Sunday Independent Stupid Statement of the Week September 23, 2012
Posted by Garibaldy in Sunday Independent Stupid Statement of the Week.trackback
The Sindo has an exclusive investigationinto the finances of what it quotes one Fine Gael MP describing as “militant union bosses”. Lucky we have it to combat the militants who are also guilty of profiting from social partnership. Something doesn’t quite fit there, but never mind.
Eoghan Harris has a new political credo. A flavour of it from the start below. And apparently he is still a social democrat.
1. I believe that the coping class is close to collapse and that the next Budget could begin a breakdown of civil society.
Ruth Dudley Edwards on her particular understanding of international relations (but not on the states that actually prop up many of the leaders she is talking about).
Most Muslim countries are poor, corrupt and authoritarian, and they have political and religious leaders who spread viciously anti-Western, anti-Christian and anti-Jewish propaganda and blame the Great Satan for all their ills.
Jody Corcoran represents the pinnacle of this week’s repetition of the Croke Park mantra.
The Government’s capitulation last week, in the face of what was an unuttered public sector ‘fat cat’ threat to strike, is nothing short of a seismic moment — one which has wonderfully illuminated the state of politics.
What happens next will define for a generation the course of events, although they haven’t seen it yet. They have all missed the moment — which was last Tuesday — when the Coalition formally caved in on premium pay and allowances.
Game, set and almost match to the unions, then, the public sector oligarchs, the insiders who have lived high on the fat of the land while the country was brought to its knees and are gorging still.
Finally, an example of how the attempt to add a veneer of intellectual sophistication can undermine the basis of a Sindo argument (and this is far from the only example). Marc Coleman leans heavily on Edmund Burke this week to support his argument for getting rid of the Croke Park deal.
If we are looking for old wisdom in new times, then we couldn’t do better than Burke’s call to maintain the contract between old and young.
This would be the Edmund Burke who was in serious debt virtually his entire life, was widely suspected of selling his political principles for a government pension, and declared himself not naturally an economist.
What a weird column from EH. Filled with contradictions.
And by the by, is it beyond any of them to quantify what they expect the gains from jettisoning CPA to be?
This from Corcoron is deeply disingenuous…
Let us put that another way: to avoid bed closures, to safeguard home help, to assist Ruairi Quinn’s drive to develop what is best in our children, Howlin wanted to cut the €27 annual underwear allowance by just €1.35 a year — less than the cost of a loaf of bread.
Those closures are going ahead anyhow. Just like cuts to SNA’s, etc etc. There’s an argument about allowances – and I’d have no problem in seeing them cut signficantly… but to pretend that one will solve the other…
Another journalist might have written:
“Howlin wanted to cut the €27 annual underwear allowance by just €1.35 a year — less than the cost of a pair of tights.”
@WbS
But surely every euro saved on unjustifiable allowances translates to a euro less in service or welfare cuts or tax increases?
(Given that we\’re working against a fixed quantum of cuts agreed with troika, and the modest allowance cuts were already factored into the plan for this year and next.).
The oddest aspect of the allowances affair is that Labour were willing to spend so much political capital in insisting that all those bizarre allowances must be maintained at all costs.
Even after their complete victory on the core CPA principles just a week or so earlier. It would be hard to see the unions unleashing complete and terrible war over for example the10k a year for no longer doing a private secretary gig, or the allowance paid while on holiday for missing the opportunity to do overtime, or the reimbursement for ladies night attire … etc. etc.
So given the fact that Labour had just secured the CPA on core pay and pay-like allowances, seems bizarre for Howlin to bottle it on the weirder fringe allowances.
the problem seems to be that there’s no agreement on what is ‘unjustifiable’ (outside of selected cases in the newspapers and consequent harrumphings) or what is not effectively part of pay… and why should there be, when it’s the clearly stated aim of FG backbenchers and the Sindo et al to force the govt into cutting public pay at all costs… including presumably the cost to tax revenues (the reduction in net pay is less than in gross pay, obviously) or as WBS keeps pointing out, domestic demand.
it’s foolish for the government not to meet a commitment to a certain level of cuts (although the extent to which people are complaining and criticising about that is verging on the sadomasochistic… we must CUT, regardless of all the internal and external complexities at work in the economic situation) but it’s happened before, in a rather similar situation: bank bonuses. In effect those are seen as ‘unjustifiable allowances’ (tied to an individualist if nebulous notion of performance for collective profit, as opposed to the communal nature of PS allowances which address rather the opposite problem of lack of individual autonomy and corporate demands) but surely you remember the furore about ‘contractual obligations’ which was as detached from the reality of failed banks as the wildest Sindo ideas of public service arrogance. it takes time to work these things out, and at least some willingness on the part of those affected to take a reduction of some kind in pay… which isn’t going to happen when people feel unjustifiably targeted (i.e. against the letter of the CPA) at the expense of other options.
