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Spending Will be Cut or Will we Just Put Up Taxes?
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This one I didn’t want to post on until Lisbon was over with and today’s front page Business Post story gives me the perfect segue.
The Government is conducting a major spending review which is expected to lead to…capital projects being scaled back…Particular emphasis is being placed on capital spending in education and health, which accounts for large elements of government expenditure.
Noel Whelan (Irish Times, Last Saturday):
No consideration appears to have been given to whether the current, temporary difficulties in the public finances should be addressed by tax increases.
Incomes in Ireland are currently under-taxed. The fact that Irish workers are the lowest taxed in Europe was emphasised this week by Brendan Butler of Ibec, not in response to the publication of the exchequer returns but during the debate on the Lisbon Treaty
I never really know what to make of Noel Whelan, he is known to be very close to Fianna Fail and it is often tempting to read him on a Saturday as an extension of thinking which is quite close to the top of Fianna Fail. If that is the manner in which to read him then last Saturday was a quiet piece of political kite-flying, that favourite passtime of politicians or a solo-run-also a favourite.
Cowen himself has never talked of tax increases on wages, have never brought it about at budget but he did commit himself wholeheartedly to the National Development Plan which secured funding for capital spending in health and education as well as roads and infrastructure. Perhaps the government reckon that they can put up taxes in certain parts of the economy and finance the capital spend out of that. It would be very interesting to hear government make that argument to people, tell them the tax we pay does not finance the public services we want.
This is especially so in education and health where primary schools get 50% less per child than secondary and some of our universities are crumbling and our hospitals and health system where….well how long have you got? Tony Blair got people onside to invest in services in the UK after 20 years of Thatcherism, could or would Cowen do the same here? In very simple terms it is investing in our future for spending in these areas is not an indulgence if we do not want to get locked into a cycle of boom and bust, binge and purge, like the past.
Irish people are only undertaxed if you forget all the extra charges we pay now versus the start of the Celtic tiger:
- We pay private health insurance because the public PRSI system is a waiting list for death.
- We pay for uniforms, PE gear, dozens of books, a lunch fee, after school study fee, building collection, class photo, class trip, class musical, no uniform day, raffles, lines, Tesco sports vouchers, etc etc, so our children can avail of “free education”
- And then we have to pay for grinds for our children because the only way to get time from a babysitt…. sorry teacher is to be the disruptive brat in the class. But they have ADHD so they get one on one “learning support” to make up for the class time they lost as a result of the disruption when they set fire to the student in front of them.
- We pay for private companies to collect our refuse because….. well because the council just decided to stop doing it.
- We pay for management companies to maintain our housing estates because, once again, the council just couldn’t be bothered anymore.
- We pay for a private pension because no matter how hard you work in life the state one is only enough to pay for food or heating but not both.
- We pay for private firms to monitor our house alarm because if the alarm does go off the guards will only respond to complaints of noise pollution 3 weeks later.
- We pay Rupert Murdock to beam RTE into our houses because the licence fee only cover’s Pat Kenny’s legal battles with neighbours rather than a 21st century transmission network.
- We pay for bottled water because tap water contains more cryptosporidium than H2O. And now there is a proposal to introduce water metering and charge us for the cryptosporidium.
- We pay benefit in kind on everything our employers give us to do our job bigger than a bic pen because the one IT system that works in the whole civil service is the blood sucking Tax system.
- We pay stamp duty on our homes because the government takes the attitude that if we can afford to buy a house then they must not have taxed us enough in the first place.
- We pay road tolls because regardless of the yearly motor tax we pay the government no longer builds roads and instead leaves that to private developers.
- We pay €80 to the government everytime we do 121kph on a straight stretch of motorway littered with garda cashpoints/checkpoints while boyracers kill hundreds annually doing 160kph around hairpin bends on country roads that haven’t seen a police car since the “incident” with the black & tans.
- We pay record high tax to the government in excise duty and VAT everytime we fill up our cars with petrol. And that’s before the greens hit us with a carbon tax on top. But apparently the record prices at the petrol pump is all OPEC’s fault.
- From the end of the month we will pay penal annual fines/tax for daring to drive anything with a combustion engine instead of following green party advice and using the Dublin Luas to do our daily commute to work from Mitchelstown to Cork!
If we are “under taxed” then what more can we pay for? We are not “under taxed” we are just “privatised”.
Last comment says it all. WE ARE PRIVATISED. But the reality is that this came about from cuts in spending on public services of all sorts and which are ongoing in most service areas. A low PAYE tax economy over a number of years (11 and before in the 80′s) paved the way for private companies to come in and take up the deficits in services. That is the deliberate strategy of Fianna Fail and PD governments in power for far too long. Most of Europe pay much higher tax and have better public services. It ain’t perfect but the American style of corporate business only suits the wealthy in society who can afford to pay for all the services they need or travel to get them if necessary. Ordinary people in middle or poorer classes end up being screwed every way. Its an illusion to say one has more money (take home pay) to make one’s own choices, That’s a false choice. We are only really seeing the very harsh reality of all of this over the past 5 to 6 years. It is a question about what kind of society do we want to be? One that encourages the wealthy to abdicate their responsibility to fellow citizens or one that provides for all its citizens to contribute to society by being educated and healthy as one can be? In my view we need to be careful about modeling ourselves on American style policies. Ironic that far left (workers party) and far right (Ganley) plus the Shinners were all on the same side. And who gave Ganley a mandate to represent anyone – bar himself and other non explicit interests? What are his policies on anything bar NO? People rightly criticised the written word of the Treaty but what does Libertas stand for?