The IMF considers deficit reduction to be the key to macroeconomic stability and, in turn, the key to economic growth.)”
“The Argentine government undertook deficit reduction with a vengeance. With the economy in a nosedive and tax revenues plummeting, the only way to balance the budget was to drastically cut government spending. In early July 2001, just before making a major government bond offering, Argentine officials announced budget cuts totaling $1.6 billion (about 3% of the federal budget), which they hoped would reassure investors and allow interest rates to fall. Apparently, however, investors saw the cuts as another sign of worsening crisis, and the bonds could only be sold at high interest rates (14%, as compared to 9% on similar bonds sold just a few weeks before the announcement of budget cuts). By December, the effort to balance the budget required cuts that were far more severe; the government announced a drastic reduction of $9.2 billion in spending, or about 18% of its entire budget.
With these cutbacks, the government both eviscerated social programs and reduced overall demand. In mid-December, the government announced that it would cut the salaries of public employees by 20% and reduce pension payments. At the same time, as the worsening crisis raised fears that Argentina would abandon the currency board system and devalue the peso, the government moved to prevent people from trading their pesos for dollars by limiting bank withdrawals. These steps were the final straws, and in the week before Christmas, all hell broke loose.”
““Fiscal responsibility,” according to the IMF, means that governments must give the highest priority to repaying their international debts”
From reading on the IMF, who area round 15% controlled by the US who just want to make sure 1) pay me my money, 2) set me up that I’m here for many years making money off the backs of your people, I would not wish them on anyone.
The Argentinian people revolted, the people in power stepped down. Here in Ireland I think there needs to be some sort of uprising to try and get a new government in there and a government who has ideas to take back the power that that we as a nation have given to brussels and to monster multinationals.
I agree that the Bank Bailout will be close to 100bn and the rest. We want to take 15 billion out over 4 years (based on nearly 3% growth a year) so thats not going to happen to that figure will be more like 22 bn or more.
As I said before, it would take 33k people earning 30k to earn a billion, never mind what would be then taken in tax, so as a nation we are not big enough to be able to pay our debts. If the IMF come in though then Ireland is finished.
A change of government is needed, but not a like for like change. FF and FG are 2 sides of the same coin. Labour will raid every cent to pay for services and Sein Fein are not an option either. It looks though as if the country is already too deep in shit.
As Macbeth once said, “For I am in blood steeped so far, that were I to wade no more, returning would be as tedious as go oer”.
Well said Bud.
Yours etc,
GSH.
agreed with everything bar the highlighted.
you seem to be avoiding the fact that it was our own fiscal policy that caused this mess, along with some pretty disastrous government decisions (either idiotic or treasonous, take yourpick)
the EU are preventing us from hitting the 30-year reset button and devaluing our currency.
this only prevents us from escaping financial penury if it is our only escape route
an escape route, i should add, that is not without victims.
it doesn’t solve the inherent injustices of the irish economy, with all the protected sectors, vested interests, etc. that serve to form our ruling class benefitting from it
having our own currency would mean we delay addressing the root causes of the currrent, repatitive mess we find ourselves in.
that is not to say that external intervention would solve the problem, they may well take the route outlined by GSH, in which case god help anyone dependent on the state for their upkeep. it may however, bring us closer to the point where enough people start asking why this keeps happening, what policies have led us to this point, and what political, structural and economic reforms will prevent us from getting back to the same place again.
How do you propose ‘taking back power’ from the multinationals? Multinationals contribute the vast majority of R&D investment in the state besides the state itself, and directly employ in the region of 200,000 people. On top of that you have hundreds if not thousands of small firms who depend on the mncs and employ tens of thousands of people in their own right, at a conservative estimate… The only economic alternative is of course indigenous industry, which because of our small domestic market have to produce innovative and high tech products that can compete in the global marketplace. That requires massive R&D investment and above all, massive investment in both secondary and third level education, which most of the people on this forum are railing against.
In a race to be the most powerful entity on the planet, large banks ran amuck throwing money at countries. Some controlled it, some didn’t.
It was not just government decisions.
Decisions of councils to turn a field worth 20k into a field worth 500k without any effort or control was too tempting.
People in pubs drank overpriced ale and apoke week in week out how mcuh their house was worth.
People scrambled for the newspapers to see if houses went up 1.2% and then they multiplied this by 735,000 and subtracted 240,000 and tore down to the pub with their new net worth on a post-it stolen from work.
The decisions were wrong by those given money for nothing, by those taking money and by the people deciding that rather follow in teh noblefamily business it would be better to be a civil servant and basically be dead inside, or become a slave to a large multinational.
Mothers were bragging at church over which of their sons was working for the largest company. I reckon that a massive number of Irish mothers, who ventured to dublin once, in 1979 to see the pope, would have heard of Goldman Sachs from their off-spring and then told other mothers about the profits that GS were making and how her son is a cog in the big wheel.
In a nut shell we were all at it, and the lunatics were running the asylum.
And still are.
Those in opposition are just lunatics from teh same asylum where a lunatic civil war broke out and the loonies stoped talking to each other.
Yours etc,
GSH.
we were most definitely not “all at it”, not by any definition of the word “we” that I’m familiar with.
although I am a slave to a big multinational if that counts toward your definition
you say it was not just government decisions, and i agree in so far as you need a willing borrower in order to be a reckless lender, but that still doesn’t shift the blame outside the country, meaning this is still our mess to deal with.
the only practical implications i can see from eurozone membership are (were) low interest rates, easier foreign holidays, and unrealistically low interest rates on government debt.
which makes (made) it easier to borrow, easier to emigrate and easier to rack up massive budget deficits.
the underlying conditions being in place, we duly did the rest.
Oh no I agree, fiscal policy in Ireland was completely bonkers, and that’s something I’ve pointed out a number of times on this forum.
I think you can be both idiotic and treasonous at the same time. 
:unsure: