Tag Archives: Austerity

Last night/this morning.

Via The Irish Times:

Both Mr Varadkar and Tánaiste Simon Coveney said that any programme for government must reflect Fine Gael values, citing fiscal responsibility and the deficit.

The Taoiseach suggested that if the deficit is not tackled – with Fine Gael and Fianna Fáil favouring plans to reduce the deficit in the latter half of a five-year term – this would send out a signal to the markets that Ireland is not serious, as would the postponement of the increase in the State pension age, another sticking point in the talks.

Mr Varadkar is said to have told his TDs: “It won’t be government at all costs.”

Programme for government must include ‘fiscal responsibility’ – Varadkar (Irish Times)


From top: At the 2016 National Economic Dialogue in Dublin Castle were from left: then Minister for Finance Michael Noonan , ESRI Chairman Alan Barrett, then Minister for Social Protection Leo Varadkar and then Minister for Public Expenditure and Reform Paschal Donohoe; Eamonn Kelly

What if austerity was a scam? What if austerity was to the 2008 financial crisis what the Patriot Act was to 9/11?

What if the same right-wing types with an eye for an opportunity to impose more control over their populations also acted in the wake of the financial crisis to seize the opportunity to roll back the welfare state?

These are thoughts that come to mind when engaging with the ideas about money and austerity put forward by Professor Emeritus Mary Mellor, from the University of Northumbria in her book “Money: Myths, truths and alternatives.”

Ten years on from austerity and it’s not really any better at the bottom, but it seems to be okay enough at the top.

More than okay. In fact, in terms of property speculation there’s a bit of a Klondike goldrush taking place in Ireland, particularly in Dublin.

According to Mary Mellor, austerity was based on not just one myth, but two: “that the market is the sole source of funding for public spending and this must be limited because money is in short supply. Neither is true…” writes Mellor.

In the model that we all know and suffer beneath, the market, run by rich tax-free wise men creating “jobs”; generates rivers of money which creates a reserve for taxation, which is then collected and goes into a kind of communal kitty to fund public spending.

But maybe this is not the way it works at all.

Austerity, according to Mellor, was justified on the basis of society being a kind of family, with the government acting as the frugal mother, and the private sector the breadwinner – an arrangement Mellor calls, “handbag economics”.

Everyone else is the “kids” who have been “bold” during the boom, spending too much and now they have to pay for that in pocket-money cutbacks.

In this scenario, austerity is like being grounded by stern but good parents eager to deliver a life lesson in how to behave responsibly with money.

In “handbag economics”, only the market creates money. The “daddy”, in other words. The patriarch, out winning the bacon in the big cruel world to feed a brood of ungrateful and greedy children who must be slapped into line from time to time.

Austerity is being slapped into line by stern “daddy”.

Mellor writes:

“Money is to be generated only through market activity and any request for increased public expenditure is almost invariably met with the response ‘where’s the money to come from’? Or as Theresa May put it – there is no ‘magic money tree’…”

This money tree argument, by the way, is always the first obstacle to any discussion about basic income, which is then characterised as hopelessly impractical pie-in-the-sky thinking, despite the millions flushed down the toilets of the likes of Seetec and Turas Nua in hopeless employment activation schemes.

But according to Mellor, not only is there a magic money tree – and I have a suspicion that those at the top know this – but there are actually two magic money trees.

She writes:

“Both the state and the market create money – that is they can increase and decrease the money supply by their activities. Markets increase the money supply when banks lend and decrease it as loans are repaid. States increase the money supply when they spend, and decrease it when they tax….”

She goes on to say that handbag economics assumes that taxation of income generated by the private sector funds the public sector, money flowing from private to public.

Which is the argument for tax-free wealthy people who are assumed to be creating the money that keeps the public sector in gravy.

But Mellor argues that the flow of money can also go in the opposite direction, from public to private.

