UK's shambolic Tories lead the way to Brexit chaos
There should be no Schadenfreude, joy in another's misfortune, anywhere in Europe, especially in Ireland, about the descent into dysfunction in Westminster. The Brexit process cannot be...
There should be no Schadenfreude, joy in another's misfortune, anywhere in Europe, especially in Ireland, about the descent into dysfunction in Westminster. The Brexit process cannot be...
When empires, the prisons of nations, collapse, their suppressed constituents invariably set up shop as new independent states. So it was with the...
The fifth straight year of economic expansion, and with labour market conditions already tightening, there was no case for an expansionary budget and every reason to target a modest surplus in 2018.
PASCHAL Donohoe’s first budget next Tuesday week will see only minor changes in taxes and expenditure.
Sixteen months on from the referendum decision, and six months since the Article 50 resignation letter, Theresa May chose to put the preservation, for now, of Tory party unity ahead of any other consideration in her Florence speech last Friday. Britain will not be pursuing a damage-limitation strategy in dealing with Brexit, but the Conservative party will hold together for another while.
Irish policymakers are understandably alarmed about the worsening economic environment created by Britain's likely departure from the EU's single market and customs union, but there could be equally troublesome changes coming in the structure and operation of the Eurozone.
David Cameron drafted alternative speeches as he awaited the result of last year's fateful and too-close-to-call referendum. Outside 10 Downing Street on the morning following the narrow rejection of EU membership, he chose Document No 2. It said, more or less, "Oops, sorry, I'm out of here".
Choices made by Theresa May's government subsequent to the Brexit referendum, and not necessary to comply with the electorate's decision to quit the EU, are at the heart of the continuing stand-off with Brussels.
It was never going to be easy to secure a frictionless border in Ireland once the UK exited the European Union. The land borders of a highly integrated market for goods, labour and capital cannot be frictionless unless it shares reciprocal rules of access, tantamount to membership, with its neighbours.
Ireland's return to levels of economic activity not seen since the credit bubble began to burst 10 years ago is not the only "lost decade" that deserves notice this summer. A decade has also been lost in reforming Europe's dysfunctional common currency regime and the same air of premature celebration is taking hold. Just as there is no guarantee of plain sailing for the Irish economy, critical weaknesses in the common currency design remain unaddressed.
Leo Varadkar's speech at Queen's University last Friday reflected (politely) his judgment that the British political leadership has wasted 14 months since the referendum in dodging the key challenges in implementing Brexit. The continuing retreat from reality saw foreign secretary Boris Johnson in New Zealand last week and the trade secretary Liam Fox in Argentina, exploring post-Brexit trade deals (aboard, metaphorically, the good ship Global Britain) to replace what will inevitably be lost in Europe.
Each summer, the Tax Strategy Group - a committee of officials from Finance, the Revenue Commissioners and other departments of central government - releases a report on possible...
The Dail recess commenced last Friday - the annual signal for the abandonment of serious politics until the autumn.
Friday's report from Daft.ie, urging changes in the regulation of the housing market to counter the latest jump in prices, should have come as no surprise at RTE's sprawling Donnybrook campus in leafy Dublin 4. The State broadcaster has just concluded a deal to sell an 8.6-acre portion of the site, which is 6km from the city centre, for the astonishing figure of €108m, without planning permission.
Reports released last week confirm something which looks like a house price bubble. It is not, or not yet, a bubble driven by excessive growth in bank credit like the last time round. But nor is it a nationwide crisis in housing affordability.
The Tory party, described by one-time leader William Hague as "an absolute monarchy tempered by periodic resort to regicide", has in a short few years delivered the United Kingdom into a dreadful strategic cul-de-sac.
Leo Varadkar's first task in government will be to prevent, insofar as he can, an early train-wreck in the UK's negotiations with the EU-27. Brexit represents, in the words of Bob Geldof, the 'greatest act of self-harm in British history'.
Economic recovery these last few years, combined with very low interest costs on new government borrowing, has brought the budget deficit down sharply. But Brexit threatens the economic outlook and the European Central Bank will likely commence raising interest rates back up to normal from 2018 onwards.
There is no budgetary scope for a fresh public service pay round, in addition to the increases in public pay already promised under the Lansdowne Road agreement and subsequent concessions to gardai and others.
