I saw on the news this morning that money spent bailing out one of its main banks is costing the same as the tax-take for the whole country for this year. Apparently the figure could rise even higher. I assume they are still heavily bailed out by the EU, but it looks like Ireland could soon go the way of Greece or even worse.
I genuienly feel sorry for them, I have some Irish ancestory on one side of my family, and I remember hearing that about half a million people have left Ireland and settled elsewhere in the last 10 years. That's one in ten of the entire population (north and south combined). Add to this the worsening financial situation and the future looks very worrying for them.
Does anyone know why Ireland has suffered so much more extremely in the recent downturn than most other European countries?
Ireland goes pop...
Re: Ireland goes pop...
They made the same mistake as us in moving most of the economy into banking and the service sector and relying on a housing boom to drive consumer spending, we are better off because the one thing Gordon did right was not letting Blair join the Euro so we could print money when the recession hit to fund extra spending, Ireland couldn't as its in the Euro so is screwed.
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Arginald Valleywater
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Re: Ireland goes pop...
Feck! Might stop the greedy twunts charging 6e for a Guinness 100 yards from where it is brewed.
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Mysteryman
- Posts: 878
- Joined: Fri Jul 14, 2017 2:40 am
Re: Ireland goes pop...
Helpfairy is wrong about the euro. Being in the euro is what will save Ireland.
Printing money devalues the currency and leads to perdition as Britain has found out in the past and may well do so in the coming months.
As it is, We in Ireland have all suffered around 15% pay cuts in the last 18 months. The government, basically a set of thick, self interested banker loving wankers, has bent over backwards to protect the banks at all costs, even orchestrating a media campaign against the public service when looking for a scapegoat to blame for the crisis so they could protect their mates in finance, not to mention their pals who, as property developers, have lived the lush life, declared their companies bankrupt, have reneged on loan repayments and still lead the millionaire lifestyles, with all their assets moved over into the names of their wives or close relatives.
True some public servants are very well paid. True they get good pensions but the vast majority are living on belowm ?30,000 p.a
The government also is holding out on 3 bye elections which would see their majority lost. One seat has been vacant for 18 months.
Whilst all this is going on John Gormley (Gormless) leader of the back to the caves party (the Greens), voted for by 2% of the population, holds the country to ransom by forming the part of the coalition that keeps Cowan and Co in power. His price? Extra carbon taxes on fuel, heating oil and transport which lead to everything going up in price.
Finally, Cowan, says the best way out of trouble is for consumers to stop saving and spend. Spend what? Few now can cover their mortgage, food, heating, lighting and school costs. The per capita debt is higher than the UK.
We all think North Korea is a mad place - it'll shortly be twinned with Ireland.
Printing money devalues the currency and leads to perdition as Britain has found out in the past and may well do so in the coming months.
As it is, We in Ireland have all suffered around 15% pay cuts in the last 18 months. The government, basically a set of thick, self interested banker loving wankers, has bent over backwards to protect the banks at all costs, even orchestrating a media campaign against the public service when looking for a scapegoat to blame for the crisis so they could protect their mates in finance, not to mention their pals who, as property developers, have lived the lush life, declared their companies bankrupt, have reneged on loan repayments and still lead the millionaire lifestyles, with all their assets moved over into the names of their wives or close relatives.
True some public servants are very well paid. True they get good pensions but the vast majority are living on belowm ?30,000 p.a
The government also is holding out on 3 bye elections which would see their majority lost. One seat has been vacant for 18 months.
Whilst all this is going on John Gormley (Gormless) leader of the back to the caves party (the Greens), voted for by 2% of the population, holds the country to ransom by forming the part of the coalition that keeps Cowan and Co in power. His price? Extra carbon taxes on fuel, heating oil and transport which lead to everything going up in price.
Finally, Cowan, says the best way out of trouble is for consumers to stop saving and spend. Spend what? Few now can cover their mortgage, food, heating, lighting and school costs. The per capita debt is higher than the UK.
We all think North Korea is a mad place - it'll shortly be twinned with Ireland.
Re: Ireland goes pop...
The ability to devalue your own currency is essential in a recession as it allows you to control the level of your own interest repayments on borrowing in that currency and also to put liquid assets into the economy.
