Why are we bailing out snr bondholders again?

[Chris]

You seem to equate 'economy' with 'society'. What is good for the economy (going by your measures) is often not good for society. There is clear evidence that income inequality is not good for society, across a whole range of measures (See Equality Trust UK's website for evidence).

No, I'm not equating the two, but without a functioning economy of private enterprise, society as we know cannot exist. Equality of income has nothing to do with economic activity. If the economy as a whole grows then the wealth of everyone increases which has a very positive social effect. How do you think that even someone on a low wage can afford to run a car, or get on planes to go on foreign holidays, or have modern computer and other electronic equipment at home? Did all this happen because somehow over the past 50, or 100, or 200 years income inequality has been decreased? No it hasn't. All these advantages of market economy based capitalism were made available because the economy as a whole grew; as whealthy companies and individuals became wealthier, so did the poor. You would have to rewrite history to claim otherwise.

There are people who are part of society, but who did not benefit from our booming Celtic Tiger economy, such as the people who live in Dolphin House and who's drinking water has the same eColi levels as raw sewage.

Looking at the last totally artificial boom to make an argument that the less well off did not gain anything is completely ignoring the bigger picture. The improvements to the lives of the poor in society over the last 200 years, are undeniable. And this was made possible through the end to serfdom and the advent of capitalism. But even in the boom years, uneducated and unskilled people got well paying jobs in construction and factories. You can hardly dispute this. At the peak of the boom foreign nationals took jobs that 100000 unemployed Irish were not willing to take. If these are the ones you feel were left behind then I have zero sympathy for them.
Also, maybe you could remind us whether it is a private enterprise or the government that is in charge of the water supply to Dolphin House?

I see, so no IDA/Enterprise Ireland (despite that fact that every developed economy in the world has resourced dedicated to attracting FDI. No Equality Tribunal to address discrimination by public and private service providers at a low cost. No Library service. No local authority sports/leisure centres which are offering amazing services to those who can't afford gym memberships. No Cliffs of Moher visitor centre or Boyne Valley interpretive centre, all of which serve to bring tourist spend into the country etc etc etc.

The IDA did not attract jobs, no matter how much they claim they did. What attracted foreign investment is the low tax rate and comparably low wages 10-15 years ago. Private enterprises do not go to IDA junkets and listen to politicians rant about how great they are and say "Hey, this sounds like a great place". Every company looking to invest will look at tax rates, wages, employment level and education level and make a comparative analysis to other possible locations. They then make a decision based on cost benefit, and I think it is wrong to claim that the IDA makes any significant impact on this, especially considering their budget. Either the cost structure is preferable or it is not; no amount of sales pitching will make a difference.
The equality of humans is written into the constitution. There is no need to create a completely seperate department, with all the ministers costs, and the duplicate senior civil servants and all that goes with it. Any legal issues should be handled by the department of justice. And creating an "equality" department does not mean that it actually does anything to improve equality in any way.
There is no reason for library services to not exist, as this could and even should fall under education, again reducing the duplicate jobs and ministerial positions.
Sports facilities should fall under health and tourist attractions would still be tourist attractions without the department of tourism. Even a visitor center at the Cliffs of Moher would exist if it had been allowed for private enterprises to set up there.
The biggest wastage at government level is in the mid to high level administration, where everything is duplicated ad nauseam. Half the employees of the HSE are non-frontline managerial and admin staff. I believe that it is the same across all government departments. Consolidate departments and admin side of things and you would quite easily reduce numbers by 50%. That's 25% of the public wage bill in savings.

The Irish people have firmly rejected the PD approach. More Irish people want to live in a country that provides decent public services to all, than want to live in a desolate, divided wasteland of the haves and the have-nots.

The PDs were no more free market capitalists than the Labour party is. They had their own interventionist agenda that favoured their lobbyists. Conservatism and socialism are two sides of the same coin called interventionism, with the only difference being those that gain. And yes, people want decent public services, starting with health, education and law enforcement. And until these are decent (or even mediocre) the majority of other services should be scrapped or consolidated.

So what's your source for the claim that public wastage exceeds private wastage? What's the source for your claim that private companies provide vastly better services than public ones?

Because if a private enterprise wastes too much it is under threat of going out of business. Because private enterprises have to constantly improve their products to remain competitive. Because private enterprises will scrap products that cause losses.
Because government services have no incentive to not waste resources. Because government services are rewarded for providing bad service with increased budgets. Because people do not have a choice when it comes to public services and therefore can only compare to public services in other countries, which is not the case in the private economy.
And as for my proof for private services being better than public, ask anybody in this country if they would rather go to a private hospital or a public one. Maybe some small business owners here can say whether they prefer dealing with the SME Association or the IDA or other government quangos. Or how about sending a parcel with UPS or AnPost, which do people have more faith in when it comes to getting things delivered on time and in the first place. Why do you think people are leaving the ESB and moving to Airtricity; hardly because their service is worse.
As for other services provided by government, these are mainly government monopolies where people do not have a choice and therefore are prohibited from providing any kind of feedback on the service.

