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Ireland's Zombie Economy

by Frank Schnittger Wed Jan 14th, 2009 at 11:34:37 AM EST

Warning that house prices may fall by 80% - The Irish Times - Tue, Jan 13, 2009

IRELAND WILL see more demolition than construction of houses over the next decade, as the economy struggles to recover from the collapse of the housing market and the emergence of "zombie" banks, UCD economist Morgan Kelly told the conference.

In a presentation that drew several collective intakes of breath, Mr Kelly predicted that house prices would fall by 80 per cent from peak to trough in real terms.

"Construction, but not demolition, of residential and commercial property will fall to zero for the foreseeable future," he said.

Low levels of education among those employed in construction - where worker numbers peaked at about 280,000 - meant retraining would not be straightforward.

Recovery will be slow: "It has taken us 10 years to get into this situation - it will in all likelihood take us 10 years to get out of it."


Warning that house prices may fall by 80% - The Irish Times - Tue, Jan 13, 2009

Mr Kelly said he had been hailed as being extremely prescient as a result of his warnings in relation to the property bubble, when in fact he and a handful of other "amateurs" were merely stating what was obvious.

Sparing no blushes, he said professional economists in the Central Bank and the Economic and Social Research Institute "need to look very closely at their analyses of the Irish economy and figure out what went wrong".

Mr Kelly said Ireland's "reputational capital" had been damaged by "chancers" such as ex-Anglo Irish Bank chairman Seán FitzPatrick, who had been abetted by "buffoons" such as former financial regulator Patrick Neary, Minister for Finance Brian Lenihan and the Taoiseach.

In discussing the €110 billion given in loans to developers, Mr Kelly said a typical regional housing collapse in the US saw banks sustain a 20 per cent loss on these loans, but the narrowness of the Irish market increased the risk of "substantially larger losses" for Irish banks.

"The guarantees of Anglo and [Irish] Nationwide liabilities have a strong chance of being called in over the next 21 months," he said. Extending the Government guarantee to these two financial institutions was "extraordinarily unwise" and could produce losses that the State cannot afford to repay.

The global financial crisis may have been positive for the Irish economy as it "stopped us dragging ourselves even deeper into our hole," he said. "If it had taken another year or two, we would have ended up in an Icelandic-shaped hole, which is not to say that we won't end up in one.

Mr Kelly said the Government should abolish stamp duty on property, compile proper price and quantity statistics and restore competitiveness through a public sector pay cut of 10 per cent."

The Irish economic crisis illustrates both the strength and the weakness of being a member of a larger currency block like the Euro.  In the bad old (pre-Euro) days, the current crisis would probably have been largely averted by interest rates rising much higher much earlier in the "asset bubble phase", followed by a much earlier and more drastic reduction in interest rates once the bubble burst, combined with a dramatic devaluation of the Irish currency.  That is arguably what we need now. to restore some semblance of competitiveness to our economy, and some resemblance to affordability in the efficiency and cost of provision of many of our public services.

But being a member of the Eurozone also gives us much greater stability in our trading relationships, and better prospects for funding our ballooning public sector deficits.  Our Debt GNP ration is likely to go up from a very reasonable 25% in 2007 to something approaching 60% by 2010.  Clearly an unsustainable rate of increase.

What should have happened, of course, is that Government fiscal policy should have taken over the role of regulating Ireland's economic growth at a time when the Government no longer had the interest rate and devaluation mechanisms available pre-Euro.  But instead of taking the tough counter-cyclical measures which would have been required to rein in Irish inflation and growth to sustainable levels, the Government instead provided populist tax reductions and wage increases which exacerbated the asset and consumer price inflation boom.

The figures all looked great so long as we could get away with ever increasing asset prices and moving the economy up to higher value added R&D, Pharma, ICT and financial services industries which were less sensitive to inflated costs of doing business here.  The Irish economy was heading for a fall before ever the US sub-prime crisis appeared on the scene, but now the crisis is happening at the very worst time possible when neither the largely foreign own multinational sector, nor the more consumer orientated service sectors are in a position to shore up the  personal, corporate, or state balance sheets.

Dell recently announced 2,000 job cuts in Limerick.  Today Nortel announced it was filling for bankruptcy putting a further 1,500 Irish jobs at risk.  Irish unemployment will double from 4 to 8% within the next year.  There isn't a bottom yet in sight, and no indication of why one should appear on the horizon, because the Government has no effective mechanisms for making the drastic adjustments required to stabilise the economy.  The public sector deficit is likely to hit 10% next year (over three times the Growth and Stability pact limit), and there is no reason to suppose that it can be reduced beyond that as escalating interest rates (based on increased Sovereign default risks and a crowding out by "bail-out" borrowing by other states) makes the Irish public debt all but unsustainable. Peak to trough, Irish GDP could well fall by 10% in real terms, and the bulk of that readjustment will fall on those least able to bear it.

We have become used to Irish private sector professionals and public sector managers earning far more than their equivalents elsewhere within the EU.  Irish Consultant doctors earn salaries in excess of €200K per annum for a 30 hour week and can earn a multiple of that from private practice in addition to their public income.  They can force public patients off their waiting lists (through excessive waiting lists) and treat those same patients privately for enormously inflated private fees paid by rapidly going insolvent health insurance companies.  Lawyers won't get out of bed for less than €2000 per day briefing fees.  Tribunals of enquiries have paid such lawyers hundreds on millions of Euros for work more properly done by the police or appropriate financial investigative agencies. Top bankers have treated their banks as their private fiefdoms for their own speculative off-balance sheet adventures. There is almost no concept of value for taxpayers money at higher levels of the civil service.