A poor Brexit deal for Britain is a bad outcome, but not just for Britain. The UK election a month hence will install a new Conservative government which has already boxed itself into a poor-deal strategy, damaging for Britain, damaging for members of the European Union but especially for Ireland. No country, other than the UK itself, has more to lose.
All the main political parties in Ireland were, until quite recently, in favour of a State-owned national utility to run the water industry, financed mainly through user charges.
Theresa May's resignation letter to Donald Tusk last Wednesday and his response on behalf of the European Council last Friday made explicit and prominent reference to exclusively Irish concerns in the upcoming Brexit negotiations, as did Guy Verhofstadt, who will represent the European Parliament when it comes to approval of the deal. Michel Barnier, the European Commission's chief negotiator, is on the record to the same effect. That all negotiating parties, British and European, have endorsed the principal concerns of the Irish Government, and in similar language, is a...
RTE has just announced a reduction in staff numbers of 10- 15pc - the total staff is almost 2,000, so around 250 jobs will go. Management hope that retirements and voluntary severance will do the trick, without compulsory redundancies, and have embarked on consultation with unions.
The British government secured House of Commons support for its Article 50 notification bill, subsequently approved by the Lords and given the royal assent, on Monday last. On the same day, the Scottish first minister, Nicola Sturgeon, called for a fresh referendum on independence from the United Kingdom.
The mainstream European media have been venting about the rise of a new populism, concerned that far-right anti-EU parties will do well in elections in the Netherlands this week, in France in April and May, and later on in Italy. But they are downplaying an important political truth: populism is as old as the hills, nothing new anywhere in Europe, Ireland included.
While the suspension of strike notice at Bus Eireann and the resumption of talks between unions and management may result in some form of interim settlement, the underlying problems at the company, and more broadly in the CIE bus and rail business, are not being addressed. Demand for intercity public transport is in decline and the costs of meeting this demand through the CIE model are excessive. The minister has wisely kept away from the talks, keeping the taxpayers' chequebook out of danger for now. But the taxpayer remains on the hook for a system of public transport...
Concerns about the Border with Northern Ireland are consuming much of the political attention being devoted to Brexit. But Great Britain is also leaving the European Union. For the Republic's economy, the Great Britain bit is much more important than the Northern Ireland bit.
Ireland's exposure to Brexit involves more than keeping the border open, important though that certainly is. The fate of the British economy and its future trading relations with the EU remain entirely unresolved and managing the land frontier could turn out to be the lesser challenge. The explicit inclusion, at number four, of the land border issue in the UK government's 12 priorities for the negotiations is reassuring.
When she took office last July, Theresa May had little choice but to opt out of the EU's single market. With Tuesday's speech at Lancaster House in London, she despatched any practical prospect that the UK can remain in the customs union either. She may have been, as some critics allege, a closet Brexiteer all along, but the more charitable explanation is that she is a student of Talleyrand.
There is quite a spat under way about the possible location in Dublin's docklands of a new film studio, promoted by a former chairman of the Film Board and a group of film industry operators. They have their eye on some State-owned land, possibly land belonging to Dublin Port or alternatively part of the storied Irish Glass Bottle site which ended up in Nama. The chief executive of Dublin Port has accused the promoters of a 'land grab' no less, while they claim to be offering jobs, economic growth and all things good and wholesome.
When Ken Whitaker was appointed to lead the Department of Finance in 1956, the Irish economy had been through a period of persistent failure.
Last week's spat in London between the civil servants and the hard Brexiteers needs to be seen in context. If the UK ends up outside the EU's single market, and outside its customs union, there will be dramatic and potentially very damaging consequences for external trade, unless a successor deal on trade access can be negotiated.
The Brexit decision and Trump's presidential victory have inspired some apocalyptic year-end commentaries. In the more extreme versions, the EU will break up; Trump will start a trade war with China; and the end of the year morphs into the end of the world.
Despite inadequate design and misguided management, Europe's common currency has survived eight years of severe economic downturn, and survived better than support for its designers, the traditional political parties in the EU's founding member states.
When a policy problem gets too big to solve, the policymakers can sometimes avoid, or at least postpone, the admission of failure and the need for reform.
Brexit and the election of Donald Trump to the US presidency, the two big political surprises of 2016, are both negative in their economic implications for Ireland. Some additional clues as to just how negative emerged last week.