A lot of very sensible points there gabbagabbahey.
Just to add in the broader context of the discussion the idea there’s a one to one correlation between reining in allowances/expenditure cuts is incorrect. The current round of cuts are in train. This year the N.S. my daughter attends has lost SNAs despite being a DEIS school. Same is true all over. Those cuts, and those in health etc will continue whether allowances are cut or not.
More broadly budget figures are open to amelioration. They have to be, there’s no guarantee that tax takes will match up with projections, and as we’ve seen they don’t, overshooting in some instances, undershooting in others. This is a dynamic situation, not one with minimal inputs and outputs.
As for increasing tax – well there’s an idea (and one that in no sense contradicts my earlier point that there are valid arguments for examining allowances carefully and closely).
another thing I’m trying to understand is how increasing income tax is a ‘disincentive to labour’, but cutting pay (or increasing working hours but keeping pay the same, as the ESRI suggested recently) isn’t.
assuming you’re not the kind of person that is actively enraged by each cent of your hard-earned money that goes towards providing public services, the only explanation I can think of is that it’s not about the perspective of the individual worker but solely of the employer, who doesn’t want to have to pay higher salaries so that after-tax income remains reasonable and attractive.
there’s an added layer of unreality in discussion of the CPA and a suggested new round of ‘benchmarking’ in that the private sector isn’t really having to compete with public sector wages because, outside of a few limited instances (notably at higher-level positions) the latter simply isn’t hiring. so even if there is some structural inequality that would disadvantage the private sector in having to make up for lower after-tax incomes (i.e. if public sector salaries are still comparably higher), it wouldn’t be visible or have any effect if taxes were increased tomorrow.
cutting public sector pay (agin the CPA) has the effect of partially reducing public spending at the cost of reduced disposable income (and the knock-on effect in the rest of the economy, including probably ultimately more unemployment spending) and reduced tax take, but unlike an across-the-board income tax hike, protects corporate profits (except insofar as those profits depend on a healthy domestic economy, which never seems to enter the calculations). that seems to be the only answer.
on the points raised further down the thread about bondholder’s payments, it’s pretty easy for someone to come in and say ‘but regardless of our massive debts, we’re still spending more than we take in’. and yes, our taxes and spending need to converge better, but to an extent that is both a partly separate and partly linked question. as in, the government is borrowing money to pay for some current spending, and also for paying down interest and debts… it’s the fact that it has to do BOTH that causes the problem, and the general climate of suspicion on the one hand about whether we can service these debts (which may or may not be helped by repudiating or defaulting on some of them), and on the other the insistence that the debts are non-negotiable. really both sides are unsustainable, and if anyone remembers that there’s an alternative to austerity the spending/tax gap, and the debt overhang, would be closed mostly in favour of raising tax revenue both through growth and increased rates. except we’re told that’s an economic impossibility straight away, unlike growing the economy through shrinking it…
“another thing I’m trying to understand is how increasing income tax is a ‘disincentive to labour’, but cutting pay (or increasing working hours but keeping pay the same, as the ESRI suggested recently) isn’t. ”
This is something I puzzle about too. Yesterday I posted up the Jason O’Toole interview with Hayes where he explicitly seemed to think that property tax (for which in his instance read house, and maybe, maybe land) was a burden that could be borne by people whereas income taxes were not. But from the perspective of the individual tax payer that line makes no sense. There isn’t money available for one if there isn’t for the other. Actually Hayes made a weird point I still don’t understnad about monthly payments of property tax IIRC.
I just had a look at that interview again, and yes that first part is a little odd. I suppose the logic goes that you have to pay a property tax as long as you own your house, so there’s no disincentive towards working involved – in fact probably an incentive towards getting a better-paid job! – whereas in the right-wing view of the world people are discouraged from earning more money if they have to pay a slightly higher proportion of it in tax.