In effect, what we have in Ireland is a class society where both public and private sector leaders and top professionals have been able to charge more or less what they like and become millionaires as a matter of course for performing activities that would command a modest salary (by Irish standards) in other European countries. It is difficult to imagine a change in the Irish social, political and economic structure that would adequately address the imbalances this has created in the economy any time soon. And as always, it will be the poor, the sick, and the unemployed who will bear the brunt of the crisis.

Display:
I actually don't know what to say after reading Frank's spot-on reporting and analysis.  It hurts to read this, but when coupled with the hundreds of other reports we read in a week, it could spiral into a real depression within the collective consciousness.

Guess i should say thanks for writing this, Frank.

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Wed Jan 14th, 2009 at 12:14:44 PM EST
It gave me no pleasure to write it.  I'm as happy to be patriotic as the next man but when you see error piled on error and public and private foolishness and greed piling on the people who can least bear it you have to let out the occasional, almost involuntary scream.  This isn't a painstakingly researched piece, I could evidence every assertion made, but just don't have the heart to do that right now.  We're going to have the mother of all blame games and I'm much more into fixing problems than pointing fingers or luxuriating in gloom.  The problem is there isn't a whole lot I can do right now, other than keeping a few organisations I do voluntary work for afloat.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 12:23:36 PM EST
[ Parent ]
The blame game is important: the government basically cut taxes far too low and relied on property transaction taxation and selling the family silver to fund spending in the mean time. All in pursuit of the fashionable ideology of time, and all enthusiastically voted for by the good people of Ireland.
by Colman (colman at eurotrib.com) on Wed Jan 14th, 2009 at 12:39:30 PM EST
[ Parent ]
It gives me no pleasure to read this as well. It's as is nothing of great importance is going on in the Irish political world, they are quite content to sit like idiots in Tokyo for photo ops after "masterfully" announcing a total gain of 157 new jobs. Yippee, I don't know if I should cry in my oatmeal or laugh as they do, like jackasses!
by Asinus Asinum Fricat (patric.juillet@gmail.com) on Wed Jan 14th, 2009 at 02:56:43 PM EST
[ Parent ]
The Irish economic crisis illustrates both the strength and the weakness of being a member of a larger currency block like the Euro.
No, it doesn't. It illustrates the disaster that are Monetarist macroeconomic theory and its associated pro-cyclical fiscal policies. And you make that point
What should have happened, of course, is that Government fiscal policy should have taken over the role of regulating Ireland's economic growth at a time when the Government no longer had the interest rate and devaluation mechanisms available pre-Euro.  But instead of taking the tough counter-cyclical measures which would have been required to rein in Irish inflation and growth to sustainable levels, the Government instead provided populist tax reductions and wage increases which exacerbated the asset and consumer price inflation boom.
Can we go back to Keynesian macroeconomic theory and counter-cyclical fiscal policies, please?

Oh, my, it looks like we're going to repeat Hoover's 1929-32 economic policy mistakes.

Are you ready for the Great Depression of the 2010s?

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith

by Migeru (migeru at eurotrib dot com) on Wed Jan 14th, 2009 at 12:21:49 PM EST
Migeru:
Can we go back to Keynesian macroeconomic theory and counter-cyclical fiscal policies, please?

It's far too late for that given that the borrowing required to counter this particular cycle is way beyond what Ireland can raise on global debt markets at a rate of interest it can afford.

For all the criticisms of the extent of the EU's CAP, regional, structural and cohesion funds, the EU really doesn't do national bail-outs on the scale that may be required here.  

Even the US, for all the rhetoric of small government so beloved of conservatives from poorer states actual does subvent poorer states much much more, because Federal spending is skewed towards poorer states, and Federal taxation is skewed towards the richer.

But then the US is a Federal state, and does have a federal financial and taxation system, something which is way beyond the current competence of the EU, for all the eurosceptic complaints of creeping integration within the EU.

However the bigger problem within Ireland, which I only barely mention, is our internal class structure, which hugely privileges an administrative, managerial and professional elite.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 12:38:59 PM EST
[ Parent ]
Soon it's going to be far too late for everyone, not only Ireland.


Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Wed Jan 14th, 2009 at 02:52:50 PM EST
[ Parent ]
Even the US, for all the rhetoric of small government so beloved of conservatives from poorer states actual does subvent poorer states much much more, because Federal spending is skewed towards poorer states, and Federal taxation is skewed towards the richer.

From what I´ve read on American blogs states like Michigan (Detroit, Flint!) for example paid more in federal taxes per capita than they got back in federal spending.

While a state like Alaska (no state sales tax, no state income tax but oil revenue checks to every Alaskan) was the no. 2 or 3 winner in federal spending received per capita compared to federal taxes paid per capita.

I grant you that´s an extreme example but if looking at the numbers clearly some states get "more".
In 2005 Texas and Florida did almost break even. $0.97 and $0.94 received for any federal tax dollar paid. Michigan $0.92 and Illinois $0.75. Alaska $1.84.

I suspect a lot depends on Congress (seniority of senators and the like). Plus military spending seems to be more concentrated in the Southern USA.

by Detlef (Detlef1961_at_yahoo_dot_de) on Thu Jan 15th, 2009 at 03:46:58 PM EST
[ Parent ]
because Senator Stevens was one of the most senior and powerful members of the Senate and very good at securing "pork barrel" spending for his state.  Mind you the population of Alaska is very small, so the sums involved would have been almost trivial in a Washington context.

As a consequence Senator Stevens was so popular in Alaska he very nearly got re-elected in November despite having just been convicted on several counts of felony - failing to declare "donations" etc.

There may also be an element of historical inertia involved.  Alaska used to be very poor before the Oil was exploited, and Michigan used to be part of the very rich industrial north before globalisation caused its (car) industry to tank big time.

