I'm Fxcking angry and pissed off!

As a public sector worker in the South I am totally pissed off with the manner in which my union has behaved in relation to the pre budget negotiations.

My union held a national ballot, organised meetings and sent out literature about the position of the union leadership in relation to the planned government cuts to public sector pay. In all of the above the argument was put forward that such cuts were not fair and must be rejected in favour of a fairer tax system whereby the wealthier members of the country would pay more, because they could afford it!

I stood with many others holding official union placards that said no to pay cuts and yes to fairer taxation. It was on this basis that people voted to strike and walked out in their hundreds of thousands. To us the argument was sound and we were taking a principled stand.

BUT THEN

Yet what happened? Our leaders then go into negotiations and put forward a proposal whereby public sector workers would have to take 12 days compulsory leave without pay! This is a pay cut and anybody with a brain can see that.

By taking this step the union leaders had moved away from the agreed principled position already mentioned and accepted that the public sector pay bill needed to be reduced. At one stroke they had undermined their/our position. This was madness!!!

As soon as I heard this was happening I said this will not be agreed and the government will hum ha and then walk away. Which is exactly what they did. SURPRISE!!

The reason they can safely walk away is that they can now simply turn around and say ,"Look you accepted the need for the pay bill to be reduced, but unfortunately your way will not work. So all that is left is pay cuts. Sorry."

And in response what can the union bosses say, "Umm umm No that's not right. We have tried to be reasonable. We don't really believe cutting pay is important anymore."

To which the media will go, "Ha ha ha. Now we have you. Now we have ya."

WHAT DOES THIS MEAN

When I try to understand what has happened to my union since the crisis began, I am left confused.

Firstly we had the behaviour around the pay cuts via the increased pension payments.

When this step was announced by the government the unions took weeks to organise a response. They got over 100,000 people on the streets opposing these cuts eventually got around to organising a ballot for strike action. But what happened? Nothing. One union did not have a big enough majority for strike action and that was it.

In my opinion this was NOT the result of poor leadership on the part of the unions. Rather the union leadership actually accepted the logic of the cuts and that wait. game over.

Secondly we have the farce around the cuts coming up in the budget. For me there is only one explanation for what happened and that is the leadership never believed what they were originally telling their members. they never actually believed in fairer taxation and making the rich pay and one of the reasons for that is possibly the high pay of many of those union leaders. For some info check here http://www.businessandleadership.com/news/article/16895/leadership/paper-publishes-salary-levels-of-trade-union-leaders

SO NOW WHAT?

So now what. Well the only thing for people to do is get active in their union. Every branch member should demand to know why the leadership are behaving as they are. If they believe in the cuts agenda, well be honest about it and convince us. If they don't support the cuts agenda then why are they just rolling over every time the government makes another attack on working people. And if we don't like their answers then we should kick them out of office and put in people who will fight for working people.

Tax Breaks and the Budget

Tax breaks and the budget.


Break a leg is the customary term of encouragement given to actors. As Brian Linehan senior counsel gets ready to deliver his third budget in 15 months we'll all be hoping this master actor gets it right this time

What he comes out with is hard anyone's guess but its likely to be a lot of old hat with maybe, just maybe, one or two good ideas in the middle. If he is looking for advice he should take a look at the Sinn Fein pre-budget proposal http://www.sinnfein.ie/files/Pre-Budget2010_small.pdf
One of the areas that documents recommends focus on is tax breaks as part of the party's argument for a functioning tax system.




Some of the proposals were:


- Abolish mortgage interest relief for landlords – Raises €285 million


- Abolish all remaining property-based tax reliefs (on property development, not principal home mortgage interest relief) - Raises €43 million


The pre-budget submission argued that standardising all discretionary tax reliefs could raise €1.1 billion.





TASC, the economic think tank arguing for a more nuanced approach to the Irish economy have now added some futher details to this discussion with a new report on tax breaks /or tax expenditures as they are officially called. http://www.tascnet.ie/upload/file/TASC%20Pre%20Budget%20Statement%20on%20Tax%20Breaks%20FINAL.pdf





TASC says that tax breaks will cost the southern state about €7.4 billion in 2009. The level of tax breaks in Ireland is exceptionally high. They amounted to € 10.7 billion in 2005 (which are the latest complete figures for the cost of tax breaks in a single year). The OECD Economic Surveys: Ireland reports that tax expenditure on personal income tax in 2005 amounted to €7.2 billion, plus an additional €3.5 billion in tax breaks on corporation tax. This totals €10.7 billion in tax breaks on personal income tax and corporation tax alone (OECD 2009a, pp. 60-62; OECD 2009b).



