Parties play dangerous game with 'Contest of Promises'
As election time approaches, Colm McCarthy examines the party manifestos likely to leave Ireland vulnerable to another economic crash
Published 03/01/2016 | 02:30
After just two years of recovery from the worst downturn since the Second World War, and the near-insolvency of the State, the general election is descending into a Contest of Promises.
It is difficult to overstate the sheer speed of the collective memory loss in the political system. Ireland is a small and exposed economy, heavily indebted, with a still-fragile banking system, lacking an independent currency and with a history of bad mistakes in economic management. The costs of any future mistakes will be high given the limits to corrective domestic policy. The most likely future mistake will not even be a new one.
Within a month or six weeks, the parties will publish their full election manifestos. But the party managers are already busy releasing the juicier items on offer and it is a depressing spectacle. Fine Gael plan to scrap altogether the Universal Social Charge, likely to yield €4b in 2016, while the other parties propose to scrap USC for most voters. Labour want the minimum wage (2015: €8.65) to go to €11.30 an hour and the old-age pension to €258 per week, Fianna Fail promise to cut Capital Gains Tax and scrap water charges, Sinn Fein also offer to scrap water charges and to reduce employee payroll taxes. All of this note against the background of over €200b in the opening level of national debt, a ninth successive year of deficit in 2016 and the promising has only begun.