I think my general point still stands...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 04:01:26 PM EST
[ Parent ]
Didn´t want to criticize your main point.
Just wanted to point out that even the US federal system is somewhat slow to recognize changing conditions. Slow, as in, needing decades.

For all the criticisms of the extent of the EU's CAP, regional, structural and cohesion funds, the EU really doesn't do national bail-outs on the scale that may be required here.

Even the US, for all the rhetoric of small government so beloved of conservatives from poorer states actual does subvent poorer states much much more, because Federal spending is skewed towards poorer states, and Federal taxation is skewed towards the richer.

However Ireland too got quite a bit of EU funds in the last 30 years. IIRC something in the DM 30+ billion neighbourhood? Simply put, Ireland isn´t one of the "poorer states" in the EU today?

And if what I´ve read is right, California right now is a lot worse off? Pretty much bankrupt? While still paying more to the federal government than they get back?


California will close most state offices on the first and third Fridays each month starting in February, shutting DMV outlets and state parks while reducing state worker pay to help survive a massive budget problem, according to a state Department of Personnel Administration memo.


Last Friday, Schwarzenegger issued an executive order which asked for state agencies to cut payrolls by 10 percent, while forcing over 238,000 state workers to take two-day unpaid furloughs each month. State employee unions have pointed out that this would translate into a 9 percent pay cut. The order also freezes all new hiring at the state level.


The governor vetoed an $18 billion Democratic plan that included new taxes and state program cuts. The governor says the plan did not have enough spending cuts or ways to stimulate the economy.
...
"It was the only wise course of action he had before him. He could not have signed that piece of legislation and generated illegal tax revenue. It would have been challenged in court and it would have essentially found to be unconstitutional. So he did the right thing," said Blakeslee.

Republicans say the Democrats' plan was illegal because it was passed by a majority instead of the two-thirds needed for tax increases.

I noticed that the US federal government hasn´t bailed out California by now. One of the largest (population and economy) states in the USA.
(Of course the California constitution is insane.)

Still I´m not quite sure if your example still stands?
California is on the verge of bankruptcy. Did you notice:

  • Cut state payrolls by 10%
  • A "two-day unpaid furlough each month"
  • The state faces the prospect of issuing IOUs beginning in February and a roughly $40 billion deficit over the next 18 months...

Is Ireland in the same situation as California?
If yes, then notice that the US federal government till now didn´t do anything to bail-out California. Just be happy with the firings of 10% of state employees. Plus a pay-cut for any remaining state employee.
If not, then just notice that comparisons between the USA and the EU might be wrong?
by Detlef (Detlef1961_at_yahoo_dot_de) on Thu Jan 15th, 2009 at 05:46:14 PM EST
[ Parent ]
I'm not an expert on California, but my impression is that it is one of the wealthiest States within the US.  The reason the state budget is in such trouble is because it is controlled by Republicans who are determined to keep takes low whatever happens - even if it means cutting essential services - because their relatively wealthy voters don't need those services as much as their poorer neighbours do in any case.

The solution for California is thus relatively simple - elect a Democratic Governor/legislature and let them raise taxes.

The problem in Ireland is somewhat different in that it is the real economy which is tanking even more than the Government is.  Raising taxes will also have to be part of the solution sooner or later, but just at the moment it would simply deepen the depression still further.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 06:17:41 PM EST
[ Parent ]
Moody's reviewing Ireland's AAA rating - The Irish Times - Wed, Jan 14, 2009

Ratings agency Moody's said today it was reviewing the strength of triple A sovereign countries and said Ireland had lost "considerable altitude" amid shrinking public finances.

---------

S&P issued similar ratings warnings since Friday for Greece, Spain and Portugal, and today it went ahead and cut Greece's sovereign debt rating to A-/A-2 with a stable outlook from A-/A-1.

Ireland, the former "Celtic Tiger", has suffered a stunning reversal of fortune as a domestic property crash and global slump plunged it into recession, forcing the state to bail out the three largest banks and borrow heavily to fund spending.

"There are some concerns regarding economic activity, economic strength and also the dynamics of debt metrics," said Moody's Hornung.

He said there were concerns about tax revenues given the reliance on real estate and financial services.

"Both sectors have done pretty poorly, it's obvious there is a loss in tax revenue," he said. "The other concern is contingent liabilities."

The deepening downturn has shattered public finances and the government raised its forecast on Friday for the 2009 budget deficit to 9.5 per cent of gross domestic product -- more than triple the 3 per cent EU limit -- from 6.5 per cent projected at budget time in October and 7.25 per cent forecast last month.

The government also predicted GDP would contract 4.0 per cent this year, from an 0.8 per cent drop forecast in October, making it Ireland's worst recession on record. GDP was forecast to fall 0.9 per cent in 2010, only rebounding to 2.3 per cent growth in 2011.

The finance ministry on Wednesday reiterated it was determined to cut the country's budget deficit to ensure the stability and sustainability of public finances.
"It is obvious that the degree of flexibility that Ireland has to show in order to keep its high level of creditworthiness is quite considerable," Hornung said.

"Ireland is still in a pretty favourable situation -- it is not only the low debt stocks, it is also being a part of the EU, being part of the EMU (European Monetary Union) and it is certainly a shelter to an imminent crisis situation," he added."



notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 02:24:20 PM EST
Tell that to the Irish people who have voted no to Lisbon!

Ireland is still in a pretty favourable situation -- it is not only the low debt stocks, it is also being a part of the EU, being part of the EMU (European Monetary Union) and it is certainly a shelter to an imminent crisis situation," he added."
by Asinus Asinum Fricat (patric.juillet@gmail.com) on Wed Jan 14th, 2009 at 03:02:51 PM EST
[ Parent ]
Lisbon has no bearing on membership in the EU or the EMU...

