Sinn Fein : wealth risk

[Purple]

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

Someone on €120k a year who just bought a house, or is renting in Dublin will have a lower disposable income than their neighbour on €70K who owns their home. Gross income is a bad measure of wealth and wealth is more important than income when measuring financial inequality.

 

[WolfeTone]

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.

These are all political decisions. If the government of the day decides not to cut pensions, it is the job of public service not to cut pensions. If government of the decides to increase unemployment benefit, it is the job of public service to ensure that those entitled to receive it, get it.
Ditto property tax, child benefit, 3rd level education etc

We have a functioning banking system.

We have a functioning banking system insofar as it is serving its own interests very well. Mortgage rates are well above what they could be and there is little indication of other banks entering the market to compete.
All is not well in the banking sector.

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.

Of course improvements can be made, but we live in a developed society, one of the richest countries in the world, unemployment is low, etc
There are of course deficiencies, housing stock, waiting lists etc...but these can resolved by political decisions.

 

[Purple]

These are all political decisions. If the government of the day decides not to cut pensions, it is the job of public service not to cut pensions. If government of the decides to increase unemployment benefit, it is the job of public service to ensure that those entitled to receive it, get it.
Ditto property tax, child benefit, 3rd level education etc



We have a functioning banking system insofar as it is serving its own interests very well. Mortgage rates are well above what they could be and there is little indication of other banks entering the market to compete.
All is not well in the banking sector.



Of course improvements can be made, but we live in a developed society, one of the richest countries in the world, unemployment is low, etc
There are of course deficiencies, housing stock, waiting lists etc...but these can resolved by political decisions.

So it's all down to the politicians then. I see. That means that now the Shinners are in there's be no homelessness, no waiting lists and no deficiencies in the provision of health services within the next few years. It was the politicians holding everything back.

 

[Firefly]

The insidious nature of your comments in general

Please have the decency to back this up

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

You didn't, unless you really think we should privatise the public sector. Do you?

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

You are jumping to conclusions. I never said it was "down to", or the fault of those 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.

I never said that and certainly did not wish to portray that.

- 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.

I agree with all of that. But you're only seeing one side of the cost/benefit, the benefit. I am discussing the cost element. We borrowed billions and billions which your kids and mine are going to be lumped with. Maybe it was a good idea to try to maintain a level of public services that we are/were used to, but should we have borrowed so so much????

you fail wholeheartedly to apply any value to the work of public sector workers.

If you are going to accuse me of something, again, please have the decency to back this up

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.

I agree except you are again only focusing on the benefit and not the cost.

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.

Again, I did not say or wish to infer this. I am merely stating the money borrowed was to help ensure that those dependent on the state for income did not lose out.

 

[WolfeTone]

So it's all down to the politicians then. I see. That means that now the Shinners are in there's be no homelessness, no waiting lists and no deficiencies in the provision of health services within the next few years. It was the politicians holding everything back.

This makes no sense, sorry. First, the Shinners are not in, nothing has been agreed.
Second, my previous comments were referring to the simpleminded notion that the national debt, or 80% of it, is attributable to certain identifiable sectors of society.

If there are issues in providing public services, and there are, then obviously they need to be resolved. But lets not equate it to 80% of national debt, or anything near it - which I think you have agreed already.

 

[Purple]

This makes no sense, sorry. First, the Shinners are not in, nothing has been agreed.
Second, my previous comments were referring to the simpleminded notion that the national debt, or 80% of it, is attributable to certain identifiable sectors of society.

If there are issues in providing public services, and there are, then obviously they need to be resolved. But lets not equate it to 80% of national debt, or anything near it - which I think you have agreed already.

I was responding to your assertion that the cause of the shortcomings I outlined is the political decisions which have been made. By that dubious logic now that the child killers are the largest political party in the country they will get into power and sort everything out.
80% of our national debt is due to borrowing to fund the cost of paying for services which we can't afford. It has nothing to do with banks or the financial sector or the lizard people or the jews or the illuminati.

 

[WolfeTone]

I never said that and certainly did not wish to portray that.

Ok, perhaps I over-reacted after misinterpreting the intent of your comment. For that, I apologize and retract my 'insidious' remark. It was unwarranted.

I am merely stating the money borrowed was to help ensure that those dependent on the state for income did not lose out.

