Sinn Fein : wealth risk

[Purple]

Is that all? We are talking about 2/3 banks here?
Imagine if 20% of GDP was used to provide public services instead, healthcare, third level education, housing the homeless.

That 20% was a once off payment and it was used to bail out bond holders and depositors. The people who owned the banks lost everything. I am very surprised that you didn’t know these things.

I do agree that state employees run the country and many do a very good job but they also have to take some responsibility for the people on trolleys and homelessness. That said at an individual level most work hard and earn their pay.

 

[WolfeTone]

That 20% was a once off payment and it was used to bail out bond holders and depositors. The people who owned the banks lost everything. I am very surprised that you didn’t know these things.

I do know these things. I also that depositors have their deposits insured by the State to the tune of €100,000. The vast majority of whom had nowhere near €100,000 on deposit.
Had the much vaunted 'free-market' rules of capitalism of risk-reward been adhered to, then the cost to Irish state would have been a fraction of what was eventually paid.
Instead, when it came to it, the capitalist free-market risk-takers when cap-in-hand in one hand, and 'financial time-bomb' in the other hand, to bail themselves out of their disastrous and corrupted financial speculations.

I do agree that state employees run the country and many do a very good job but they also have to take some responsibility for the people on trolleys and homelessness.

They do take responsibility, all of the time. That there is a trolley crisis and homelessness crisis is a result of political decisions, such as, the aforementioned political decision to use State funds to bail out so called 'free-market risk takers' (this terminology really is a joke) thus perpetuating the trolley crisis and homelessness crisis.

 

[Purple]

I do know these things. I also that depositors have their deposits insured by the State to the tune of €100,000. The vast majority of whom had nowhere near €100,000 on deposit.
Had the much vaunted 'free-market' rules of capitalism of risk-reward been adhered to, then the cost to Irish state would have been a fraction of what was eventually paid.

are you saying that all those pension funds (the bond holders) should have been left to collapse?

They do take responsibility, all of the time. That there is a trolley crisis and homelessness crisis is a result of political decisions, such as, the aforementioned political decision to use State funds to bail out so called 'free-market risk takers' (this terminology really is a joke) thus perpetuating the trolley crisis and homelessness crisis.

are you saying that we should have borrowed €40 billion more than we did already to fund the health sector? Do remember that the majority (80%) of our debt came from the cost of funding current expenditure so in reality we probably did borrow €40 billion for health already. Therefore are you suggesting that we should have borrowed more?

You have made the point that the growth in the private sector since the crash was kick started with that injection of borrow money and I agree with you. How do you think the economy would be doing if we hadn’t bailed out the banks? Do remember that the net cost of that bail out is down to €20 billion and is now just under 10% of our National debt.

as for the free market being an artificial construct, I agree with you on that too. I’ve made that point many times here.

 

[WolfeTone]

are you saying that all those pension funds (the bond holders) should have been left to collapse?

No, im saying that the notion propagate earlier of 'free markets bouncing back' is an indoctrinated ideology.
For sure there are plenty of examples of where it does occur. But when vast sums of wealth (such as pension funds) are left in the control and management of few, then it will induce corrupt practices leading ti financial chaos.
Invariably, those that cheer-lead the free market most will be those demanding state interventions and bail outs when their chips are cooked.
In other words, the State has a responsibility, on behalf of the people, to ensure not only that the poor are given a hand up, but that the rich cannot accumulate extreme levels of concentrated wealth that invariably lead to corrupt practices.

 

[Purple]

Are you suggesting that the State should control private pension funds?

I’m all for effective regulation, underpinned by competent legislation, but I don’t understand the point you are making about who should manage the pension funds.
I’d like to see those who are in charge of recklessly run funds, and those who failed in their regulatory duty, to spend a few decades in prison. But that would challenge both the monies establishment and the Public a Sector establishment so it will never happen.

 

[WolfeTone]

No, im saying the propagated notion of 'free-market' economies 'bouncing back' is indoctrinated ideology.
Im saying that public sector workers are not dependent on the State for their income anymore than anyone else is.

 

[Duke of Marmalade]

Wolfie you may recall that Fierce Doherty was the most adamant voice for "burning the bondholders". It's pure speculation but do you think the country would be in a better place today if we had followed that advice?

You keep repeating the mantra about "free market capitalism". No-one is arguing that unfettered fmc is the correct model; our civilisation is much too complex for that. Instead, all of the successful economies have for some time operated a "regulated fmc" model. For example Mario said he would do whatever it took to save the euro, the antithesis of "let the market rip". Lefties and anarchos were salivating at the prospect of the collapse of the euro as they had earlier salivated at the hoped for meltdown of the capitalist system and then cried foul (as you are) when the authorities successfully interfered to save the situation

The putative alternative to rfmc for organising our civilisation is the command economy. Every attempt at this latter has been a disaster so just accept that rfmc is the best we have at this point of our development.

