Ireland Callingby John Spain
- "Greed is good", especially in Ireland it seems with pillars of society on the take
- Vintage pamphlets offer a glimpse at the rules of 50s-era Irish Catholicism
- A leap of faith by Ireland, the exit from the IMF/EU bailout
- A temporary detour from ecomic issues to Irish soccer madness
- Give Britain a break after decades of Irish emigration to the UK
These briefings were part of the government’s attempt to form a national consensus on the measures necessary to reduce the enormous budget deficits that are threatening to bankrupt the country. The cuts in spending and increases in taxation are so huge that they need all party support if they are to be accepted by the country at large.
There is a view among a large section of the population in Ireland these days that the situation we face is so serious it’s time to put party politics aside, get all the politicians together and form a national government.
A lot of people have come to this conclusion because they realize we are facing an economic crisis of unprecedented proportions, and that the usual point scoring and squabbling that goes on between the political parties has become irrelevant.
The country is sinking into debt at a frightening speed, and it’s getting worse every week because the government is spending over a third more than it collects in tax.
That’s happening because we expanded state spending in line with the huge tax revenue inflow during the property boom, and even though the property bubble burst three years ago and our tax revenue started to dry up, state spending has stayed much the same.
Last Thursday -- dubbed Black Thursday by the Irish media -- Minister for Finance Brian Lenihan revealed the awful truth to the Dail (Irish parliament).
We had known in advance that it was going to be really bad -- in fact I gave the €50 billion figure in this column last week -- but to hear it spelled out in stark detail by Lenihan in the Dail was genuinely shocking.
For once the media were not exaggerating. It was without question the darkest day for Ireland since the Irish state won its independence.
Two years ago this week, after Lehman Brothers collapsed and the international financial crisis accelerated, Anglo Irish Bank in Dublin with its tens of billions in bad property loans reached the brink.
The situation was stark. Either the government stepped in or the bank would have imploded within hours. The alternative for the government would have been to let Anglo Irish collapse immediately and risk the fallout that could have dragged the rest of the Irish banks down with it.