Your post seems to suggest you believe Ireland is actually in a better position than the UK? If so what are you bothered about? And you believe the Euro will save you? Not sure how that one is going to come about with half the Eurozone on the verge of bankruptcy and suffering general strikes.
Your post seems to suggest you believe Ireland is actually in a better position than the UK? If so what are you bothered about? And you believe the Euro will save you? Not sure how that one is going to come about with half the Eurozone on the verge of bankruptcy and suffering general strikes.
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max_tranmere
- Posts: 4734
- Joined: Fri Jul 14, 2017 2:40 am
Re: Ireland goes pop...
Mysterman, very interesting comments. I watched 'Hearts & Minds' on BBC1 Northern Ireland tonight (I live in London but can watch that channel on Sky channel 973). An economist from Dublin was interviewed and he said that a lot of this has been glorified and exagerated by the media, he said that these costs will mainly be borne this year as a one-off and next year things will improve.
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Mysteryman
- Posts: 878
- Joined: Fri Jul 14, 2017 2:40 am
Re: Ireland goes pop...
Max, that economist was talking bollocks. Before the "final" cost of the bailout was announced today, and we have had at least 3 "final" estimates previously, the government had taken ?4 billion out of the economy in the last budget and was in line to take ?3 billion in this December's budget and a further ?3 billion in December 2011.
Those figures are now off the table and the estimate is that to pay for the bailout, each man, woman and child in the state will have to pay between ?10,000 and ?12,000 between now and 2016 in extra taxes, reduced benefits and reduced gross pay, depending on how much the current "final" figure actually turns out to be as, as is usual in Ireland, there are a number of caveats attached to the calculations.
Helpfairy, I don't know why you think my posts suggests that Ireland is in a better state than the UK. I'm pointing up the fact that the UK is in a poor state as well and when the cuts already signalled start to take effect this winter you'll see what I mean - and there will be more to come.
Devaluing a currency helps if you are a major manufacturing nation with products people want. You can then sell abroad cheaper than your competitors. However you risk a run on your currency. I lived, as a working, British, adult through the years 1967 - 1976 during which various crises hit the pound. In those days the UK still made a vast array of products that could be sold abroad but Wilson's devaluation started a rot which ended up with the pound continually slipping in value, increases in taxes, prices (especially as the UK was a nett importer of food, oil and heavy materials) and eventual intervention by the IMF.
Since Thatcher's demolition of British manufacturing industry and the dependence on service industries, the UK is in a much weaker position long term in a devaluation scenario.
On the other hand Ireland, which can only export, food and some chemicals and high tech products and services, is part of a currency union which has strong members, such as Germany and the Benelux, which manufacture volume exportable and saleable products and, given judicious fiscal policies, can support Greece, Portugal, Spain and Ireland. In this respect, it could be said to be in a slightly better position than the UK
If Ireland had not adopted the euro and had kept the punt we would now be seeing hyper inflation, bread lines and massive civil unrest which would put the odd one day strike, as seen this week around Europe, into perspective as minor expressions of anger.
Of course if monetary union had gone the whole way and a federal eurozone budget was in place life would be much easier for all the countries involved.
Those figures are now off the table and the estimate is that to pay for the bailout, each man, woman and child in the state will have to pay between ?10,000 and ?12,000 between now and 2016 in extra taxes, reduced benefits and reduced gross pay, depending on how much the current "final" figure actually turns out to be as, as is usual in Ireland, there are a number of caveats attached to the calculations.
Helpfairy, I don't know why you think my posts suggests that Ireland is in a better state than the UK. I'm pointing up the fact that the UK is in a poor state as well and when the cuts already signalled start to take effect this winter you'll see what I mean - and there will be more to come.
Devaluing a currency helps if you are a major manufacturing nation with products people want. You can then sell abroad cheaper than your competitors. However you risk a run on your currency. I lived, as a working, British, adult through the years 1967 - 1976 during which various crises hit the pound. In those days the UK still made a vast array of products that could be sold abroad but Wilson's devaluation started a rot which ended up with the pound continually slipping in value, increases in taxes, prices (especially as the UK was a nett importer of food, oil and heavy materials) and eventual intervention by the IMF.