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Wed Jan 14th, 2009 at 03:08:27 PM EST
[ Parent ]
Technically, legally correct, but politically rather less so.  Ireland needs the EU more than the EU needs Ireland and it needs the EU to function in a more dynamic cohesive fashion.  The poorly coordinated actions of the ECB and major EU economies in responding to the global crisis was bad enough under Sarkozy's Presidency, but think how bad it would have been under the current Czech Presidency?

Never has the case for a more permanent President of the EU Council, freed from the responsibilities of also leading his/her member state been more obvious.

Besides the structural arguments - e.g. reduced requirements for unanimity - which can improve decision making, there is also the straightforward political one.  Now is not the best time for Ireland to piss off the Governments of its 25 fellow member state Governments who have ratified the Treaty and who wish to move on.

The reasons for the NO vote seem rather trivial in comparison, and were born of a time when Ireland had the luxury of voting on the issue without perceived downside risk.  What has happened since, both politically and economically has been a rude awakening for those caught up in the hubris of the Celtic tiger.

My hunch - based on no evidence at all - is that the next vote will have a rather different outcome.  In a private e-mail Dick Roche (Minister for European Affairs) also intimated to me that more and more people are saying to him (unprompted) that they would welcome the opportunity of a second vote.

But then he would say that, wouldn't he!


notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 03:54:17 PM EST
[ Parent ]
Peak to trough, Irish GDP could well fall by 10% in real terms, and the bulk of that readjustment will fall on those least able to bear it.

During the Swedish recession depression of the early 90's, real GDP shrank a bit more than 4 %... It was without question the worst crisis we had since the Depression (which has resulted in people calling the current debacle "the worst things since the 90's crisis", not since the 30's), in spite of the fact that our economy kind of started turning to shit around 1970 and never really recovered, until a quarter of a  century later.


GDP per capita in real prices (funny how while growth as measured in percent slowly falls, it's pretty much constant when measured as an increase in absolute numbers).

Quite a number of people who lost their jobs 15 years ago got stuck in unemployment and are still there.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Jan 14th, 2009 at 04:30:46 PM EST
Starvid:
Quite a number of people who lost their jobs 15 years ago got stuck in unemployment and are still there.

That's my problem with all the right wing "the market will adjust and everything will come right" "theorists"=ideologists.  Capital flows and consumer price adjustments are a lot more "flexible" than people or the social structures which largely mould them.  I have no doubt the Irish economy will eventually recover, but its the collateral damage a real depression creates - people whose self esteem, capabilities and social environments suffer almost irreversible damage and never recover.

I really hate the phrase "human or social capital", but economists have no real way of valuing the value embedded in people and companies which fail, and which can be very expensive/difficult to restore or replace.

Ireland lost whole generations to emigration that way.  This time we are going to have to sort it out for ourselves.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 05:04:33 PM EST
[ Parent ]
European Tribune - Ireland's Zombie Economy
In the bad old (pre-Euro) days, the current crisis would probably have been largely averted by interest rates rising much higher much earlier in the "asset bubble phase", followed by a much earlier and more drastic reduction in interest rates once the bubble burst, combined with a dramatic devaluation of the Irish currency.

Actually I wonder about that. Iceland managed to create an enormous bubble with large amounts of foreign denominated debt. What would have prevented Ireland from doing the same?

Von überall könnte das Volk, Urbrut alles Undemokratischen, Zelle des Terrors, über die gewählten Hüter von Wachstum und Wohlstand® kommen. - flatter

by generic on Wed Jan 14th, 2009 at 04:58:32 PM EST
Actually our public foreign debt has been reducing whilst the private foreign debt has boomed anyway - probably in part because there was no exchange risk with foreign debt provided it was denominated in Euros.  If anything it was easier for Irish banks/individuals to raise excessive foreign debt because of low Euro area interest rates and the low risk perception the Celtic Tiger created.  I can't find the source now, but I remember reading that Irish private foreign debt could be near 400% of GDP!

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Jan 14th, 2009 at 05:20:44 PM EST
[ Parent ]
Iceland built up massive levels of private debt, precisely. Its 3 big banks had balance sheets in the range of 10 times GDP, IIRC.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Thu Jan 15th, 2009 at 08:31:44 AM EST
[ Parent ]
This is where Government regulators, central banks etc. seem to have taken their eye off the ball big time.  What's the point in preening yourself on a 25% public sector debt/GDP ratio if the private sector Debt/GDP ratio has ballooned to 400%?  I'm not even clear what actions the Irish Government could have taken in the absence of capital/exchange controls and control over interest rate policy.  Certainly the prevailing ideology - let the private sector do what it does best etc. - wasn't helpful, but tou have to ask whether there shouldn't also have been ECB level controls on this.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 08:40:33 AM EST
[ Parent ]
But banking regulation is still a member state responsibility. Assuming theoretically that they did recognize the risk 3-4 years ago:

- Raise that topic in the ECB and during government meetings. Yes, I know, rather weak. :)
Probably would have fared as well as Merkel at Heiligendamm in 2007.

- Maybe threaten to audit the banks? And threaten not to accept some "securities" as tier 1 level capital? I seem to remember reading somewhere that Spanish banks were regulated much more stringent?
Ahh, here.


Thanks in large part to stringent regulation, Spanish banks are rightly being applauded for the way they steered clear of toxic credit derivatives and shadowy off-balance-sheet exposures. However, they are finding it much harder to avoid Spain's cramping housing market.
...
Spanish lending policies were certainly more conservative. Loan-to-value ratios usually did not exceed 80%. Borrowers were even required to provide documentation proving things like income. Spanish banks have not had to shelve riskier product lines in the same way that American and British mortgage lenders have done.

Mind you, Spain still did have its housing bubble. But it seems to indicate that more stringent member state regulation was possible.

