Not really such a Super Tuesday
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A WINTRY, so-called Super Tuesday brought a degree of cold comfort to a few, but it conjured up an apocalyptic, infernal vision for a shocked majority.
Cold comfort perhaps for the lower paid public servant who has been promised that he or she will be given priority when, and if, conditions again allow pay increases.
Many will be relieved to hear that there are to be no further public service pay cuts before 2014, but does that mean that the wider body of taxpayers will have to pay a bigger price as a consequence?
And will the unions' promise of reform really translate into tangible savings?
Cold comfort too for the customers of Quinn Insurance who have been assured that they will not be adversely affected when the administrators begin to straighten out the stricken company.
But will a levy be imposed on policy holders in other insurance companies to plug the €200m hole, as happened when PMPA collapsed back in the Eighties? And how much more will people have to pay on premiums if Quinn's rivals seize the opportunity to raise prices?
We were promised there would be some cold comfort in the fact that the Government would draw a line under the banking bailout and the cost of NAMA. Super Tuesday would see an end to uncertainty.
That did not happen. It has not been adequately explained why the totally insolvent Anglo Irish Bank has to be saved at enormous cost.
Mr Lenihan says that although the sums required are enormous, the cost of allowing the bank to fail would be even greater. We can only take the minister's word for it.
Moreover, Bank of Ireland and Allied Irish Bank have been given 30 days' grace to raise revenue through their own resources and to come up with strategies to meet the tough targets they have been set. Another bottom line for another day.
In short, we still do not know the total cost of the Government's plans. We will not know how much has been lost until the banks attempt to sell their overseas divisions and we will not know the final cost of NAMA for another ten years or more.
NAMA remains problematic and cryptic, but at least those in charge seem determined to take a tough line on what the loans are really worth and on the level of performance expected from the banks from now on.
Yet solving the banking crisis is only part of the bigger challenge facing the country. The Government is committed to getting the public finances under control and to bring down Exchequer borrowing to 3pc of GDP by 2014. Neither the agreement struck with public service unions nor the measures announced by Mr Lenihan have changed the fact that economic recovery is the ultimate prize.
The Government has paid a political price for its imposition of €4bn in spending cuts in last December's Budget, but it will have to repeat that prescription more than once before the next general election.
Super Tuesday was neither a beginning nor an end to a long and painful process. It may prove to have been a point of no return, although that point was probably reached on the long night in September 2008 when the Government decided to give the banks a state guarantee.
One thing we know now is the guarantee probably averted the annihilation of the entire Irish banking system.
The minister told the Dail yesterday that the country is on a firm path to economic recovery and the Governor of the Central Bank said that the country can afford the billions it will take to restore the banking system to health.
The two are inextricably linked and there will be much pain and sacrifice before they are achieved.
All sections of society, including a public sector committed to reform, will have to make their contribution if we are to regain a vibrant, competitive economy in a time when Super Tuesday 2010 is just an unpleasant memory.
Irish Independent
