Marc Coleman: Failed policy of tax hikes and cuts in spending will only bleed us dry
Despite having 2010 as a template for recovery, the Coalition is steering a safe, middle course
As the Government says, the economy is undergoing a recovery of sorts. However, it is not the first recovery since the recession. After falling 10 per cent in 2008 and 2009, GNP began recovering in 2010, growing by 0.9 per cent. It was a modest recovery. But it was also a real one, matched by jobs growth, rising confidence and modest growth in retail sales.
But what was most impressive about the 2010 recovery was the performance of tax returns – after collapsing in the two preceding years (by 17 per cent and 19 per cent in 2008 and 2009 respectively) tax revenues began to recover and finished the year an impressive €700m ahead of target.
So no, this is not the first year of recovery since the recession began. It is, however, hopefully the first year of uninterrupted recovery. What caused the recovery of 2010? The failure of economic policy in 2008 and 2009 was because the Government relied on tax-sterity rather than austerity.