Ireland on the brink (?)

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Unemployment statistics are always fashioned in a way that suits the government fine, but hides a lot of the real unemployment. The US is no exception there.
Having the two figures, 10% in the US and 14% in Ireland, also doesn't tell you that much to be honest. You can't tell how accurate the statistics are. You cannot see the kind of unemployment which comprises most of what is covered in the statstics. For example, how much is frictional unemployment, and how much is structural unemployment, etc.
And the way the two countries measure unemployment is very different. So what does it mean that Ireland has 14% unemployment rate currently and the US just 10%. Where is real unemployment, meaning how much is hidden and therefore not represented in the statistics? How much is structural?
Also, employment itself is very different in the countries. While the US has a huge population of the so called working poor, and others who work two or three jobs just to makes ends meet, to my knowledge these phenomena hardly, at least much less exist in Ireland.

I further read that Ireland is now saying that it may well take help from the uncivilized continent.
 
Vincent Vega said:
Unemployment statistics are always fashioned in a way that suits the government fine, but hides a lot of the real unemployment. The US is no exception there.
Having the two figures, 10% in the US and 14% in Ireland, also doesn't tell you that much to be honest. You can't tell how accurate the statistics are. You cannot see the kind of unemployment which comprises most of what is covered in the statstics. For example, how much is frictional unemployment, and how much is structural unemployment, etc.
And the way the two countries measure unemployment is very different. So what does it mean that Ireland has 14% unemployment rate currently and the US just 10%. Where is real unemployment, meaning how much is hidden and therefore not represented in the statistics? How much is structural?
Also, employment itself is very different in the countries. While the US has a huge population of the so called working poor, and others who work two or three jobs just to makes ends meet, to my knowledge these phenomena hardly, at least much less exist in Ireland.
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I don't think the two/three job phenomenon is as widespread in Ireland as compared to the US. However there are plenty of working poor because of the property bubble. Because of the property bubble they took on mortgages they can barely afford at current interest rates and we all know long term interest rates are only going one way.
 
Europe`s Monetary Crisis: Ireland's "Suicide Pact" With the E.U.

Ireland could be the next Lehman Brothers. That's what has the markets worried.
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But no one believes that will happen. Most people think that Ireland will "take its medicine"
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"It cannot be denied that Ireland has lost its status as a sovereign nation. Thanks to its disastrous entanglement with the euro, it has lost any independence in domestic, foreign and above all economic policy. The Irish nation is the creature of Brussels and the European Central Bank. The Irish prime minister has effectively been turned into a pro-consul dispatched to Dublin from Brussels. Brian Lenihan, the finance minister, is like an overseas manager of a Brussels subsidiary. For those of us who love Ireland, this is miserable and demeaning – but it needs to be borne in mind that a similar fate awaits a number of other European countries. Greece already does what it is told by the IMF and the ECB; the same will shortly apply to Portugal and in due course Spain." ("Ireland has lost its sovereignty and is now the creature of Brussels – thanks to the euro", Peter Oborne, Telegraph)
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Why spend 800 years trying to overthrow the Brits just to come under the sway of the EU? Having said that, almost no one in Ireland goes anywhere as far as UKIP or many Tories in opposing the EU altogether....

The European Project was and is a Utopian idea, based not on practical logic but on an idealistic vision, and it has only one aim in mind – total political union. Along the way its architects have consistently lied to the public about its aims, especially so in the creation of a single currency, which logic suggests requires political unification." ("Ireland's smug, Euro-loving elite has led their country to ruins – 'Little Englanders' saved ours", Ed West, Telegraph)

The financial crisis has stripped away much of the pretense surrounding the 16-country EU. No one is blabbing about ending wars and shared prosperity anymore. The focus has shifted to belt tightening for workers and golden parachutes for bankers and bondholders. In other words, elites are waging the same relentless class war they always have, only this time it's behind the facade of European unity. Does Ireland really want to be a part of that charade?

It's time for Ireland to leave the EU and deliver a blow to the ill-conceived Uberstate. In fact, they should have left years ago.
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it would be an interesting exercise to see ireland leaving the EU
perhaps I could buy Dublin in a year or 2 :hmm:
 
I haven't studied the economic history of Ireland closely, so I genuinely wonder if the Celtic tiger would ever have had a chance of coming about if it weren't for the membership in the EU.
 
