At 8:30 on Saturday night, the family was engrossed in "American Idol." Well, to be more accurate, the three teenagers were, my wife was keeping them company and I was hiding behind the paper wondering why we ever got a satellite TV dish. When Simon Cowell’s impaling of some tone-deaf contestant was interrupted by the commercial break on the half-hour, I announced that we were going to change channels to watch the live broadcast of Taoiseach (Prime Minister) Brian Cowen’s speech to the annual ard fheis (convention) of the Fianna Fail party. “It’s just about to start,” I insisted, to howls of protest and derision. “Hang on a minute,” I said, “the country is in the most serious crisis in our history and he is the leader, so what he has to say is vitally important to everyone.” “You’re sad,” said Teen 1, the sensitive female one. “Forget it, Dad, it’s not going to happen,” said Teen 2, picking up the remote and flexing his muscles. “Cowen is not going to change anything anyway,” said Teen 3, who probably has a future in politics. “Can’t you watch it downstairs?” asked my wife, who definitely has a future in the UN if her fashion business goes belly up. So muttering about how this proved that people did not understand the gravity of the situation (“Yes Dad,” they sighed), I slipped downstairs to my basement office and switched on another TV to watch Cowen. I’ve a feeling the same scenario was played out in many homes across Ireland on Saturday night. Given the state of the country, the whole population should have been tuned into the half-hour live broadcast. n’s every word. But such is the air of unreality about the situation here that my guess is that a lot of them were watching "American Idol" or some other crappy Saturday night entertainment. For many, the penny still has not dropped. But for many more, particularly the ones who have lost their jobs or had pay cuts or seen their pensions become worthless, a once unimaginable scenario has become all too real. They have woken up, and the nightmare has not gone away. Even for those in so-called good jobs, the sight of the economy shrinking further every day has them wondering just how “secure” their secure jobs really are. And they, like me, are fearful for the future. So I suspect that many more people than usual this year interrupted their easy Saturday night viewing to watch the Cowen, just as I did, in the hope of finding some reassurance about the future. For Cowen, it must have been a daunting task. He was feeling the huge weight of expectation from a country desperate for a way out of the mess. He was aware of ther about the banks. The speech came at the end of a week that had seen the Fraud Squad going into Anglo Irish Bank in search of incriminating files. And on top of that the taoiseach had to make his address just a day after a devastating national opinion poll had revealed that only 10 percent of voters are satisfied with the government’s performance in dealing with the crisis. (Even George W. Bush never had a rating as bad as that.) The poll in the Irish Independent also confirmed the slump in Fianna Fail’s support, with the party at just 25 percent, down 17 points from the last election, with Fine Gael (for decades the smaller of the two main parties) now on 30 percent, and the Labor Party now at 22 percent (up 12 points and now just three points behind the once almighty Fianna Fail). Numbers like this make the Fianna Fail members of the Dail (Parliament) lose their seats in the next election. So Cowen knew he had to reassure them. But he had to raise the hopes not just of his own party faithful in the audience in front of him, but of the audience watching on TV across the country, where so many people are sunk in fear and depression. As I said, it must have been a daunting prospect. But he did well. In his characteristic blunt manner, he told it exactly like it is, in simple plain language, appealing for patriotism and sacrifice so that we can all pull together and get through this. One speech cannot solve our problems. But at least we know that he is on the case. And there can now be no doubt about the hard times that lie ahead. So how does he see the situation we are in? “I want to make sure tonight that people realize the scale of the challenge we are facing,” he said.This year we budgeted for €55 billion in spending. The maximum amount we expect to raise from taxes is €37 billion. This leaves a gap of €18 billion in the day to day costs. We must close this gap. “We have decided to do this over the next five years,” Cowen said. “And the only way to do this is through an appropriate combination of cutting spending and raising taxes.” I could not have put it better myself, although many experts think the gap this year is likely to be over €20 billion, in spite of the cutbacks that are already underway. We have to cut day to day spending by the state very severely over the next few years and at the same time have penal increases in tax. In the meantime, we will have to borrow the shortfall every year while the gap closes. The amount we have to cut back can be seen from the fact that this year at €20 billion or so, the shortfall in revenue is not far off and all the rest of the spending on state services and programs. Close to half of what the state will spend this year will not be paid for by those who lose their jobs. “The fact is, we are now spending too much on the day to day running of the country,” Cowen said. “During the good times we could afford it; during the bad times we just can’t. It’s as simple as that.” The truth is that we completely lost the run of ourselves during the boom years and vastly increased government spending. A lot of it went on wasteful programs and agencies (like the Equality Authority) that seemed to fit our new status as one of the world’s rich nations. Most of this was paid for by tax revenue from the property boom. Now the bubble has burst and the tax revenues have vanished, but no one wants to give up any of the extra state spending. A lot of the useless agencies can be dumped, but we will also need to cut back on the areas most spending goes into, like health, education, benefits and so on. Services will be cut, Cowen warned, but that alone will not be enough.
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