The Cedar Lounge Revolution

When you live in a slightly social democratic society… February 18, 2009

Morgan Kelly in the Irish Times yesterday argues that “government borrowing is not an immediate problem, but the extent of banks’ bad debts may prove catastrophic”. Which is curious since we’ve been told precisely the opposite. And yet still they continue with a bail-out of a banking sector which has proven itself utterly beyond belief in terms of the rapacity of its attitude towards the state and taxpayers – and a shining example of that today in the refusal of Seán FitzPatrick former head of Anglo Irish who is refusing to appear before the Oireachtas committee on economic regulatory affairs due to ‘legal reasons’. No such reservations from Seán when offered the chance while still in charge to opine at length about how the government had to be ‘brave’ and slash the public sector and social programmes… some piece of work in other words. Still, consider the rest of that article and you’ll see that his problems multiply and multiply, as do those of the cosy little environment within which he was embedded.

But the thing is, and despite the somewhat lower key bids to stir the pot against the public sector – lower key presumably because the all-out attacks only delivered an evisceration of Fianna Fáil’s poll ratings and a majority against the pension levy – that the public recognises all too clearly the severity of the situation, and while sympathy for the public sector is limited it is – frankly – neither here nor there when considered in the totality of the situation (and as a further point, the Irish Times should reflect on the fact that the public sector stretches across this state and that, as I think sonofstan noted previously, our partners, parents, children or friends may well work within it, and more than likely do. So class war from above isn’t necessarily the wisest course of action even if you inhabit those lofty heights).

The severity of the situation revolves around a political class seemingly in thrall to the financial sector, to the extent that they will bet the house, or in this case the state, on that sector, a sector already in part demonstrably malign in their actions, a sector that appears to have played the markets off the back of government financial assistance. And that’s not a boiler-plate attack on capitalism, although I’m more than happy to talk at length about how ill-served this country has been by its indigenous version of capitalism. I loathe terms like crony state and such like. But really, who can argue that what we have seen has been a supine retreat from responsibility by those who appear inextricably linked with those they should by rights be overseeing in a neutral and dispassionate fashion?

So, what are we left with? The political aspects of this are clear. There is no likelihood of a change in government. There is some possibility that the fall-out from severe defeats for the Government at the local elections might presage some change, but I think its slight.

Counter-intuitively the worse things are for the government the less likely that any element of it will cut and run either to opposition or to the country. And the house that Bertie built remains just about strong enough, so far.

That said the ferment of anger out there is such that only the very bravest of Fianna Fáil TDs and representatives won’t be quailing at its force (and for the first signs of that consider this). No harm there. And perhaps the slight prospect that they will actually recognise that you cannot even indirectly attack a people, which is to my mind largely what we are seeing here, in order to prop up an unsustainable system.

Indeed, as an aside, it will be interesting to follow media coverage of the Irish Life and Permanent union which has ‘written to senior executives at the lender saying they have lost confidence in chairman Gillian Bowler and interim group chief executive Denis Casey’. That must set off some cognitive dissonance in the great and good as they try to deal with a union (bad) berating the paragons of the banking sector (double plus bad, at least for the moment). Oh yeah, and ‘interim’ chief exec Casey? You’ll know that name from … er… a certain…

Mr Casey bowed to growing pressure and resigned last Friday after the board had initially declined his offer to step down following the emergence of details of a €7 billion transaction between IL&P and Anglo Irish Bank. He will remain as acting group chief executive for a transition period until a successor is found.

He’s unlikely to starve in the meantime.

I’ve argued before that we’re only a very slightly social democratic society. Our public infrastructure, in its broadest sense, has remained undeveloped and underfunded, a legacy of a political approach positioned in the supposedly apolitical or unideological, which – of course – was in truth anything but those two qualities. It remains to me a breath-taking fact that even in 2009 near enough 70% of our populace is willing to place a tick beside centre right political formations. And that represents precisely no change on the situation for decades (I exclude the most recent poll, and will until we see definitive trends). But here’s an intriguing paradox, perhaps because that public infrastructure I mention is so weak, so paltry, in comparison even with our nearest neighbour and more particularly with our European partners, that what we have we tend to want to hold.

