So far the downturn has hardly effected middle class families at all - unless they are running their own business - so life goes on as normal for the majority and the political establishment just continues playing its usual games as if nothing is happening. Some of the no vote, at least, was a protest vote against this disconnect.
The problem is that this problem will get a lot worse in the next few months, and unless the Cowen Government does something pretty dramatic about it, the level of anger and protest can only get worse. I am hoping it doesn't develop into full blown racist xenophobia directed at the huge recent immigrant population living here and am relieved that so far, it hasn't. However the Celtic Tiger cubs are growing up and now want to command their own prides, and some pretty nasty infighting could occur when there aren't enough jobs to go around.
Giving them history lessons on how the Irish, too, are a nation of emigrants isn't really going to help much - especially when those lessons are being given by the middle classes still sitting on record levels of income. "It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."
After all, if they are unemployed, then it means that nobody is benefiting from their skills.
(Cue Mig pulling out a Keynes quote :-P)
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
There have been some noises from Cowen to the effect that this may have to be scaled back because of a sharp downturn in tax revenues, but if ever there was a time and reason to hold your nerve and increase borrowing to fund a large infrastructural programme well this is it.
I can see the Unions pressing hard for this as part of the current social partnership talks - but they may have to pay in terms of pay moderation in order to get it.
The other plus side of doing it now is that there has been huge price inflation in infrastructural projects because of the tight labour market (in the past) and - well - infrastructural bottlenecks. So it should be possible to get a lot more done for the same money now that might have been possible a couple of years ago.
Huge money has been spent on infrastructure, health etc. - tripling expenditures of c. 10 years ago - the problem has been getting value for money for the invstment spent. (Our metros cost many multiples per KM more than e.g. Madrid spent for comparable investment). A lot of this is down to to inflation at a time of huge growth, but even more to very poor project management and decision making capabilities within the public service.
For instance the M50 ring road motorway around Dublin handed even been completed when they had to start upgrading it from 4 lanes to 6 for multiples of the original cost. Now they are going to spend hundreds of millions on an electronic tolling system when a few cent on the price of petrol would bring in the same extra revenue for zero incremental collection cost.
Every private sector company I know rubs its hands at the prospect of a public contract. The initial tender price may have to be low - but the spec is always changed and then they can charge what they like. 100's of lawyers have become multi-millionaires from the Tribunals alone - work that in England would have been done by a judge and a couple of barristers in a matter of weeks.
The waste is spectacular and yet it is almost impossible to even raise the issue of poor management. (The Irish Times has never published a letter of mine criticizing any aspect of the management of public projects/services). This is why I am sometimes at odds with Jerome's paeans of praise to the French public service - if only some real accountability and management disciplines applied in Ireland. "It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."