Certainly the prevailing ideology - let the private sector do what it does best etc. - wasn't helpful, but you have to ask whether there shouldn't also have been ECB level controls on this.

You´re probably right. But let me ask you:
What would have been the reaction of the Irish government and population 2-3 years ago if the ECB had proposed just that? Probably a repeat of what I´ve  read on English websites for years: "Shriek! Power grab! Undemocratic EU!"

It´s pretty unlikely - given "the prevailing ideology" back then - that the Irish (or most other governments) would have agreed?
Times are good why change anything?

by Detlef (Detlef1961_at_yahoo_dot_de) on Thu Jan 15th, 2009 at 04:40:57 PM EST
[ Parent ]
are a lot more positive than the UK and, (perversely from a Eurosceptic point of view) there is probably more trust in the competence of EU institutions than there is in our own!  Generally speaking Ireland supports further integration/extension of competency especially for things that are clearly too big to control at (a small) national level - e.g. globalisation, currency management, speculative capital flows..

Isn't that part of what (ECB) monetary policy is supposed to regulate - excessive credit/debt creation due to inappropriate interest rates or insufficient capital adequacy ratios?  The Irish banks have never been adequately regulated by the Irish Government - they are too biog, rich and powerful, and for all I know - too generous in their contributions to political parties!

Dublin is a small town.  Everyone knows everyone else.  Its all a cosy club - big business leaders, senior civil servants, top professionals, politicians.  The name of the game is "you scratch my back and I'll scratch yours." No one is prepared to rock that boat...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 04:59:36 PM EST
[ Parent ]
I predict the government will wait till things get so bad that they'll 'have to get the IMF in' to shaft the working people. They're too cowardly to do that themselves. 'Adjustment' won't come from Fianna Fail. It'll have to be a foreign boogieman.

Meanwhile they're attempting through a proposed Anglo Irish Bank Recapitalisation to save a batch of their 'Developer' friends from having their goods and chattels taken from them by the sheriff and the cops. That will be 'fun' when the govt come back into the Parliament. They have to get some kind of veneer of legitimacy before they give peoples pension money to developers.

Strange days. Everything seems so normal but it's not. I do notice on the slightly bright side that people are actually talking to each other and they definitely aren't talking about the prices of houses. That was the almost sole topic of conversation here for a good 7 years.

I've been watching some old documentaries from Argentina in the early years of the century to acclimatise to the near future before it lands on us.

by irishhead on Thu Jan 15th, 2009 at 03:47:45 AM EST
Here's an interesting question (which may not apply so well to Ireland.) In an era of privatisation, does the government truly bankroll enough of the economy to be able to use fiscal policy to dampen a bubble?

Pulling figures out of the air for 2004 (easiest ones to find in Google) Irish tax revenue is 30% of GDP.

Using this as a ballpark figure and assuming they spend it all, a 10% cut in government spending is about 3% of GDP.

I think that would be a serious fiscal damping.

But, a 10% cut in government spending sounds politically difficult in any country.

What I'm groping towards is that perhaps being in the euro truly does make it hard for small countries to control their bubbles.

Of course, if the Irish bubble had been directed more evenly (domestic energy? nuclear/wind/wave?), instead of largely into domestic construction, the picture might look different again.

by Metatone (metatone [a|t] gmail (dot) com) on Thu Jan 15th, 2009 at 05:04:32 AM EST
Of course, the real fiscal action is to raise taxes... but we've been told so long that "raising taxes is evil" I fear we're in some bizarre economist's trap.
by Metatone (metatone [a|t] gmail (dot) com) on Thu Jan 15th, 2009 at 05:21:41 AM EST
[ Parent ]
I fear we're in some bizarre economist's trap.

The pro-cyclical fiscal policies of the Current Consensus. Some trap...

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Jan 15th, 2009 at 05:23:35 AM EST
[ Parent ]
Realistically, Government expenditures never go down.  Even when we have had enormous controversies about Government cutbacks, it has always been cutbacks with respect to future budget, not last year's actual expenditure.  Cutbacks are always attacked because they effect the "old, poor and sick" disproportionately, but in reality the budgetary increases being considered for cutting back always include a generous "overheads" component which goes to the administrative class.

Cutbacks - even when defined as above - are almost always more unpopular than even tax increases and almost undoable in a democracy with such a strong tradition of clientalism as Ireland.

So fiscal dampening or countercyclical budgeting always means tax increases.  No wonder governments don't like them - they are sure popular vote losers - but even that is preferable to the paralysis that would accompany RERAL cutbacks in Government bureaucarcy.

For instance the Department of Education has outsourced almost all responsibility for curriculum development, examination management, school start-ups, development and management to independent (and sometimes voluntary) groups.  Its civil servants are notorious for beuing inaccessible and taking responsibility for absolutely anything.  It is against their religion.  You could close the entire Department down and things would probably run better.  (Psst. - don't tell anyone I said this - it would make me public enemy no. 1 in some circles.  You are not allowed to say an entire Government Department doesn't add value.  You can't be a serious person if you say such things).

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 06:53:05 AM EST
[ Parent ]
Raising taxes could've moderated the boom -- and, given that Ireland doesn't control the currency, that would've been the right way to go about it.  But going the other way, you still run into the problem of constraints on countercyclical fiscal policy because of the SGP.

Now maybe that could be dealt with in future cycles by (say) mandating government savings during expansions, but I'm inclined to think there'd be an unrealistic level of precision needed to make that work.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Thu Jan 15th, 2009 at 08:42:27 AM EST
[ Parent ]
SGP?  Stability and Growth Pact?  This was actually a constraint on Government borrowing in the good times (limited to a 3% current budget deficit) and so prevented even more pro-cyclical policies. Now of course it is being totally ignored, with the latest figures predicting a 9% current budget deficit - which is already hugely countercyclical -  and unsustainable unless the cycle turns upward very rapidly.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 09:05:03 AM EST
[ Parent ]
200K euros for hospital consultants?