This is great theory, but it just doesn't work in the real world. Have a look at the posts here on AAM, and you'll see customers have just as many problems with their hotel, or their accountant, or their car dealer as they do with their local authority or Govt dept.

It is not just some great theory. The western world came out of serfdom and widespread poverty over 200 years ago. There was little government services or intervention or taxation, and this resulted in the biggest and longest economic boom in human history. That theory is free market capitalsim where only successful enterprises survive and hard work is rewarded.
I also have encountered terrible services and products, and they have resulted in me not using the specific company again. There is a specific Irish airline that I will never fly with again, but millions of people disagree with me and the company is doing very well.
Private companies can only exist if they succeed in retaining customers, i.e. serving their customers interests in the best way compared to competitors. Unless they do this (or are subsidised by government) they will not make profits. This is the case for any size company, and I'm sure there are a few small and medium size company directors here that can confirm this.
The main point is, that if you have a problem with a hotel, you can choose to not go there again and use another hotel. When you have a problem with a government service you do not have a choice. Each cent you spend or don't spend with private comapnies is a vote, it is a continuous daily plebicite by the consumer; it does not get more democratic than that!

I don't think that many people in the Nordic countries, or in Japan have a miserable existance. Compared to us, they are on the pigs back.

You are assuming that these countries actually have somewhat more equal income. They are often cited by socialists as proof that the welfare state can work. But what is totally ignored is the fact that their private economies are among the freest in the world and their higher tax bands kick in at a much higher rate. This means that they are more capitalist and have less income redistribution than most other countries.

There is none so blind as the one who does not want to see. The evidence (all published, peer-reviewed papers) is all there.

And you can confirm that they have been reviewed by peers of opposing views? These are the ones you want to look at, anything else is preaching to the choir.
Goethe: "In the newspapers and enyclopedias, in schools and universities, everywhere error rides high and basks in the consciousness of having the majority on its side."

I'm not going to take you through the evidence, post by post. Go read the evidence or the book. It's all there.

You don't need to go through every point, but you rate the website and the book so high that you should ba able to provide some logical explanation as to why income inequality is apparently such a problem.

Or to translate - I'm going to ignore the evidence that I don't like, and quote one or two irrelevant examples that disprove another completely different issue.

I think you are exposing what you are doing yourself in this statement. You are not acknowledging the facts that previous posters have provided with very relevant examples of countries that have the highest levels of wealth (economically or socially), while at the same time having the lowest levels of income redistribution. These are countries that do very littleif anything to actively reduce the gap between rich and poor. And by doing so, their economies thrive, which makes the poor wealthier.
It should be even more damning on the majority of the western world, that their actions to redistribute income is having the exact opposite effect as what the inactions of a few countries is having.

You really haven't read anything significant about it. Go read the book. Seriously.

I know this wasn't directed at me, but how about this. I'll read this book if you read Socialsim by von Mises.

You obviously haven't read the evidence, given your one dimensional view. I've certainly never proposed income equality. However, there is no doubt that wide income inequality is bad for everybody. The evidence is there, whether you like it or not.

No, there is only an interpretation of evidence. But let's say that social consequences of income inequality actually were bad for everyone. I imagine that the solution would be to redistribute income from wealthy to poor members of society through taxation. This would suggest that socialism should have resulted in wonderful places to live in East Germany, Russia, Romania, and today Cuba and North Korea. But this simply is not the case. Quite the opposite happens: when you tax the rich to "improve" the lives of the poor, the lives of everyone trend towards misery. There is no historic proof to the contrary.
Income redistribution is not the solution to improving the wealth of society. Poor African countries would not benefit by redistributing their income; people would still be poor. The western world did not improve economically and socially by redistributing income. It did so through private ownership rights and by becoming ever more productive and making more efficient use of resources. And this process improved the lives of everyone!

 

[Chris]

So how do you explain the fact that free western style democracies such as USA, Ireland, UK etc. where there is income inequality, consistantly outscore countries such as North Korea, Cuba, Mynamar etc. where there isnt income inequality in all these categories? We even had, what was in effect, a contolled experiment running in Europe on this issue for a number of decades - i.e. the Iron Curtain. Surely this conclusively proved beyond any doubt that income equality is BAD for any country?

Remember, that the most equal society is the one with equal opportunities, not equal income.

Very important point, which I forgot to mention. And more specifically than the iron curtain as a controlled social experiment was the division of Germany. You had people of the same country, language, religion, race, education, etc. seperated by force into two opposing economic regimes, i.e. socialism and free market capitalism. West Germany immediately recovered, while East Germany is still trying to recover 20 years after the end of socialism.

Hayek put it very well when he said that the most equal society would be one where all laws had to be applied equally to everyone. Where not the loudest or wealthiest or most aggressive or violent are the source of economic decisions. That is true liberty and freedom for everyone.

 

[Complainer]

I have a long plane journey coming up so I might (along with its apparant companion piece, The Spirit Level Deception) as I do find studies like this interesting but it's not a great recommendation if they can't synthesise the information well for their website.