Vincent Vega said:
Unemployment statistics are always fashioned in a way that suits the government fine, but hides a lot of the real unemployment. The US is no exception there.
Having the two figures, 10% in the US and 14% in Ireland, also doesn't tell you that much to be honest. You can't tell how accurate the statistics are. You cannot see the kind of unemployment which comprises most of what is covered in the statstics. For example, how much is frictional unemployment, and how much is structural unemployment, etc.
And the way the two countries measure unemployment is very different. So what does it mean that Ireland has 14% unemployment rate currently and the US just 10%. Where is real unemployment, meaning how much is hidden and therefore not represented in the statistics? How much is structural?
Also, employment itself is very different in the countries. While the US has a huge population of the so called working poor, and others who work two or three jobs just to makes ends meet, to my knowledge these phenomena hardly, at least much less exist in Ireland.

I further read that Ireland is now saying that it may well take help from the uncivilized continent.
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I agree. I live in a typical American working class neighborhood. Nice folks with modest means and what use to take one paycheck to live on now takes two. We are just getting by. Though fortunate to still have jobs, everything is so expensive. It doesn't match our pay raises and the folks on SS. I really feel sorry for them. My mom is 82 and it is a joke in regards to what the government gives her to live on. So, who fills in the income gap? The grown children do, meaning we have nothing to save towards own retirements. But, what are we suppose to do? Let mom live in a shelter or on the streets?
 
Irish economy near financial collapse

Wondering if U2 has commented on this-have you heard anything I missed?

Irish financial crisis threatens government - CNN.com

Dublin, Ireland (CNN) -- Irish Prime Minister Brian Cowen on Monday said he will delay any decision on whether to go ahead with national elections until the 2011 budget is passed and negotiations on the details of an $11 billion international bailout package are finalized.

"I'm saying that it is imperative for this country that the budget is passed," Cowen said at a news conference Monday evening in Dublin. "I'm also saying that it is highly important in the interests of political stability that that happens. It's very important for people to understand that any further delay in this matter in fact weakens this country's position."

Earlier Monday, the Green Party, one of several parties in Ireland's coalition government, called for new elections amid controversy after the Cabinet signed off on the bailout from the European Union and the International Monetary Fund.

Green leader John Gormley wants the elections to be held at the end of January.
Ireland and the bailout
Bailout pressure on Ireland
Ireland facing emigration again
Bailout for Ireland
RELATED TOPICS

* Ireland
* Dublin (Ireland)
* European Central Bank
* International Monetary Fund

Cowen confirmed that he would seek the dissolution of the Dail (parliament) when legislators have passed the 2011 budget and published a four-year fiscal plan, and when the bailout loans are confirmed.

"This past week has been a traumatic one for the Irish electorate. People feel misled and betrayed," Gormley said in a statement.

The party has said that its involvement in the government would go on "as long as it was for the benefit of the Irish people," the statement said.

"But we have now reached a point where the Irish people need political certainty to take them beyond the coming two months," it said. "So we believe it is time to fix a date for a general election in the second half of January 2011."

The international bailout comes with required spending cuts that Irish politicians are saying will be a shock for voters.

Earlier Monday, Labour Party leader Eamon Gilmore called on the Greens to bring the government down if the senior party, Fianna Fail, didn't agree to new elections in January.

"The Green Party has at last recognized what the country has realised for many months, that this government is long [past] its sell-by date and that it is incapable of leading the country to economic recovery," he said in a statement.

Fine Gael leader Enda Kenny called for "an immediate general election so that a new government, with a clear parliamentary majority, can prepare the four-year economic plan" to spur Irish recovery.

Cowen requested substantial "financial assistance" from the European Union and the International Monetary Fund on Sunday evening. He also pledged spending cuts and tax increases. This request came less than a week after the prime minister said Ireland had "made no application for external support" for its debt-ridden banks. Dublin has spent billions trying to buttress the banking sector.

Fears about Ireland have pushed down the value of the euro against the dollar and put stock markets under pressure.

Ireland is forecast to run a deficit of 11.9 percent of its GDP in 2010. And overall, the country is grappling with a running tab of debt that will total 98.5 percent of its entire economy this year, Cowen said.

Since 2008, Ireland has enacted strict budget-cutting measures, slashing about $20 billion off the country's budget. Now it's time for round two, as Cowen plans to cut an additional $20 billion over the next few years.
 