Because take a little from someone who has a little and you’re taking a lot. And that – potentially – is one reason for the near uncontrolled and politically clearly uncontrollable (at this point) rage at the banks and at the government. They, the government, ceded so very little, tax cuts that have been frittered away across a decade and a half, widening of tax bands and so on and so forth. The paraphernalia of a system that is – in effect – paper or computer based, intangible, nebulous. It’s not that these things have no utility, that would clearly be wrong, but their utility is lesser than that of a sustained effort to build up public capital in terms of the physical infrastructure, in terms of services both education and health, and so on.

I always thought the Fine Gael charges about ‘wasting the boom’ were poorly made even if accurate, and the source of them dubious, but there is something to that – even if one suspects that they in power would have done little that was different.

But now that money is gone and what is left is being diverted towards more paper based locations, the financial sector. And all the time the hectoring tone from above…. we must take the medicine. We must suffer the pain. We must do what they say because?

Well, actually, why?

Just because… because they won’t pay. Perish the thought. Fitzpatricks first and last instinct was to see others cough up, and that was when things were less parlous than they are today. The Irish Times is as ever quick to demand solidarity to benefit the strong, but strangely less keen to seek it for the weak. And our Government… ah.. our government.

These are the same people who were cheerleaders for the last decade and half, the same people who applauded every time the tax rate dropped a further percentile, every time the housing market bounced upwards.

So who, precisely, are they to tell people what they should do and how they should feel when the very policies that they championed have seen our resources squandered, our society left on the brink of impoverishment and our people – including, for the record, me – living in genuine fear of what tomorrow will bring?

And they wonder why the public isn’t listening to them?

And turning to our exalted second chamber, what of discussion of the economy in the Seanad? February 17, 2009

What indeed?

Senator Joe O’Toole:    I have regularly raised the issue of bank recapitalisation, but every time I raise this question people tell me why we need to do so. I have no problem with recapitalising the banks but can someone explain to me how that can lead to the release of credit to small shopkeepers and other small businesses?

Senator David Norris:   Hear, hear.

Senator Joe O’Toole:  It has not been explained. It has not worked in the United Kingdom or the United States. The British chancellor was almost in tears because after giving billions to the banks over there, they told him to go away. I am not trying to catch the Leader out on this, but if he does not know the answer I would like him to check it. Banks are owned by their shareholders who decide what is to be done with the money. If we put money into the banks, which is described as recapitalisation, the bank management decides what happens next. They can only do what is in the best interests of shareholders, not what is in the best interests of the Government, the economy or the country. That is the law of the land. I want to know how putting money in at one end ensures it will come out the other. I cannot simplify it any more than that. Since last September, I have asked this question of everyone who has anything to say about the economy, but nobody can indicate to me how it can happen. I had a discussion with the Leader about ways to release money when we had the issue concerning the ACC, the ICC and credit unions. As of now, however, I do not see how it can be done.
As regards the pension levy, I agree with Senator Fitzgerald’s point that we have managed to split the workforce between the public and private sectors. We should look at this on the basis of what is right, fair and honourable. If public servants need to pay more for their pensions, they should do so. On the other hand, there is absolutely no justification, understanding or equity in a situation when people earning huge amounts of money – the 35,000 millionaires that the Minister for Education and Science, Deputy Batt O’Keeffe, refers to regularly in his weekend speeches – are not asked to pay one shilling above and beyond the 1% levy that everyone else is being asked to pay. The Government should face up to the difficulty and recognise that it should introduce an extra tier of taxation. That would at least let people see that there is fairness and equity in what is happening. Until that happens, people will react against the measure.
Somebody asked if strikes are a good thing. They are never a good thing but there is a time when people must express their views on something – not to achieve an objective but simply to say “We will not accept this. It is not good enough”. That is the danger of what is happening now. The Government should look at the proposals, deal with them in the broader context and tell us where they lead. It should also tell us how it is going to deal with high earners who are not being asked to pay extra.

