cutting taxes did not cause the boom- it ended it.

[thedudeinthehat]

great article in last sundays independent by gene kerrigan. So many lament the current tax rises but in fact all we are doing is moving to a normal level. Current levels have left our public services and budget in general anemiac. As kerrigan highlights- it was a combination of cheap credit, US foreign investment and EU subsidies that led to the rapid growth of late nineties. Mc Creevy cut taxes after the fact. In my opinion-The excessive money in peoples pockets led to the years of decadence- as the first decade of this century will be remembered. Real growth was replaced with the idea that people know best how to spend, invest their money. The govt would have made better use of all that cash then yachts or shoddy apts in bulgaria. The first steps to recovery will include property tax and equitable income tax system.

[wysiwyg]

Pfft.. I said this years ago, and was almost lynched..

Christ above, did anyone not consider saying stop when Mc Creevy came out with his famous line

"when we have it we spend it, when we don't, we won't"...

Bring that to it's most base level... what would you think of a person who got their wages (or dole at this stage) on a Thursday, went drinking till Sunday night, and then complained about having no food on the table on a Monday morning ?

Or consider schemes like the SSIA's... A frankly lunatic scheme, whereby you had to prove you had money that you didn't need (i.e. money you could afford to save), and the Government would give you free money for saving it... fupping lunacy... and if I still try to explain the lunacy of it, people still get angry with me... completely oblivious to the fact that the money wasn't free, it was coming from the tax take...

How many hospitals, schools, public works etc could have been built with that money?

And what happened the money that was saved?.. It boosted bank balance sheets, so that they gave out even more stupid credit, driving prices higher, inflation higher, totally negating the bloody point of the scheme in the first place...

And when people got the "free" money.. what did they do with it???

They paid back for the car and holiday loans they got on the strenght of it coming.. sending more taxpayers money directly out of the economy

Or they used it for deposits on second.. or third.. or fourth house.. driving the bubble on.. or gaudy extensions, driving up construction prices..

And yet still some idiots think it was a good idea


LUNACY!!!!!!!!!!!!!!!!

[thedudeinthehat]

fully agree. Its funny in the same edition brendan o connor o wise property guru says way out is to reduce public pay and social welfare. Yes, the tackle the public expenditure brigade have a new cheerleader. Mister- the guys with balls are buying now. No thanks. Higher taxes please. Would do alot to help bring down rents and house prices. That will be first step on road to competitiveness.

[robert151410]

Gene Kerrigan Spare me from this populist, chippy commentator who absolves us from all our sins by saying that everything is someone else's fault.

[macdarawhitfield]

Party pooper.You are right of course but still,I'd go into hiding now for a couple of months and let the screaming die down if I were you!

[seenitallb4]

Tax cuts did not solely cause the boom, and nor did they solelyend it. However, the CT rates certainly had a large impact. As for the end of the boom, take your pick fom the many factors that coincided to kick us in the nuts. There is something to be said for your pov though- taxes could have been used to curb speculation in over heated markets, and this may have helped us avoid some of our current troubles.

[wysiwyg]

Gene Kerrigan Spare me from this populist, chippy commentator who absolves us from all our sins by saying that everything is someone else's fault.

Great response.. really cutting analysis.. do you have a newsletter, I'd like to sign up for it

[thedudeinthehat]

Gene Kerrigan Spare me from this populist, chippy commentator who absolves us from all our sins by saying that everything is someone else's fault.

Play the ball....

[FutureTaoiseach]

I disagree. The EU largely got us into this mess through cheap-credit and mass-immigration after 2004 which fuelled the property-bubble. FF is also implicated in the latter for the insane decision to open our labour-market from Day 1 of Enlargement in 2004. Even Brian Lenihan is now admitting it was a factor. FG are right to say you can't tax your way out of a recession. We are a small, open economy, and regardless we would be in recession in any case because of the contagion from the US. But it was needlessly worsened in this country by a blind adherance to the "ever closer union" mantra and pandering to the Galway Tent brigade's insatiable hunger for cheap-labour. I blame the EU and FF for making it far worse than it needed to be, but I want to make it clear I am not blaming the immigrants themselves. On the EU structural-funds, I have never trusted in the Keynesian mantra of throwing money around like smarties. It didn't work for Japan during its "lost decade" in the 1990's, and it didn't work here. American FDI in Ireland was more important, which in turn was largely due to our improved competitiveness as a result of tax reform and labour-market reform.

[Panopticon]

What's this nonsense about the government making better use of money than its citizens?

The State would have spent it on stuffing the mouths of doctors and teachers with gold as is its wont.