Big money indeed. But tax breaks are not necessarily bad its just when you use them unwisely they can cause the wrong type of outcome. Like increased inequality of wealth distribution or else stoking the fires of a property boom.But of course they also help people with breaks existing for disabled people or as aids to help businesses and keep people in jobs etc. The southern state is out of kilter with the rest of Europe. If tax breaks on personal income tax and corporation tax were reduced to EU average levels, they would only cost €2.2 billion in 2009, a drop of €5.2 billion. On Progressive-Economy http://www.progressive-economy.ie/2009/12/tax-breaks.html Nat o'Connor notes tax expenditure on personal income tax in Ireland cost three times as much as the average of 22 other EU countries.



TASC has argued that The Government is effectively spending money every time it decides to create or extend a tax break. All these tax breaks should be included in every annual Budget and the govt. would have to justify on an annual basis whether to keep or to scrap or add new tax breaks. Every single break would have a "sunset clause" and their evaluation as a success or not should not include any investments or jobs created that would happen anyhow as noted by the Irish times.




There are a couple of stumbling blocks for Brian taking these ideas up. Specifically the need to justify tax breaks each year, and they need to analyse their specific benefits over and above any investment or jobs that would be created anyhow. These points would require accountability, honesty and the implementation of basic controls. Basic controls that you would have in any business not to mind a state.



But the pre-budget proposal is right not to call for a huge clamp down on tax breaks. Too drastic an action would impact on low and middle earners who cant afford it and would probably harm small businesses trying to keep running and keep people in jobs.


But there seems to be plenty of room to tighten up the system and to help improve govt. revenue.


When it comes to reforming the tax breaks system and demanding accountability on why they exist and a demonstration that they are part of an appropriate economic strategy for the state then There Is No Alternative (TINA).



The Tasc report is http://www.tascnet.ie/upload/file/TASC%20Pre%20Budget%20Statement%20on%20Tax%20Breaks%20FINAL.pdf here and the Progressive-economy.ie site is discussing it at http://www.progressive-economy.ie/2009/12/tax-breaks.html

Time for mutiny on this ship of fools

Over on the Sluggerotoole site they have highlighted a review on the Guardian newspaper of Fintan o'Toole's new book Ship of Fools: How Stupidity and Corruption Sank the Celtic Tiger.

It looks like its going to be an interesting read and above all its fantastic to see this type of contribution to the general debate. After the fall of the Soviet Union Finland nearly fell as bad as we now have fallen. But they rebounded rebuilding a fairer society and becoming an inspiration to other countries. So while things may seem incredibly bleak now this is an opportunity to start building something new.

Of course the Finns didnt have to deal with a Fianna Fail party but the debate has to start somewhere and if we are going to build a Republic on this island then getting rid of the corrupt Fianna Fail kleptocracy is a necessary step.

The book review highlights clearly our predicament:

Irish GDP is now shrinking faster than in any other advanced economy, and the country's gross indebtedness is larger than Japan's. House prices have fallen more rapidly than any others in Europe, and the average Irish family has lost half its financial assets. Unemployment has risen faster than anywhere else in Europe.

It lays out clearly how Kleptocracy relaced democracy in the south:

All this has been accompanied by a culture of corruption so shameless and spectacular that it makes Dublin look like Kabul. The former prime minister Charles Haughey stole €250,000 from a fund set up to pay for a liver transplant for one of his closest friends. Last year, the chairman of Anglo Irish Bank resigned when it emerged that he had €84m in loans from his own bank, a sum concealed by an annual (apparently legal) cooking of the books. As O'Toole points out, bribery, tax evasion and false evidence under oath have not simply gone unpunished; the very idea of penalising the culprits is viewed by the governing elite as unsporting or even unpatriotic.