If taxation is taking money out of people’s pockets, public spending is putting money back into people’s pockets. Governments, like banks, can, if they so wish, create money out of “thin air”.

Banks do it by setting up bank accounts. States do it by allocating budgets.

Mellor writes:

“When governments set budgets they do not draw money from a taxation ‘piggybank’ any more than banks raid deposit accounts. The budget allocates spending commitments that may, or may not, match the amount of money coming in through taxation. Public budgets put money in the pockets of individuals and organisations, taxation takes that money back. It is not tax that creates the money for the public to spend, it is public spending that creates the money to tax….”

Viewed this way, the entire austerity project can be seen then as facilitating the transfer of wealth from the public to the private and putting nothing back. The parallels with the right-wing view towards natural resources and climate damage are striking.

Leo Varadkar’s stubborn unwillingness to provide social housing, resulting in over 10,000 homeless people, can be seen as a by-product of this transfer of wealth from the public to the private, with no effort made on any level to put anything back, apart from the insulting and humiliating provision of soup kitchens and sleeping bags.

The engineers of this transfer of wealth from the public to the private, basically Fine Gael facilitated by Fianna Fail, are commonly regarded by an often-obsequious mainstream media as “incompetent”. But maybe that judgement is missing the point.

Maybe they are being very clever in that Irish way of being very clever that necessitates being perceived as “stupid” and incompetent.

Meanwhile, the transfer of wealth from the public to the private continues unabated, while everyone wrangles about the “outrageous” incompetence of the governing parties.

Eamonn Kelly is a freelance Writer and Playwright.





A look at the facts surrounding the Greek bailout that has supposedly saved the country’s economy.

TeleSUR English posts on social media:

The IMF and the EU nearly destroyed Greece with its financial bailout. Now, the country is going to market and being sold piece by piece, as almost every industry becomes private.

TeleSUR English


Mind the austerity gap.

Darragh Quigley writes:

‘Why do you use a food bank?’ asked the nice, well meaning, well spoken senior policy adviser from the ‘left leaning’ think tank, over coffee, paid for by another senior policy adviser.

For once lost for words I mumbled something about not having any food left before my dole comes through and and that I didn’t have any food sometimes.

What I didn’t say was, what the fuck? Here we have a person who advises on public policy who through the way in which our society is structured has never had to sit down with some body surviving on the sharp edge of the public and political policy he advises on.

…This cultural divide along monetary and gulf in life experience is where the ‘Ah shure it’s just an extra few euro a week.’ Mentality comes from. People so deliberately and in an incredibly calculated way were shielded and still are protected from even having to glimpse the ‘vulnerable’ way of life.

Hands up how many middle class people knew the college Joan Burton visited on that faithful day in Jobstown is also a food bank?  Hands up who’s seen someone cry after being handed a tin of beans, some yogurt and pasta at a food bank? Hands up who told them they have done nothing wrong and it is a spiteful, shameful society who fucked up there, not you.

…This is how austerity works, quietly, efficiently and hidden behind economic policy and political decisions: live are destroyed, but slowly and strategically while firstly stripping people of all pride and dignity. ‘They’re less likely to fight back that way.’

At the height of a suicide epidemic what does the government decide needs to go? The bereavement grant, young men don’t usually have life insurance.  The most vulnerable, private, sensitive moments offer no escape from the constant suffocating pressure of austerity. The kind of pressure which goes unseen, when the stress and turmoil we all experience with a bereavement also involves anything from not being able to afford clothes to simply not having the money for a funeral.

…The officer class desperate to believe the recovery narrative, terrified to look the cold hard data and facts in the eye. Austerity has failed, for us, for the 80 people who own half the world’s wealth, media, and exert huge political and economic power, it has been a fantastic success. Its also ideology, austerity is a belief system there is no ‘science of economics’ behind it.

Even economists don’t believe the austerity model, as discussed with Bill Black at Kilkenomics only about 10% subscribe to that school of thought, i’ts a way of thinking which is rewarded by our society and those 80 or so people who own half the worlds wealth.