That's pretty insane. UK hospital consultants are generally thought to be on £110,000 excluding private work.

Even when the pound was strong that's still only like 154K euros.

Given the similarities of language, education and system that's indicative of some real barriers thrown up by the Irish profession (and the government must have been complicit in this.)

by Metatone (metatone [a|t] gmail (dot) com) on Thu Jan 15th, 2009 at 05:12:04 AM EST
To follow on from this, it seems that you're saying (and presenting evidence for) a class system rooted in "access to government"?

i.e. The rich make their money and protect their position by virtue of their contacts with the government?

by Metatone (metatone [a|t] gmail (dot) com) on Thu Jan 15th, 2009 at 05:23:20 AM EST
[ Parent ]
The irony of this is that the principles of trade unionism (and much of the language) have been most vociferously appropriated by the most privileged in society - people in highly paid, relatively secure, and pensionable occupations in both the public and private sector.  Dare change a minor clause in a consultants contract, and you find yourself in the High Court.  These people are almost unsackable and cover for each other.  The negotiations around their contracts are conducted by senior civil servants whose interests are served by high settlements because they can then benchmark their own salaries against these high settlements.

So it isn't just about access to Government.  Their is a well organised elite, often ensconced within legally unchallengeable agreements - pharmacist's mark-ups, legal fees, consultants "rights" to private practice, teachers unions etc. - which often use the language of the oppressed working class to support their positions - often at up to twice EU salary levels and with non-contributory defined benefit pensions indexed not only against inflation, but against any future productivity awards made to their still working colleagues!

Only in Ireland...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 06:18:13 AM EST
[ Parent ]
Sounds like what Adam Smith wrote against corporations (guilds, in effect) in The Wealth of Nations. He was very much against them. As he wrote before the time of trade unionism it's hard to know what he would have said of the unions (he probably would have objected to their power, too) but you might use Adam Smith quotes to attack these privileged professionals and their corporatism.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Thu Jan 15th, 2009 at 06:32:02 AM EST
[ Parent ]
Indeed. The relation between Adam Smith and 'economists' closely resembles that between Jesus and born-again pastors.
by nanne (zwaerdenmaecker@gmail.com) on Thu Jan 15th, 2009 at 06:44:59 AM EST
[ Parent ]
I am so gonna steal that line.

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Jan 15th, 2009 at 10:49:25 PM EST
[ Parent ]
With the "magic of the markets" or the invisible hand replacing the Holy Spirit as the guiding force of history?  It seems Jesus' description of "those that have, shall be given, and those that have not, shall have taken from them even that which they have" pretty much prefigures Marx's "the rich will get richer, and the poor will get poorer" - both nicely incorporated into law if the Markets come to be seen as the natural (and God ordained) order of things.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 18th, 2009 at 04:30:23 PM EST
[ Parent ]
Regarding unions, he did write:

Smith: Wealth of Nations, Book I, Chapters 8-9 | Library of Economics and Liberty

I.8.11

What are the common wages of labour, depends every where upon the contract usually made between those two parties, whose interests are by no means the same. The workmen desire to get as much, the masters to give as little as possible. The former are disposed to combine in order to raise, the latter in order to lower the wages of labour.

I.8.12

It is not, however, difficult to foresee which of the two parties must, upon all ordinary occasions, have the advantage in the dispute, and force the other into a compliance with their terms. The masters, being fewer in number, can combine much more easily; and the law, besides, authorises, or at least does not prohibit their combinations,*10 while it prohibits those of the workmen.*11 We have no acts of parliament against combining to lower the price of work; but many against combining to raise it. In all such disputes the masters can hold out much longer. A landlord, a farmer, a master manufacturer, or merchant, though they did not employ a single workman, could generally live a year or two upon the stocks which they have already acquired. Many workmen could not subsist a week, few could subsist a month, and scarce any a year without employment. In the long-run the workman may be as necessary to his master as his master is to him, but the necessity is not so immediate.

So I would guess he would be in favor of a balance of power between the masters and the workmens organisations.

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!

by A swedish kind of death on Sun Jan 18th, 2009 at 02:32:24 PM EST
[ Parent ]
I think that ideologically he'd prefer aggressive trust-busting to remove the employer organisations altogether (see, for instance, his oft-quoted comment about merchants' penchant for forming cartels).

What dead people would've or could've thought about institutions that didn't arise until long after their time is hard to guess. Suffice is to say that if Adam Smith and Karl Marx had had a chance to see present-day Scandinavia and present-day USA, both Wealth of Nations and The Communist Manifesto would probably have been quite different reads...

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 18th, 2009 at 03:33:28 PM EST
[ Parent ]
But which book has better stood the test of time?

JakeS:

What dead people would've or could've thought about institutions that didn't arise until long after their time is hard to guess

But isn't that what New Testament exegesis (in particular) is all about?  Thus Jesus is presumed to have been against homosexuality, although he never said a word on the topic.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 18th, 2009 at 04:18:04 PM EST
[ Parent ]
Having actually read neither cover-to-cover, I cannot say which has better stood the test of time. I suspect that both contain some ideas that time has shown to be rather naïve. But I expect that Marx has some advantage by way of being more recent, if nothing else.

It's possible that NT exegesis is about, but I wouldn't know for sure. I've never been a big fan of that particular sport...

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 18th, 2009 at 05:36:11 PM EST
[ Parent ]
Or did he see both Unions and cartels as distortions of the market place?  Was the market, in itself, good for Adam Smith, and thus all distortions inherent evil, or at least inefficent?  Did he make value judgements - such as the one you suggest - that it would be better to have a more equal balance between workmen and their employers - or did he simply see his work as a description of the reality without "taking sides" or making any value judgements whatsoever.