Trump's victory is the second political surprise of 2016 with negative consequences for Ireland, following the UK's Brexit decision at the end of June. There could be further negative surprises from European electorates in 2017.
Ireland's economic management is caught in a trap, exposed to a fiscal paradox that is barely visible. Despite heavy debt, the Government can borrow freely at low interest rates - lower than they were when the public finances were far healthier - courtesy of the easy money policy pursued by central banks.
Political decision-making in democracies has a bias towards the short term: decision-makers are temporary hires and will not be around to reap what they sow. Electorates seem almost to prefer their political leaders employed on short contracts. In good times this may not matter too much: politics reduces to the distribution of any available gains from economic growth. But when...
The Government's plan to re-introduce the first-time buyers' grant has received a cool response from housing experts. They think it will encourage demand rather than supply and will facilitate a bidding-up of prices by purchasers.
The latest leg of the long-running eurozone banking crisis is playing out - not in Greece or in Italy, but in Germany, home to the headquarters of Deutsche Bank, whose share price has collapsed and which may shortly require support from the authorities. Comparisons are being made with the failure of Lehman Brothers on September 15, 2008, which triggered the freeze-up of world financial...
The UK Government is likely to trigger Article 50 of the Lisbon Treaty sooner than had been expected, in the first months of 2017, according to last Thursday's remarks from Foreign Secretary Boris Johnson. EU Council President Donald Tusk indicated last week that this was also Theresa May's timetable, only to be corrected by the UK prime minister. The Three Brexiteers in the UK Cabinet (Johnson, Liam Fox and David Davis) have been jointly charged with executing Brexit. While the division of responsibilities is unclear, all three appear to contemplate not just an accelerated...
Nama was established in late 2009 to buy property-related loans from Ireland's bust banks at a discount. The intention was that the assets be warehoused and fed gently into the market, avoiding a chaotic fire sale.
The Brexit decision damages the context of Ireland's international relations and in ways not all of which will be clarified quickly. The 27 European Union leaders meet in Bratislava on Friday, the full roster minus the British.
In 1935 Albert Einstein and two co-authors published an article in an academic journal called the Physical Review about the problem of quantum superposition, the idea that a subatomic particle exists in a combination of several alternative states. The act of observation affects the particle making it select just one of these states. The Austrian physicist Erwin Schrodinger concocted a thought experiment to illustrate the point. A cat is enclosed in a lead box with a device which might or might not have released a fatal dose. When the box is opened, the cat will prove to be either...
The 2017 Budget will be introduced on October 11, which is just six weeks away. Documents released recently by the Department of Finance suggest that the Government will be able to further reduce the budget deficit while providing for spending increases and tax reliefs. There is some fiscal space, in other words. Lobby groups and political parties are returning from the holidays and the...
The demonstrations in Brazil against the Olympic Games are hardly a surprise. Just two years ago, the World Cup provoked outrage in the same country at the colossal waste on white elephant stadiums in cities where there are no top-flight football teams. There has been no subsequent use for several of these venues, which were constructed with public funds and much corruption.
The Government's new housing plan has received a cautious welcome at best. There are good reasons for caution.
The Irish economy, on all credible indicators, grew by about 5pc last year. The GDP growth rate could even have been a little higher. But it could not have been 26.3pc, the amazing figure computed by the Central Statistics Office.
The acute phase of the eurozone sovereign debt crisis in 2012 was triggered in Italy, not in Greece or one of the other small peripheral economies. The European Central Bank eventually took action - an Italian collapse would have threatened the survival of the common currency - and crisis was deferred. But the eurozone banking system has not been fixed, and the extend-and-pretend tactic is facing another challenge. UK Prime Minister David Cameron's referendum gamble has not merely come unstuck, it has gone wrong at the wrong time.
It is no longer imaginable that Britain's Conservative party will risk further political dislocation by ignoring the popular vote and seeking an escape from the unexpected Brexit decision. This prospect disappeared with the demise of Boris Johnson's leadership campaign last Thursday.
The decision to take Britain out of the European Union hurts Ireland's economic prospects and some more air has escaped from the fiscal-space balloon. The departure threatens the survival of two unions, the EU and the United Kingdom itself, and the negative reaction in financial markets has not been overdone.
Unaffordable housing is largely confined to the Dublin area. Figures from Daft.ie reveal that rents in central areas of Dublin are (at least) double those in the provincial cities.