I have to confess that it wouldn't be my choice for a long plane journey, but everyone to their own. It really seem to be nitpicking to criticise them because you didn't spend enough time on their website. There is a lot of good information there, but you'll have to invest the time there.

So how do you explain the fact that free western style democracies such as USA, Ireland, UK etc. where there is income inequality, consistantly outscore countries such as North Korea, Cuba, Mynamar etc. where there isnt income inequality in all these categories? We even had, what was in effect, a contolled experiment running in Europe on this issue for a number of decades - i.e. the Iron Curtain. Surely this conclusively proved beyond any doubt that income equality is BAD for any country?

Where did you get your information on income inequality in Cuba, North Korea and Myanmar?

The Iron Curtain had nothing to do with income equality. It had everything to do with one small group exploiting the majority. It also suppressed just about every basic human freedom, so it is not really a good model for anything.

Remember, that the most equal society is the one with equal opportunities, not equal income.

Your claim is fiction. See

Researchers at the London School of Economics have used this method to compare social mobility in eight countries. Using their data, we have shown that, at least among these few countries, the more equal countries have higher social mobility (see graph). It looks as if the American Dream is far more likely to remain a dream for Americans than it is for people living in Scandinavian countries. Greater inequalities of outcome seem to make it easier for rich parents to pass on their advantages. While income differences have widened in Britain and the USA, social mobility has slowed​

No, I'm not equating the two, but without a functioning economy of private enterprise, society as we know cannot exist. Equality of income has nothing to do with economic activity. If the economy as a whole grows then the wealth of everyone increases which has a very positive social effect. How do you think that even someone on a low wage can afford to run a car, or get on planes to go on foreign holidays, or have modern computer and other electronic equipment at home? Did all this happen because somehow over the past 50, or 100, or 200 years income inequality has been decreased? No it hasn't. All these advantages of market economy based capitalism were made available because the economy as a whole grew; as whealthy companies and individuals became wealthier, so did the poor. You would have to rewrite history to claim otherwise.

Looking at the last totally artificial boom to make an argument that the less well off did not gain anything is completely ignoring the bigger picture. The improvements to the lives of the poor in society over the last 200 years, are undeniable. And this was made possible through the end to serfdom and the advent of capitalism. But even in the boom years, uneducated and unskilled people got well paying jobs in construction and factories. You can hardly dispute this.

How do you conclude that growing economies help everyone? There is no basis for this. The old 'rising tide lifting all boats' story is great for those who have boats. If you don't have a boat, you drown.

You seem to be very quick to attribute a whole range of social developments to capitalism. Is it possible that your view is just a tad one-sided and has no basis in fact? Could possibly some of these benefits be attributable to the benefits of socialism, such as the health improvements in the UK arising from the NHS, and the economic developments in Ireland arising from the public education system? Could possibly some of these benefits be attributable to gains in terms and conditions hard won by trade unions for their members? Could possibly some of these improvements be attributable to improvements in science and technology, just some of which might have come from public universities? You don't have to rewrite history to show where benefits have come from.

Also, maybe you could remind us whether it is a private enterprise or the government that is in charge of the water supply to Dolphin House?

And I guess management companies that run private developments never give rise to complaints - No? I guess that forum here on AAM covering these complaints are just people making things up?

The IDA did not attract jobs, no matter how much they claim they did. What attracted foreign investment is the low tax rate and comparably low wages 10-15 years ago. Private enterprises do not go to IDA junkets and listen to politicians rant about how great they are and say "Hey, this sounds like a great place". Every company looking to invest will look at tax rates, wages, employment level and education level and make a comparative analysis to other possible locations. They then make a decision based on cost benefit, and I think it is wrong to claim that the IDA makes any significant impact on this, especially considering their budget. Either the cost structure is preferable or it is not; no amount of sales pitching will make a difference.

So is it only in the public sector that 'sales pitching' doesn't work? It's strange how it is fairly well established in the private sector that 'sales pitching' works, and it is worthwhile investing in good salespeople and sales processes. But you are absolutely certain that there is no value in Ireland having similar resources pitching Ireland and providing considerable resources to startups (including buildings), especially as the competing economies will certain have their IDAs hammering down the doors of the FDI candidates?

The equality of humans is written into the constitution. There is no need to create a completely seperate department, with all the ministers costs, and the duplicate senior civil servants and all that goes with it. Any legal issues should be handled by the department of justice. And creating an "equality" department does not mean that it actually does anything to improve equality in any way.
There is no reason for library services to not exist, as this could and even should fall under education, again reducing the duplicate jobs and ministerial positions.
Sports facilities should fall under health and tourist attractions would still be tourist attractions without the department of tourism. Even a visitor center at the Cliffs of Moher would exist if it had been allowed for private enterprises to set up there.
The biggest wastage at government level is in the mid to high level administration, where everything is duplicated ad nauseam. Half the employees of the HSE are non-frontline managerial and admin staff. I believe that it is the same across all government departments. Consolidate departments and admin side of things and you would quite easily reduce numbers by 50%. That's 25% of the public wage bill in savings.