 

[cremeegg]

Is that all? We are talking about 2/3 banks here?
Imagine if 20% of GDP was used to provide public services instead, healthcare, third level education, housing the homeless.

Yes just imagine. That would represent a huge cut on what we currently spend.

I am continually surprised at how many people have no idea about just how much the state spends.

 

[WolfeTone]

Yes just imagine. That would represent a huge cut on what we currently spend.

I am continually surprised at how many people have no idea about just how much the state spends.

My bad, I said GDP instead of national debt.
But as a side, what should the State its revenues on?

 

[joe sod]

Sinn Fein in government !!, what would the american multinationals make of it, what about the 11 billion apple tax in the escrow account that the government are fighting the EU over, Will they make a grab for that ?
They could upend 50 years of successful irish industrial policy by frightening away the american horses.

 

[cremeegg]

My bad, I said GDP instead of national debt.
But as a side, what should the State its revenues on?

I don't really think that is the question.

Throwing money at difficult issues doesn't resolve those issues.

Take housing, anyone who says that the country can spend it way out of the housing shortage, hasn't thought very much about it, and perhaps dont want to.

Understanding the causes of the problem, In my opinion the high costs of construction and associated items, and developing a response, taxing land, taxing zoned heavily, training more builders, reducing development levies for a start. Spending more money on housing will only entrench the problems.

 

[Firefly]

Public sector workers are not 'dependent' on the State for income.

Who else is going to pay them?

 

[WolfeTone]

Throwing money at difficult issues doesn't resolve those issues.

Throwing money at it is wrong, true. Take the bank bailout for instance. Do we have a functioning banking system here that serves the interests of the economy as a whole? Are mortgage holders being charged fairly, competitively?
Are businesses able to borrow at competitive rates?


Spending more money in a planned, organised way, where there is a market failure can solve problems.

Understanding the causes of the problem, In my opinion the high costs of construction and associated items, and developing a response, taxing land, taxing zoned heavily, training more builders, reducing development levies for a start.

Exactly. And policy decisions can help resolve alot of the problems associated with house building.

Spending more money on housing will only entrench the problems.

I would have to disagree. Spending money on housing will build more houses (which are needed) and help alleviate the problem.

 

[WolfeTone]

It's pure speculation but do you think the country would be in a better place today if we had followed that advice?

Yes it is pure speculation, so I do not know the answer. Perhaps looking at an economy that did burn bondholders would help. Iceland for instance. By all economic indicators it has recovered, and in quicker time too.

You keep repeating the mantra about "free market capitalism".

In the context that some assume that the economic recovery is down to the free market - that principles of social democracy, socialism for short, have no or little part to play.

Instead, all of the successful economies have for some time operated a "regulated fmc" model

Yes, and what does 'regulated' generally mean?
Generally, a set of rules mandated from State institutions, like parliaments, or Central banks mandated to regulate financial systems deriving from principles of social democracy eg. your €10 note is no more or less valuable than my €10 note.
Its when those rules are broken, or corrupted, or applied for some but not to others, to favour one over another, that the problems begin.
But in order for State institutions to function, in order for State rules and regulations to apply, there requires investment in people to establish, monitor, administer, inspect, investigate etc....ie a State sector.
Without it, there is no functioning free-market, regulated or not.

For example Mario said he would do whatever it took to save the euro, the antithesis of "let the market rip".

This is when the rules are broken. This is not the free-market, nor the regulated free-market. The regulated free-market said that if you enter into a private transaction and that transaction goes sour, you lose.
Instead, the regulated free-market, became the regulated socialised monetary system.
That is what we live in today. A monetary system that has crashed and is 'bouncing back' because principles of socialism are being applied to the financial system. Not in a democratic way, but from a centralized command authority - the ECB.

The putative alternative to rfmc for organising our civilisation is the command economy. Every attempt at this latter has been a disaster so just accept that rfmc is the best we have at this point of our development.

The regulated free-market economy is the best model we have, I have never disputed this.
The regulated free-market is a social construct, built on principles of social democracy - fairness and equality.

We don't have that now.

It is a corrupted system designed to break its own rules in favour of some (bondholders in this instance) over others, - shareholders, pension funds, taxpayers, working people, home owners, rent payers, insurance policy holders, small businesses, students, etc.

You may have noticed, that while the economic numbers are improving or have stabilised, the political landscape in Ireland, UK and much further afield has seen some more than significant disruption -
except, perhaps Iceland.

The Rise of Extremist politics I think some might call it?
Is this the consequence of the regulated free-market bouncing back?

 

[WolfeTone]

Who else is going to pay them?

You could privatise the whole State sector. Judges, politicians, gardai, civil servants, doctors, teachers, nurses, prison officers etc...then there would be no more dependence on the State to pay their incomes.

 

[Firefly]

You could privatise the whole State sector. Judges, politicians, gardai, civil servants, doctors, teachers, nurses, prison officers etc...then there would be no more dependence on the State to pay their incomes.

You didn't answer the question.

