Bacon 2 - Property developers will reap benefits

     
If you were expecting proposals to stop profiteering in the private house building sector you were wrong
Property developers must be congratulating themsleves all over Ireland this week with the announcment of new proposals to ease the housing crisis. The publication of Bacon 2, the second phase of economic consultant Peter Bacon's study on the housing crisis in the 26 Counties was used by the Fianna Fáil/Progresssive Democrat Coalition as a springboard for a raft of initiatives aimed at resolving the housing crisis.
The coalition proposes to free up land in North Dublin so that 16,000 houses can be built using temporary sewerage facilities. They also proposed tax reliefs to make rental accommodation more affordable for low and middle income families. Other proposals aimed at the supply side of the housing sector included increasing infrastructural investment to remove any constraints on house building programmes as well as reducing capital gains tax for land sold to build houses.

If you were expecting proposals to stop profiteering in the private house building sector you were wrong. There are no proposals to increase public sector housing programmes or to introduce rent control in the private sector.

Don't expect price controls to be introduced which would stop for example the price of land increasing by a rate higher than inflation. House price increases which in 1998 topped 30% will not be contained.

No instead the theme of the proposals is to make it easier for property developers and house builders to build more house and charge higher prices for them while the Dublin Government and utlimately the Irish tax payer carries the costs. This is not a solution. There was a housing crisis in Ireland before the middle classes realiedd that home ownership was moving out of their grasp. The proposals announced this week do not even tackle this aspect of the problem.

We need quality affordable housing for all, not small scale proposals that tinker with the problem. The coalition must think again.

War - Who is it good for?

     
What we are witnessing is not really a Banana War but the prelude to a potentially far more dangerous conflict.
War was declared and the USA had launched retaliatory strikes. This was the news that greeted those of us who watched an evening news bulletin last Friday. The USA and the EU were going to war over bananas.

What had actually happened was that a long running dispute between the European Union and the USA had come to a head with the US Government announcing £350 million of sanctions on EU exports including biscuits, Italian cheese, batteries and Scottish cashmere products.

At the basic level the dispute between the USA and the EU is a simple one. The US government believes that the EU is giving preferential treatment to banana producers from states that were once colonies of the EU. This puts the so-called `Dollar Bananas' from Latin American states at a disadvantage in EU markets.

This is not really a dispute about banana states being hard done by. It is about the demands of US banana exporting companies. The banana issue is only one part of a wider series of disputes between the USA and the EU.

Currently the EU and the USA are in dispute over proposals to ban genetically modified food - the US is a significant exporter of these foodstuffs. There are also serious differences over the use of hormones in beef production.

The introduction of a new third generation of mobile phones has been hampered because of a dispute between the EU and the USA over agreeing international standards for this new mobile phone technology.

Most importantly the EU and the US have growing differences since the introduction of the euro on what role both superpowers should play in running the global economy.

At the recent G7 meeting the US objected to EU officials being present at the talks. The G7 is the self appointed group of the largest global industrial powers. They meet with increasing regularity to plan strategies to control the world economy. Now they have been in dispute over whether exchange rates between the dollar and the euro should be controlled to encourage global economic growth.

Control is in fact the essence of the dispute between the EU and the USA.

The USA has realised what many people in the EU do not yet seem to grasp - that the EU is a global economic political and military force to be reckoned with.

What we are witnessing is not really a Banana War but the prelude to a potentially far more dangerous conflict. Two superpowers are flexing their muscles. One is the new kid on the block ,the EU, the USA is the self appointed police officer of the New World Order.

We the people of Europe have not been consulted on this war. Yet we will have to carry the costs in terms of job losses and if it ever came to serious conflict it will be us `Joe Public' who have to fight the war. We have already been propagandised on the issue of job losses and the whole use of the war terminology is dangerous.

There will be no difference to the workers in the banana producing states whoever wins the Banana War. The upcoming EU elections means that there will be considerably more coverage and debate on EU issues in Ireland. Progressive groups must make their voices heard. No to phoney wars, and No to super power arm wrestling.

Three tales of unemployment

Unemployment figures for Japan, the United States and the 26 Counties were released last weekend. For the unemployed in Ireland the reaction to the various figures makes interesting reading for how those in power view the unemployment problem.

The USA


In the United States the February unemployment figures caused a surge on the Wall Street stock exchange. The Dow Jones index rose by 268 points after it was revealed that unemployment rose slightly from 4.3% to 4.4%. 15,000 jobs were lost in the clothing industry, the automobile industry lost 8,000 jobs, 6000 jobs went in the aircraft industry, the metals sector lost 6,000 jobs and 7,000 jobs went in the industrial machinery sector.

The financial markets in the USA were happy that unemployment had risen because it meant that US interest rates will not increase. European share prices also increased as well as the bond markets in Germany and Britain. The message from these financial markets is that jobs are an easy sacrifice to keep their financial games running.

The 26 Counties


Unemployment in the 26 Counties fell in February. The Live Register figure for unemployment was 207,600 just under 7% of the labour force. Enterprise Trade and Employment minister Mary Harney welcomed the figures. Harney said the next push would be to get unemployment below the 5% level.

What sort of wages and quality of jobs those who left the live register have is not clear. The Irish National Organisation of the Unemployed (INOU) believes that many of the people who left the register have been put onto schemes and are therefore not really employed.

Japan


In Japan unemployment has risen to its highest level in 50 years. The percentage of the labour force without jobs has risen to 4.3%, 2.98 million people are without work. The Japanese government is implementing a package to pull it's economy out of recession.

However if this were the 26 Counties an unemployment rate of 4.3% would be seen as a spectacular success. In the USA it would depend on the whims of the financial markets.

The only acceptable rate of unemployment is to create an economic environment where everyone who wants a job has one and those who have jobs have a wage level which guarantees them a dignified and acceptable standard of living.