And thats to leave out the most cunning of them all. The review continues apace laying bare whats rotten in the southern state:

The state is widely seen as "a private network of mutual obligations" rather than an impersonal body. Palms are greased, backs scratched and old pals promoted, often without much sense that this is anything other than the natural thing to do.

And boy did the last 10 years take that to a new height. The worst type of gobdaw was appointed not because they were barely qualified but because they were the orignal greasy hands in the till.

And then it gets to a point of discussion that is all too common in Ireland today:

The discrepancy between formal and informal codes in the country, between official behaviour and nods and winks, bulks large. Stretching a point or turning a blind eye is rife, in ways that would scandalise many a German or American

How do we make our country more like Germany and less like a maffia ridden fiefdom? Now those countries are not perfect but for all the American pork barelling at least they have some corrupt people do the perp walk.

Why are basic minimum standards of governance ignored in this state.

Why are key positions farmed out to buffons whose only qualifications was buying rounds with one pint of Bass included.

The review ends by saying for the south

Perhaps its best hope now is to revert as soon as possible to third world status and qualify for a loan from the IMF.

Is that what we are reduced to?

Once upon a time people in the south believed that the Greens would be the party that would drag the south into the modern world. We have two failed states on this island and need to build one - a modern state, where merit is the key to advancement and nomal democratic standards are upheld.

The rich pay too much tax me arse!! Just look at the facts

Below is a piece from Eoin Ó Broin that appeared in this weeks An Phoblacht. It provides useful information on how we can answer the government claim that the rich cannot afford to be taxed anymore and are already paying more than there fair share.

I strongly believe the information here and the information contained on the TASC website, mentioned below, is the ammunition we need to counter the propaganda of the ruling elite in this country. In order to convince people we are capable of running this country we need to convince them we know our stuff, especially in relation to economic matters. Therefore it is vital for republicans to continue to educate ourselves on economic matters and the TASC site and Michael Taft's notes from the front http://notesonthefront.typepad.com/ are good places to start.

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FINANCE MINISTER Brian Lenihan keeps telling us that high-earners pay enough tax.
In their November pre-Budget outlook, the Government told us that 4% of earners could pay up to 48% of the total income tax take in 2009.

What more proof do we need that the country’s super rich are paying their fair share? Well, as it happens, a lot more.

Why? Because the Government’s figures don’t tell us how much the top 4% earn and whether paying 48% of all income tax take is fair or not.

Fortunately for us, those smart people at TASC have produced a report that tells a lot more about income distribution than the Government would like you to know.

TASC is an independent think-tank dedicated to combating economic inequality and promoting equality. The website http://www.tascnet.ie/ is filled with invaluable information.

Their latest report is The HEAP Chart. It provides a detailed analysis of income inequality in the state.

The top 1% of the population own 20% of the state’s wealth. When residential property is not included, this same 1% own 34% of the state’s wealth.

83% of the PAYE workers earn less than €50,000 per year, while 66% earn less than €33,000 per year.

Only 14% of PAYE workers earn more than €50,000 per year, with a tiny 2% earning more than €100,000 per year.

When you consider that 5% of the population own 50% of the state’s wealth, then the Government’s projected income tax returns for 2009 don’t seem so unfair.

What TASC’s HEAP report tells us is even more interesting. While, during the boom, the income of all groups increased, the gap between high and low incomes widened considerably.

In a comparison of income distribution from 1987 to 2005, TASC demonstrate a clear growth in inequality.

In 2006, women’s income was only 86% of men’s. The proportion of women at risk of poverty in 2007 was 19% compared to 15% of men.

The average annual salary for those with no primary or formal education was €13,489 compared to €45,707 per year for college graduates.

More shocking is the fact that 34% of those with no primary or formal education were at risk of poverty compared to only 3% of college graduates.

IN every EU or OECD comparison contained in the TASC report, the 26 Counties was near the bottom of the pile.

We have higher levels of inequality and poverty and lower levels of spending on social protection than almost all of our rich EU or OECD neighbours.

For TASC, the solution to this mess requires greater equality in people’s pre-tax and post-tax income. Guaranteeing minimum incomes, limiting ‘super salaries’, a fairer tax system and investment in education are all required.