Economists, academics and journalists have been kept in tenuous positions and easy to control. The herd behaviour our great commentators fretted about ended up applying to them, too afraid to question the dominant ideology they went along with the gang. With The Irish Times reading like a string of middle class people afraid to lose their jobs, fall through the cracks and end up in the public system.

Austerity restructures society in such a way that policy makers can’t even conceive the effect of their policies…(more at link below)

Why do you use a food bank? (Dara Quigley, Degrees of Uncertainty)


This afternoon.

Anti-Irish Water and austerity protesters in solidarity with Greece outside Leinster House, Dublin this afternoon.

Earlier: Tsip Happens

(Sam Boal/Photocall Ireland)



Julien Mercille (left) and Owen Jones at the Sinn Fein Summer School last weekend

Syriza has to be broken, or so the EU great powers decided long before it was even elected. But how? First: compel it to impose another dose of disastrous austerity, in violation of the party’s clear electoral mandate. This would inflict on it the same fate as the Greek social-democratic party Pasok, which so alienated its support base that its vote plummeted from 44 per cent in 2009 to 4.7 per cent by 2015.

A second possible strategy: strangle Greece’s economy until the people decide that the lesser catastrophe would be to resign themselves to endless austerity within the eurozone. This is the current course of action.

The third strategy: force a default and drive Greece out. However, this might expose the eurozone’s Achilles heel. A precedent would be set: the eurozone would no longer be an indivisible currency union, but a club that weaker members can leave or from which they can be de facto ejected. Italy, say, could find itself the subject of extreme market speculation….

The elites are determined to end the revolt against austerity in Greece (Owen Jones, New Statesman)


Paddy Ferris writes:

If you want to know how bad a certain amount of people in this country are suffering due to austerity, one need only take a look at adverts.ie today as a person asks ‘Please help?’ He is looking for a loan of €200 for ‘food for my kids.’ Shockingly sad, and an indictment of the economics that our government still advocate.

Please Help (Adverts.ie)

UPDATE: Ad since withdrawn. Go figure.

tubridyRyan Tubridy during Friday’s Late Late Show

Further to Friday night’s Late Late Show.

Julien Mercille writes:

Last Friday Paul Murphy TD of the Anti-Austerity Alliance was on RTÉ’s The Late Late Show where Ryan Tubridy questioned him about the water charges protests that have sprung up throughout Ireland recently.

Many on social media have noted how Tubridy was biased against Murphy, showing that he disapproved of the protests, or at least the ones that involve civil disobedience.

Another way to see it is that Tubridy was pretty good from the standpoint of protecting government interests. He’s paid handsomely for that. His current salary is €495,000, and in 2011 it was €723,000. He asked all the right questions to try to discredit the water charges protests and Paul Murphy by:

– Bringing up the protests that left Joan Burton in her car for two hours during which she was apparently ‘intimidated’ and asking multiple times whether this was ‘appropriate’ and saying the protest should have been more ‘civilised’.

– Asking whether Paul Murphy gets a ‘thrill’ from being arrested because this allows him to get in the media.

-Bringing up the protest against President Michael D. Higgins and suggesting it was wrong because the President shouldn’t be challenged.

– Asking why would anyone protest the water meters closer than 20 meters if the courts said they should stay beyond 20 meters.

– Trying to picture Paul Murphy as being ‘anti-everything’ but not proposing any positive alternative.

Those are standard tactics of a media establishment that fears real democracy. Real democracy involves more than voting for two or three similar parties once every few years. It is about people being able to make decisions that affect their own lives and participate in policy at the national and local level.

The problem with that from the establishment’s viewpoint is that the policies that would be favoured by the majority of people would often turn out to be completely different from those that have been imposed on us over the last few years of austerity.

For example, who, other than the government, would want to implement policies that have forced 31% of the population into deprivation, up from only 12% in 2007?