There is an element of variability in a property tax in that (under normal conditions) you could downsize or rent, thus reducing your tax bill relative to income in a way that you can’t simply do with income tax… so perhaps enable some people to reduce the pressure on themselves – and thus also on wages and employers, which I think is more in the line of thinking. But people aren’t inclined or able to move currently, and with legitimate expectations of a fair-sized family home, etc. it will just be factored in as a reduction in disposable income, so surely it will have the same pressure on earners and pay as regular income tax increase would (and those kind of pressures are why ‘broadening the tax base’ is generally still seen as an attack on income: unless it can be shown that the things taxed are something people genuinely have a choice about, or derive from greater wealth).
Hayes seems to be talking about ‘pressure on working people’ rather than any specific disincentive to work, so I suspect he means his current enmity to pensioners and the recently-floated issue of ‘intergenerational equity’ (which btw, while I think as an issue has its merits in relation to employment, tends towards the view of society as competing, atomised individuals – although organised in cohorts when it suits ideology – and misses the point that there is rather more solidarity between generations in families, indeed it is a recognised system of welfare/social transfers outside the official figures). Not everyone who owns a property is necessarily ‘working’, although most would be drawing an income of some kind, and one of the purported advantages of a property tax is that it would incentivise retired people to move from costly, large, urban or near-suburban family-sized houses and make them available to ‘working families’… who can presumably better afford to pay the tax. I suppose (in theory) it is aimed at distributing wealth more in line with income, by taxing the former from the latter… although that is still inherently unprogressive when class division and overall income inequality is taken into account, which it rarely is by the economic orthodoxy.
On the monthly thing I assume he means that some people find it easier to pay large sums on a staged basis… although of course that doesn’t at all address genuine inability to pay, and since the question put to him on the strength of mortgage defaults, which are based on inability to make monthly repayments… well that’s the typical politician’s answer isn’t it, ironically circling back to the point and completely missing it…
@WbS
Yesterday I posted up the Jason O’Toole interview with Hayes where he explicitly seemed to think that property tax (for which in his instance read house, and maybe, maybe land) was a burden that could be borne by people whereas income taxes were not. But from the perspective of the individual tax payer that line makes no sense. There isn’t money available for one if there isn’t for the other.
The point is that the payers of an income tax rise and a property tax are not necessarily the same people.
There are plenty of non-poverty-striken people who pay little in the way of income tax (retirees, self-employed, farmers, those involved in various cash-trades etc.) so would be largely untouched by income tax rises.
By virtue of income tax falling on a smaller pool of payers, the impact is greater on average. And more damagingly, that impact can cause people to choose to reduce their hours, or not go for a promotion, or engage more aggressively in tax avoidance.
Whereas as gabbagabbahey points out, a non-income-based tax is a positive incentive to increase earnings (as well as bringing a wider pool of payers into the net).
And more damagingly, that impact can cause people to choose to reduce their hours, or not go for a promotion, or engage more aggressively in tax avoidance.
There is empirical evidence to support these contentions, yes?
Spot on ejh. And perhaps even better is this…
a non-income-based tax is a positive incentive to increase earnings
In the middle of the worst economic downturn in living memory with unemployment at 14 per cent plus talk of ‘positive incentives to increase earnings’ are absolute nonsense.
Better yet again is this:
The point is that the payers of an income tax rise and a property tax are not necessarily the same people.
What’s breath taking is the complete indifference (or misunderstanding) of the central point made by me that those who already pay income tax (and a large subset of same – perhaps a majority, I don’t have the figures to hand) – will overwhelmingly have to pay a property tax as well. Brian Hayes made no distinction.
This is world class trolling.
there’s an added layer of unreality in discussion of the CPA and a suggested new round of ‘benchmarking’ in that the private sector isn’t really having to compete with public sector wages because, outside of a few limited instances (notably at higher-level positions) the latter simply isn’t hiring.
Squeezing the hiring pool is not the only, or even the main issue with disproportionately high public sector salaries, holiday entitlements etc.
The real problem is that the services provided by the state (on which the private sector depends) have disproportionately expensive unit costs.
So if a certain quantum of education or healthcare or security or whatever (usually labour-intensive) service becomes more expensive to provide, then a fixed budget can only purchase a lesser amount of that service.
The taxpayer gets far less bang for their buck in effect.
so even if there is some structural inequality that would disadvantage the private sector in having to make up for lower after-tax incomes (i.e. if public sector salaries are still comparably higher), it wouldn’t be visible or have any effect if taxes were increased tomorrow.
