Opinion A budget which Charlie McCreevy or Brian Cowen would be proud of…

Discussion in 'Budget 2018' started by Brendan Burgess, Oct 10, 2017.

  1. Brendan Burgess

    Brendan Burgess Founder

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    During the Celtic Tiger we based our budgets on artificially inflated property and other tax receipts.

    We are making the same mistake now – basing our budgets on artificially high taxes and artificially low interest rates.

    The difference now is that we have €200 billion of borrowing which we have to pay interest on.



    Despite

    · the booming economy

    · the artificially high Corporation Tax returns

    · the artificially low interest rates



    Minister Donohue is budgeting for a budget deficit next year.

    We will increase our borrowing next year because we are planning to spend more than we raise in taxation.



    The country faces huge risks

    · When interest rates rise, the true cost of our €200 billion and growing national debt will hit home

    · When Brexit happens, our exporters could be very hard hit

    · Trump’s trading policy could hit our exporters and could even result in some of them returning to America

    This was a missed opportunity to cut expenditure – in particular on social welfare.

    We need a Minister for Finance who is not afraid to say “We can’t afford it.”

    The result of this Budget is that we will be in deep financial trouble in a few years and we will need to be bailed out again.
     
  2. odyssey06

    odyssey06 Frequent Poster

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    Point of order on the thread title...

    Cowen was brought in to loosen the purse strings and spend, spend, spend without a thought for tomorrow because McCreevy wouldn't... and McCreevy put aside billions into the Reserve Fund... I'm not saying McCreevy's budgets were perfect but there's no comparison.

    McCreevy was Minister for Finance from 1997 to 2004. Over that time the national debt went down both in real terms (by 1 billion) and in % terms of GDP (by 30%).

    I totally agree that the budget was a missed opportunity to reduce spending, increased social welfare in the current economic climate is bonkers.
    It's not even good politics for FG.
     
  3. Firefly

    Firefly Frequent Poster

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    Hi Brendan,

    It's pro-cyclical as it always is in this country.
    When the good times are here we spend more because we have it, when the bad times come, we spend more to boost the economy. That 200bn national debt is going to keep growing until we hit a wall. Then the real good times are ahead...

    Plus ca change and all that.

    Firefly.
     
  4. Brendan Burgess

    Brendan Burgess Founder

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    Interesting. But if McCreevy was in charge from 1997 to 2004, during a period of great growth, should he not have reduced spending even more?

    Of course, was Cowen really to blame? Didn't Noonan call him Scrooge for not spending more. We all partied.

    Brendan
     
  5. odyssey06

    odyssey06 Frequent Poster

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    Ideally yes, he should have reduced spending even more. Realistically, he seemed to hold the line as well as anyone could ... Cowen I don't think gave a damn about the future state of the economy and only cared about becoming Taoiseach so yes I think he deserves his share of blame. Of course the cheerleaders for more spending which dominate our media deserve the blame too.
    And I didn't party!
     
  6. galway_blow_in

    galway_blow_in Frequent Poster

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    FG are reliant on FF for support , FF always spend when they have it ( and FF are misers compared to the rest of the parties not in government ) , WOD would have a fit if social welfare had not been increased , his overwhelming support stems from high social welfare spend areas
     
  7. JoeRoberts

    JoeRoberts Frequent Poster

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    Was that not the reason McCreevy was banished to Europe, because he would not spend more ?
     
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  8. Seagull

    Seagull Frequent Poster

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    This was essentially a FF budget. There was no way they would pass the kind of budget that is actually needed.
     
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  9. gnf_ireland

    gnf_ireland Frequent Poster

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    Yes, it was definitely a populist budget... with the haulmarks of FF all over it
    Sadly the types of budgets we actually need, we don't have anyone capable of implementing.
    Our chance was when the IMF were in, and we blew it

    One thing I don't see in the budget is any attempt to address the looming pension crises, by either proper funding of the public service pensions/old age pensions or a strategy to tackle the looming crises in front of us...
     