Bono let the world know his thoughts on Ireland
when he got his money out, if others had followed his example of moving their business from Ireland to the Netherlands they would be sitting pretty, too.
 
deep said:
Bono let the world know his thoughts on Ireland
when he got his money out, if others had followed his example of moving their business from Ireland to the Netherlands they would be sitting pretty, too.
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Not really, that was a tax management strategy. U2 were gearing up for further heavy property related investment at the time the credit crunch first hit in 2007, also they did not sell the Clarence and surrounding properties when they had the opportunity during the bubble. 2005/2006 would have been the best time to sell. All the indicators suggest that they didn't see it coming.

Has the Clarence ever actually made a profit?
 
I am sure you have better information about that than I do.

I just know that large corporations moving profits off shore to avoid taxes does not sit right with me.

The fact that Dick Cheney's Haliburton Corp got fat off of U S tax payers money profiteering on war and avoided paying taxes on those profits by setting up corporations over seas is wrong.
 
financeguy said:
Not really, that was a tax management strategy. U2 were gearing up for further heavy property related investment at the time the credit crunch first hit in 2007, also they did not sell the Clarence and surrounding properties when they had the opportunity during the bubble. 2005/2006 would have been the best time to sell. All the indicators suggest that they didn't see it coming.

Has the Clarence ever actually made a profit?
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From what I have read, no.

I do know that my home is worth less than it was during the economy boom. Fortunately for me. I didn't loose any money since it was already paid for. 100% equity. I am always recieving mail on selling my house. Not going to do it. I am staying put. At least I own, what I own. I don't trust the mortgage loans. Too many people lost their houses.
 
Forget Ireland, we got real problems here

After several delays, Bono has admitted that bringing the $60 million 'Spider-Man: Turn Off the Dark' musical to Broadway has been something of a nightmare.:sad:
With this Sunday marking the first preview performance of the show, U2's singer is calling the undertaking "harder than we ever thought."
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Imagine that Yasser Arafat had succeeded in ending Israeli occupation and establishing a Palestinian state in the West Bank and Gaza. Now imagine that 10 or 15 years later, new Palestinian president, Mahmoud Abbas, agreed to hand over control of his country's budget to the IMF so his people's future would be controlled by outsiders. Do you think Palestinians would praise Abbas as a patriot or denounce him as a traitor?

Irish Prime Minister Brian Cowen is Mahmoud Abbas. He's caved in to the demands of foreign capital and transferred control over the nation's budget to the EU and the IMF. Here's an excerpt from a November 24, article in Reuters:

"Ireland's teetering government will announce plans on Wednesday to cut welfare spending sharply and raise taxes to help pay for the country's catastrophic banking crisis and meet the terms of an international bailout.

The four-year plan to save 15 billion euros is a condition for an EU/IMF rescue under negotiation for a country long feted as a model of economic development that has become the latest casualty in the euro zone's emergency ward.

Prime Minister Brian Cowen told parliament no final figure had been agreed for financial assistance, "but an amount of the order of 85 billion (euros) has been discussed.

The finance ministry said the austerity plan would be published at 1400 GMT and posted on the official government website." (Reuters)

This is a black day for Ireland. The Irish people will now face a decade or more of grinding poverty and depression thanks to their venal leaders. As soon as the ink dries on the IMF loans, the second occupation of Ireland will begin, only this time there won't be armored cars and Paramilitaries in fatigues, but nerdy-looking bureaucrats trained in the art of spreading misery. In fact, the loans haven't even been signed yet, and already IMF officials are urging the government to cut jobless benefits and the minimum wage. They're literally champing at the bit. They just can't wait to get their hands on the budget and start slashing away.

And don't believe the hype about European unity or saving Ireland. My ass. This is about bailing out the banks. The bondholders get a free ride while workers get kicked to the curb. Here's a clip from the Financial Times that spells it out in black and white:

"According to data compiled by the Bank of International Settlements, the three largest creditors to the Irish economy at the end of June...were Germany to the tune of €109bn, the UK at €100bn and France at €40bn. These sums amount to 2 per cent of France’s gross domestic product, 4.5 per cent of Germany’s GDP, and 7 per cent of British GDP."

See? Another bank bailout. Ireland is being asked to cut to social services, slash wages, renegotiate contracts, and dismantle the welfare state so that undercapitalized banks in France and Germany can get their pound of flesh. But, why? They're the ones who bought the bonds. No one put a gun to their head. They knew they could lose money if Irish banks went south. That's the risk they took. "You pays your money, and you takes your chances." Right? That's how capitalism works.