The 200-page draft report of the Oireachtas Committee on Housing and Homelessness is due to be finalised over the coming weeks, and its recommendations will be influential. The dysfunction in the system of housing supply and in the market for housing finance was at the heart of the banking collapse, and the sector's failings are complex and of long standing.
Ireland has long had a two-tier pension system to go with the two-tier health service. Some groups of employees are covered by decent occupational pension arrangements but many are not. Those who work in favoured sectors of the economy are fortunate, notably permanent employees in banks and in the public service, but there are very wide variations and many workers in the broader economy have little or no entitlement to income from an occupational scheme.
The economic recovery in Ireland continues to reduce unemployment at a rapid pace. Figures from the Central Statistics Office last week show that the overall unemployment rate has fallen below 8pc and has halved in just four years. The numbers are from the Quarterly National Household Survey (QNHS), a very large-scale data-gathering exercise and one of the best tools for monitoring economic trends.
The formation of the new Government has avoided, according to Friday's Red C poll, a second general election which would have produced another hung Dail and little change from February's result. There would have been some form of minority government anyway.
Ten long weeks of government formation have produced an enormous list of concessions on public spending. The Independent deputies must feel they have been negotiating with the Make-a-Wish Foundation. A rough costing (remarkably there is none in the documents that have been released) puts the bill at €3bn in annual cost and leaves the State's finances ever more exposed to whatever problems are coming down the track. The problems in Europe, including the risk of Brexit and the continuing travails of the common currency, are not the only ones. The biggest threat to long-...
Generations of neglect has taken its toll on Ireland's water supply and waste water disposal systems. The result is cryptosporidium, boil notices, service interruptions, dangerous levels of E. coli, high leakage rates, a looming supply crunch in the Dublin area, pollution of inland water bodies, untreated sewage discharged off coasts and high operating costs.
The water issue is not the key challenge facing politicians. The infant recovery is fragile and the next government will need to focus quickly on more urgent domestic and external threats. Irish business is losing its competitive edge again, according to last week's report from the National Competitiveness Council. Public service trade unions are gearing up for another pay round, beyond the deal agreed at Haddington Road, which was supposed to run to 2018.
There is another house price bubble under way in the Dublin area. Notwithstanding the efforts by the Central Bank to keep mortgage credit under control, some extraordinary prices have been quoted recently for the small parcels of land that become available.
The fiscal space balloon has been losing altitude since its release during the election and the Exchequer figures for the first quarter bring it even closer to earth. There was another big overshoot on the health budget and the earnest discussions in Government Buildings are about schemes to dispense largesse which does not exist.
There is no national housing crisis. In most parts of the country second-hand homes are for sale at prices that are affordable and below the cost of construction. The deposit required under Central Bank rules in these areas is no more than the price of a small car. Rents are also modest in most counties and there is little need for new construction.
The European Central Bank is running out of ammunition. Last Thursday's announcements of further monetary policy moves are an attempt to boost the sluggish economy and the inflation rate, which remains close to zero. There are widespread doubts that the latest measures will have the desired impact.
The latest stand-off over Irish Water is lamentable. If the supply of electricity in Ireland was in the hands of local authorities, with no national grid and no centralised planning, some bright spark would suggest that a single state monopoly be established, led by engineers rather than politicians, to bring order to the mess. And this is precisely what happened, all of 90 years ago.
For a government elected in 2011 to stabilise the economy and avert bankruptcy, the commitment to tax cuts and spending increases served only to validate the Contest of Promises from everybody else.
The negotiations concluded yesterday in Brussels may have equipped David Cameron with enough concessions to claim that the European Union has reformed and that the UK electorate should back continued membership.
How about this for a policy achievement: over-provide finance for houses, over-produce houses, bring down the banks and the country to its knees and end up with, would you believe, a shortage of houses.
The early days of the election campaign have been dominated by controversy about something called 'fiscal space' which must have had voters scratching their heads. What is this apparently precious commodity, and how large is Ireland's newly-discovered endowment? The phrase is borrowed from the vocabulary of debt sustainability analysis and rarely escapes the statistical appendices of IMF reports. It is a little unfair to inflict this unfamiliar piece of jargon on a blameless electorate.
The Irish banking bubble had been a decade in the making when it began to deflate almost eight years ago. In what had been a cautious and conservative banking system, every single bank went wallop and all required guarantees and capital injections.