Not sure what youre getting at here. How would across-the-board non-confiscatory taxes make a structural inequality between sector disappear?
then a fixed budget can only purchase a lesser amount of that service
Except that of course the budget never is fixed, because attempts to cut public sector wages are always accompanied by attempts to cut public sector budgets and public sector provision.
Exactly, and it is also possible to increase revenue streams through taxation.
I have to say I never did quantum economics in college (even though I had Moore McDowell as a lecturer, who took great pleasure in telling us that it’s not economically worth it to try and reduce road deaths to zero… which is true, but it’s also a good example of the potential problems with relentlessly applying quantification to political issues).
I guess I was just talking about public sector pay in terms of inputs not outputs, as you are. Which is obviously important but I think difficult to quantify – at least to the point where you can define, even speculatively, the ‘unit cost’ of what is a very disparate and essentially non-economic services (i.e. activities which are not commercially traded either for inherent reasons – like Gardaí – or because they’re providing a public service at least partially outside of the market – teachers, nurses, busdrivers, and of course the central apparatus of government). I mean, you can find out how much an hour’s work by each costs, but that doesn’t tell you much if they’re not traded services, and if the benefit is accrued not to individual consumers but society in general.
Ideally we should have a public service staffed by reasonably paid, professionally qualified people who provide, as efficiently as (reasonably) possible, the amount of services people want in return for the amount of taxes they are willing and able to pay. Because practically by definition the consumers of each ‘quantum’ of public service are not, except occasionally, the exact funder of that service, you can’t put a unit price on it – only by aggregate, matching the demand (votes) and supply (taxes) curves. The idea of ‘getting more bang for your buck’ – making public services more efficient – rather obscures the actual ideological battle going on between those who want more bang for possibly more buck (the Left) and those who want less bang (except for anything relating to their own collective interests) for significantly less buck (the Right). as ejh says, the reduction in pay is an addition to, not a substitution of, reduction in services under the current orthodoxy. Politicians pay lip service to protecting services, but it’s difficult to pay fewer people (remember, there’s target for reduction in numbers too) less money to do the same work. Of course there are efficiencies to be made, but the public sector is not a business – it’s aim is not to be profitable, by reducing costs relative to revenue, but to provide necessary services. A company can reduce its unit cost by downsizing, and to an extent that’s what the government is doing right now, but since there’s no equivalent competitor to take its place, there’s just a reduction in the aggregate service for everyone.
Anyway, that’s why I think the quantum approach to the public sector doesn’t make sense. There may be other issues about the relative tax burden compared to other economically competitive countries, but in general the output of the public sector is defined by a democratic balance between taxing and spending, i.e. macroeconomics not microeconomics. The inputs (pay and salaries, in total the net amount from tax revenue) matter outside that mainly because of their effect both on the quality of services and the effect on the labour market – but since the public sector is largely removed from the labour market currently (at significant cost to unemployment), that’s why I’m saying that too-high public sector pay couldn’t have that great an effect on it.
If there was an inequality – which I think is difficult to prove considering the above, in relation to outputs, and mostly matters in terms of what other jobs the same people could get in the private sector – it wouldn’t disappear with tax rises, but it wouldn’t have any effect until the public and private sectors started competing again for workers. Which is likely to happen sooner if the government doesn’t suck money out of the economy through pay cuts, but if they simply redistribute it through tax (pace the whole bigger slice of the smaller cake thing, or the unsolved Laffer curve).
That’s very kind of you, but I think you’ll find that no more sophisticated analysis than “get the bastards” is actually required in order to address this issue.
@gabbagabbahey
I mean, you can find out how much an hour’s work by each costs, but that doesn’t tell you much if they’re not traded services, and if the benefit is accrued not to individual consumers but society in general.
Sure, its very difficult to quantify the outputs of certain public sector jobs. But I dont see how taking that as a given prevents us from measuring the costs of service provision, and then reasoning about the impacts on service provision of variations in those costs.
Turning the situation on its head, take for example the impact of Bertie Aherns benchmarking on public sector costs. We saw a sudden step function in wage rates with virtually no change work-practices (so productivity should have been virtually constant throughout that period). Can we come to any conclusions about the impact on unit costs?