The constitutional provisions on equality are very narrow, i.e. ‘held equal before the law’. It doesn’t say anything about equality in the pub, or in the workplace, or at the bank. And of course, it doesn’t say anything about social equality. People die waiting for healthcare in Ireland, unless of course they have VHI or equivalent.

But regardless, your claim is ‘not needing a separate department’ is simplistic. First of all, equality doesn’t have a separate department. It has 1/3rd of a department, mixed in with Community & Gaeltacht Affairs. We actually agree on something (surprise surprise). I do agree that creating an Equality Department does not actually do anything to improve equality. Either the Government has a focus on equality or it doesn’t. The last time equality had any serious focus from Government was when Mervyn Taylor was Minister for Equality and Law Reform in the 90s.

But the real over-simplification is about the reducing numbers by 50% and saving 25% of the public wage bill. Please pick any department and have a look at their org chart – tell me where the 50% reduction will come from? You won’t save 50% of any department by moving it around. There may be some economies of scale, but it is certainly nothing near the 50% saving that you expect. There is no benefit to be achieved by moving libraries from environment/local authorities into education. All you will achieve is considerable disruption and uncertainty, as Charlie McCreevy achieved with is €4 billion spend on decentralisation. Many public bodies organisations are already using shared services structures to reduce admin costs. No large organisation has a single HR dept, or a single IT dept. Have a look at IBM or AIB or Johnson & Johnson and you’ll find a myriad of IT groups and HR groups and consultants and special projects etc etc. Large organisations are complex beasts – public and private.

The PDs were no more free market capitalists than the Labour party is. They had their own interventionist agenda that favoured their lobbyists. Conservatism and socialism are two sides of the same coin called interventionism, with the only difference being those that gain. And yes, people want decent public services, starting with health, education and law enforcement. And until these are decent (or even mediocre) the majority of other services should be scrapped or consolidated.

This is nonsense. You present no rationale for scrapping services. You have no clear business case for consolidating services. You can’t scrap library services, or environmental protection, or health and safety regulation, or financial regulation because health services aren’t perfect,

Because if a private enterprise wastes too much it is under threat of going out of business. Because private enterprises have to constantly improve their products to remain competitive. Because private enterprises will scrap products that cause losses.
Because government services have no incentive to not waste resources. Because government services are rewarded for providing bad service with increased budgets. Because people do not have a choice when it comes to public services and therefore can only compare to public services in other countries, which is not the case in the private economy.
And as for my proof for private services being better than public, ask anybody in this country if they would rather go to a private hospital or a public one. Maybe some small business owners here can say whether they prefer dealing with the SME Association or the IDA or other government quangos. Or how about sending a parcel with UPS or AnPost, which do people have more faith in when it comes to getting things delivered on time and in the first place. Why do you think people are leaving the ESB and moving to Airtricity; hardly because their service is worse.
As for other services provided by government, these are mainly government monopolies where people do not have a choice and therefore are prohibited from providing any kind of feedback on the service.

Again, more over-simplistic nonsense. When I ask my GP for referrals (across a whole range of medical issues), he always recommends public over private where possible. The quality of medical services is far better. The food might not be quite as nice, but is that a good reason for selecting a healthcare provider. And I spoke to one multi-national that has just switched back from private courier to An Post recently on a large distribution contract, for reasons of cost and quality. Perhaps you could explain how quality of service is often pretty crap in restaurants, in hotels, with builders, with solicitors etc etc, often with established businesses that have survived for years and will continue to survive. Your theoretical perfect market just doesn’t exist in the real world. Crap service providers continue to exist for a whole range of reasons in the private sector.

I have lots more to say, but life’s too short, and I have a life too!

 

[Firefly]

The Iron Curtain had nothing to do with income equality. It had everything to do with one small group exploiting the majority. It also suppressed just about every basic human freedom, so it is not really a good model for anything.

Income Equality IMO is a nice idea but goes against human nature. There are those who strive to better their position through education, what they eat and family values and there are those who don't

After the Iron Curtain came down the Russans privatised state assets via Voucher privitisation - everyone got the same number of shares. Some chose to sell, others to accumulate. Those that accumulated took a risk and it paid off, those that sold lost out. Human nature.

 

[Firefly]

How do you conclude that growing economies help everyone? There is no basis for this. The old 'rising tide lifting all boats' story is great for those who have boats. If you don't have a boat, you drown.

I think this is pretty obvious, but perhaps you are thinking about something else....a growing economy brings in more tax receipts for the government to spend on services that benefit everybody - old age pensions, the public schools that you mention, roads, increases in gardai numbers etc

 

[shnaek]

How do you conclude that growing economies help everyone? There is no basis for this. The old 'rising tide lifting all boats' story is great for those who have boats. If you don't have a boat, you drown.

Very easy to prove this by just looking around. The poor in countries in Europe are a hell of a lot richer than the poor in the middle east, India, North Korea, Africa etc.

 

[orka]

It really seem to be nitpicking to criticise them because you didn't spend enough time on their website. There is a lot of good information there, but you'll have to invest the time there.

