Wednesday, April 8, 2009

Chalkboard in 'agreement with Government' shock


Try as I might to dismiss the Minister for Finance, his brain and his Emergency Budget, I don't think I can.

I think he's gotten it as right as he probably could.

Let's get the inner lefty out of the way first - the poorest in our society are going to remain that way. That's no shock. No Fianna Fail government went near the poverty issue when it had money, never mind what it might do now that its wallet is on fire.

The halving of dole for under 20s is a good idea, but I'd have liked to have seen it incentivised a bit more with increases in learning/skills programmes for first time signers.

I've worked in Social Welfare and know that all they really do when an 18-year-old comes in to sign is ask them if they know where FAS is. He says yes, we give him a cheque. The system was flawed.

The phasing out of the early childcare supplement is regrettable, as it was one of the more forward-thinking welfare policies of the Tiger years. But just like public sector benchmarking, it was an idea derived from wealthier times. That cut was inevitable.

As for the bigger economy/jobs/banking clusterf*** we find ourselves in, I feel the budget was a marginal positive.

The Board's friend in blogging and bitter, bitter morning coffee Bock feels the banks have been let off. They have. Yes, senior bankers are detestable. Yes, they plundered and defrauded our nation's credit.

But we cannot go on waving our fists at clouds.

The Government have to create the best environment to attract investment into our country. The securing of all the bank's toxic debt into a State-backed 'bad bank' isn't desirable (We'd all rather we weren't in a recession, people), but it is what needs to be done.

The risk for this has been passed to the taxpayer, but I have to say I agree with the Minister's thinking. We could default on these loans and burn those scurrilous investors. But that would result in Irish bonds becoming as attractive overseas as mustard gas deodorant and Ebola-brand muffins.

Lest we forget, we do not make anything in this country. Our natural resources were sold to travelling merchants many a year ago. We are reliant on foreign capital.

Until someone changes the rules of free market capitalism, money will go where it feels safe and warm and happy. Now, at this critical juncture, we can't stick two fingers up at foreign investors. They might go away and decide not to come back.

Taxes are up, but we expected that. At least they left beer and petrol alone.

Junior ministries have been cut and the review of ridiculous payments within the Oireachtas is underway. This should all have been done two years ago, but we must be a tad happy for small, late mercies.

The context for looking at all this isn't if we like it or not. That luxury left a long time ago. What is needed is to look and see if the Government have succeeded in creating anything near the right framework needed for stabilisation and recovery.

The latter will depend on the Dow Jones and the resuscitation of American capital. The former is something we can influence ourselves.

This budget is just one tiny, tiny, tiny step, but it is nonetheless a step in the right direction.

1 comment:

Bock the Robber said...

Minor correction if I may. Our natural assets were given to snake-oil salesemen, like Shell E&P. Free. For nothing.

Current estimate of Corrib field value:€13 billion.

Current estimate of royalties to be paid to irish government: NIL.