Senator Ned O’Sullivan:     Will the Leader arrange a debate on the future of the horse racing industry, which, like every other sector of the economy, is facing a rather uncertain future? It is a very big industry and creates many jobs at various levels, from breeding and training to racecourse management. It regularly injects a large amount of money into small towns such as Kilbeggan, Mallow and Thurles, in addition to the major festival locations such as Fairyhouse, Punchestown, Galway and Listowel. Sponsorship has been the most significant factor in making Irish racing so important and the generosity of sponsors has never been questioned. I was delighted to see that Punchestown was able to announce that it had secured its five major sponsors again for this year’s festival meeting. That is wonderful but other stories are beginning to emerge about difficulties at smaller tracks. I ask the Leader to arrange a debate on what is a crucial industry for this country.
It would be remiss of me to talk about racing today without mentioning an outstanding sporting performance by A.P. McCoy who rode his 3,000th winner yesterday in a career which has been a showpiece for Irish racing and for the world.

An Cathaoirleach:    That is not relevant to the Order of Business.

Senator Pearse Doherty:   …I refer to the discussion on the banks and the need to get our act together. We are hearing the Government is thinking about imposing cuts on high earners in the banks. We are hearing it is considering a two-year moratorium on home repossessions. We are hearing it is considering that lending is made available to small businesses. These are the proposals that my party and others on this side of the House argued for when we dealt with the issue in the autumn. These are the same proposals we made when dealing with the Finance Bill a few months ago. The Government is behaving in a reckless manner by not listening to the concrete—–

An Cathaoirleach:    We cannot have a debate now.

Senator Eugene Regan:    I refer to the Taoiseach’s speech at the Dublin Chamber of Commerce function last week, in which he—–

Senator Terry Leyden:    It was an excellent speech.

An Cathaoirleach:    We are taking questions to the Leader now.
Senator Pearse Doherty:     —–proposals being made by the Opposition that make sense. This is the economy for slow learners. The Government is in the slow lane.

An Cathaoirleach:    Does the Senator have a question for the Leader?

Senator Jim Walsh:    To follow on from the point made by Senator Regan, it is good to see the engagement between the Opposition and the Government because those of us who occasionally have the opportunity to observe what is happening in other jurisdictions will have noticed that the British Minister, Mr. Hill [erm... does he mean Miliband?] , made a comment at a party meeting that the world was facing the worst economic situation in 100 years. In a Freudian slip, the British Prime Minister last week in the House of Commons mentioned the word “depression”. Yesterday the American President gave an indication that it could take 15 to 20 years before we come out of this situation. All the signs are that this is as bad as the Great Depression. Everyone knows it took 20 years for the Great Depression to pass and it took the Second World War to change the scene.
I agree with the request for a debate on the recapitalisation of the banks and in particular with regard to the releasing of credit. I refer to the Dutch Government model in which it took on board 80% of the debts of the Dutch bank. There was a devaluation of 10% which was given as a cash contribution to the bank and no other cash contribution was given, in the hope that by parking these debts and taking them off the balance sheets of the bank, this would release credit through the banks. Some business people who deal in fairly substantial sums with the Dutch banks tell me that the situation there seems to be better than in any other country in Europe. I suggest this should be considered as a model for us. It is a case of trial and error as no government seems to have come up with the recipe for a solution.
Senator O’Toole referred to the divide between the public and private sectors. This will be so destructive that it could accelerate the difficulties we face and insolvency could be the end game for many countries, including our own. As Senator Hanafin said, it could well be others who will be telling us what needs to be done.
Public service salaries are too high. Our pensions are unsustainable. The extra contribution we are now making towards pensions do not in any way meet the cost of those pensions. There is still a need to reduce salaries by a minimum of 10% across the public service and there is a need to reduce numbers by a minimum of 15%. These will have to be the people who are not performing in the public service. If we fail to do this we will not be able to address the difficulties.
I refer to the reasonable points being made by Senator Alex White. The Taoiseach has been saying for quite a considerable time that there is a hole in the public finances amounting to €16.5 billion to €17.5 billion and this must be addressed over a period of four to five years. Other economists are saying it could well be north of €20 billion. All we have done with our €2 billion is scratch the surface—–

