Will austerity budgets push the Irish economy into double dip depression?

johntrenchard

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ABSOLUTELY.

Anyone that believes that taking €4 billion in 2011, €4 billion EXTRA in 2012, €4 billion EXTRA in 2013 and €4 billion EXTRA in 2014 out of the economy will somehow create GROWTH would need to drive straight to St Pats now.
so your answer would be to increase government spending and borrowing to get us out of the hole?

in order to close the deficit, we should borrow even more ?

i'm sure there is a doctor somewhere that has suitably strong medication for you.
 


CarnivalOfAction

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Current spending will be cut sharply but only after years of delay while Labour in coalition try to squeeze more tax from the dwindling numbers of rich. The last gasp of taxation would be a wealth tax,which invites tax avoidance and evasion in useless investments in concealable wealth such as art and collectibles,gold,precious metals,diamonds etc. Coming on top of capital gains tax and marginal income tax of 50% plus,a wealth tax is punitive and very inefficient to collect. But it would thrill the envious.
They seem to manage it in Sweden, Denmark & most other progressive countries. And they are not fleecing their public services to Kowtow to greedy gamblers like Abramovitch. Of course I'm envious that I'm helping to fund John Terry & Ashley Cole's off-side antics.
 

johntrenchard

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They seem to manage it in Sweden, Denmark & most other progressive countries. And they are not fleecing their public services to Kowtow to greedy gamblers like Abramovitch. Of course I'm envious that I'm helping to fund John Terry & Ashley Cole's off-side antics.
ah , but the swedes and danes actually do stuff with that money - like schools, infrastructure and such like.

we spend tax money on empty fields run by NAMA.
 

gijoe

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my understanding of a recession is 2 quarters of negative growth.
on the flip side of that we only had 1 quarter of growth in q1 2010,so did we really come out of recession?
A depression is defined as a decline in output of in excess of 10% from its peak. By that measure we never exited the first depression and are unlikely to for some time.
 

patslatt

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Very few countries have wealth tax

They seem to manage it in Sweden, Denmark & most other progressive countries. And they are not fleecing their public services to Kowtow to greedy gamblers like Abramovitch. Of course I'm envious that I'm helping to fund John Terry & Ashley Cole's off-side antics.
Very few countries have wealth tax,as far as I know only the uber socialist Swedes and the French who are envious of the rich. The British looked into it many times,even when income tax was at an obscene 95% marginal tax rate, but thought it was too inefficient to collect and violated the British sense of privacy.
 

FreshStart

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The property addiction will come back to haunt the banks as people across the country will be able to afford to pay their mortgages due to allowances disappearing, increased taxes, cuts in pay, water/property taxes. The banks go under again and people will stratch their heads in 3 years time wondering why more bailout money is needed (I thought Lenihan said they were fixed.)
:):):):)

I couldn't agree more. Let's face it, this is the elephant in the room. When mortgage default occurs on a much wider scale, there will be no bail-out money. Our government don't care about us and will see us homeless. I'm alright Jack is their motto.

Perhaps the miserable polling for the opposition reflects our deep-seated beliefs that we will pay for the elite whether they are people like Seanie Fitzpatrick, Brian Cowen, Roman Abramovitch et al. Finally, when we have nothing left, we will be placed on coffins ship with no arrival destination. We are being buried at sea.

When are we going to protest? Are we going to take this lying down?

Can the garda and the army not see that we need them to seize control and make this place a country for people, not an elite.

I always thought life during feudalism sucked and I now I know why.
 

hammer

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so your answer would be to increase government spending and borrowing to get us out of the hole?

in order to close the deficit, we should borrow even more ?

i'm sure there is a doctor somewhere that has suitably strong medication for you.
Are you a half wit?
 

Squire Allworthy

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I am not so sure that bleeding the wealthy white is a good strategy, no matter who is in government. I think what is needed is a tax structure that promotes reinvestment.

I am also convinced that the public sector needs to decline and the private sector increase. By that I don't mean just privatising a few of the frills. One cannot afford the other and until a new balance is achieved it will be hard to expand economic production.
 

