Get ready for an avalanche of election giveaways that will put Santa to shame
Published 10/12/2015 | 02:30
To put it bluntly, the nation is in peril. It's no exaggeration to conclude that the ground under election platforms appears shakier with each passing week. Our economic history is punctuated by binges of electioneering, plunging the country into a subsequent decade of debt and recession.
The stream of leaks and titbits of manifestos merely confirm that political leaders are reverting to type. They're convinced votes are bought on the strength of populist tax cuts and extra spending.
The general elections of 1977 and 2007 came with instant sickly sweeteners. Thus we saw house rates disappear, motor tax vanish, massive welfare hikes, income tax reductions and public pay enhancements.
The latter contest saw a consensus built in on the premise of 4-5pc GDP growth for the foreseeable future. Now all parties compete with their packages. The public, in the aftermath of austerity, will embrace all relief that lifts pressures on household budgets.
Nothing stands between politicians and their goal of securing power. Not one leader has shown the vision to override their political DNA and resist buying votes. Enda Kenny, Mícheál Martin, Michael Noonan and Brendan Howlin are all former teachers. They appear impervious to the harsher realities that go with self-employment and job insecurity, insulated by the certainty of their pension entitlements.
No party strategist believes that more than 2pc of the electorate values fiscal discipline to the extent where they would say no to the demands for increased spending on health, education, security and welfare.
The ECB, EU and IMF no longer have a vice-like grip on our budgets. Ten multinationals' Corporation profits and tax windfalls can bank roll a short-term orgy of good news. The Department of Finance can't be regarded as a foolproof guardian against irresponsibility. The mandarins always find ways to tell politicos what they want to hear. Costings for the irresistible goodies are often vague.
These guys have form. Despite stern expressions of a need for rectitude, expediency wins out.
Even in darkest hours of 2011, FG promised unsustainable healthcare: free GP visits for all; the elimination of waiting lists and trolleys; cheaper drugs; a National Children's Hospital by 2016, and a single tier equal access to hospital beds. You know what we got.
Now FG, under a cloak of conscientiousness, appears set to gazump all comers. They've already committed to the abolition of the Universal Social Charge, costing a mere €4 billion annually.
This was explained away because its origins go back to emergency budgets - as we're no longer in extremis circumstances, it can go.
Then there's the €27bn of capital spending, not to mention the restored public sector pay and personnel numbers.
Low-paid workers are pledged to receive a minimum living wage of €11.75 per hour.
Labour concluded they've nothing left to lose by gambling public finances to secure a return to power. Their seat loss scenario is really that dire.
Get ready for very specific promises. Remember that "every little hurts" misadventure which took such a toll on credibility?. Well don't knock it, it yielded 39 Dáil seats.
Now we have extra paternity/maternity paid leave, more free childcare, and universal free GP care up to 18 years - get the message? We love young parents; we especially love their votes. Labour are feeling heat from Sinn Fein.
However, it is Sinn Féin that leads the pack with specific vote grabbers. Already they've promised to abolish the Local Property Tax for every household along with all domestic water bills.
Only last week, before the election even kicks off, they promised an additional €2.2bn to construct 100,000 affordable and social houses.
It gets even better: 1,000 more gardaí; a tax credit of €500 for self-employed/farmers; an increase in the minimum wage by one euro per hour; an additional 2,260 teachers and 1,000 SNAs.
There's also an increased child benefit and an OAP increase of €3 per week.
Old habits die hard in Fianna Fáil. Their early bird menu already promises reduced prescription charges from €2.50; hundreds of new occupational therapists in community care; electric cars will have access to free electricity; waiver of car tax/toll charges for five years; increases across-the-board in personal income tax credits; reduction in Capital Gains and Capital Acquisition Taxes and DIRT rates; increase OAP by €5 per week and Child Benefit by €5 per month; extend PRSI benefits to self-employed; reduce commercial business rates.
Even the smaller new parties like Renua, Social Democrats, AAA/People before Profit and the independents are queueing up with gifts that would put Santa's seasonal sack to shame. These include abolition of TV licence fee, USC, employers' PRSI and motor tax.
The entire political class are now disciples of Bertie-nomics.
I am not expecting warnings from Colm McCarthy, David McWilliams and Dan O'Brien, or even the strictures from stockbroker economists to bring the surge tow to splurge to an abrupt halt
My urgent plea is for some national unity prior to the usual outrageous campaign antics to agree an extension to the mandate of the Fiscal Advisory Council so that it might independently appraise and cost each and every promise. They don't have that legal power as of now.
This is exactly the kind of control that's been put in place abroad. Australia established a Parliamentary Budgetary Office to police largesse. The UK has checked political promiscuity through an Office for Budget Responsibility since 2010. Dutch voters insisted on a Bureau for Economic Policy Analysis (BEPA) to analyse election commitments.
Unless a credible watchdog like the Fiscal Advisory Council (John McHale steadfastly declines subservience) has complete independence to expose reckless political pledges, we're doomed to return to the economic quagmire from which we so painfully re-emerged.
Forget about having the most sophisticated electorate in world. A naïve audience awaits an avalanche of sales pitches. We're goosed again.