Who would cut violence against women programmes by 38%? Who would cut health care spending by a mind-boggling 27%? Or community development by 44%? Or drugs programmes by 37%?

The media used rather flimsy arguments to try to cast a negative light on those who protest. We’re still talking about Joan Burton’s feelings while in her car, but less so about those who have suffered from the cuts.

The strongest reason gathered to oppose protesting the President is that… well, he’s the President, after all. If you oppose cutting government services, you must be doing so for personal glorification, not because you care about people. Or maybe you just reject everything like an immature child.

The sole mention of civil disobedience brings hysterical reactions, even though it’s been used around the world to resist immoral policies. Howard Zinn, the celebrated American historian, put it this way during the Vietnam War (Hollywood’s Matt Damon read those lines in a video here):

‘Civil disobedience is not our problem. Our problem is civil obedience. Our problem is the numbers of people all over the world who have obeyed the dictates of the leaders of their government and have gone to war, and millions have been killed because of this obedience. Our problem is that people are obedient all over the world, in the face of poverty and starvation and stupidity, and war and cruelty.
Our problem is that people are obedient while the jails are full of petty thieves, and all the while the grand thieves are running the country. That’s our problem. We are going to need to go outside the law, to stop obeying the laws that demand killing or that allocate wealth the way it has been done, or that put people in jail for petty technical offenses and keep other people out of jail for enormous crimes. My hope is that this kind of spirit will take place not just in this country but in other countries because they all need it.
People in all countries need the spirit of disobedience to the state, which is not a metaphysical thing but a thing of force and wealth. And we need that kind of declaration of interdependence among people in all countries of the world who are striving for the same thing.’

Those thoughts should enter the media debate in Ireland.

@JulienMercille is lecturer at UCD and the author of The Political Economy and Media Coverage of the European Economic Crisis: The Case of Ireland. He will provide evidence to the Banking Inquiry {in March] on the role of the media during the housing bubble years.

Earlier: The Paul Murphy Takedown

itToday’s Irish Times


Les we forget.

The media have not been shy about announcing their role in convincing the public that austerity is good for them.

At the outset of the crisis, in November 2008, an editorial the Irish Times, called for a campaign to ‘educate’ the population about the need for austerity and ‘civic discipline’.

The problem was that Irish people did ‘not appreciate the possible extent of the economic downturn’ because only 10% of them thought the budget should be tougher while two-thirds thought it should be less tough, according to a national poll.

The editors thus concluded that ‘the Government will have a major job to do in educating public opinion about unpalatable economic realities and the need for civic discipline’.

The media have helped the government extensively in that task. One reason that explains why only about 12% of articles oppose austerity is that a large majority of writers come from elite institutions that favour austerity.

Excluding regular journalists, 29% of the authors of opinion articles in the press on austerity are mainstream economists, 28% are working in the financial or corporate sector, and 20% are political officials in the three main political parties, which have all supported austerity.

The media’s favourable view of fiscal consolidation can be assessed through the following sample of article titles published since 2008: ‘Commitment and Stamina are Required for Fiscal Consolidation’ (Irish Times), ‘New Budget will Prove Tough but Necessary’ (Sunday Independent), ‘Austerity Vital to Maintain our Economic Sovereignty’ (Irish Times), ‘We Need to Stop Living in Denial and Cut Costs Even Further’ (Sunday Independent), ‘We Must Suffer the Pain Now—Or Else we will Blight Future Generations’ (Sunday Independent), ‘Bill is Tough but Necessary’ (Irish Times), ‘Tough Budget Would Restore Confidence’ (Irish Times), ‘Supplementary Budget can Begin Urgent Task of Restoring Depleted Tax Revenues’ (Irish Times), ‘Budget May Cut Wages and Raise Taxes to Restore Competitiveness’ (Irish Times), ‘[Austerity] Budget Will Restore Confidence and Hasten Economic Recovery’ (Irish Times) and ‘Tough Budget Needed to Stave Off Grimmer Future’ (Irish Times).