A small trading economy, and Ireland fits the description, cannot escape when things take a nosedive internationally. There are growing fears that this is happening, with agencies like the European Commission, the IMF and the OECD revising their economic forecasts downwards.
When the economy entered recession in the final quarter of 2007, the budget was in surplus: indeed a surplus had been recorded for nine of the preceding ten years. Public debt was just 25pc of GDP, amongst the healthiest figures of any developed country. But the international downturn, accentuated by the domestic banking bust, was so severe that large tax increases and spending cuts ensued and a pro-cyclical adjustment, deepening the downturn, had to be pursued until 2014 when the austerity phase could finally be relaxed.
It is impossible not to feel sympathy for homeowners affected by the unprecedented flooding around the country. But there should be less sympathy for the dam-burst of instant political reactions. Sinn Fein leader Gerry Adams was even driven to condemn as "insulting" the whistle-stop tours of flooded areas by politicians. He was speaking in Limerick during his whistle-stop tour of flooded areas.
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.
The UN climate summit which ended yesterday in Paris was the 21st devoted to the search for agreement on how to limit global warming. The first was in Berlin in 1995 and the annual get-together now attracts 195 participating countries and 25,000 delegates.
The stream of good economic news in Ireland shows no signs of letting up. The budget deficit for 2015 will come in under target, due mainly to healthy growth in tax revenues, while unemployment continues to fall. But the external developments which have fuelled the turnaround are not guaranteed to last. When things improve so quickly it is foolish to extrapolate: the good times could roll a little longer but they will not roll forever.
The life of the 31st Dail is coming to a close and it is time to consider the issues which should preoccupy its successor. First among them should be the identification of policies to ensure steady economic progress in the years ahead without courting any more boom/bust cycles.
The collective unpopularity of the three mainstream Irish political parties gets harder to explain. Recent opinion polls show Fianna Fail, Fine Gael and Labour commanding the allegiance of around 55pc of the electorate between them.
ECB President Mario Draghi made his fourth and final visit for 2015 last Thursday to the European Parliament's economic and monetary committee, the only form of democratic accountability to which the ECB has chosen to submit itself. The ECB has refused to attend at the Oireachtas Banking Inquiry, even though there is nothing in the ECB statute to prevent its officials from making themselves...
Bank crashes large enough to inflict substantial damage on taxpayers require failures at three levels. The boards and managements of banks need to incur large losses on dud loans. The regulators and supervisors need to miss what is going on, and to neglect timely remedial action. Finally, the Government needs to socialise a large portion of the losses, imposing them on taxpayers. That third failure, particularly the very broad state guarantee of bank liabilities, has dominated blame allocation in Ireland, but there is less information in the public domain on failures elsewhere.
At the end of September, Dublin prices for residential properties had increased by just over 5pc on the January figure.
Patrick Honohan will be leaving the Central Bank in December in considerably better condition than it was back in September 2009 when he arrived in Dame Street. He has had to devote much of his term as Central Bank governor to firefighting. The fires may not be decisively extinguished but the reputation of the Bank has been restored. His successor, Philip Lane, will wish to do more than consolidate what has been achieved.
'When you come to a fork in the road, take it' was the advice of the New York Yankees baseball legend Yogi Berra, who passed away three weeks ago. The Taoiseach used the 'fork in the road' metaphor to characterise the Government's Budget strategy in his Dail address on Wednesday, shortly after Fiscal Council chairman Prof John McHale had made it plain that the fork chosen was the wrong one. The Budget was needlessly expansionary for the second year in a row and the Government is trying to spend its way out of a boom.
Tuesday's budget will see roughly €1.5 billion distributed between tax reductions and spending increases. All of this money is being borrowed: the economic recovery has improved the public finances but the budget remains in deficit. Had the government opted to make no changes for 2016 the deficit would have continued its decline and might have been close to zero next year. The attainment of a zero deficit and an end to the accumulation of debt is being deferred.
During the bubble, State expenditure rose dramatically, and under virtually all headings. A major beneficiary was the State capital programme, and it became a major casualty when government revenue collapsed in 2008. This is a familiar pattern. When the public finances last got into trouble in the late 1980s, the correction saw a much bigger cut in capital than in current spending and public investment has again been cut severely this time round.
