FINE GAEL AND LABOUR PILE ON THE PUBLIC PAIN

There’s a better way to fix our finances

BY JOANNE SPAIN

Labour’s Joan Burton and Fine Gael’s Richard Bruton

THE Irish economy is doing very well. No, seriously – it is. Michael Noonan says so.
On 1st September he told the Dáil Finance Committee that the 26-County export market is performing well and we’re a very competitive state. The Government is meeting fully its IMF/EU deal targets on tax raising and spending cuts. The banks have received their full multi-billion-euro recapitalisation. They’ve so much money now they’re throwing it at small businesses but the businesses don’t want it; they’re doing fine!
The Finance Minister is worried about one thing: people aren’t buying much. They’re hoarding their wealth – in banks, under the mattress, in teapots, wherever they can. It’s okay, though. He’s going to provide a three-year plan in October which will show people how much more they’ll be taxed over the next three years and where he’ll be cutting spending, and that’s going to make everyone confident again. That will get them running to their local stores to buy flat-screens and Bollinger. Fear not – he’s not being over-optimistic. The Economic and Social Research Institute, that wonderfully independent organisation which always gets things right (excuse my sarcasm), has predicted massive growth in the Irish economy. One caveat – there’ll be no jobs. But there’ll be growth. Think on that for a while.
It’s hard to decide if this carry-on is ostrich/head/sand territory or a wilful misleading of the Irish people. Whatever, it’s not working. Any one of the almost 460,000 people on the dole, or the 90,000 households in mortgage distress, the thousands of parents sending their children to school without books and uniforms because the Back to School grants haven’t been processed properly, or even just that small group of parents in Kilbarrack in Dublin who saw the school for their autistic children closed down and face into this term with no school to send their children to – any of those groups can tell you how they feel about how the economy is doing.
All of the Establishment commentators out there seem to agree on one thing: Ireland will have an export-driven recovery. They don’t mention that over 75% of our exports come from multinationals based in Ireland. So this state does not book the profits of these firms. We get employment from them but everyone agrees that they can lift their export figures without really increasing their workforce numbers.
Sinn Féin sees this as problematic. Another area we see as problematic is the direction this government is taking on deficit reduction and debt burden.
Fine Gael and Labour were democratically elected and are now undemocratically implementing the former government’s policies that were roundly rejected by the electorate. They barely waited a week in office before they began their utterances of ‘we’re tied into this’ even though they campaigned tirelessly on a myriad of promises to reverse Fianna Fáil government policies. Now they are pursuing the same slash and burn policies as the last government. The obsession with treating the deficit as though that is the cause of the recession and not the result is proving detrimental to the economy. Unemployment is rising. People’s real incomes have dropped (ordinary people are not stashing their money – they have no money). Poverty is on the rise and people are suffering from the downgrading of essential public services.
The Government has forgotten that the economy is meant to serve society – not the other way round. This ‘misunderstanding’ has led to the complete recapitalisation of the banks – even with the likes of Joan Burton and Richard Bruton, who had repeatedly called for no more money to go into the banks, now on the Government benches.
And our new Minister for Finance continues to fail us badly. His government said it was going to seek a 0.6% reduction in the interest rates of the IMF/EU deal. Greek people took to the streets to resist their deal and, following concerns in Spain and Italy, the interest rate looks like it will be reduced to 3.5%.
Then French President Sarkozy and German Chancellor Merkel met in August and decided the course of European economies, including a constitutional requirement for eurozone members to restrict their deficits and deeper fiscal centralisation. Noonan was happy to not be at the table and he welcomed their announcements. How quickly Fine Gael has been able to switch its allegiance from Britain to Brussels!
Ireland is at crisis-point and faces another three years of austerity. And when Sinn Féin says Ireland, we’re referring to its people – not the banking system, or the Department of Finance. Our debt to GDP (the amount of money we owe verses the total economic activity in the state) has rocketed to over 100% because we’ve recapitalised the banks so handsomely, and still senior bank bondholders remain untouched. For every cent Noonan saves in this year’s Budget with tax increases and spending cuts, more will have to be found for servicing debt interest, which has risen year on year.
The Irish people need a strong voice right now. They need a party willing to decouple private debt from public debt . . . A party willing to reduce the deficit with sensible, fair measures . . . A party willing to address the jobs crisis and stimulate growth in the economy . . . A party willing to tell the IMF/EU that we won’t be honouring a bad deal made by the last government and if they want the money that has already been drawn down back, then they better sit down at the table again and we will tell them how we are going to pay it.
All of this is achievable. There is still a better way to fix this economy and we must continue to drive that message home to the people so badly let down by Fine Gael and Labour. The Irish people deserve nothing less.