SirCharles

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The article "Big Bad Bond Markets" (October 13, 2010) in the "Fixing the Economists" blog is pointing out that

"The ideologues over at the Washington Post are at it again. They're claiming that bond markets are forcing countries to adopt prudent fiscal measures and are thus reigning in an 'age of austerity'. This, of course, is conventional wisdom in Ireland - but as with most conventional wisdom, it is not true."

Further the autor writes,

"What's remarkably strange is that Irish commentators often seem to accept this logic. They often call for self-imposed austerity measures which increase unemployment and damage the economy in order to please the dark gods of international finance. Why is this? Why don't they stand up for their countries and insist on more equitable means of spreading a crisis that is as much international as it is national? Well, in all likelihood it's because such opinions keep them employed - and when the cuts they prescribe come, these opinions will keep them off the chopping block."

I like to point out that far more than half of every Euro spent by the state is coming back again in taxes, employment etc.

That means if we are now facing a budget cutting 4 billion Euros, the effective savings are much less than 2 billion. Cuts at the wrong places even massively enhance public spendings on the other side as pointed out in RTÉ Prime Time (October 19, 2010). So the REAL savings as a result of these cuts are likely tending towards ZERO or even NEGATIVE.

The only REAL impact of the widely supported austerity plan of this government are MORE poverty, MORE job losses, MORE problems in health, MORE migration of our elite, a downturn spiral where we cannot see an end. We cannot cut us out of this recession. On the other hand this government is giving away our resouces for discount prices or allmost for free (public forestry, Corrib gas... ). The REAL problems seem still to come!
 

wombat

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Another negative is that the weak economy could easily be tipped into a double dip depression
A double dip implies a recovery before the 2nd dip - has anyone noticed one?:lol:
 

MPB

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The article "Big Bad Bond Markets" (October 13, 2010) in the "Fixing the Economists" blog is pointing out that

"The ideologues over at the Washington Post are at it again. They're claiming that bond markets are forcing countries to adopt prudent fiscal measures and are thus reigning in an 'age of austerity'. This, of course, is conventional wisdom in Ireland - but as with most conventional wisdom, it is not true."

Further the autor writes,

"What's remarkably strange is that Irish commentators often seem to accept this logic. They often call for self-imposed austerity measures which increase unemployment and damage the economy in order to please the dark gods of international finance. Why is this? Why don't they stand up for their countries and insist on more equitable means of spreading a crisis that is as much international as it is national? Well, in all likelihood it's because such opinions keep them employed - and when the cuts they prescribe come, these opinions will keep them off the chopping block."

I like to point out that far more than half of every Euro spent by the state is coming back again in taxes, employment etc.

That means if we are now facing a budget cutting 4 billion Euros, the effective savings are much less than 2 billion. Cuts at the wrong places even massively enhance public spendings on the other side as pointed out in RTÉ Prime Time (October 19, 2010). So the REAL savings as a result of these cuts are likely tending towards ZERO or even NEGATIVE.

The only REAL impact of the widely supported austerity plan of this government are MORE poverty, MORE job losses, MORE problems in health, MORE migration of our elite, a downturn spiral where we cannot see an end. We cannot cut us out of this recession. On the other hand this government is giving away our resouces for discount prices or allmost for free (public forestry, Corrib gas... ). The REAL problems seem still to come!
No brains, no backbone and utterly shameless.

That about sums up our worthless Govt. They are willing to put bondholders in private Banks before citizens and tell us they are not traitors.

I do not think they understand the true meaning of the word.
 

SirCharles

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One easy example.

With all that money going into the banks (and people are still tending to believe this propaganda that we would be "much worse" on if we didn't do that), with the estimated 85 or even 90 billion Euro, we could easily finance Ireland's electricity supply fed 100% (!) by wind and PHES (pumped hydroelectric energy storage), 100% renewable.
That would mean a carbon footprint of about 10-20 grams per kilowatt (that's for the embedded energy counting for errection of the system etc.) instead of the existing 600-1200 grams per kilowatt.
That would mean, no more expenditures for fuel to supply us with electricity in the future.
That would mean we would be guaranteed better off in the future.
That would mean we'd be ahead of all other countries in the world.
That would mean Ireland would not just be the country with the worst financial crisis in history of this planet.
That would mean we would have learnt from our failures.

Just imagine...
 

patslatt

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We can spend ourselves rich!!

