Wednesday, January 21, 2009

Update: Mushroom Cloud III

Here is an updated chart...

After talking to a couple of fellow economists - both admittedly gloomier than myself - I came to a conclusion that Brian Lenihan simply must face the nation on what is holding him back from putting forward a real rescue plan for Ireland's bettered economy:
  • is it the internal opposition by the Cabinet to do anything that will potentially anger public sector trade unions, or
  • is it his own Department inability to provide logistical support for a credible and effective plan?
It is now clear, despite a recent 'consensus' amongst the Government-fed economists, that the country needs rapid and significant cuts in public spending, a tax stimulus (across income tax, VAT and payroll tax) and a round of privatizations (carried out in voucher form to transfer ownership of state enterprises to the public, improving private households' balance sheets). These must be enacted before the end of February. In the medium term, we need a dramatic reform of the stamp duty on property (moving in the direction of a land value taxation system), a long-term reform package for public services and a political reforms pack to include reduction and consolidation of local authorities, reduction of the number of TDs and the size of the Cabinet and an overhaul of our Byzantine system of Departments and Quangoes.

Given the above chart, we have no longer the luxury of time to wait for various Committees and Commissions' reports - it is time to act now!
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