  10. galway_blow_in

    galway_blow_in Frequent Poster

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    raising the state pension is about the one thing that nearly all parties enthusiastically support but also which most people in general support , we are a very sentimental people when it comes to the elderly , we instinctively view them as vulnerable , i think the country would need to be in the state greece was before any government would cut the state pension , when brian lenehan tried to curb free medical card access for the over seventies who were on very high incomes , not only did thousands and thousand of pensioners take to the streets , people fifty years younger joined them despite the fact those people in their twenties would be forced to take cuts or see tax hikes in order to continue providing medical cards for pensioners earning up to a grand per week for a couple , this will take something extraordinary to reform
     
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  11. gnf_ireland

    gnf_ireland Frequent Poster

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    I am not disagreeing with you, but all of this is based on the premise that each generation will be better off than the previous one, and creates a form of social contract. The sad reality is this is no longer the case, and appears the quality of living for Generation X, Y & Z will be lower than the Baby Boomers.

    I have no objection with increasing the old age pension (in theory), but I would like to see my pension funded from the PRSI paid today. This should be securely placed into a fund that will be used for that purpose - and being honest constitutionally protected. I don't want my kids to pay for my pension - they should pay for their own. Like most countries in the western world we have an aging population with no provision for them. We cannot even manage a budget surplus in the current climate !

    I have always struggled to understand why anyone over 65 pays less tax on the same income as someone under it. I would have thought someone under 65 on the same income would in effect be 'poorer' and therefore deserve the same treatment tax wise.
     
  12. galway_blow_in

    galway_blow_in Frequent Poster

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    Last edited: Oct 10, 2017
    pensioners have far less spending demands than the younger generations , their immense political power is entirely behind the universal desire to court their vote and furnish them with goodies despite them being very comfortable in the majority of cases and having had virtually no recession

    the young are very slow in this country to realise the elderly do not give a hoot about them
     
    Last edited: Oct 10, 2017
  13. gnf_ireland

    gnf_ireland Frequent Poster

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    And maybe the Generation X/Y/Z category need to start voting in higher numbers and stay away from the traditional parties

    I genuinely thought the Social Democrats would have attracted a larger share of the vote the last time around, as it appears to be a better 'idealogy' for younger voters....
     
  14. galway_blow_in

    galway_blow_in Frequent Poster

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    the social democrats are nothing but a temporary dwelling for disillusioned labour party voters , doubt they are around in five years , roisin shorthall is the biggest waffler to ever sit in the dail , her entire career has been spent knocking other peoples policies while never coming up with anything substantial herself , she bailed on labour when the hard decisions had to be made a number of years ago , the ultimate hurler on the ditch who is predictably completely in favour of high public spending and little regard for how its spent
     
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  15. 24601

    24601 Frequent Poster

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    The collective amnesia in this country is amazing. I can't believe that the entire narrative today has focused on the increase in current expenditure not being high enough! It's perverse that there appears to be near-universal support for increasing social welfare and pension payments!

    A huge missed opportunity to widen the tax base, cut spending and tackle structural weaknesses. Sigh.
     
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  16. kaiser1

    kaiser1 Registered User

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    Agree with most of Brendans initial post, really nothing much in this budget for the working man and woman. I'm very disappointed that the focus is on increasing even more payments on social welfare (on all weekly payments) which we will be paying for, for years to come.
    We need a sort of "temporary dictatorship" of sorts to come in and make all the unpopular but fiscally prudent decisions we should be making.
    There are too many cooks in the kitchen in on this budget and the end result isn't very palatable.
     
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  17. Purple

    Purple Frequent Poster

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    We had one, it was called the Troika. Unfortunately we are back to auction politics and everyone looking to their left.

    The problem is the same as it has always been; a mutton-headed and economically illiterate electorate.
     
  18. galway_blow_in

    galway_blow_in Frequent Poster

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    Last edited: Oct 11, 2017
    i think another major reason is the fact that our media is so overwhelmingly left wing so people are conditioned into believing wanting to balance the books is heartless and nothing more , i cant think of a single unashamedly right of centre journalist in the country when it comes to the economy , dan o brien is very good but im not sure he is a journalist in the main , colm mc carthy is also very good but both are more viewed as academics
     
    Last edited: Oct 11, 2017
  19. Delboy

    Delboy Frequent Poster

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    A terrible budget.

    A person on the dole is €260 better off for the 2nd year in a row = €520 per annum. At a time of near full employment!
    An OAP is now €13 a week better off over the past 3 budgets = €676 per annum. Plus they got some allowances back/charges reduced.
    By my calcs, a worker on 33k per annum (just under the rate band change) is €86 better off in 2018 (after getting €167 in the last budget). So €250 better off per annum

    Leo needs to double the €5m he's given to his Spin Unit because his actions are certainly very different to his words.
     
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