Bankrupt of ideas, bankrupt of money

Ireland is bankrupt financially and its government is bankrupt of ideas on how to solve the problem.

This is to be expected, disastrous though it may be. We are now reaping the property whirlwind that laughably went by the title of 'Celtic Tiger' for the past decade or so.

We were warned, repeatedly, but wouldn't listen. Specifically, we bought into the idea (metaphorically and literally) that there was a property 'ladder' we had to climb, even as prices went up indefinitely and spectacularly.

We bought into the idea that rent was dead money, and that we should all mortgage ourselves to the hilt in the hope of making ever greater returns as prices rose forever.

We know now that it was all a 'Ponzi scheme', a pyramid selling project designed to enrich the developers, who as we know from the tribunals, were backhanding a proportion of that cash to prominent members of Fianna Fail.

Now the credit crunch has happened, and there is a threat of the entire country going to the wall, as Iceland just did.

Our government's response? Raid the pension reserve fund to buy zombie banks that lent money to the developers. Plough hundreds of millions into 'affordable home' schemes, which would be better titled 'developer bailouts'. Then slash public services and public sector pensions (but not ministerial pensions or car entitlements, of course.)

So we're in a series of laughable positions after yesterday's mini-budget (the first of a series, I predict.)

We hand over nearly a billion euro in overseas development aid annually, even as we're expensively BORROWING the money that we then hand over to African despots for vanity projects that achieve little in sub-Saharan Africa.

And this on the same day that the latest exchequer figures came out indicating that we need to find 600 million euro MORE than we thought we needed back in October! (Which is why there will inevitably be more mini-budgets, since this government is incapable of working from up-to-date figures.)

We'd be better off sacking Irish Aid in its entirety and cutting a cheque to Oxfam or Goal, who are at least efficient and responsive to the needs of the communities they work in.

Or we could accept both the argument that we're skint and the argument that Africa does not benefit from the aid we send, and cut our borrowed losses.

But that's just one billion out of around 20 we have to find from somewhere. Sure, cuts are necessary, especially in the public sector. Actual staff cuts are needed, to weed out the Tetris-playing chaff. And pay cuts too, though that sort of happened yesterday.

What's most frightening about the position we find ourselves in is that clearly the government, such as it is - a village solicitor who inherited both his parliamentary seat and the Taoiseachship, a rural housewife as number two, a moustachioed gun-toting idiot in the jump seat and a collection of failures, ne'er-do-wells and shysters as supporting cast - haven't the foggiest notion what to do.

They should quit is what they should do. They should go to the country and seek a mandate to reverse the damage they have inflicted on this country over the past decade. They won't get that mandate, of course. Instead, they'll be slaughtered at the polls. But it would show good grace, respect for democracy and that rare thing in Irish politics, penitence for their mistakes.

But they won't quit. They won't even admit to doing wrong. Last night, Justice Minister Dermot Ahern told the nation that our current economic plight was no one's responsibility. Wrong, minister. It is YOUR responsibility, and that of your government.

Fianna Fail historically has always been a shallow organisation when it comes to principles, and they are beloved of playing government and opposition all at the same time. Instead of policies, they fly kites to guage public opinion, backing down if pensioners march on Leinster House, or pushing ahead if the public sigh heavily and accept another bitter pill.

But at this point in time not only are Fianna Fail bereft of ideas, they have also bankrupted the country quite spectacularly.

It's time for them to go. Those who created the problem cannot be trusted to resolve it. Especially since they are Fianna Fail, who can never be trusted with anything anyway.

Every day, every hour until they leave office is another day, another hour where the possibility of recovery is postponed or delayed further.

And while that continues, while they take 160K flights to America and swan about in 150K Mercs driven by Gardai on 70K euro a year, things will keep getting worse for us, up and until the point where the International Monetary Fund is called in.

We're really not too far from that vista right now, and if it comes about, the pain will be unimaginable - Russia in the late Yeltsin era, Argentina a few years back, that sort of national, hard to forget, deprivation.

We can't let it come to that. The bereft bunch of chancers on the government benches today looked guilty and sheepish and most of all tired. They should go, for their own dignity's sake, but primarily because every second they stay they hurt this country more.

Budget carnage

Did you enjoy your decade of gombeen government?

I hope you did, because the bill just arrived:

1% 'levy' on all earnings.
2% over 100K.
HSE middle management axed; review of public service to find more job cuts.
Decentralisation paused till 2011.
8c a litre on petrol, 50c on pack of fags, 50c on bottle of wine.
'Review' of pension reserve fund (he's going to raid it later.)
Dublin Metro on pause.
Over 70s med card axed for those who don't qualify - but they'll get a 400 euro donation towards med costs in its place.
Capital gains tax up.
10 euro tax on airport departures, 2 euro for 'shorter' journeys.
Tax on second homes and let homes, but not on homes for sale but not sold (got to look after those poor builders).
Child benefit halved for 18 year olds, and to be scrapped in a couple of years.

When your next pay cheque arrives, notably lighter than before, remember who to blame. You'll get a chance to have your say next year, when the local government elections come around.

(Pic shamelessly nicked from the geniuses at The Irish Sentinel)

A little bell will ring

In a few hours, in New York, a little bell will ring.

And then all your hard work, a lifetime's effort of diligence and sacrifice, will begin to vanish. All that you saved, all that you invested, all that you salted away in pensions for when you're old which is sooner than you'd like it to be, will start to erode, like salt in a rainstorm.

You think it's been bad already, with indices like the Dow and Nikkei falling 7-10% a day, and the Iseq a mere fraction of what it was only a year ago.

But once that little bell rings, complex mathematics overseen by overpaid shouting white men will take over, and all the many hours of your effort, all the careful scrimping and saving, the self-denial, the sacrifices you made, they'll all begin to fall in value.

Not in real value. You put those hours in, you did the work, you strove to ensure the future for you and your family. That value remains in your character and the admiration of those who love you and witnessed how hard you slogged.

But in monetary value, a large proportion of your efforts is about to vanish for no good reason other than the greed of bankers and traders and their deliberately opaque and complex system of self-reward.

The solution is NOT to do what is currently being done. The solution is to do the exact opposite. Rather than ensuring their losses, it is time to hold them culpable for them.

It's a solution I'm prepared to bet no government in the world will implement, not even Iceland which officially went broke as an entire nation yesterday. But it's the right solution.

It may provide you with a little comfort today, after the little bell rings and your savings, investments, pensions and stocks start to diminish before your very eyes, to know what the answer is to this economic meltdown.

That's why I offer it to you. Remember who's responsible for this mess and hold them to account. They just stole years of your working life and pissed it up the wall.

Otherwise, when that little bell rings, take cover. A global depression is coming out swinging.

Update: It's bad alright.

Now we're for it

An actual Iseq crash yesterday.

A 7% or so collapse in the Dow.

The Nikkei heading south tonight amid Japanese sub-prime problems adding to the international concerns from the USA.

And the likelihood of the FTSE going lower still tomorrow on the back of more concerns about British banks.

And no chance of legislation in America till Thursday because the Jews are celebrating their new year.

And all this on top of the disastrous market year globally already.

Now we're really for it.

Wave goodbye to your pension plans, your stock portfolios, and start worrying about the safety of wherever your savings are.

Buckle up. It's going to be a very bumpy ride.