 

[cremeegg]

Does the election go to penalties if they finish level? You’d have to fancy Sinn Féin in the shootout....

sorry, couldn’t resist that.

 

[WolfeTone]

You didn't answer the question.

I did. Privatise the public sector and then teachers, gardai, judges, prison officers can have their wages paid by private market rates.

But lets not beat about the bush here, lets look at your ill-informed comment

The vast majority of the rest of it was built up from 2008 - 2014 or thereabouts to ensure that those dependent on the state for income, (public sector workers, pensioners and those on the dole) would not have lost out

The clear inference here is that aside from 20% of national debt to bail out banks, that the rest of the national is down to particular identifiable sectors of the population who are 'dependent' on the State for income.
This is an insidious comment to portray public sector workers, pensioners and people on the dole as a burden to the rest of society.
Lets get some things straight, the national debt is a consequence of borrowing to pay for ALL State services in which ALL sectors of society are dependent in some shape or form.
- if you have children and receive child benefit, you are contributor to that debt and that dependent on the State for that income.
- if you are a PAYE worker in receipt of a tax credit you are a contributor to that debt and dependent on the State for that income it provides.
- if the government has ever borrowed to keep part of your income at 20% you are dependent on the State
- if you ever had cause to call and rely on emergency services you are contributor to that debt and are dependent on the State to provide for the cost of that service.
- if your kids go to a State school....
- if you use public roads, street lighting, public sewers...
- jaysus, if you live in a democratic society, can cast a vote without fear or favour, and be confident that the count is impartial, fair and free, you are a contributor to that debt and are dependent on the State.

The insidious nature of your comments in general, is that you fail wholeheartedly to apply any value to the work of public sector workers. That the national debt is 69% of GDP is not because GDP has been generated by the free-market alone, it has been generated by the free-market that operates on a platform that provides the public services in which such wealth can be generated by attracting investment, attracting people into the workforce, providing the political stability, assurances to corporations and people, security, healthcare, education, etc in which economies can prosper.

It is by no means perfect, but to allude that the 80% national debt is attributable to certain sectors of society, without acknowledging the value that those sectors provide to the wealth of the economy is an insidious comment to make.

 

[Delboy]

I don't know, this whole SF in Govt could be great:
- No more rises in carbon taxes (or even a reduction)
- Property tax abolished
- No USC on the 1st 30k of income
- Pension age restored to 65

All paid for by the fat cats on over 120k or so and the Goggles of this world. Bring it on

 

[Purple]

The clear inference here is that aside from 20% of national debt to bail out banks, that the rest of the national is down to particular identifiable sectors of the population who are 'dependent' on the State for income.
This is an insidious comment to portray public sector workers, pensioners and people on the dole as a burden to the rest of society.
Lets get some things straight, the national debt is a consequence of borrowing to pay for ALL State services in which ALL sectors of society are dependent in some shape or form.
- if you have children and receive child benefit, you are contributor to that debt and that dependent on the State for that income.
- if you are a PAYE worker in receipt of a tax credit you are a contributor to that debt and dependent on the State for that income it provides.
- if the government has ever borrowed to keep part of your income at 20% you are dependent on the State
- if you ever had cause to call and rely on emergency services you are contributor to that debt and are dependent on the State to provide for the cost of that service.
- if your kids go to a State school....
- if you use public roads, street lighting, public sewers...
- jaysus, if you live in a democratic society, can cast a vote without fear or favour, and be confident that the count is impartial, fair and free, you are a contributor to that debt and are dependent on the State.

The insidious nature of your comments in general, is that you fail wholeheartedly to apply any value to the work of public sector workers. That the national debt is 69% of GDP is not because GDP has been generated by the free-market alone, it has been generated by the free-market that operates on a platform that provides the public services in which such wealth can be generated by attracting investment, attracting people into the workforce, providing the political stability, assurances to corporations and people, security, healthcare, education, etc in which economies can prosper.

It is by no means perfect, but to allude that the 80% national debt is attributable to certain sectors of society, without acknowledging the value that those sectors provide to the wealth of the economy is an insidious comment to make.

I have to agree with you but I don't think that's the point being made by Firefly. The fact that State pensions weren't touched by the crash is a disgrace. The fact that property tax is so low is a disgrace. The fact that rich people get children's allowance is a disgrace. The fact that rich people send their kids to 3rd level for free is a disgrace. There are loads of things wrong with society and how the country is being run but claiming that the problem is quantitative easing or the banking system or some other flagbearer for capitalism is nonsense.
We have a functioning banking system.
We have competitive interest rates considering that it is impossible to repossess a house so in effect mortgages are unsecured lending.
Businesses can borrow from banks. Frankly I am amazed at some of the SME's who are able to get credit.

WE have problems but you are looking in the wrong place. There's no one issue, no one target, no easy fix. There are thousands of small things that make up bigger solutions. Yes the government must take a leadership role but the entire State sector collectively runs the country and collectively they have to do a better job. The private sector and the citizenry at large can't do that. They can only make sure they pay their taxes and hope.