Since Thatcher's demolition of British manufacturing industry and the dependence on service industries, the UK is in a much weaker position long term in a devaluation scenario.
On the other hand Ireland, which can only export, food and some chemicals and high tech products and services, is part of a currency union which has strong members, such as Germany and the Benelux, which manufacture volume exportable and saleable products and, given judicious fiscal policies, can support Greece, Portugal, Spain and Ireland. In this respect, it could be said to be in a slightly better position than the UK
If Ireland had not adopted the euro and had kept the punt we would now be seeing hyper inflation, bread lines and massive civil unrest which would put the odd one day strike, as seen this week around Europe, into perspective as minor expressions of anger.
Of course if monetary union had gone the whole way and a federal eurozone budget was in place life would be much easier for all the countries involved.
Re: Ireland goes pop...
"and, given judicious fiscal policies, can support Greece, Portugal, Spain and Ireland. In this respect, it could be said to be in a slightly better position than the UK"
Ah, so you think you will get a bail out, I would not bank on that one, because bailig out you means bailing out Portugal, Spain, even Italy, the German public are not going to wear that - and it will mean effectively selling control of your country to Berlin if they do, they were telling the Greeks they must sell off some of their Islands and directing Greek austerity measures as payment for their help - you talk about UK cuts, what do you think the Germans wil demand for covering your debt? That you can go back to spending like in the last decade? lol.
Ah, so you think you will get a bail out, I would not bank on that one, because bailig out you means bailing out Portugal, Spain, even Italy, the German public are not going to wear that - and it will mean effectively selling control of your country to Berlin if they do, they were telling the Greeks they must sell off some of their Islands and directing Greek austerity measures as payment for their help - you talk about UK cuts, what do you think the Germans wil demand for covering your debt? That you can go back to spending like in the last decade? lol.
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Mysteryman
- Posts: 878
- Joined: Fri Jul 14, 2017 2:40 am
Re: Ireland goes pop...
Helpfairy, get real. Whatever the German public demands, the facts of life are that the eurozone is moving towards a total fiscal/federal union. Slowly, sometimes painfully and not without the difficulties of sinking national differences, the goal will be reached, maybe not in my lifetime but within the first half of this century.
The British readers of the Torygraph, Daily Wail and Daily Depress are deluded if they think that the UK remaining outside the zone will be in a better position in the longer rterm.
As far as the ailing economies in the eurozone go, it would be a far greater catastrophe for the system if one or more countries had to abandon, or be forced out of the euro than dealing with the problems of the countries concerned. Letting a eurozone country leave would be like Utah, Oklahoma or Louisiana leaving the US$ for a local currency unsupported by massive manufacturing capacity and potential exports to the other US states.
As far as Ireland spending money in the last decade is concerned (having lived here for 12 years I have some experience), the Celtic Tiger was mainly an illusion built on twin foundations of incoming foreign companies opening here and a building boom that was never sustainable.
If you knew anything about the way Ireland works you would understand that the influx of foreign owned industry, tempted into the country by massive tax breaks and economic enticements started the ball rolling. They paid wages far higher than the average Irish company. On the back of that the banks lent to developers to build houses far in excess of need and at prices far ahead of anything seen before. People, many of whom for the first time had real expendable income in their pockets were encouraged to take mortgages of up to 5 times their salaries and were assured they were safe by the lenders.
The cronyism that abounds in all levels of Irish political and financial circles made sure that the politico/financial oligarchy fed the dream to the public.
Pay rates and prices went into an upward spiral that was never sustainable, house prices went mad. My house hit a peak of 6 times what I paid for it new after 7 years and I'd still get 4 times the purchase price now.
When the tax breaks and other enticements expired for the incoming companies, they started to look to east Europe and the far east to produce their products. Tens of dozens of foreign companies, having had their cheap deals expire, moved out. My own area with apopulation of 28,000 has seen no less than 8 major companies shut up shop in 3 years as their deals came to an end. Ordinary workers are thrown out of a job with no hope of a replacement.
Out of the 28,000 total population of the area, 6,333 are signing on according to today's figures, many with mortgages that banks encouraged them to take. Yet also this morning we hear the MD of AIB, the bank that has failed most spectacularly of them all, has been sacked.