So the next time you hear a Government TD tell you that 4% of workers pay 48% of income tax, don’t just sit there, reach for the HEAP Chart and tell them it’s because our society is so unequal.

Sinn Féin TDs stand in solidarity with striking public sector workers

Great work from the Sinn Féin TD's

Leader of a developing-world country visits natural disaster zone

What leader of the developing world could this be...?

Well look no futher than Mr. Brian Cowen.

Nobody will doubt the accuracy of "natural disaster" but developing world is that a bit harsh for south Ireland?

Frankly no its not. If the shoe fits we should call it as it is. There is a reason why traffic in Dublin creeps along, why rail bridges collapse and why Galwegians either cant drink the water in their houses or they cant get into their houses cause of water.

The enjoyable notesonthefront blog highlighted a report by world economic forum in October 2008 on our infrastructure. Its not comfortable reading. It turns out that infrastructure wise we are all too often a disaster.

In the category of 'Quality of Overall Infrastructure' we rank 64th in the world. 64th! 64th out of 134 countries. Our infrastructural quality ranks behind Sri Lanka, Mauritius, Azerbaijan, Jordan and Jamaica.

Sri Lanka and Mauritius are developing countries and we rank behind them. That description of south Ireland as a developing world country seems to be holding water.

Quality of Roads: We rank 70th - behind even Georgia. With a mean score of 3.5, we are closer to bottom ranking Mongolia (1.4) then we are to top ranking France (6.7).

Georgia - 70 years of Moscow mismanagement is better than 70 years of FF/FG mismanagement it seems

Quality of Port Infrastructure: But then we fall back down - all the way to 64th (we own 64). This is particularly dismal given that over 90 percent of our exports go through our ports; and we're an exporting nation. We even rank behind Zimbabwe and they're landlocked! (They rank higher because they still have better access to South African ports and any inland waterways.)

Worse than a land locked country. Brilliant stuff Fianna Fail. Why would a country like Ireland need quality ports. Thank god we are are surrounded by water but tis a pity at the moment we are under it. So according to the WEF many important aspects of our infrastructure are worse than countries we give aid to.

But the World Economic Forum are not the only body turning an eye on south Ireland. Our friends in the OECD issued a set of conclusions and recommendations at the start of November on our environmental performance.

There are many interesting points in it to discuss but I want to focus on the part that deals with water and flooding. That being topical and all.

Remember this was issued only in November. It was so rosy back then when we were assured that

Ireland has met all deadlines to date for implementing the Water Framework Directive. A new approach to minimising flood risk is being put in place.

Excellent news that. Cork will be thrilled to hear that.With brilliant timeing it continues:

nevertheless, the rate of progress so far is unlikely to prove sufficient...
The city of Galway experienced outbreaks of cryptosporidium in 2002 and 2007, and old lead pipes cause unacceptably high lead levels in more than a few towns.

Unlikely to prove sufficient. Could that be the understatement of the year? I wonder what affect having to drink faeces fouled water has on the minds of multi-nationals in Galway? Were jobs lost because of that?

But then at the end of the report's section on water, and you'd have to laugh really, they have the following recommendation to the Fianna Fail Govt:

further integrate water quality and flood risk management considerations into spatial planning and development management processes.

Can anyone imagine Fianna Fail tying together water quality, flood risk management and spatial planning. Well maybe some naive newbie in the OECD but surely in Ireland we are all learning the hard way that FF is simply too corrupt and incompetent to even tie their shoelaces.

Martin Ferris TD, the Sinn Féin spokesperson on the Environment, put it well when he said

"The cosy relationship between Fianna Fáil and developers throughout the 80's and 90's saw housing estates spring up in the most unsuitable places such as the flood plains where so many houses have now been ruined by water. Concern for the safety of the homes being built and those living in them meant nothing as developers lusted after massive profits in an over-inflated housing market and in this they were facilitated by their friends in Fianna Fáil.

Martin hits the nail on the head by highlighting this. We have not experienced a natural disaster so much as a man made disaster. Fianna Fail let housing developments go anywhere as long as de boys paid up in the Galway tent. Can we be surprised that aspects of our infrastructure are worse than Georgia or Sri Lanka - neither countries have had an easy time. So what excuse can Fianna Fail have. Corruption, no planning or long term vision, blended with incompetency had a huge role to play in what happened.