Not any more, it doesn't. Not while Cowen's in charge, at least. The Irish PM has decided to bail them out; make all the bondholders "whole again." But who made Cowen God? Who gave Cowen the right to hand over his country to the IMF?

No one. Cowen is a rogue agent kowtowing to international capital. After he finishes his work in Ireland, he'll probably join globalist Tony Blair on the French Riviera for a little hobnobbing with the tuxedo crowd.

It's revealing to watch the way Cowen works, as though the interests of foreign bankers mean more to him than those of his own people. For example, the Green Party withdrew from the government last night calling for new elections, but even though the government is in a shambles, the slippery Taoiseach wants to stay in power long enough to push through a new 4-year budget that will leave Irish workers on the brink of destitution. Who is Cowen working for anyway?

This is from the Irish Times:

"Opposition parties have today stepped up pressure on the Government as it seeks to push ahead with passing next month's budget.

Fine Gael again called for an immediate general election and said the four-year budgetary plan should only be implemented by a Government which has a proper mandate....

"What is best for the country is that the negotiation about a programme for four years be done by a government which has four years to serve, that has a mandate from the public so that it has the authority and the credibility to not only develop and negotiate it but to implement it. I think that is in Ireland's best interest," he said. ("Opposition steps up pressure", Charlie Taylor, Irish Times)

The prospective belt-tightening measures will include the firing of 28,000 public employees, a boost in property taxes, a 10 percent cut in welfare benefits, and higher taxes on low-wage workers. Cowen believes that taxing low income families is preferable to making billionaire bondholders eat their losses. The whole thing stinks to high-heaven.

Is there a way out for Ireland? Economist Mark Weisbrot thinks so. Here's what he thinks should happen:

"The European authorities and IMF can loan Ireland any funds needed in the next year or two at very low interest rates....Once these borrowing needs are guaranteed, Ireland would not have to worry about spikes in its borrowing costs like the one that provoked the current crisis....The European authorities could scrap their pro-cyclical conditions and, instead, allow for Ireland to undertake a temporary fiscal stimulus to get their economy growing again. That is the most feasible, practical alternative to continued recession.

Instead, the European authorities are trying what the IMF... calls an "internal devaluation". This is a process of shrinking the economy and creating so much unemployment that wages fall dramatically, and the Irish economy becomes more competitive internationally on the basis of lower unit labour costs."

It's all de rigeur for the IMF. It wouldn't be an IMF program unless someone was starving. That's the benchmark for success.

Ireland doesn't need structural adjustment programs that shrink GDP, dismantle popular social programs and strip wealth from workers when low interest funding and fiscal stimulus can bring the economy back to life. This is politics not economics. The EU and IMF are using the crisis to push through their own agenda. Their real goal is to crush the unions, shred the social safety net, and roll back the gains of the Progressive Era.

The Irish people are left with no choice but to resist. Presently the Cowen government is collapsing. Bravo. Now it's off to the barricades to see if the damage can be undone. Ireland needs to withdraw from the EU and start fresh. It'll be a bumpy road at first, but there's no other way. Economist Dean Baker sums it up like this in an article in The Guardian. Here's what he said:

"Even a relatively small country like Ireland has options. Specifically, they could drop out of the euro and default on their debt....Like Ireland, Argentina had also been a poster child of the neoliberal crew before it ran into difficulties.

But the IMF can turn quickly. Its austerity programme lowered GDP by almost 10% and pushed the unemployment rate well into the double digits. By the end of the 2001, it was politically impossible for the Argentine government to agree to more austerity. As a result, it broke the supposedly unbreakable link between its currency and the dollar and defaulted on its debt.

The immediate effect was to make the economy worse, but by the second half of 2002, the economy was again growing. This was the start of five and a half years of solid growth, until the world economic crisis eventually took its toll in 2009."