I have actually read pretty much everything on their website - starting after you yakked on about it in a previous thread a few months ago - if you're saying that's all there is and the book doesn't have anything extra, there doesn't seem much point in reading it as the website 'evidence' just isn't compelling. It's good information to the already converted but it just doesn't stack up for an independent reader looking for a complete and rigorous analysis with no agenda.

Remember, that the most equal society is the one with equal opportunities, not equal income.

Your claim is fiction. ...

Researchers at the London School of Economics have used this method to compare social mobility in eight countries. Using their data, we have shown that, at least among these few countries, the more equal countries have higher social mobility (see graph).

You say csirl’s claim is fiction but then you give absolutely nothing to back this up. First of all, the social mobility section of ET’s website is asserting that societies with more equal income have higher social mobility – nothing to do with equal opportunities being a worse/better indicator of equality than income equality.

Second, this section typifies the approach of the ET website and book. Their work is basically an analysis and use of other people’s work and research – they analysed 150+ papers and corresponding data and gave their interpretation – and subtly (or not...) used the respectability of some of their sources. So here, ‘researchers at LSE used this method’ (LOOK – it’s the LSE – therefore what we say must be as respectable as the LSE) – but the LSE method was in respect of the social mobility definitions and analysis – not the equality part.

The LSE was looking at all causes of social mobility and not just a single focus on outcome vs income equality. ET then took the social mobility data and compared it with their own definition of equality (and used the LSE name to give their result some credibility). In fact the LSE paper which there’s a link to on the ET website says

Also intergenerational mobility has declined in Britain at a time of rising income inequality. The strength of the relationship between educational attainment and family income, especially for access to higher education, is at the heart of Britain’s low mobility culture. If improving intergenerational mobility is viewed as desirable, this clearly suggests that from early ages, including prior to school entry, Britain needs to adopt a strategy to equalize opportunities. This should apply at all stages of the education process, and include support during the early years, for both parents and children; policies to improve the performance of deprived children in schools; and steps to promote participation at the post-compulsory level. Such policies have the potential to enhance intergenerational mobility by ensuring greater equality of educational opportunity

This is a more complete analysis which acknowledges that there are many factors affecting social mobility – income is an apparent one but when you analyse deeper, you see that income affects opportunity and it is actually opportunity which affects social mobility and not income. So I think csirl’s statement is far from fiction and much closer to reality than the ET’s simplistic income equality stance. There is not a single mention of education or opportunity on the ET’s ‘in detail’ description of their social mobility analysis.

 

[Complainer]

After the Iron Curtain came down the Russans privatised state assets via Voucher privitisation - everyone got the same number of shares. Some chose to sell, others to accumulate. Those that accumulated took a risk and it paid off, those that sold lost out. Human nature.

It is human nature to feed your family today, rather than holding out for some hope of 'jam tomorrow'. Those who sold did not have the luxury of holding out for future benefits. They needed food. The result of the Russian privatisation is the concentration of wealth among a tiny number of oligarchs. These are now the same people threatening to sue the Irish Govt if the State doesn't cover the costs of their investments in Irish Nationwide. Nice people.

Income Equality IMO is a nice idea but goes against human nature. There are those who strive to better their position through education, what they eat and family values and there are those who don't

No-one is proposing income equality. The evidence shows that societies with less income inequality do better across a whole range of measures - teenage births, obesity, life expectancy, inprisonment rates, mental health, social mobility etc. The proposal is for less income inequality. That is not the same as a proposal for income equality.

 

[Firefly]

It is human nature to feed your family today, rather than holding out for some hope of 'jam tomorrow'. Those who sold did not have the luxury of holding out for future benefits. They needed food. The result of the Russian privatisation is the concentration of wealth among a tiny number of oligarchs. These are now the same people threatening to sue the Irish Govt if the State doesn't cover the costs of their investments in Irish Nationwide. Nice people.

Those same people who needed to sell their shares for food needed food before they received their shares and also after they sold their shares. In this respect could they have not held on to them?

No-one is proposing income equality. The evidence shows that societies with less income inequality do better across a whole range of measures - teenage births, obesity, life expectancy, inprisonment rates, mental health, social mobility etc. The proposal is for less income inequality. That is not the same as a proposal for income equality.

Thanks for the clarification.

 

[Complainer]

Those same people who needed to sell their shares for food needed food before they received their shares and also after they sold their shares. In this respect could they have not held on to them?

Would you hold onto any shares if your family was going hungry?

 

[Complainer]

I have actually read pretty much everything on their website - starting after you yakked on about it in a previous thread a few months ago - if you're saying that's all there is and the book doesn't have anything extra, there doesn't seem much point in reading it as the website 'evidence' just isn't compelling. It's good information to the already converted but it just doesn't stack up for an independent reader looking for a complete and rigorous analysis with no agenda.


You say csirl’s claim is fiction but then you give absolutely nothing to back this up. First of all, the social mobility section of ET’s website is asserting that societies with more equal income have higher social mobility – nothing to do with equal opportunities being a worse/better indicator of equality than income equality.