The resignation on Wednesday of Volkswagen chief executive Martin Winterkorn followed revelations that the company had been fiddling emission tests on diesel cars in the United States, provoking the threat of large fines by US regulators and a collapse in the share price. Volkswagen is, with Japan's Toyota and General Motors of the US, one of the world's big three automakers, with annual sales that exceed Ireland's GDP.
Ireland's two-year bank guarantee introduced at the end of September 2008 was meant to cost nothing at all. The banks were solvent, people were assured. They were just temporarily short of liquidity due to some incomprehensible snafu at banks in New York. This was not credible at the time and was not widely believed. Every single domestic bank duly went down in one of the biggest bank busts ever recorded anywhere. Through 2009 and into 2010, the Government scrambled to keep the system functioning, principally through injecting vast quantities of taxpayer's cash. Meanwhile,...
The public finance figures announced last Wednesday show, on the face of it, an improving picture. Tax revenues are ahead of expectations, government spending is apparently contained and the budget deficit is below the target. But the persistence of any deficit at all, after seven years of fiscal correction, means that government debt continues to rise. Any country with debt over 100pc of GDP and lacking a national currency is vulnerable should there be another leg to the international financial turmoil. Small indebted countries in the eurozone will, on past experience, be the first...
The Irish economy is one of the few in Europe enjoying any kind of recovery, partly down to some good luck on energy import prices and the weaker exchange rate. The recent nervousness about economic prospects in China is not the principal threat to that recovery. The bigger threat comes once again from the international financial situation. With the eurozone architecture unreformed,...
Last Tuesday's announcement from Ryanair that Europe's biggest carrier may commence interlining with long-haul airlines is hugely significant for Aer Lingus and for Dublin Airport.
This morning's Sunday Independent poll asked a number of interesting questions about the public's personal experience of economic recovery and expectations for the year ahead, as well as preferences for tax cuts, should there be any in October's Budget. The context is important. The Irish economy has been through the sharpest contraction since World War II; the quickest rise in unemployment it has ever gone through; a monster banking bust, amongst the largest ever endured anywhere; and the indignity of the country forced into a financial rescue from official lenders for...
Ensuring adequate income for people in retirement has become a major policy challenge for European governments. At the heart of this pensions crisis is the viability of the defined benefit model of pension provision. Under this model the retiree is promised a pre-set level of pension benefit, regardless of the performance of the scheme's invested assets or indeed of whether the scheme has any assets at all. Some guarantor (the government or a business firm) promises to meet payments to pensioners well into the future. But some of the guarantors, including governments which...
The negotiations about Greece should have had two objectives - to give Greece a shot at economic recovery, and to avoid Grexit and further destabilisation of the common currency. Neither objective has been achieved.
The emerging 'deal' for Greece, the alternative to the country's exit from Europe's ill-advised common currency, is shaping up to be another essay in extend-and-pretend. The last six months have been wasted by the new Greek government and the creditors - on making a bad situation worse in Greece - without any promise of a sustainable economic recovery. The closure of the banks and the consequent suspension of both internal and external payments in a sinking economy was a quite extraordinary failure of common sense.
Central banks were created to ensure financial stability, particularly to prevent fatal depositor runs against banks which might otherwise survive. They ensure survival through furnishing banks under stress with emergency liquidity and central banks can create the needed liquidity at will.
Whatever the outcome of the weekend crisis meetings on Greece it has been another dreadful week for the European Union. Greece could fall out of the common currency even before the referendum planned for next Sunday and financial markets are set for a turbulent opening tomorrow. Seven years into the crisis this kind of thing simply should not be happening. There must be senior politicians in France and Germany, the principal architects of the common currency, beginning to wonder if the game is worth the candle.
Tomorrow's emergency summit of eurozone leaders will consider whether a deal can be fashioned to keep Greece in the common currency area.
The Government last week appointed a new advisory council on climate change to be chaired by economist John FitzGerald. There were immediate queries from Opposition TDs about the independence of the new body. Happily, the Government has furnished Professor FitzGerald and his colleagues with an early opportunity to dispel any doubts on this score. Last Monday, the Taoiseach announced a new electricity-generating station for Killala, Co Mayo, trumpeted as a contribution to the attainment of lower carbon emissions. The new station, to be fuelled with imported wood,...
Ireland's banking collapse was mainly due to excessive lending against property assets, including residential property. The Irish banks became the principal mortgage lenders, inflating a price bubble with 100pc loans and careless inattention to borrowers' capacity to repay. They also made extravagant loans, without adequate collateral, against land and commercial property.