The Irish people didn't struggle through centuries of famine and foreign occupation so they could be debt-peons in the EU's corporate Uberstate. Like Sinn Fein president Gerry Adams said, "We don't need anyone coming in to run the place for us. We can run it ourselves." Right. Tell the EU plutocrats to take their Utopian Bankstate and shove it.
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Mish's Global Economic Trend Analysis

Go Mish :up:
 
This is probably a very stupid question, but why wouldn't it be overall better to let Ireland default without leaving the euro? I don't really understand how leaving the euro is a viable option with debts that large relative to GDP anyhow, it will only make them larger.
 
yolland said:
This is probably a very stupid question, but why wouldn't it be overall better to let Ireland default without leaving the euro? I don't really understand how leaving the euro is a viable option with debts that large relative to GDP anyhow, it will only make them larger.
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It isn't a stupid question. I assume it is legally possible for Ireland to default and remain within the Eurozone, though this would be unprecedented for a Eurozone member country - then again, the currency is only in existence for around a decade.

The key issue is, however, that a large chunk of the debt consists of private debts owed by Irish banks to foreign banks. The former foolishly built up their balance sheets to unsustainable levels by huge lending to property developers, the latter foolishly lent them the money.

The argument from Shedlock and others is that these debts should not be the responsibility of the Irish electorate. It is as though the taxpayers of the state of Florida were made liable for debts owed by the Bank of Florida to JP Morgan, or whatever. The public sector element of the debt, i.e., the government deficit, is, I believe, manageable with cutbacks.
 
would it honestly have made anyone happier if Germany and France has decided to sell Irish bonds when it became obvious Ireland was in trouble?

this is the sort of arsed backward reasoning that's more embarassing than educational

Mark Weisbrot makes more sense but from a business perspective it's easy to understand why countries investing in Ireland under the guise of the IMF feel like they want to lay down some rules on what to do with all that money
we're not talking small change here
 
Salome said:
would it honestly have made anyone happier if Germany and France has decided to sell Irish bonds when it became obvious Ireland was in trouble?

this is the sort of arsed backward reasoning that's more embarassing than educational

Mark Weisbrot makes more sense but from a business perspective it's easy to understand why countries investing in Ireland under the guise of the IMF feel like they want to lay down some rules on what to do with all that money
we're not talking small change here
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'Cos, like, socialisation of losses has worked out pretty well so far.
 
The situation here is totally fucked.

The IMF behaves like a criminal enterprise much of the time and this bailout is a terrible deal for the Irish people. Default and fuck the banks in France, Germany and the UK. They took risks that didn't pay off, too bad.
 
anitram said:
The situation here is totally fucked.

The IMF behaves like a criminal enterprise much of the time and this bailout is a terrible deal for the Irish people. Default and fuck the banks in France, Germany and the UK. They took risks that didn't pay off, too bad.
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Agreed 100% - but the EU is equally guilty of behaving like a criminal enterprise in all of this (allegedly IMF were pushing for a lower rate than our esteemed EU overlords).

I am in the process of transferring my modest savings into USD and CHF.
 
^ That rant is class war bullshit. Stopped watching when he started ranting about "wanking f***** employees of banks".
 
Drastic Cuts and Punitive Interest Rates: The EU Is Pushing Ireland to the Brink of Ruin - SPIEGEL ONLINE - News - International
The Dublin government has been congratulated and encouraged from across the European Union for being so brave in sticking to its austerity goals. The unemployed, low-income workers, pensioners, students -- hardly any sector of society has been left unscathed.

Yet this huge national sacrifice will not significantly improve the country's massive debt problem. The sometimes severe cuts to social welfare payments, public sector pay and state investment pale into insignificance when compared to the massive gaps in the Irish banks' accounts. That is why investors are continuing, undeterred, to speculate on Ireland's eventual insolvency.

Irish Taxpayers Paying the Bill

The bailout loan of €85 billion that the EU, the European Central Bank and the International Monetary Fund agreed to extend to Ireland just over a week ago had failed to calm market jitters. And why would it? After all, it actually exacerbates the country's financial problems.

The EU has failed to make the foreign bondholders take a hit on the losses from toxic real estate loans. In particular, the ECB insisted that the interests of the German, British and French banks would continue to be protected. Instead, Irish taxpayers are being asked to pay the bill: at a hefty interest rate of 5.8 percent, to ensure the foreign creditors will get their money back rather than face any losses.

That may be something German banks welcome, but it is a disaster for Ireland. And many economists now predicts that it is just a question of time before the country defaults. "This 'bailout' will sink the Republic," warns economist David McWilliams in the Belfast Telegraph. "It is the EU giving us enough rope to hang ourselves in the hope that we don't hang all of them."
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A welcome riposte from a well respected German newspaper to the Eurofederalist elete.
 
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