Ok, looking at the borrowing over that period, in flat terms, yes, the borrowing was to keep the whole show on the road, public sector wages, pensions, unemployment benefits, child benefit, tax credits, etc.
But its primary purpose was to ensure that the entire economy didn't run into a meltdown.
Simple example, if judges and gardai are not paid, the entire law and order system begins to collapse. In turn, the insurance industry collapses, in turn businesses cannot open their doors, in turn we will quickly revert to a banana republic.
The borrowing was to ensure that you and I, and as many others as possible, could go about our business in a civilized society as normal.
In the main, a total economic collapse was averted, but not without casualties - the thousands who lost their jobs, the businesses that folded, the mortgage debt hanging from necks of working people, the homeless, the extortionate rents paid by working people, shareholders of banks whose investments were plundered, the next generation of people who are excluded from progressing their adult lives, forced to live at home into their thirties etc...etc...

So the economy has bounced back, in economic figures terms at least. Was the additional borrowing worth it? Could we have borrowed less and still 'bounced back', or would the aforementioned casualties be more profound?
Impossible to tell.

But what is clear, to me at least, that notions of 'free-market' ideology being the primary driver in the economic recovery are defunct.
The free-market, the regulated free-market, is secondary to the principles of social democracy that facilitate the operation of the free-market.
A good example of unregulated free-market and its inability to prosper without principles of social democracy being applied as a platform for it to operate is unregulated free-market live animal markets in places like Wuhan.

 

[joe sod]

Introduce a wealth tax for the wealthiest 1% in the State at a rate of 1% on the portion of net wealth held over €1 million with a number of exemptions including farms

To raise 89m.

I think they will have to move alot on that downwards to raise any money, it would have to start at 500,000, that would pull alot of people into that net including alot of people that voted for Sinn Fein in Dublin.
Presumably a share portfolio would be in Sinn Feins sights but then what about a pension pot surely that would be equivalent to a share portfolio in a wealth tax. Then Sinn Fein are in very tricky waters because a private sector worker with a pension pot could argue convincingly that he is still poorer than a state worker with a guaranteed pension worth much more, That would be a no no in Sinn Fein ideology

 

[Purple]

But what is clear, to me at least, that notions of 'free-market' ideology being the primary driver in the economic recovery are defunct.
The free-market, the regulated free-market, is secondary to the principles of social democracy that facilitate the operation of the free-market.
A good example of unregulated free-market and its inability to prosper without principles of social democracy being applied as a platform for it to operate is unregulated free-market live animal markets in places like Wuhan.

I don't see anyone disagreeing with you on that. I still don't know what point you are making.

 

[Firefly]

Ok, perhaps I over-reacted after misinterpreting the intent of your comment. For that, I apologize and retract my 'insidious' remark. It was unwarranted.

Thanks, appreciate it.

Ok, looking at the borrowing over that period, in flat terms, yes, the borrowing was to keep the whole show on the road, public sector wages, pensions, unemployment benefits, child benefit, tax credits, etc.

But its primary purpose was to ensure that the entire economy didn't run into a meltdown.

Simple example, if judges and gardai are not paid, the entire law and order system begins to collapse. In turn, the insurance industry collapses, in turn businesses cannot open their doors, in turn we will quickly revert to a banana republic.

The borrowing was to ensure that you and I, and as many others as possible, could go about our business in a civilized society as normal.

But paying for pensions, public sector works and the dole is not a binary choice. It's not a case of either pay them or not. Public sector wages were cut for example and the economy didn't run into a meltdown. Why did public sector workers have to endure pay cuts whilst those on pensions and the dole get away scot-free?

Ireland National Debt 2023

countryeconomy.com

Our national debt at Dec 2007 stood at 47bn.
In Mar 2019 is stood at 215bn.
Take away the 40bn we capatilised the banks with and the difference is 128bn. 128bn seems like an extraordinarily large amount of money to keep the show on the road to me.

In the main, a total economic collapse was averted, but not without casualties - the thousands who lost their jobs, the businesses that folded, the mortgage debt hanging from necks of working people, the homeless, the extortionate rents paid by working people, shareholders of banks whose investments were plundered, the next generation of people who are excluded from progressing their adult lives, forced to live at home into their thirties etc...etc...

It was pretty bad alright. Do you think that 128bn euro that was borrowed went to the right areas then?

So the economy has bounced back, in economic figures terms at least. Was the additional borrowing worth it? Could we have borrowed less and still 'bounced back', or would the aforementioned casualties be more profound?

Impossible to tell.

I agree we'll never really know. I would argue that we didn't need to borrow so much. I would have pruned the hedge first to see what was actually healthy.

The free-market, the regulated free-market, is secondary to the principles of social democracy that facilitate the operation of the free-market.

A good example of unregulated free-market and its inability to prosper without principles of social democracy being applied as a platform for it to operate is unregulated free-market live animal markets in places like Wuhan.

