Friday 6 December 2019

Alison O'Connor: No matter how bad it gets, we can't afford to tune out

CUT back or stimulate? Economy or society? 2014 or 2016? ESRI or EU? Economists or politicians? Stay or emigrate? Calculator or rosary beads?

So many choices, so little time, all of them stark. None of them are remotely palatable, all are complicated, all have a domino effect. All come with a cripplingly high price to be paid -- and that's in a scenario where we get it right. If we get it wrong we won't find our way out of this hell for decades.

The problem is we appear to have no way of knowing who is right and who is wrong. Even those 'in the know' seem to be flying somewhat blind, and you suspect that some of those who are presenting their theses with any degree of certainty (bar a few notable exceptions) may have an element of spoofery going on.

The truth, after all, is that Madame Zelda and her crystal ball would appear to have as much chance as anyone of predicting where we'll be as a society in five years' time.

Turn on the radio or tv and it's often a case of whoever was speaking last that you find yourself in agreement with on the vexed question of our economy.

ICTU's David Begg is on the 'News at One' asking whether it is economists or politicians who should decide on society. He wants us to extend the period of budgetary adjustment from 2014 to 2016. As you listen, you can't help but see his logic.

In the speech he gave to the Irish Taxation Institute, he makes plenty more sense, saying what the forthcoming Budget should be about is political economy, and the deeper question of whether the economy is embedded in society or the other way around.

But then you remember that David Begg also wants to stick to the Croke Park agreement, and it makes you doubt his clarity of thought.

Anyway, earlier in the day you were listening to DCU lecturer Tony Foley, who was also very persuasive. The longer period, according to him, would cost us an extra €20bn to be serviced and we'd be repaying "forever".

But then you hear Finance Minister Brian Lenihan has hinted that we could get an extension anyway as long as we'd shown good form to our European paymasters in reducing the deficit.

At some stage, former Taoiseach John Bruton popped up saying we were in danger of falling into a "consensus of hopelessness", and there's little arguing with him.

It's well over two weeks now since Environment Minister John Gormley made his call for political consensus. This week the Taoiseach and opposition leaders met, and while they all agreed that we had to cut the deficit to 3pc by 2014, they could come to no agreement on how we might get there.

In a sense, they paid lip service to Mr Gormley's suggestion and have now returned to their own political corners. It looks very likely now that the Budget will be delivered in more than six weeks' time by the Fianna Fail/Green Party Government.

You can argue at present that whoever's hand is at the national tiller is not quite irrelevant, but at least a hell of a lot less so than in normal times, with the EU Commission calling the shots. Watching closely over its shoulder is Germany. The Germans are determined that if they have to bail out reckless EU partners, the Greeks and Irish et al will stick closely to the rules laid down.

That government is a beaten docket now, but the manner in which Fine Gael and Labour conduct themselves over the next few weeks is crucial to both parties. It may not seem much like it but there is choice and opportunity here and we need to know their plans.

Interestingly there is a definite sense about Fine Gael in the past week or so that it is stepping up to the plate. Spokespeople such as Michael Noonan, Richard Bruton and Leo Varadkar have been coming forward with details on various policies, giving the voters a sense of just what Fine Gael would do in government. This includes major cuts in civil service numbers, a proposed new cabinet minister for public sector reform, and the HSE being abolished in its current form with a pledge to publish more proposals in the coming weeks.

Richard Bruton has described his proposal as the "most radical change in the way the Irish State works since its foundation".

Stuck in the mire of owing billions and having further bad news heaped on us each day makes it difficult to look ahead with any optimism or to have the enthusiasm for any more "radical changes".

However, this sort of initiative is exactly what we need, and to have a proper debate ahead of the Budget and a General Election.

On the face of it, the past two weeks should have been damaging to Labour as Eamon Gilmore's tactic of keeping things vague has seemed increasingly unsatisfactory, and what he has divulged seems almost laughably crowd-pleasing.

However, the tactic has worked a treat for the party so far, and Labour looks set to continue it for now. We'll have to wait and see if the voters continue to favour vagueness from Mr Gilmore in the face of hard facts from Fine Gael and, of course, the Government.

From now until Budget Day and beyond, it's going to continue to be information overdrive.

During the boom years, we didn't care too much about the detail as long as the good times kept rolling. Now we're being steamrolled daily with pessimistic and complicated detail on how to stop ourselves from drowning in a sea of debt.

But it's a national conversation that we have to have. Top of the list of things we cannot afford to do at present -- whether we're front loaders, stimulators or just simply fed up -- is to tune out.

Irish Independent

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