Second, this section typifies the approach of the ET website and book. Their work is basically an analysis and use of other people’s work and research – they analysed 150+ papers and corresponding data and gave their interpretation – and subtly (or not...) used the respectability of some of their sources. So here, ‘researchers at LSE used this method’ (LOOK – it’s the LSE – therefore what we say must be as respectable as the LSE) – but the LSE method was in respect of the social mobility definitions and analysis – not the equality part.

The LSE was looking at all causes of social mobility and not just a single focus on outcome vs income equality. ET then took the social mobility data and compared it with their own definition of equality (and used the LSE name to give their result some credibility). In fact the LSE paper which there’s a link to on the ET website says This is a more complete analysis which acknowledges that there are many factors affecting social mobility – income is an apparent one but when you analyse deeper, you see that income affects opportunity and it is actually opportunity which affects social mobility and not income. So I think csirl’s statement is far from fiction and much closer to reality than the ET’s simplistic income equality stance. There is not a single mention of education or opportunity on the ET’s ‘in detail’ description of their social mobility analysis.

You really haven't read the website well at all. You are mixing up income with income equality. You are using your own definition for social mobility. You are nitpicking with claims that you don't understand why a society with less teenage births, less obesity, lower imprisonment rates, more social mobility, less mental illness and lower murder rates would be better for everyone?

Come on, get off the stage and get real.

 

[Firefly]

Would you hold onto any shares if your family was going hungry?

If I knew that I'd be hungry soon after selling then I wouldn't.

 

[Purple]

You are nitpicking with claims that you don't understand why a society with less teenage births, less obesity, lower imprisonment rates, more social mobility, less mental illness and lower murder rates would be better for everyone?

Nobody is saying that lower income disparity is desirable, they are suggesting that the best way to achieve it is through allowing the economy to function freely.

Here’s a question for other posters, I’m on Complainers ignore list so he won’t see it (what’s that you say, you didn’t know there was an ignore list?) but anyway, here’s the question; Of the people you know that grew up poor and then did well as adults how many of them did so on the back of handouts and how many did so on the back of working hard (in school and/or afterwards)?

 

[shnaek]

Of the people you know that grew up poor and then did well as adults how many of them did so on the back of handouts and how many did so on the back of working hard (in school and/or afterwards)?

That's a very good question. My father came from a family of 13 living in a 2 room house going to school without shoes. He and all his siblings have done well, all on the back of working hard. There really was no other choice back then.
Cousins of mine who grew up in working class areas are all doing well now, through hard work also. But their parents are really great people, so that helped too.
Some friends of mine here in Cork haven't had things easy growing up, and though the have been on the dole from time to time they have always been applying for work and all of them are working presently and doing pretty well also.
That's my tuppence worth.

As for the ignore list - The Irish government have their own version of that too!

 

[csirl]

Of the people you know that grew up poor and then did well as adults how many of them did so on the back of handouts and how many did so on the back of working hard (in school and/or afterwards)?

Know quite a few people who fall into the above category. In my experience, the majority used the education system to get themselves out of poverty. Others, mainly those who are less academic, essentially worked their way up from the bottom by being reliable and good at their jobs.

 

[csirl]

I know a family who are an interesting example of what Purple is talking about. 4 siblings, grew up together in an average house with parents in average jobs. For some unexplained reason, these siblings took different paths in life.

2 of them are wealthy and respectable, 2 of them are long term unemployed living in council housing. One of the wealthy ones used the education system to get into a particular profession and has done well as a result. The other wealthy one worked hard in his youth for various businesses, rose to a management level and eventually started his own business in the same industry and was successful.

One of the two poor ones essentially fell in with the wrong crowd as a teenager, didnt finish school etc. Did get offered an apprenticeship through a family connection, but wouldnt take up the offer. The other got a good leaving cert and got a scholarship to go to college, but couldnt be bothered going - prefered to laze about at home.

Family gatherings of this family are very interesting. The children of the two who did well are all privately educated, well groomed etc. The children of the other two are tracksuit wearing dole scroungers - the wealthy family members say that some of them have a tendancy to rob stuff when they visit. Meeting both groups, you would never guess that it only took 1 generation to put such a gulf in status between the two groups.

 

[PaddyW]

I grew up in a three bed house. 2 parents and 7 children (I always find it funny when people need 4 bed houses for 2 parents and 2 kids). Anyways, we were never well off, but today most of us work full time. I've never been on the dole, working since I left school. Same for my brother and sister here in Dublin. Both own their own houses now and I ended up buying the family home. All done through hard work.

 

[serotoninsid]

Thread has ran away with itself has it not?

 

[shnaek]

Thread has ran away with itself has it not?

True! Can't even remember what it started out as

 

[Chris]

The Iron Curtain had nothing to do with income equality. It had everything to do with one small group exploiting the majority. It also suppressed just about every basic human freedom, so it is not really a good model for anything.