I would argue that without free-markets an economy cannot flourish and without a strong economy all those things we take for granted are impossible. Take a look at communist states for many examples of what happens when the state tries to control markets. The economy goes off a cliff, the communists take control of everything else and then the people suffer. I'm not saying free-markets or capitalism is the panacea for all our problems, but it is the best system we have ever tried.

 

[odyssey06]

These were the detailed proposals from Sinn Fein for wealth tax in 2013, unclear if this will be the shape of what they propose now.

https://www.sinnfein.ie/files/2013/WealthTaxProposalsWeb.pdf

 

[WolfeTone]

Why did public sector workers have to endure pay cuts whilst those on pensions and the dole get away scot-free?

This is a contradictory question. How can you say that the tens of thousands who lost their jobs got away 'scot-free'.
They suffered more than anybody. That the government borrowed to maintain welfare rates was a political decision made, in no small part to retain social cohesion.
Imagine losing your job because of the financial mismanagement of the banking sector and then the ignominy of having your benefits cut at the very time you need that support.
In terms of social cohesion, could you envisage any potential negative consequences.

128bn seems like an extraordinarily large amount of money to keep the show on the road to me.

It is an extraordinary large amount of money. As I recall, the collapse of the construction sector left a gaping hole of some €20bn to keep the show on the road plus fulfill our requirements to repay debts as they fell due.

Do you think that 128bn euro that was borrowed went to the right areas then?

Its simply not possible to quantify. The economy has recovered, on paper at least, but there are many societal deficiencies.
So some of it worked well, other sums of it not so well.

I would have pruned the hedge first to see what was actually healthy.

How would you go about that?
The government of the day set up a Special Group on Public Service Numbers and Expenditure Programmes chaired by Colm McCarthy and whose members included directors from the banking and financial services sector.
The Special Group identified €5.3bn worth of 'savings', including cuts in public service numbers of 17,000 and a 5% cuts in welfare payments.
Still someway short of the overall deficit. Bear in mind, when the government cuts spending, it is money that is extracted from the economy putting jobs and businesses at risk - in other words, in danger of perpetuating the problem it is attempting to fix.
But perhaps you have other suggestions as to how the deficit in public finances would be plugged?

I would argue that without free-markets an economy cannot flourish and without a strong economy all those things we take for granted are impossible.

A free-market (in the truest sense of its meaning) is the best system to innovate and invent.
But in order for free-markets to flourish, they need to operate on principles of social democracy that provide fair and equitable opportunity.
We dont have that now. This recovery is engineered by a centralized command authority - the ECB.
You point to the national debt of €47bn in 2007. It was also about 30% of GDP meaning the economic activity was valued at around €150bn.
In the 13yrs since then, that included the worst economic crash in our history, where one of the largest sectors, construction, was relatively dormant, and our debt has spiraled to €200bn - this debt is calculated at roughly 70% GDP. Meaning, in the space of 4-5yrs when economic indicators pointed to recovery, our economy is now valued at near twice the amount as it was in 2007 at its peak.
With inflation at near zero for the period, this should point to a massive expansion of the workforce. But there is little actual difference in the numbers at work in 2007 than today.
It should point to much higher wages, but wage increases have been modest at best.
It should point to the value of your home being worth a lot than its peak price in 2007?
Is it?
Interest rates are next to zero, but personal loans, credit card rates are way above what you would expect in a free market. Mortgage rates are also way above what they should be.
Insurance claims and the value of those claims has fallen, but insurance premiums are rising.
Everything from your mobile phone subscription, TV, electricity bill, health insurance is regulated. Some prices to move only up or down within set parameters.
You cant go for a cup of coffee without knowing that a regular size is set at a price between €2.50 and €3.20.
Products lined up in hardware and software stores have recommended retail prices, which are rarely altered.
There are of course the black Friday, January, Summer Sales advertising 20/30/50% off - invariably on a limited out of date stock.

Is this the free-market? Doesn't feel like it to me. It is a highly centralised price controlled market commanded and regulated by central banks.

 

[Firefly]

This is a contradictory question. How can you say that the tens of thousands who lost their jobs got away 'scot-free'.

In the private sector, permanent and temporary workers lost their jobs. In the public sector only temporary workers lost their jobs their jobs. Do you think this is fair?