Senator Alex White:    It is one and a half—–

Senator Jim Walsh:    —–and everybody should recognise that. I appeal to the social partners to come and play their part as they have done in the past.

Senator Jim Walsh:    They have also been instrumental through benchmarking and otherwise in adding to the depth of the problems we face. We need solidarity from both the private and public sectors and turning on each other will be counter-productive. I hope we can move in that direction. The change in the mood in the House today has been a step in the right direction which I hope will last.

Meanwhile, if you like that… well, you’ll love this…

Senator Donie Cassidy:    Senators Fitzgerald, O’Toole, Alex White, O’Reilly, Norris, Coghlan, Buttimer, Doherty, Hanafin, Walsh, Healy Eames and Quinn gave the House the benefit of their experience, made proposals and expressed opinions on the banking challenge facing the country, Government policy and our low tax regime. Interest rates are at an unprecedentedly low level. Anyone who read page six of the Irish Independent on Saturday will have noted that Bank of Ireland and Allied Irish Banks are offering a rate of less than 3% to first-time house buyers. As someone who had bridging finance in 1980, I have seen both sides of the coin. Those with a secure job who have confidence in the market have an opportunity to buy their home because they will not get better value for money.
Recapitalisation of the banks is necessary. Many of us will have seen President Obama make his first address to the American nation. Yesterday, he visited small towns where unemployment has increased from 4.6% to 15.3% in 12 months. Some countries may be in a better position than Ireland but many others are worse off than we are. Members of both Houses will have to channel their energies, expertise and focus into job creation. This can only be done by looking after the small and medium-sized businesses which kept the country going in the 1970s and 1980s. During those difficult periods, we looked after these enterprises through the Government bank, the ICC. The ACC, as it was then, helped the farming sector in the 1970s when agriculture experienced major difficulties.
Anglo Irish Bank is now a State bank. Let us look after the innovators and creators who are creating wealth and jobs. We must seriously consider creating competition in the marketplace if certain banks refuse to play their part, especially those which did not accept the State guarantee. Senator Hanafin cited a number of examples. The Government and Legislature are duty bound to look after Anglo Irish Bank, a State bank which can provide credit and replace the ICC.
Senators have expressed diverse views on this issue. We must take steps to give hope and confidence. Ireland has some of the most able and creative people in the world and the economy is one of the most successful in the world. For the past 12 to 18 months, credit, the lifeblood of commerce and business, has not been available. It must be made available.
A number of Senators present in the Chamber have played a leading role in society over the years by giving exemplary service to the nation. In my humble opinion we must give serious consideration to creating competition for the banks. Senator O’Toole was a leading figure in the social partnership process, of which we are still part. As he correctly noted, in his experience shareholders come first. In that case, the only institution which will look after small family businesses and medium-sized enterprises which employ people throughout the country is a State owned bank. The Government will have to take a lead in this regard. Our only obligation is to look after the bank we own. Perhaps the Minister will outline whether this proposal is a runner. We should consider this approach.
Many Senators noted that energy costs are too high. I watched the programme “One to One” on RTE last night. I am an admirer of much of the work done by the ESB which has performed an exemplary role during the years in providing a service all day, every day throughout the year. The chief executive officer of the company, Mr. Padraig McManus, gave a magnificent interview last night on his vision for the ESB in the coming years. Under Mr. McManus and his predecessors, the ESB has been a success story both here and abroad.
Be that as it may, as Senators pointed out, we are in a time of crisis and energy costs are of the essence. It is unacceptable that energy charges to industry have increased by 25% in the past three or four months. The position is unsustainable and must be addressed by the Government or Commission for Energy Regulation. All sides of the House call for action to be taken immediately to keep the economy competitive. Energy costs for some private dwellings have increased by 50%. Senior citizens who need heat and electricity have been particularly affected and must be supported during the downturn. Senators must raise the issue of energy costs when the Minister comes to the House. At the start of the term, I stated the House would prioritise the issue of energy until a satisfactory outcome is secured from Bord Gáis and the ESB.