In post for two years and put in place to sort out the mess when it was first discovered, he came out with a series of hopelessly optimistic figures concerning the costs of his bank's failure but, having been sacked, will get ?100,000 per annum as pension pay off for life, starting the day he leaves.
His crony, Lenihan, the Finance Minister, has said he is entitled to the money under his contract. At those levels of power it seems total incompetance means nothing.
Thank God for the euro, for the determination of the larger nations to make it work and that the idiots who are currently running the country in Leinster House have a prop to fall back on which they don't control.
The British readers of the Torygraph, Daily Wail and Daily Depress are deluded if they think that the UK remaining outside the zone will be in a better position in the longer rterm.
As far as the ailing economies in the eurozone go, it would be a far greater catastrophe for the system if one or more countries had to abandon, or be forced out of the euro than dealing with the problems of the countries concerned. Letting a eurozone country leave would be like Utah, Oklahoma or Louisiana leaving the US$ for a local currency unsupported by massive manufacturing capacity and potential exports to the other US states.
As far as Ireland spending money in the last decade is concerned (having lived here for 12 years I have some experience), the Celtic Tiger was mainly an illusion built on twin foundations of incoming foreign companies opening here and a building boom that was never sustainable.
If you knew anything about the way Ireland works you would understand that the influx of foreign owned industry, tempted into the country by massive tax breaks and economic enticements started the ball rolling. They paid wages far higher than the average Irish company. On the back of that the banks lent to developers to build houses far in excess of need and at prices far ahead of anything seen before. People, many of whom for the first time had real expendable income in their pockets were encouraged to take mortgages of up to 5 times their salaries and were assured they were safe by the lenders.
The cronyism that abounds in all levels of Irish political and financial circles made sure that the politico/financial oligarchy fed the dream to the public.
Pay rates and prices went into an upward spiral that was never sustainable, house prices went mad. My house hit a peak of 6 times what I paid for it new after 7 years and I'd still get 4 times the purchase price now.
When the tax breaks and other enticements expired for the incoming companies, they started to look to east Europe and the far east to produce their products. Tens of dozens of foreign companies, having had their cheap deals expire, moved out. My own area with apopulation of 28,000 has seen no less than 8 major companies shut up shop in 3 years as their deals came to an end. Ordinary workers are thrown out of a job with no hope of a replacement.
Out of the 28,000 total population of the area, 6,333 are signing on according to today's figures, many with mortgages that banks encouraged them to take. Yet also this morning we hear the MD of AIB, the bank that has failed most spectacularly of them all, has been sacked.
In post for two years and put in place to sort out the mess when it was first discovered, he came out with a series of hopelessly optimistic figures concerning the costs of his bank's failure but, having been sacked, will get ?100,000 per annum as pension pay off for life, starting the day he leaves.
His crony, Lenihan, the Finance Minister, has said he is entitled to the money under his contract. At those levels of power it seems total incompetance means nothing.
Thank God for the euro, for the determination of the larger nations to make it work and that the idiots who are currently running the country in Leinster House have a prop to fall back on which they don't control.
Re: Ireland goes pop...
"Helpfairy, get real. Whatever the German public demands, the facts of life are that the eurozone is moving towards a total fiscal/federal union."
Well that certainly sums up the mindset in Brussels, ignore what the people want we will create a superstate anyway, creating huge states that people don't want and driven only by politicians will is never a good idea, and I don't think the outcome will be a unified European state in the end, no not at all.
" it would be a far greater catastrophe for the system if one or more countries had to abandon, or be forced out of the euro than dealing with the problems of the countries concerned"
Catastrophe for the system? Are you a communist or something? What about if it was good for the country and the people who lived in it to leave the EU?
Well that certainly sums up the mindset in Brussels, ignore what the people want we will create a superstate anyway, creating huge states that people don't want and driven only by politicians will is never a good idea, and I don't think the outcome will be a unified European state in the end, no not at all.
" it would be a far greater catastrophe for the system if one or more countries had to abandon, or be forced out of the euro than dealing with the problems of the countries concerned"
Catastrophe for the system? Are you a communist or something? What about if it was good for the country and the people who lived in it to leave the EU?