(These are all genuine questions - I haven't read Adam Smith)

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 18th, 2009 at 04:23:17 PM EST
[ Parent ]
As I read him - though I must confess I have only read bits and parts - his priority is the general wealth. The analysis is to understand how things fit together in order to take actions that increase the general wealth. After concluding that progressive times (i.e. expanding economy) benefits the workmen (wages goes up, some go in business for themselves) but not so much the masters (who must pay higher wages, gets more competition and loses some of their best workers):

Smith: Wealth of Nations, Book I, Chapters 8-9 | Library of Economics and Liberty

I.8.35

Is this improvement in the circumstances of the lower ranks of the people to be regarded as an advantage or as an inconveniency to the society?*38 The answer seems at first sight abundantly plain. Servants, labourers and workmen of different kinds, make up the far greater part of every great political society. But what improves the circumstances of the greater part can never be regarded as an inconveniency to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, cloath and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, cloathed and lodged.



A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!
by A swedish kind of death on Sun Jan 18th, 2009 at 05:13:12 PM EST
[ Parent ]
A swedish kind of death:
tolerably

so subtly patronising, at first glance...

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Sun Jan 18th, 2009 at 05:34:31 PM EST
[ Parent ]
I suspect his readership at the time came almost entirely from the ruling, merchant, and middle classes (and within the "improving" tradition of Scots Presbyterianism) and thus anything which improved the general lot of the people was to be welcomed even if it made circumstances more difficult for some of the middle classes - through increased competition, uppity servants, higher wages - and was an argument against the entrenched social class system of the (Anglican) aristocracy which was viscerally opposed to any mobility or free market access.  (From the perspective of a quasi feudal landed gentry the development of international trade, industrialisation and wider markets could have seemed very threatening).

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 18th, 2009 at 06:03:56 PM EST
[ Parent ]
yes, i believe it was said in a disinterested way, in good faith so to speak, it just jars today's ear.

"We can all be prosperous but we can't all be rich." Ian Welsh
by melo (melometa4(at)gmail.com) on Sun Jan 18th, 2009 at 07:51:23 PM EST
[ Parent ]
I don't know about Wealth of Nations, but in Theory of Moral Sentiments he does make value judgements, generally based on some brand of proto-utilitarianism. Precisely how he would weight different contributions to general happiness and welfare, I can't know without reading the book itself (it's next on my reading list, though...).

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 18th, 2009 at 05:29:35 PM EST
[ Parent ]
Anglo Irish Bank to be nationalised - The Irish Times - Thu, Jan 15, 2009
"Anglo Irish Bank is a major financial institution whose viability is of systemic importance to Ireland. Anglo has a balance sheet of some €100bn with a substantial deposit base which the State is determined to safeguard. The Government has made clear that it will ensure its continued viability. Anglo Irish Bank will continue to trade normally as a going concern, with appropriate Government support as necessary. All Anglo employees remain employed by the company," said a statement from the Department of Finance.

Minister Lenihan said the funding position of the bank has weakened and that the recent admission that former chairman Sean FitzPatrick had loans of over €87 million taken off the bank's books over an eight-year period, had caused "serious reputational damage" to the bank at a time when overall market sentiment towards it was negative.

He said that the Government believes that the recapitalisation "is not now the appropriate and effective means to secure its continued viability."

"The Government believes that the prospects for the institution are solidly underpinned in the new structure, with the benefit of state ownership and a renewed management and Board. In the current circumstances the State is the only available potential owner," said Mr Lenihan.

The above should be read in the context of the quote in this diary above as follows:
European Tribune - Comments - Ireland's Zombie Economy

Mr Kelly said Ireland's "reputational capital" had been damaged by "chancers" such as ex-Anglo Irish Bank chairman Seán FitzPatrick, who had been abetted by "buffoons" such as former financial regulator Patrick Neary, Minister for Finance Brian Lenihan and the Taoiseach.

The reference to the former Financial regular is in the context of the fact that the Financial regulator's staff knew that Mr. Fitzpatrick took his loans off the Anglo  Irish balance sheet just before their year end every year for eight years (by borrowing from another bank for a few days) and then transfered it back to Anglo irish balance sheet after the year end thus obviating the need to report it to the shareholders.

Apparently the Board were also not aware of this little arrangement...  The Financial regulator has resigned in consequence.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 03:52:31 PM EST
Ireland Property - Daft Property! Irish Property & Real Estate News - Dublin Webcam: The Devil's Triangle - Fianna Fáil, Bob The Builder & Banks...
Probably the most vulnerable of all is Anglo Irish Bank, the third biggest Irish-owned bank which described itself as "a relationship bank" but is more popularly known as "the builders' bank" and "the bank for big fish."

It is exclusively engaged in commercial lending and, though it has just 30,000 customers, its loans, primarily to the property and construction sector, come to €70bn.

When I was in Dublin on 5th November the talk among those I met (which included a minister) was that the shit would really hit the fan when the auditors got stuck in to the Anglo Irish loan book.

Fitzpatrick's cosy loan arrangements were just the start, I suspect. What the real value of the security underpinning this €70bn is worth right now is not clear: what is clear is that the bank had no prospect whatever of surviving without being nationalised.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Thu Jan 15th, 2009 at 05:30:50 PM EST
[ Parent ]
I suspect the taxpayer will end up paying big time for this.  Do you think the Irish Government should have let it go bust?

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 06:07:06 PM EST
[ Parent ]
Dunno.

Governments can afford to be pretty patient. The US government ended up making money after about 15 years on the pool of duff loans and foreclosed land they got in the Depression. But the default/repossession process won't be too pretty politically

I'm going to see if I can get a crack at the Builder's Party (ie Fianna Fail) with the "unitisation" concept.