The idea of ‘getting more bang for your buck’ – making public services more efficient – rather obscures the actual ideological battle going on between those who want more bang for possibly more buck (the Left) and those who want less bang (except for anything relating to their own collective interests) for significantly less buck (the Right).
You forgot a third alternative important in the Irish context – those who are happy to get pretty much the same bang for significantly more buck, as long they get pay-back on polling day (the FF approach).
I would be quite concerned about the safety of any demonstrating strikers at the moment. All a assive distraction from the real issue which is the impossible debt and the opaque negotiations with the troika thereof . As is the Reiily/Shorthall debacle . No where is there any evidence that’ a change of Minister do anything about these cutbacks. Even if he should go for other reasons . Who will be the next target? Welfare recipients and indeed the Labour Party itself. The latter seeming ly intent on turning on some of its own. This is sll a sign of serious conflict. And it will get worse .
Apparently Peadar Toibin of SF has been on radio 1 explaining that his party is against Croke Park because it protects the high paid at the expense of front-line services. I believe someone was objecting the other day to the description of SF as FF 2.0? Nice to see SF taking their cue from the Sindo, a paper which has been so kind to them over the years.
SF was opposed to croke park from the get go, as many on the left were, as it didnt offer sufficient protection for lower paid workers, but also I think it’s perfectly reasonable to say that excessive pay at the top of the PS. Having said that, I would be surprised if Toibín had said that, as generally SF position is that some protection better than no protection, and aren’t for the deconstruction of croke park, but are still calling for tacking excessive pay. For the life of me, I cant see whats wrong with that.
I didn’t hear the interview myself, which is why I said ‘apparently’, but the account I got of it is from someone I would trust not to exaggerate things (he doesn’t have any particular animosity towards SF). If the SF line is as you say it is, I doubt anyone would have much of a problem with that; there’s a big difference, of course, between criticising the CPA because it doesn’t give enough protection to low-paid workers, and falling in with the current media chorus (or failing to oppose it properly). I guess we’ll see over the next while – this issue isn’t going to go away any time soon, so whatever SF’s position is, it’ll have to be made very clear over the next couple of months.
The various parties were asked to outline their position on Croke Park by thejournal.ie. Sinn Féin’s answer is available by scrolling down a wee bit:
http://www.thejournal.ie/croke-party-agreement-party-positions-602551-Sep2012/
@ Barley
“Given that we\’re working against a fixed quantum of cuts agreed with troika…”
Who’s the “we”? The Troika given is a fixed quantum to the banks. That is what is driving the services and welfare cuts, not public sector allowances. That and the low level of high earner and corporation taxes.
For Bartley, I think the ‘we’ is Fine Gael…
From the Ballyhea Facebook page:
“On Oct 1st, hidden from public view by a compliant media, AIB (which we own 99.8%) will pay an unsecured unguaranteed bond of €1bn.”
Can Bartley come out and state, unambiguously, that the 1 billion euro unsecured bondholder should NOT be paid on 1 October? His response to that question will be useful in assessing the coherence of this position. Incidentially, between 1 January this and 1 October of this year 7 Billion euro plus will have been paid out to unsecured bondholders. Payments to covered and secured bondholders are in addition to that 7 billions. Personally, haggling over allowances for public servants, who are Irish citizens after all, members of communities, parents etc, while paying over billions to bondholders, is rather beside the point.
As an aside, the CMK household has two PS still decent incomes coming in; we’re steadily going under financially – there are tens of thousands, and probably more, in the PS. Another pay cut will send us over the edge. Personally I will be defaulting on my mortgage as I’m not going to deprive my kids of a decent life in order to keep my creditors happy. A further PS paycut will have unintended consequences, some have been sketched out by Michael Taft, but there will be others. Rumsfeld’s soliloquy about ‘known knowns and unknown knowns’ could usefully apply to this instance. A PS workforce where 70 per cent earn under 50 K per year, after a 5% decrease in take home income and facing a minimum 400 euro per year tax increase plus more layoffs, forced retirements etc, will not be amenable to ‘reason’ in 2013. Bring it on!!
“I will be defaulting on my mortgage”is a solution but I feel would be wonderful if you had hundreds of thousands doing it at the same time. It would become a political act. This is what the unions should be trying to organise, a kind of mass squatters’ movement. How would the forces of the state and finance stop this?
Can Bartley come out and state, unambiguously, that the 1 billion euro unsecured bondholder should NOT be paid on 1 October?