The iron curtain was east against west, socialism against capitalism. The east decided to base their economic system on Marxism/socialism for the good of the worker, where no private capitalist pig could exploit the poor worker. The problem with socialism is that it can only work under the explicit threat of force. This is why every socialist country past and present are totalitarian states with far less freedom than capitalist countries. And that is the reason why their poor are far far poorer than the poor in western countries. Please explain how it is that in these socialist states there was far less income inequality, but the lives of the people were and are miserable?

Your claim is fiction. See

Researchers at the London School of Economics have used this method to compare social mobility in eight countries. Using their data, we have shown that, at least among these few countries, the more equal countries have higher social mobility (see graph). It looks as if the American Dream is far more likely to remain a dream for Americans than it is for people living in Scandinavian countries. Greater inequalities of outcome seem to make it easier for rich parents to pass on their advantages. While income differences have widened in Britain and the USA, social mobility has slowed​

I have to agree that the "American Dream" no longer exists in the USA, but that is because of the inequality of opportunity and income redistribution. America is not the post card ideal of free market capitalism, no matter how much they claim they are.
Those scandinavian countries you refer to score far higher in economic and market freedom and therefore are success stories despite their welfare systems. And the American Dream, as in the idea of being able to go from having nothing to becoming wealthy, is not some sort of idealist utopia. Most people just do not grasp that it takes endless hard work, risk and personal sacrifice to achieve. But as long as nobody stand in your way, you are only limited by your abilities.

How do you conclude that growing economies help everyone? There is no basis for this. The old 'rising tide lifting all boats' story is great for those who have boats. If you don't have a boat, you drown.

Because a growing economy has growing investment, which creates more job opportunities. More productivity means higher wages, that is why factory workers get paid more now than they did 150 years ago, relatively speaking.
Economically speaking everybody has a boat, unless you are significantly mentally or physically impaired. What you do with that boat is up to you. Everybody that wants to work would have work if it wasn't for government intervention. If you think that you are not getting paid enough for what you are doing then it is up to you to improve your productivity.

You seem to be very quick to attribute a whole range of social developments to capitalism. Is it possible that your view is just a tad one-sided and has no basis in fact? Could possibly some of these benefits be attributable to the benefits of socialism, such as the health improvements in the UK arising from the NHS, and the economic developments in Ireland arising from the public education system? Could possibly some of these benefits be attributable to gains in terms and conditions hard won by trade unions for their members? Could possibly some of these improvements be attributable to improvements in science and technology, just some of which might have come from public universities? You don't have to rewrite history to show where benefits have come from.

No I am not quick to attribute the most significant social and economic advances to capitalism. The ideas of Socialism/Marxism were not set into action until the late 19th, early 20th century. The level of wealth and social benefit resulting from capitalism until that time was far greater than the level achieved during socialist periods.
The NHS is hardly an example of a good health system. It certainly is better than what we have here, but the best health systems in the world are in countries where it is not under total and almost full monopoly of government.
If anything unions have hampered the increase in total wages and jobs in the long run, as their forceful actions resulted in less profit and therefore less reinvestment in business expansion. If a worker can only get a certain amount of wages it is because there is a queue of people willing to work for that amount. And forcing up wages results in less employment, that's very basic economics of supply and demand.
Indeed some public universities have come up with good inventions, but the some of the greatest inventions and discoveries have come out of the private sector. And when it comes to science, there is at least a relatively open and competitive market.
The greatest benefits that society enjoy today have all come from private enterprises not some omnipotent government entity. The increases in the standard of living have happened despite government intervention and socialism, not because of it. I already suggested you read "Socialism" by von Mises to give you a better understanding of what you are actually favouring.

And I guess management companies that run private developments never give rise to complaints - No? I guess that forum here on AAM covering these complaints are just people making things up?

Of course private enterprises are subject to complaints, because you can never please everyone. But in the private sector people have choice where they spend their money. In the public service monopoly you do not have a choice how your money is spent. It is appropriated from you and then dictated how it is best spent. It is a one size fits all system, where the majority of people do not fit the size.
And unless a private company pleases enough people it will not stay in business, the very opposite is the case when it comes to public services.

So is it only in the public sector that 'sales pitching' doesn't work? It's strange how it is fairly well established in the private sector that 'sales pitching' works, and it is worthwhile investing in good salespeople and sales processes. But you are absolutely certain that there is no value in Ireland having similar resources pitching Ireland and providing considerable resources to startups (including buildings), especially as the competing economies will certain have their IDAs hammering down the doors of the FDI candidates?

I am absolutely certain that the private economy would be better served if the IDA's budget were returned to the private economy through lower taxes, and for the private sector to expand organisations like the SME Association or create new ones. The IDA is made up of civil servants and politicians that know little if anything about running businesses.
Maybe over the next few years an economist will get a chance to look at how many jobs the IDA created and at what cost to the taxpayer. Given the government inability and waste that has so far come to light I am more than certain that the costs were higher than the benefits.
You do not need an IDA to tell the international community that Ireland has a low cost base (and maintain it at a level that is competitive), which is the main reason for attracting foreign investment.