Dr Julien Mercille

Relentless Cheeleaders For Austerity (Julien Mercille, Social Europe)

Previously: Relentless Cheerleaders for Austerity



Luke ‘Ming Flanagan MEP

We don’t really expect much. An odd good summer and for the children not to have to take the boat when they’re reared. People are being told that things are getting better. People are not stupid. It’s getting worse.

I had to use a ‘local’ A&E the other night. We got a letter from our GP and headed for our destination with a screaming 7 week old child. Before we left we explained to the baby sitter that our other two daughters were not to use the tap water when brushing their teeth due to it being contaminated with cryptosporidium. We arrived at the hospital at around 7pm to be met by very helpful staff. We got in line. Baby still screaming. After an hour we got to see a very helpful nurse and were then sent back into a waiting room. After another two hours we were brought into an area to see a doctor. Baby still screaming. It was wall to wall with people on trollies. Some had been there for two days.

So what eh! Sure this is normal. After all things are improving! The war zone hospital scene in front my two eyes is this governments idea of improvement. Even Terry “twist it” Prone couldn’t find a collection of words to make this place look acceptable. The people on the trollies looked both sick and sickened. When you are sick you want at least to be buffered from stress. All I could see and feel was stress. Doctors and nurses trying to manoeuvre around a maze of trollies packed into corridors. Howya Ming said one man. “Ashamed” I said. We didn’t need to elaborate. Another man approached me and said “my wife tried kill herself last night with tablets”. The first line of treatment for this couple in unimaginable trauma was to be subjected to even more. Not even a space to themselves. I had felt more dignity the evening I was committed to Castlerea prison.

At this stage we needed to call home as our other two children would be worried. We called but failed as there was no signal. I went out to the middle of the car park until I finally got one but I still couldn’t ring as our baby sitters mobile was out of range. You see unless we leave the phones in one particular part of our house then they can’t be contacted. By the way we live in the middle of a town.

As it turned out our daughter was fine. With cryptosporidium in your water supply you never know. No matter how vigilant you are as a parent there’s always the worry that somehow the child’s bottle has been contaminated. The basic instinct of being able to run something under a tap to give it a clean is turned on it’s head.

We travelled home that night and both my wife and I spoke about the services in this country. You can’t drink the water. If your child does and gets sick then they must endure the torture of an overcrowded understaffed A&E. That’s if you can get there on time. You can’t ring home with news because the phones don’t work. When you try to get to and from the A&E you must put up with diabolical road conditions. When we got up the following morning we sent our children to a school with a pupil teacher ratio so high that crowd control is the best the teacher could possibly achieve. You basically have to teach them yourself when they come home. I pity the committed teachers who are expected to work in these conditions.

I hear the cry from government deputies that it is easy to be in opposition. No it’s not. It’s torture. It’s torture to watch everything falling around our ears while at same time our government tells us things are getting better. We are a warned about the sinister fringe. How much more sinister can it get than the way things are at the moment. While we struggle to provide basic services for our citizens we at the same time continue to bail out the European banking system. The interest alone on the odious bank debt is €1.6 billion per annum. So even when you pay to get services there are cut to the bone because the banker must be paid first.

The last few weeks have been inspirational. I have a hope that people are starting to expect more. Why shouldn’t you? Keep expecting and eventually you will get it. Keep it up. Bring on December 10th and bring this government to its knees. The alternative is to accept that barely surviving is the new thriving. Accept it now and you accept it forever.

Luke Ming Flanagan (Facebook)

(Laura Hutton/Photocall Ireland)


[The UNICEF report] found Irish families with children have lost the equivalent of ten years of income progress. The child poverty rate rose by over 10% to 28.6% between 2008 and 2012.This corresponds to a net increase of more than 130,000 poor children in Ireland.

There you go now.

UNICEF report finds 10% rise in child poverty in Ireland (RTE)