The debate meanders…

Senator Donie Cassidy:    When one adds income tax of 41%, they [top earners] pay 45% of their income. They belong to the 6.5% of the population who pay 50% of all income tax paid in the State.

Senator Pearse Doherty:    Public sector employees who earn €40,000 pay more than 50% of their income in tax.

Senator Joe O’Toole:     On a point of order, we were warned by the Government not to call the levy a tax.

Senator Donie Cassidy:    On a point of information, whether it is a levy or tax, it comes out of one’s wages.

Senator Ivana Bacik:    That is what we say.

Yeah, and not just you guys…

Senator David Norris:    The Leader is learning.

Senator Donie Cassidy:    I am trying to bring balance to the House, given the comments made. We must not forget that 50% of all the income tax paid is paid by 6.5% of the people. Some 38% of people working pay no income tax. We must bear in mind that if there are no golden geese, there are no golden eggs.

Senator David Norris:    The goose is not golden but the eggs—–

Senator Donie Cassidy:     We must know—–

Senator David Norris:    That is a goose with magical properties.

Senator Donie Cassidy:    We must know from experience that those who take the risks must have a chance to make a profit. We must also know from experience that it is not a crime to make a profit.

Senator Joe O’Toole:    Hear, hear.

Senator Donie Cassidy:    We want to encourage the Irish-owned small and medium-sized family businesses, in particular, who employ 880,000 people. They will be here next year and in the years after that if credit is made available by the banks. As legislators, we have a duty to ensure we bring this point home. Our party leaders are meeting this afternoon. We are the representatives of the people who work for those who have provided employment for a long time.

At this point, once in slightly less than a week, I put my head in my hands…

Henry McDonald discovers ‘independent senator’ Eoghan Harris February 16, 2009

A very welcome guest post from EWI

A recession-themed blog post with Irish interest last Friday by Henry McDonald of the Observer:

“One of those calling for such a government is a member of Ireland’s second chamber, the Seanad, who has himself crisscrossed the old traditional divides of left/right republican/nationalist over the last four decades.

Eoghan Harris, an independent senator, has been a spin doctor and political adviser to an eclectic band of parties ranging from the hard-left Workers party all the way across to Fianna Fáil under Bertie Ahern.

In between, his media strategy helped elect Mary Robinson, the first female and liberal president of Ireland, back in 1991.

He even crossed the border to come to David Trimble’s aid when the then Ulster Unionist leader tried to sell the Good Friday agreement to a sceptical unionist electorate.

Harris argues that the republic’s present plight is akin to a nation at war and that, in wars, parties unite to form national coalitions.”

Now, there’s a number of problems with this remarkably modest account of the adventures of one Eoghan Harris over the past couple of decades – “crisscrossed the old traditional divides of left/right republican/nationalist” hardly does justice to someone who has bounced from hard-left Stalinist to hard-right Bush (and Adhmed Chalabi, and Likudite, and other lovely causes) supporter – and one might reasonably wonder at how an old comrade like McDonald can be unaware of the finer details of such a colourful career (or fail to mention their personal connection in the old Sinn Féin – The Workers Party). Indeed, an innocent reading for the first time of this particular Irish senator might form the opinion that here indeed is a Hibernian Gorbachev, an intellect untramelled by the constraints of ideology, ready to shed light on the truths which lesser mortals cannot see.