It's only the Irish would be up for it, I think, for the same entrepreneurial reasons that got them in the shit in the first place....

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Thu Jan 15th, 2009 at 06:20:29 PM EST
[ Parent ]
If property values ever rise to something close to their peak levels again, the Government could have got a bargain, as Anglo was worth a few Billion not so long ago.  But I wouldn't be holding my breath.

ChrisCook:

I'm going to see if I can get a crack at the Builder's Party (ie Fianna Fail) with the "unitisation" concept.

I wish you luck, but I'm not sure Fianna Fail will offer fertile ground.  They don't have any economic intellectuals at the moment and will be pretty focused on digging themselves out of this crisis in the short term.  However anything which avoids creating further debt should be of interest to them.

I can offer you an introduction via Dick Roche, Minister for European Affairs, if that is of any help.  He's not the worst and was formerly a lecturer in Public Administration and Public Finance at UCD.  He is Minister for European Affairs and Cowen's Deputy at the Department of the Taoiseach.

However its a very long shot.  You probably need to get to some senior Dept. of Finance officials.  The politicians are up to their neck in crocodiles and aren't even thinking about draining the swamp...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 07:35:00 PM EST
[ Parent ]
Frank Schnittger:
I can offer you an introduction via Dick Roche, Minister for European Affairs, if that is of any help.  He's not the worst and was formerly a lecturer in Public Administration and Public Finance at UCD.  He is Minister for European Affairs and Cowen's Deputy at the Department of the Taoiseach.

Simple and radical ideas are in my experience resisted to the death by top civil servants and the consultants and corporates withwhich they are symbiotic - and which I think you identify as a particularly egregious problem in Ireland.

My experience in Scotland is that the sequence goes

1/ It gets written about in a respected paper.

2/ Politicians then take it seriously.

3/ Senior civil servants get told JFDI

(JDI = Just Do It)

I'll drop you an e-mail.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Thu Jan 15th, 2009 at 08:01:06 PM EST
[ Parent ]
But the big question Frank is - who was he borrowing the money on behalf of?  Can of snakes the whole thing. The country is having a nervous breakdown with anger over Gaza on top.
by irishhead on Thu Jan 15th, 2009 at 04:27:20 PM EST
I presume you mean Fitzpatrick?  I suspect he had his own speculative ventures in property and maybe venture capital.  Had they all come good he could have paid off the loans and no one would be any the wiser that he had put the banks capital at risk for his own little side-plays.  Banking to business is what that bank is about - and a lot of it at the speculative/risky end of the property/venture/corporate game - which is probably why they are now even more exposed than AIB or BofI.  In the days of the Celtic Tiger it would have been lauded as entrepreneurial at its best.

The problem now is why is the Government putting the taxpayers funds at risk to possibly huge debts? Anglo-Irish is hardly too big to fail - unlike AIB or BofI.  Not so long ago the Government was trying to force mergers on the smaller banks.  We clearly don't need 6 in a small economy - the UK has a similar number.  So what changed?

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Jan 15th, 2009 at 04:43:50 PM EST
[ Parent ]
Frankly, I don't buy a lot of the crap about Anglo: I suspect it's more or less a sacrificial lamb to protect a bigger bank that's in more trouble.

I think that Anglo's problem may very well be market and consumer confidence rather than any insurmountable problems with its loan book.

by Colman (colman at eurotrib.com) on Fri Jan 16th, 2009 at 04:50:03 AM EST
[ Parent ]
That's the Government's line, anyway - they claim Anglo-Irish is still solvent but suffering from irreparable "reputational" damage.  They're even talking about compensating shareholders.  On what basis (other than the market) can they possibly put a value on shareholder funds?

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 18th, 2009 at 06:08:49 PM EST
[ Parent ]
They are mates, so they need bailing out?
by Metatone (metatone [a|t] gmail (dot) com) on Mon Jan 19th, 2009 at 09:18:08 AM EST
[ Parent ]
Oh the usual reasons - some of the shareholders are poor pensioners and anyway, if they didn't, the shareholders in all the other Irish banks will run for cover anyway - soemthing whoich has happened today anyway.  AIB was down to 2% of its year high today - and even the year high wasn't that high...

Pretty soon you or I'd be able to buy one of the big banks for the price of a house

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 19th, 2009 at 10:29:59 AM EST
[ Parent ]
Dublin Bus to cut 290 jobs, reduce fleet by 120 buses - The Irish Times - Fri, Jan 16, 2009

Dublin Bus is to cut 290 jobs and reduce its fleet by 120 buses in a bid to reduce losses at the firm.

The State-owned firm also said it would not pay the 3.5 per cent national pay award due in April, nor the 2.5 per cent increase from October 1st.

The 10 per cent reductions in staff and the fleet come after a review of Dublin Bus's services in the city, which identified trends such as a sharp decline in passenger numbers as employment contracted, growth in newly developing areas of the city and a reduction in consumer spending.

Passenger journeys fell by 4 to 5 per cent last year, with further decreases expected in 2009.

The jobs will be cut throughout the organisation, including executive, clerical, operations and maintenance positions.

The company said it was facing a serious and challenging financial position in 2009, with losses for the year projected at €31 million if what it described as "corrective action" was not taken.

"This is due to the current exceptionally challenging economic environment which has led to a sharp decline in passenger numbers and also the abolition of the fuel duty rebate following an EU directive," Dublin Bus said in a statement.

The company recorded an operating loss of €10 million in 2008 after turning a profit of €4.7 million the year before.

Dublin bus is a state owned monopoly supplier of urban bus services in Dublin.  The profits/losses mentioned above are after a substantial state subvention.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Fri Jan 16th, 2009 at 11:29:16 AM EST


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