If the Ryanair board agrees to sell its 29.8pc stake, Aer Lingus will become the fourth member of IAG, the International Airlines Group, along with British Airways and two Spanish carriers, the former state airline Iberia and the low-cost operator Vueling.
It remains to be seen what will be the outcome of Friday's news, from the Government, that holders of variable-rate mortgages will see reductions in their monthly repayments. The Central Bank has prepared a valuable report on the complex issues involved, which was released to coincide with the Government's declaration of victory. This is a wearingly familiar pattern: the report on which any kind of coherent public debate might be based is withheld, apparently to suit the Government's convenience.
Whenever you hear trade union officials ask for the 'restoration' of the 2008 levels of public service pay you should ask what other features of Ireland pre-2008 they would like to restore. Unsustainable government finances, bust banks offering 100pc mortgages, soft landings all round?
the banking inquiry has had two unproductive weeks. The dog-and-pony show at the Royal Hospital a week last Thursday gave Jean-Claude Trichet a platform from which to declaim his personal narrative about the eurozone mess. This narrative has few adherents aside from its author.
Jean-Claude Trichet spoke in Dublin on Thursday about the Irish financial crash and the role he played before and after the bubble burst in September 2008. Members of the Oireachtas inquiry questioned the former ECB president at an event staged in the Royal Hospital in Kilmainham, an arrangement designed to avoid any appearance of direct accountability of current, or even former, ECB officials to elected members of national legislatures.
The Oireachtas banking inquiry is finally reaching the interesting part of its deliberations. From about the year 2000 until the balloon went up in September 2008, the Irish banks engaged in an extraordinary, and out-of-character, lending splurge which resulted in one of the most damaging banking busts ever to occur anywhere.
the decision to abolish the Irish currency and join the eurozone in 1999 was a break with the precedent regarding Ireland's membership in the EU itself. Ireland applied to join the EU's forerunner, the Common Market, in the 1960s only when Britain applied; withdrew that application when British membership was vetoed by the French and eventually joined, alongside Britain, in 1973. But Ireland chose to join the euro even though the British decided to stay outside and retain sterling. There are few commentators in Britain today who regret their decision and plenty in Ireland who regret ours.
The Government will take two bites at the budget cherry this year with a trailer in the form of a 'Spring Statement' due on the 28th of this month, and the full movie in October.
When a piece of equipment fails the options are to fix it decisively, scrap it, or patch it up with half measures. The eurozone architecture is a piece of economic policy equipment, it is clearly not working and the strategy is to devise one temporary fix after another.
Imagine you are the finance minister of a heavily indebted country emerging from a deep recession, during which the state lost the ability to borrow and had to rely on official lenders, including the IMF. You have a legacy of high debt and high unemployment, and the budget is still in deficit. But things are looking up. The economy is expanding again and is predicted to grow in future years. Unemployment is falling. Inflation is roughly zero. What would be the most prudent budgetary strategy to adopt?
When contentious trade policy issues arise between the EU and rivals in other parts of the world, the interests of the various EU member states do not always coincide. The big countries, particularly France and Germany, can be quick off the mark in identifying where their advantage lies and are not shy about bending EU policy to their narrow national interest.
Opposition to the proposed IAG takeover of Aer Lingus is based principally on local politics and on trade union rivalry. Government deputies fear the loss of their seats and have been stoking fears among Aer Lingus staff, especially in north Dublin. Deputies of all parties representing the Cork and Shannon airport catchments have been seeking assurances about continued service to those airports, including assurances not available.
The latest instalment of the Greek drama has provided a fresh opportunity to watch the Eurozone's renowned crisis-management machine swing into action. Leaks, counter-leaks, threats to the banks, accusations of bad faith, grandstanding to domestic audiences, and late-Friday gatherings of tired officials and politicians in Brussels - it brings you back to the great days of the Cypriot crisis, the Spanish crisis, the Italian crisis, the second Greek crisis, the Portuguese crisis, the Irish crisis, and the connoisseurs' favourite, the first Greek crisis.
On Thursday last, Willie Walsh, chief executive of IAG (International Airlines Group), the prospective bidders for Aer Lingus, provided members of the Oireachtas Committee on Transport with an elegant tutorial on how commercial airlines actually work.