Mar dheá. A suspicious mind might find it odd that the good senator should happen upon this idea just as a poll appears this week predicting the catastrophic electoral demise of Fianna Fáil (to whom, incidentally, Harris owes his Senate perk). An idea, moreover, which would divorce the main opposition party from their prospective Labour coalition partners (and leftward influence) and instead hitch them into Government with a political party committed to the very same cult of the free-market that got us here – and, of course coincidentally, policies which facilitate the rescue of FF’s privileged friends and benefactors in Irish society, and which are responsible for their hammering in the polls. Our hypothetical innocent reader might wish to enquire further into the subject of McDonald’s hagiography, given such recent Harris-emanated senatorial pronouncements as:

“There was a lot of talk of fat cats but “every wealthy person in Ireland, Tony O’Reilly, the Smurfits, whoever you want to name, has seen their wealth cut by between 50 and 60 per cent”.

He was struck with absolute disbelief about the case being made for those in the public service.

“I cannot understand how in a world of Dell and the Waterford workers, people in permanent and pensionable employment have so little grasp of reality.””

“Sir” Tony O’Reilly, of course, is the tax-exile billionaire whose patronage (and employment) Harris has enjoyed for many years as a faithful attack dog in various forums, and the conversion of whose Irish media interests to a pro-Bertie stance before the last elections led to a grateful FF leader giving Harris the reward of a cushy seat in the upper house. And Harris using a reference to Waterford Glass – which O’Reilly himself owned and has now closed, putting all those workers out of employment – to beat the public sector with? Pure class.

Odd that…the Sunday Business Post says that public spending is and isn’t an existential problem. February 15, 2009

Check this out from – to my mind – the only Sunday paper produced in Ireland worth reading (and incidentally, what’s with the book reviews, pretty much every second week there is something of interest to leftists)…

[Royal Bank of Scotland] estimate that total banking losses in Ireland could reach €30 billion, which is significantly higher than existing estimates by the government or banks. The RBS ‘fragility index’ measures the financial position of each eurozone country on the basis of nine measurements, such as household debt, public debt, foreign funding and current account balance.
…
Ireland comes last in five of the nine sub-indices. According to the report, Ireland faces huge pressure in funding its short-term financing needs, which are the highest in the euro area.
….
In the next three years, more than 100 per cent of Irish GDP will need to be refinanced, split evenly between non-financial corporate debt, financial corporates and the public sector. This debt will be much more expensive to refinance than was previously the case. ‘‘This . . . will be the greatest challenge of the Irish economy over the coming two to three years,” according to the RBS report.

Wait a second what’s this?

However, RBS also notes that the National Treasury Management Agency has a strong cash position and the facility to generate cash quickly.

Huh? That’s not what we’ve been told by the great and the good…(and only Michael Taft has referenced the NTMA figures which are exceedingly healthy).

This will facilitate public sector borrowing in the short term, but finance for the banking sector is likely to pose a greater problem.

Pardon? A ‘greater problem’?

Hmmm…. how interesting, and yet how odd…on a day when yet again the SBP editorial argues that:

Cutting public spending is key

Not just a means of dealing with a small part of the problem, but ‘the’ key.

Oh dear…

The government’s principal attention, therefore, must be devoted to reducing public spending. The government’s decision to impose a pension levy on public servants – praiseworthy and courageous though it was – is not sufficient in itself to address the imbalance between what the government spends and what it collects.

The level of public spending will have to be reduced, and that will entail a reduction of services in many areas. Capital spending has to be cut. Entitlement programmes have to be examined and some – particularly those which benefit the better off – reduced. This is unfair and it will be unpopular. But it is not a matter of fairness. It is a matter of necessity.

Er… no Mr/s Editorial writer because RBS amongst others say it’s not actually a matter of necessity and that our banking sector problems are much greater.

As the situation worsens, the crisis at least has the advantage of bringing clarity and a sense of proportion to the questions of public policy which currently confront us. What is less important should be set aside, and dealt with later. The government must do what it can.