The bondholder was only unsecured in advance of the Cowen/Lenihan bank guarantee, no?
Post-guarantee, it became as good as sovereign debt, or?
If so, I cant advocate for an unilateral, uncontrolled default on that debt.
But if not, then have at it … burn, unsecured-bond-holder, burn!
A PS workforce where 70 per cent earn under 50 K per year …
Michael Taft recently published data showing just 60% of the PS earning less than 50k, and the remaining 40% earning above that threshold.
But your extra 10% aside, it is odd to see 50k presented as some kind of poverty line, when compared to average earnings in the rest of the economy.
Who cares, Bartley? A state engaged in grinding down the living standards of the majority of its citizens, while paying out billions every month to bondholders, needs to be working according to fairly significant, indeed epoch shaping, developments in political philosophy. I’ve a pretty good knowledge of political philosophy but I don’t see, as yet, any major work stating that, unlike centuries of theoretical developments, bondholders hold priority over citizens. No doubt there is any argument buried deep in Hayekian manure which states that ‘yes, citizens must yield in their demands to bondholders’. Indeed, the sorts of hair splitting about public sector pay and allowances, which seem to be a large factor in getting you of the bed in the morning, seem to have their analogue with regard to bondholders. Hair splitting seems to be part of code of, ahem, ‘honour’ among neo-liberals. Whereas relatively simple minded people like myself just can’t seem to grasp why, for example, it’s important to ensure that teachers don’t get an allowance for getting a masters degree in their subject area (in all likelihood taking at a year, probably more, of their lives and costing them several thousand for the privilege) while simultaneously demanding that EVERY bondholder be paid and being punctilious regarding the status of each bondholder and ensuring each is paid every cent of their bonds. Like, I’m sure Pimco wouldn’t notice if the Irish state didn’t pay out on any bonds they may hold? http://www.pimco.com (for those who want to have a look into the belly of the beast and the real beneficiaries of ‘Bartley’s’ and ‘GM’s’ efforts).
the €1 billion aib unsecured bond due on 1 oct was issued on 1 oct 2009, that is after the bank guarantee.
Bartley is blowing out of his asshole, but for some reason he’s indulged here even though he’s actively sucking the energy out of commentators who feel that they have to retort his complete and utter ignorance on these matters.
any fool who thinks that all the bonds were issued pre-bank guarantee is bringing Alan Partridge levels of insight and reflection to this topic. That’s one guarantee we can give.
I doubt there’s one person contributing or commenting at this site who takes what he says at all seriously.
And on some levels I’m delighted to see him here because it means that we’re able to marshal our counterarguments to all the crap in the Sindo that most of us hear regurgitated
time and again in everyday conversation with people off line (take your point for example, a useful piece of information for any serious discussion on the topic).
I’m a bit sad that he chose to take this route, some of what he has said in the past has been useful. But stop now? Are you kidding? He’s a fantastic troll. I think for sheer entertainment value he’s great to be honest.
Thanks. Alan Partridge: the missing link in Bartley’s evolution. However, I think you’re being a bit to harsh on oul’ Alan. I don’t Partridge, even in his Radio Norwich heyday, would ever stoop to the level that Bartley, and the entire economics ‘profession’ has stooped in the past few years. Indeed, it would be a difficult choice between Enda and Alan if you had to choose either one or the other to be Taoiseach. At least if Alan were Taoiseach there’d be a few more laughs to be had.
BTW, Bartley is an idiot, I don’t want to be dismissive of your concerns. If Bartley, or anyone else, did in fact significantly disrupt the site (or indeed if a consensus developed that these engagements were damaging) then it’s a banning. No problem. There’s already about five or so individuals banned from here on a permanent basis.
Have many/any noticed how fanatical the S/Indo “journalists” have become lately? It perhaps may be a reflection on their continuing poor performance in the market-place aided by the carry-on thats going on in the take-over war! I myself see a distinct move towards a tabloid type operation, are they heading in a NOTW direction? Last week some S/Indo “journalists” actually lied about elements of the public sector allowances, how long before they start hacking peoples phones or worse?
I hope this comment won’t see WbS dragged down the Four Goldmines, but I would not be at all surprised if certain sections of the Irish media (which shall not be named) have not already been involved hacking peoples phones – or worse.
It has happened here, no doubt about it. It won’t be happening again under the NOTW furore dies down which could take several years before the court cases are concluded. The old chestnut about Irish journalists being supposedly nobler than their UK counterparts is not one that would stand much scrutiny.