Just ask the people in houses built on what Bandon locals used call the swamp. Welcome to a developing country.

There are a lot of ties in with this story - reformed govt:local and national, appropriate tax burden and subsequent investment, NAMA, and criminal legislaton for corruption. This flood tells us so much about modern Ireland.

Peter & Paul - Till Debt do they part

The great Irish playwright George Bernard Shaw said "a government that robs Peter to pay Paul can always depend on the support of Paul". So how is Peter doing?

Well Peter who we might regard as the ordinary citizen presently getting knocked over because he wasn't smart enough to win money on the horses like Bertie (he was quare lucky that Bertie) is not doing so great.

In the southern state Peter is relying more and more on the state to make ends meet. The CSO's survey on Income and Living conditions 2008 revealed that social welfare and benefits accounted for more than 22% of household income

But for the 10% of households in the lowest income bracket these state payments accounted for 88% of the gross household income. Now every week for months this govt. has been jumping from one position to another when it comes to such payments. They have to be cut drastically or cut a small bit. Smash these dole bludgers or its just necessary cuts etc.

All they have succeeded in doing is terrifying ordinary people who rely on state transfers to make ends meet. Now scaring the bejaysus out of people is hardly doing anything to boost consumer confidence and today's Irish Times report, anecdotal though it be, is further evidence that this govt. is only ensuring economic activity weakens further and further. Japan, move over! south Ireland is thinking about joining you in a lost decade.

But besides the deflationary impact this will have there is a more immediate impact. As mentioned households rely on the govt. for 22% of household income. Add in the fact that southern Irish household debt as a percentage of disposable income increased from 48 per cent in 1995 to approximately 176 per cent in 2009 giving us the dubious honour of being fourth among developed countries in terms of debt ratio.

In other words we are over our heads in debt and the clowns at the top who have NAMA for their developer buddies think Peter our indebted citizen can go hang. Welfare is going to be reduced by god and if that tips him and thousands others over the edge into bankruptcy then its a price worth paying. Who cares that 20% of households were in arrears on payments such as bank accounts, mortgages, rent, credit cards and utility bills. Almost eight per cent of households had arrears of two or more types. Who cares? Well certainly not Fianna Fail.

So what happens when you go bankrupt in south Ireland. Well, as described in an excellent article in the Irish Times, you dont actually go bankrupt. You see when our flag went up over Dublin we didnt seem to ever get around to changing the Victorian mindset. In 2007 a grand total of 4 people went bankrupt in south Ireland. 4! Considering the collapse of the global finances in 2008 this rocketed to 8 in 2008. Doesn't sound right does it?

But remember I mentioned Victorian mindset. Well in the South you have the Dickensian outcome that you get 12 years to discharge your debt; as opposed to 12 months in Britain and 5 years in many other european countries. As the Times noted 12 years is longer than manslaughter. And now that we are speaking about Prison maybe we should think about a system that jailed 276 people in relation to the non-payment of civil debt last year. While the High Court abolished the imprisonment of debtors due to an inability to pay their debt earlier this year its still on the books. Still jailing someone at the cost of 2k a week must make sense on some level although not if they owe money on the level of Seanie Fitz.

And typical of south Ireland when the state fails the people must fend for themselves. The money and Advice budgeting services, a voluntary group, saw its number of clients jump from 14,551 in 2006 to 23,000 this year.

As our economic recovery document says:

There are currently 422,500 people on the live register. This number is growing and there is no government strategy to deal with it. The government claims that saving the banks will fix the economy. Proving them wrong will be cold comfort to the many people who have lost their jobs, who face this Christmas in debt, in poverty and with the prospect of the very small payments made to them by the state being cut.

We are facing into the worst financial crisis since the last one caused by Fianna Fail and we have to rely on a voluntary group to support ordinary people from the deprivations of a Victorian era bankruptcy model thats going to be pushed to the limit by the deflationary policies of a govt. thats intent on reducing the income of one of the most indebted people in the industrial world.

A Bankrupt state morally if not yet financially. I am no radical but the only thing that springs to mind in response to this situation is does anyone have a sledgehammer. This state needs to go.