Do you think someone should tell him or her about the facts, as distinct from the ideology?

Still, why should the government, and by implication all of us, do this?

Reducing the budget deficit and restoring confidence in our ability to manage our affairs, so that we are able to borrow enough money to run the country in the immediate future, would not just be a vital signal to the international markets and the international community at large – it would be an affirmation to ourselves.

Somehow that’s one sort of affirmation I don’t think we really need… but the RBS report quoted above makes a nonsense of the editorial’s analysis. Don’t they even read their own newspaper?

The Irish Times editorial bemoans the poll indicating that the public doesn’t want to have to pay for the actions of others in our economy… We’re all ingrates now. February 14, 2009

Well, I guess it’s as expected really. The Irish Times editorial is horrified by the fact that the public hasn’t bought the government, the media and the economic commentators analysis of the current situation.

A SIGNIFICANT proportion of voters believe that the €2 billion savings package announced by the Government last week was too tough, according to the Irish Times /TNS mrbi poll.

And worse…

On the question of the pension levy, 47 per cent thought the Government was wrong to impose it while 41 per cent thought it was right.

Which leads the editorial to argue…

After a property tax, support for an income tax increase and a new carbon tax run into double figures. But public willingness to shoulder a fresh burden is extremely limited. And, again, attitudes reflect the impact such taxes will have on the spending power of individuals.

So, that in mind its first instinct is to try to restoke the fires of the anti-public sector attacks, despite the polls fairly clearly indicating that this isn’t working as a diversionary tactic by the groups mentioned above.

Protest marches and industrial unrest have been threatened in response to the pension levy on public sector employees. Resistance is most evident in Dublin, where the majority of public servants work. But such actions may deepen a polarisation that already exists between public and private sector workers. Large majorities within both groups now insist they are taking more pain, arising from the recession, than their counterparts. This disagreement has been resolved in favour of private-sector workers by the general public in the opinion poll.

Well, yes and no.

When asked if the public or private sectors were taking more pain or whether it was being shared equally, the biggest number, 39 per cent, opted for the private sector with 29 per cent saying the public sector and 24 per cent saying the pain was being shared equally.

To be honest we could read that in two ways and we’d probably be justified but allied with the reservations about the pension levy above I think it’s fair to suggest that in fact broadly speaking the pain issue is off the agenda.

But this being the Irish Times it cannot resist putting the boot in further…

…the failure of public servants to acknowledge their protected and privileged positions and their unwillingness to accept a reduction in living standards, is an issue that should be addressed by their union leaders. A gap of 20 per cent already exists between comparable pay levels in the two sectors, without taking into account near-permanent positions and pension entitlements. That is the context in which the levy is seen in this poll.

Well, I’m not so sure. Look again at the figures. But more importantly should our paper of record be bandying around this supposed (and entirely unreferenced) gap of 20 per cent? What evidence does it have that such exists? For if we read this we get a rather different picture of the comparative situation between public and private sector. And as ever, given the noises emanating – that’s right – from the economic commentators on the IT’s own opinion pages it is clear that the next issue on the list they wish to address is the very concept of ‘permanent positions’ and ‘pension entitlements’. Which rather makes a mockery of the IT’s own argument. Don’t talk about entitlements if the reality is that you want them taken away and certainly don’t use them as a wedge between workers.

But as ever the calls for strong pain inflicting leadership grow.

Faint shoots of political recovery may be evident in such disagreement as sections of the public begin to support necessary, but unpopular, measures. For this trend to develop, however, determined and even-handed leadership will have to be provided by Brian Cowen within a clearly articulated framework for economic recovery. And the Minister for Finance must continue to exercise his authority and clean up financial services.

Yes. The old old solution. A leader. A leader who will ‘exercise authority’ ‘even-handedly’… Solomon perhaps. Or some such. Somehow, though, this is just as wrong-headed as John Waters near barmy piece on Friday. And just as unconvincing.