Well, Louis Walsh is currently alleging the Sun newspaper paid a person to make claims that Mr. Walsh had sexually assaulted him. If proven true, this would be even more serious than phone hacking.
http://www.independent.ie/national-news/courts/the-sun-paid-man-to-make-louis-walsh-sex-claim-court-3108874.html
An example of their desperation to make headlines to bash PS workers here… Independent story below
http://www.independent.ie/national-news/75m-joke-12-public-sector-perks-the-government-wont-cut-3234414.html paragraph from article ..
“Chester Beatty Library boxmaking allowance: The business case for retaining the allowance said it is necessary for the continuing “housing and conservation” of collections in the library in special boxes. Staff members receive up to €20 for each box.”
actual here
http://per.gov.ie/wp-content/uploads/CBL-BC-Boxmaking-Allowance.pdf
Maybe I am missing something, but the reading I took from this was that to outsource the work would cost 15-20 euro per box, I could not find where it said what the allowance actually was in money terms. When I checked the other “12 perks” listed I found plenty more of “errors and omissions”, !!!
Mary Wilson’s evening programme on RTE radio last week introduced its discussion on PS allowances with a vox pop in which the reporter giggled about various ridiculous allowances of the Chester-Beatty-box variety, leading all his interviewees to concur that the public service is indeed a paradise of unmerited perks. If, of course, he had asked : ‘Do you think a school principal should be paid more than the other teachers? ‘, I doubt if he’d have had any demurrers – and that one ‘allowance’ alone costs more than all the ones he did mention, put together.
That’s a great point. The SBP printed a list of ‘allowances’ many of which would appear to be encompassed by the sort of example you give re principals. Of course not all allowances are defensible, but then not all of anything is.
There’s a put-down that government TDs always use in TV debates on economic matters, whenever someone advocates income tax rises or wealth taxes: that there’s no ‘pot of gold’ of untaxed wealth that remains untouched. Public Sector allowances are the right-wing’s version of the chimerical ‘pot of gold’: there’s endless media mileage in it but the truth is here’s not much real saving to be made.
Why isn’t Brendan Howlin too worried? Because the longer the media howling about allowances goes on, the more the idea takes hold that every penny paid to public servants is a penny stolen from ‘the most vulnerable’.
@WbS
In the middle of the worst economic downturn in living memory with unemployment at 14 per cent plus talk of ‘positive incentives to increase earnings’ are absolute nonsense.
Its a great fallacy that 14% unempoyment rate means that there are no variable earning opporunities out there.
Take for example a teacher with scope to do a few hours of grinds. An income tax rise causing their marginal rate to go significantly above 50% might lead said teacher to conclude that its not worth the hassle (or even, boo hish!, lead to a certain forgetfullness when it comes to filling out their form 11 return next year). Whereas a property tax might incentivize that same teacher to take on a few more grind students (clients?) to cover their liability.
What’s breath taking is the complete indifference (or misunderstanding) of the central point made by me that those who already pay income tax (and a large subset of same – perhaps a majority, I don’t have the figures to hand) – will overwhelmingly have to pay a property tax as well
But you miss the point that said income tax-payer would have to pay less in a property tax than they would if the government attempted to raise the same ammount of revenue through income tax alone. (Because the same total tax imposition is spread over a larger pool of potential payers).
I genuinely did have some respect for you before the Summer and then in the space of two weeks I got your number as regards your intentions. The seeming dispassion of your analyses to that point was blown away with just a little bit too much overt snideness as regards the PS and matters general.
And here you are, not even bothering to conceal that latter tendency. A teacher doing grinds! Oh yes, a typical example of the problem that was mentioned as reagards 14 per cent unemployment and ‘positive incentives to blah blah blah’.
And yet again you misunderstand the point above with your entirely specious point about the property tax given that the individual impact will be contingent on multiple other factors than the pool of taxpayers, ie value of property, structure of property tax etc, etc.
It’s both shameless and comical. You just can’t resist the impulse can you?
@WbS
Oh yes, a typical example of the problem …
I dont remember claiming that as a typical example, just one that might be closer to home than others. But I could just as easily used the example of barrister in a position to choose to take on more cases, or a taxi-driver who could put more hours in on the rank, or a factory worker who could make themselves available for overtime, or a painter/decorator who might do a few nixers, or a college lecturer who might decide to write an undergrad text book, or a mother of young children contemplating a return to the workforce, etc. etc.
