We cannot be crucified on a cross of frugality: only growth can save us


The words of Jonathan Swift should have been echoing in our ears last week as we anticipated both the Budget and the latest EU Council meeting: “Expect nothing and you will not be disappointed.”

In both cases, the expectations far outweighed the outcomes. In the case of the Noonan/Howlin Budget, we learned that the kite-flying of the previous weeks had been done on ministerial hot air.

On one side we had Social Protection Minister Joan Burton stalking the corridors like a modern-day Maxwell Smart, waiting to pounce on passing journalists to tell them that the Labour Party is stopping Fine Gael doing A, B and C and to make sure to mention that she had led the charge.

On the other side, the Minister for Health took on the pantomime villain role; telling his colleagues that if he did not get his way, he would huff and puff and blow the hospitals down.

Meanwhile, Transport and Tourism Minister Leo Varadkar — the man who seems to be permanently poised between a platitude and a peccadillo — has turned into a latter-day Marie Antoinette with his weekend break version of “Let them eat cake”.

While the three major parties accept the reality of the debt-reduction strategy that has been imposed on us, there are choices. We can decide how we reduce the deficit by balancing tax increases against expenditure cuts.

The Fine Gael election manifesto proposed a ratio of 75:25 for expenditure cuts and tax increases. The Labour manifesto proposed a 50:50 ratio.

The resulting coalition adopted a division of 62.5 per cent coming from expenditure cuts and 37.5 per cent coming from taxes. An almost exact splitting of the difference: a squalid compromise.

Instead of any coherent strategy, what we have is a strategy that can be agreed by a majority of backbenchers on both sides. It is not budgeting by strategy but budgeting by horse trading. There is no more coherence in this strategy than there is in a box of fireworks.

We have a compromise rather than a coherent strategy at a time when the country is in great peril. Worse still the Government is apparently relying on austerity by itself without any stimulus, plan or job creation measures to get this country through the current crisis.

It is like a medieval doctor who treats patients by applying leeches to suck out the blood. When the patient fails to recover, he just applies another leech to suck out more blood. Eventually, when there is no blood left, the patient dies.

The objective of the Government’s jobs strategy announced after its first 100 days in office was, sensibly enough, to reduce unemployment. A few months on we can see from CSO figures that the strategy has been an abject and miserable failure.

Since that strategy was introduced, unemployment has risen by almost 10,000. That does not include the accelerated rate of emigration rate. According to all the anecdotal evidence it is running at 100 per day, though some suggest it could rise to as much as 200 a day over the next 12 months.

Nor does it count the increased number of people who have gone on the various job-training schemes the Government has set up.

As Mark Fielding, the head of Isme (the organisation representing the small and medium business sector employing 665,000 people) said a few weeks back after the Government had announced its micro-credit scheme for the umpteenth time: this Government needs to start taking its role more seriously and desist from participating in public relations stunts. What is required is less waffle, more action.

Let us face it; the Government’s compromised strategy approach will not work.

When Roosevelt took America off the gold standard, he was influenced by the advice of one of his top advisers who said that America could not be crucified on a cross of gold.

Ireland cannot be crucified on a cross of austerity either. What we need is austerity with imagination.

Austerity will stop the slide, but only growth can return us to prosperity.

Share This

Scroll to Top

This website uses cookies to ensure you get the best experience on our website. See our Privacy Policy for more information.

Subscribe to my newsletter

Advanced Search

Search archived posts using our predictive search facility.
Note: Predictive search currently only works with english translation.