The article "Big Bad Bond Markets" (October 13, 2010) in the "Fixing the Economists" blog is pointing out that

"The ideologues over at the Washington Post are at it again. They're claiming that bond markets are forcing countries to adopt prudent fiscal measures and are thus reigning in an 'age of austerity'. This, of course, is conventional wisdom in Ireland - but as with most conventional wisdom, it is not true."

Further the autor writes,

"What's remarkably strange is that Irish commentators often seem to accept this logic. They often call for self-imposed austerity measures which increase unemployment and damage the economy in order to please the dark gods of international finance. Why is this? Why don't they stand up for their countries and insist on more equitable means of spreading a crisis that is as much international as it is national? Well, in all likelihood it's because such opinions keep them employed - and when the cuts they prescribe come, these opinions will keep them off the chopping block."

I like to point out that far more than half of every Euro spent by the state is coming back again in taxes, employment etc.

That means if we are now facing a budget cutting 4 billion Euros, the effective savings are much less than 2 billion. Cuts at the wrong places even massively enhance public spendings on the other side as pointed out in RTÉ Prime Time (October 19, 2010). So the REAL savings as a result of these cuts are likely tending towards ZERO or even NEGATIVE.

The only REAL impact of the widely supported austerity plan of this government are MORE poverty, MORE job losses, MORE problems in health, MORE migration of our elite, a downturn spiral where we cannot see an end. We cannot cut us out of this recession. On the other hand this government is giving away our resouces for discount prices or allmost for free (public forestry, Corrib gas... ). The REAL problems seem still to come!
We can spend ourselves rich!! The burden of government spending at 55% of the economy can be fluffed off!
 

turdsl

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Mar 2, 2008
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The real harm that Fianna Fail and the PDs have done to our country will only become apparent from early next year.
 
Last edited:

Tom245

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Jun 11, 2004
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Methinks 2011 will prove to be the blackest year in the history of this state thanks to FF, the PD's and the Greens
 

turdsl

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Dont you mean Fianna Fail and the Greens?
No, it was THE PDs and their pal McCreevy that sowed the seeds of destruction going back 12 years. It would have been more normal to have higher taxes when people could afford it,
Now Harney backs wage cuts and and higher taxes when there is less jobs and almost a half million unemployed, Lunatic economics.
 

patslatt

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Apr 11, 2007
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We can spend ourselves rich!!

The article "Big Bad Bond Markets" (October 13, 2010) in the "Fixing the Economists" blog is pointing out that

"The ideologues over at the Washington Post are at it again. They're claiming that bond markets are forcing countries to adopt prudent fiscal measures and are thus reigning in an 'age of austerity'. This, of course, is conventional wisdom in Ireland - but as with most conventional wisdom, it is not true."

Further the autor writes,

"What's remarkably strange is that Irish commentators often seem to accept this logic. They often call for self-imposed austerity measures which increase unemployment and damage the economy in order to please the dark gods of international finance. Why is this? Why don't they stand up for their countries and insist on more equitable means of spreading a crisis that is as much international as it is national? Well, in all likelihood it's because such opinions keep them employed - and when the cuts they prescribe come, these opinions will keep them off the chopping block."

I like to point out that far more than half of every Euro spent by the state is coming back again in taxes, employment etc.

That means if we are now facing a budget cutting 4 billion Euros, the effective savings are much less than 2 billion. Cuts at the wrong places even massively enhance public spendings on the other side as pointed out in RTÉ Prime Time (October 19, 2010). So the REAL savings as a result of these cuts are likely tending towards ZERO or even NEGATIVE.

The only REAL impact of the widely supported austerity plan of this government are MORE poverty, MORE job losses, MORE problems in health, MORE migration of our elite, a downturn spiral where we cannot see an end. We cannot cut us out of this recession. On the other hand this government is giving away our resouces for discount prices or allmost for free (public forestry, Corrib gas... ). The REAL problems seem still to come!
According to the logic above,we can spend ourselves rich with the positive multiplier from government spending.But at some point,the burden of government spending becomes too great and has definitely reached that level at 55% of the economy in Ireland. That means higher taxes and higher interest rates,which together kill growth. Irish government interest rates are so punitive that the top strategic goal should be reducing them.
 


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