Anyone in effect with scope to vary their supply of effort and make rational decisions about the opportunity cost of their leisure/family time. Its a wide and varied economy that we have, and the variable earning opporunities are similarly diverse.
And yet again you misunderstand the point above with your entirely specious point about the property tax given that the individual impact will be contingent on multiple other factors than the pool of taxpayers, ie value of property, structure of property tax etc, etc.
Sure, a lowish earner living in a large and valuable house might end paying more in property tax than they would have done if the same revenue was raised in income tax alone. But imposing the tax on a wider pool of payers, allows the average impact on active workforce participants to be less. If the goal is to minimize the disincentive effects on active & regularized workforce participation, then surely this is a good thing?
The problem with Bartley’s proposal is that is pushing the ‘Laffer Curve’ and saying that its shape changes dramatically if you give your taxes different names. (Both of the taxes in question will have to be paid out of income regardless of what you call them.)
I shall leave it to others to consider whether this argument is even internally consistent. I shan’t get into the criticism of the Laffer Curve itself.
True, but that’s not the only problem. Yet more snide stuff from Bartley. That’s the problem with being a world class troll. It’s not really much of an achievement.
An income tax rise causing their marginal rate to go significantly above 50% might lead said teacher to conclude that its not worth the hassle
Is there any empirical evidence that people do in fact act in that way?
I wonder if there’s a tipping point at which the amount of troll posts and rebuttal thereof reaches such a high proportion that a website becomes dominated by them and to a certain extent loses its identity. That’s for Wbs, Garibaldy and more dedicated souls than me to decide but it does seem a bit lopsided this weather. Which I presume is the purpose of the trolls in the first place.
It’s a bit like every TWIW thread being dominated by counter posts suggesting that Wbs should have spent his weekend listening to Stock Aitken and Waterman instead.
+1
@Rosencrantz
Take a quick look at fig 14.8 here http://goo.gl/FbSv5 for a 101-style jargon-free illustration of such shape-shifting.
There is a difference between paying a tax out of income and paying tax directly on the income itself.
People who find that graph unreadable (because you can’t scroll properly) might try here and when they go to look Inside! search for “emigration”.
When they do, they’ll note that the graph displayed is a theoretical one, i.e. one dependent on certain assumptions about the chices an individual might make. there is no attempt to demonstrate that those choices are actually made that way in real life.
I can read the piece without any difficuIty.
What I cannot see is how Bartley thinks this aids his argument. The author states that the only tax that escapes the problem of inefficiencies is a ‘poll tax’, which is a flat rate and imposed on all people who live in an area. The best that tax can be is, like our own property tax, neutral. This means it will not engender any economic growth but it will not hinder it either.
The author then qualifies this in footnote 3. He notes that the flat poll tax may, if too high, engender evasion in the same way an income tax might.
All of the above is open to question, but it certainly does not support Bartley contention that a property tax will lead to high productivity and a reinvigoration of the entrepreneurial spirit.
As the book actually says, people may take issue with a flat tax on equity grounds and may choose to evade the tax because it is too high and/or inequitable.
But that, surely, is an unrealistic scenario, isn’t it?
Wages and living standards have to fall and fall and fall so that billions can be transferred to international finance capital, aka the ‘bondholders’. This massive transer of surplus value produced by the working class is taking place with only some grumbles of dissent. The F.G/Labour/IMF/EU plan for Ireland is working as planned.
Am I going off my head or did Harris make a few good points this week?
Furthermore Eilis O’Hanlon actually noted something as well…I’ll get me tablets.
Even a stopped clock …
Harris’ last point wasn’t too nuts, but the rest of his ‘Credo’ was as demented as ever (in particular, I think, the idea that there’s a public sector constituency of Alex Whites in South Dublin, as against the private sector working class beholden to Sinn Féin.
Given the breakdown of salaries across the public sector, and the very small numbers of public servants on salaries over, say, 100,000, I’d be very surprised if any but a minority of the residents of Dalkey, Killiney, Foxrock etc. were public, rather than private, sector workers. While it’s certainly true that the lowest salaries are paid in the private sector, it’s also true that the highest salaries are paid there as well, a point ignored by Harris et al.
Also, if he’s so concerned about public sector pensions, why doesn’t he give up his own?