The constitutional provisions on equality are very narrow, i.e. ‘held equal before the law’. It doesn’t say anything about equality in the pub, or in the workplace, or at the bank. And of course, it doesn’t say anything about social equality. People die waiting for healthcare in Ireland, unless of course they have VHI or equivalent.

But regardless, your claim is ‘not needing a separate department’ is simplistic. First of all, equality doesn’t have a separate department. It has 1/3rd of a department, mixed in with Community & Gaeltacht Affairs. We actually agree on something (surprise surprise). I do agree that creating an Equality Department does not actually do anything to improve equality. Either the Government has a focus on equality or it doesn’t. The last time equality had any serious focus from Government was when Mervyn Taylor was Minister for Equality and Law Reform in the 90s.

The justice department is more capable of applying and enforcing laws, whether they are enshrined in the constitution or otherwise. And it should be an indication of a very poor constitution when human equality is not included.
You can also be certain that each one of the 1/3 department comes with its very own senior civil servants and "managers".

But the real over-simplification is about the reducing numbers by 50% and saving 25% of the public wage bill. Please pick any department and have a look at their org chart – tell me where the 50% reduction will come from? You won’t save 50% of any department by moving it around. There may be some economies of scale, but it is certainly nothing near the 50% saving that you expect. There is no benefit to be achieved by moving libraries from environment/local authorities into education. All you will achieve is considerable disruption and uncertainty, as Charlie McCreevy achieved with is €4 billion spend on decentralisation. Many public bodies organisations are already using shared services structures to reduce admin costs. No large organisation has a single HR dept, or a single IT dept. Have a look at IBM or AIB or Johnson & Johnson and you’ll find a myriad of IT groups and HR groups and consultants and special projects etc etc. Large organisations are complex beasts – public and private.

This is not an over simplification. A college lecturer of mine spent the first part of his career advising companies on how to best merge and consolidate existing departments and new acquisitions. There was always easily 25% saving made at admin and managerial level.
McCreevy's "decentralisation" was geographical and did not involve consolidation of resources. And comparing the way a public service staffs its departments by arbitrarily saying that private organisations also have "duplicate" services makes no sense whatsoever and is not a valid argument. A private enterprise can measure the profitability, cost/benefit and thereby the necessity of each single department. This simply does not happen in the public sector. Even if there is a similar service available in the private sector that is more efficient and effective, the public one will just have more money thrown at it. It does not have to abide by any rules of conserving resources, as doing the opposite has no negative effect.

This is nonsense. You present no rationale for scrapping services. You have no clear business case for consolidating services. You can’t scrap library services, or environmental protection, or health and safety regulation, or financial regulation because health services aren’t perfect,

Could you please elaborate on how it is beneficial to society to have loads of unessential services while the most important ones are totally in tatters? How is consolidation in resources not beneficial to the taxpayer? And how can you argue that I do not have a business case for consolidation? Every private company tries to employ as few resources as possible to achieve its optimum performance. At an ever increasing rate we are getting information about the wastage and duplication in government services. Look at FAS and the HSE alone. It is nothing short of scandalous how over-resourced and wasteful these organisations are. And there is no evidence that other service are in anyway less wasteful.
You are also cherry picking a couple of government services that I never mentioned should be scrapped. And just because the government doesn't provide library services does not mean that there would be no libraries. The government does not provide food, but there is more than enough available for every budget.

Again, more over-simplistic nonsense. When I ask my GP for referrals (across a whole range of medical issues), he always recommends public over private where possible. The quality of medical services is far better. The food might not be quite as nice, but is that a good reason for selecting a healthcare provider. And I spoke to one multi-national that has just switched back from private courier to An Post recently on a large distribution contract, for reasons of cost and quality. Perhaps you could explain how quality of service is often pretty crap in restaurants, in hotels, with builders, with solicitors etc etc, often with established businesses that have survived for years and will continue to survive. Your theoretical perfect market just doesn’t exist in the real world. Crap service providers continue to exist for a whole range of reasons in the private sector.

OK, and when you ring to make an appointment with the public service and are told that it will be in 12 months time do you still prefer not to go private?
And what if that multi-national had to pay the actual full price over deliveries excluding government subsidies that the taxpayer is forking out for? As for quality and dependency of service An Post comes nowhere close to what private couriers offer. Only two weeks ago I gad to send a small parcel to Germany. It cost me €5 more with UPS than An Post who not even able to insure the package for the full amount of the value.
Your idea nd my idea of crap service may be completely different. The only way a private company can survive (even if you personally think it is crap) is if more people think it is not crap. Otherwise it has no customers and therefore cannot continue to operate.

You really haven't read the website well at all. You are mixing up income with income equality. You are using your own definition for social mobility. You are nitpicking with claims that you don't understand why a society with less teenage births, less obesity, lower imprisonment rates, more social mobility, less mental illness and lower murder rates would be better for everyone?

Come on, get off the stage and get real.

I have looked at the info on the website and have to agree that it is an altar to those that are convinced. Maybe you can enlighten us as to those "compelling" arguments that we are missing, that you find so obvious, rather than just pointing to the website.