 

[joe sod]

These were the detailed proposals from Sinn Fein for wealth tax in 2013, unclear if this will be the shape of what they propose now.

https://www.sinnfein.ie/files/2013/WealthTaxProposalsWeb.pdf

it doesn't seem too bad in fairness, however most people will be excluded from this tax therefore they will not raise enough money to fund all their spending commitments, of course once they bring in this tax then they reduce the threshold to raise the cash, they have to.
It could have the consequence of reducing property prices though especially the ones at the top of the market, thereby reducing construction activity again, this could take a few years to play out though.
In other words the problems we have now are the problems of a wealthy country, Sinn feins solution will be to make us less wealthy, asset prices will fall

 

[WolfeTone]

In the private sector, permanent and temporary workers lost their jobs. In the public sector only temporary workers lost their jobs their jobs. Do you think this is fair?

No, but you seem to think that those who lost their jobs got away scot-free?
How can you say that the tens of thousands who lost their jobs and ended up on the dole during the crash got away 'scot-free'?

 

[Firefly]

No, but you seem to think that those who lost their jobs got away scot-free?

How can you say that the tens of thousands who lost their jobs and ended up on the dole during the crash got away 'scot-free'?

Where did I say that?

 

[Duke of Marmalade]

The wealth tax to me seems unworkable. Pension pots excluded! Totally unfair on those who did not provide for their retirement with a formal pension fund structure. Big boon to the pension industry of course.
Wealth is assessed on households. Anyone with a second home will then claim that this is the residence of the other half.

 

[Firefly]

They suffered more than anybody. That the government borrowed to maintain welfare rates was a political decision made, in no small part to retain social cohesion.

Imagine losing your job because of the financial mismanagement of the banking sector and then the ignominy of having your benefits cut at the very time you need that support.

In terms of social cohesion, could you envisage any potential negative consequences.

They could have quite easily kept the dole at the same rates for anyone made redundant but who has worked for the past 3 years, but cut it for everyone else. The OAP could also have been cut.

The government of the day set up a Special Group on Public Service Numbers and Expenditure Programmes chaired by Colm McCarthy and whose members included directors from the banking and financial services sector.

The Special Group identified €5.3bn worth of 'savings', including cuts in public service numbers of 17,000 and a 5% cuts in welfare payments.

Still someway short of the overall deficit.

€5.3bn is nothing to be sneezed at. It would transform public housing today for example.

Bear in mind, when the government cuts spending, it is money that is extracted from the economy putting jobs and businesses at risk

The government slashed what it spent on health, but I don't recall it affecting the general economy too much.

But perhaps you have other suggestions as to how the deficit in public finances would be plugged?

I'm not an expert in the area, but I can tell you something, there is no way the company I am doing work for would countenance borrowing money to pay my rates.

But in order for free-markets to flourish, they need to operate on principles of social democracy that provide fair and equitable opportunity.

Free markets can flourish without principles of social democracy in the strictest sense, but I agree that to actually benefit people, boundaries & regulations are needed, inside which the participants can freely trade.

Interest rates are next to zero, but personal loans, credit card rates are way above what you would expect in a free market. Mortgage rates are also way above what they should be.
Insurance claims and the value of those claims has fallen, but insurance premiums are rising.
Everything from your mobile phone subscription, TV, electricity bill, health insurance is regulated. Some prices to move only up or down within set parameters.
You cant go for a cup of coffee without knowing that a regular size is set at a price between €2.50 and €3.20.
Products lined up in hardware and software stores have recommended retail prices, which are rarely altered.
There are of course the black Friday, January, Summer Sales advertising 20/30/50% off - invariably on a limited out of date stock.

Is this the free-market? Doesn't feel like it to me. It is a highly centralised price controlled market commanded and regulated by central banks.

This is quite an interesting topic and I agree with everything you have said here. I would like to see more resources and powers go to the The Competition and Consumer Protection Commission. I would love to see them investigate and punish collusion in the market place.

I acknowledge that we of course do not have free-markets in the strictest sense, we have markets that are, by and large, free to trade within regulations and I think this is a good thing.

 

[WolfeTone]

Why did public sector workers have to endure pay cuts whilst those on pensions and the dole get away scot-free?

You inferred it above. Tens of thousands of working people lost their jobs during the crash and ended up on the dole.
I took from your comment above, that having lost their job, you believe they should have had their welfare cut also.
Perhaps you can clarify?

 

[Firefly]

You inferred it above. Tens of thousands of working people lost their jobs during the crash and ended up on the dole.

I took from your comment above, that having lost their job, you believe they should have had their welfare cut also.

Perhaps you can clarify?

Sorry, didn't mean that at all. Those lost their jobs lost the most & I think the dole should have been kept the same for them. The dole could have been reduced for those who haven't worked in years.