Showing posts with label GE2016. Show all posts
Showing posts with label GE2016. Show all posts

Tuesday, March 1, 2016

29/2/16: GE 2016 - Ireland's Answers to No Questions Asked


The election 2016 is a catalyst-free contest that has been shaped by the political parties attempts to understand the mind of the electorate, while the electorate has been struggling to make up its mind about what the pivotal issues of the election should be. Compounded by the  epic gaffes of the reality-skipping life-time politicos (take that Enda Kenny pill, ye old comedian) and we had an election devoid of real ideas and ideals as far as the mainstream parties go.

Harder Left and genuine Centre-Left (e.g. Social Democrats and majority of the independents) have attempted to focus the elections on the issues relating to the lagging nature of economic recovery in the domestic sectors - an issue that, traditionally, has been the core breadwinner for the Labour. However, having completely abandoned any pretence at ideals-based, principles-rich politics, the Labour has thrown its weight behind the FG-led attempt to steer plebiscite into a debate about a general (and to majority of us abstract) notion of policy continuity and stability of governance as the panacea for the ‘continued recovery’. Topical issues and specific policies aimed at actually producing a real recovery that is not stuck in the canyons of tax arbitrage by the MNCs became the victims of this absurd departure from the world of the living into the world of FG/LP.

Even shielded from competition by being effectively the only Right-of-Centre (in the Politics of Boggerville 101-style of Enda Kenny and Michael Noonan) party, FG has managed to squander the election by such a massive margin, one has to wonder how on earth can the party continue to pretend to represent anyone other than a handful of clientilist farmers, rent-seeking businessmen and a bunch of conservative civil servants. 

Not surprisingly, the key battles of the GE2016 have been waged in the contestable space created by Labour’s departure from its social and electoral core. 

Failure of Labour and FG to consolidate Centre-Left and Centre has meant that the FF was left significant room to recover some of its electoral fortunes. In a typically FF fashion, the ‘new party of the Centre-Left’ has managed to deliver very few tangible new ideas, but provided plenty oppositional rhetoric and old-fashioned pork barrel promises.

All in, Election 2016 was dominated by the lack of big thinking, shortage of specific ideas, and a large doses of surrealism. Neither global, nor European context entered the mainstream debates; economics swung from ‘tax and don’t spend’ to ‘don’t tax and do spend’ heralding the arrival of the Celtic Tiger 3.0. The entire circus of the ‘fiscal space’ debates was yet another opportunity for Enda Kenny to play the role of a cross between the U.S. Republican contestants Ben Carson and Jeb Bush - a dynamic combo of a man who can’t run for the office and a man who doesn’t know he wants to run for the office. Money, advisers, analysts, party machines and even track record - all squandered on disconnecting from the voters.

In contrast, three smaller political groupings / parties: Renua from the Right and Social Democrats from the Centre Left and the Independent Alliance have mangled to produce far reaching, ambitious, even if, at times, poorly structured policies proposals. The Independent Alliance and Soc Dems have fielded some really strong, highly impactful candidates with ideals and occasionally ideas of their own. These three forces, relatively weak and surrounded by a sprinkling of other independents and political groupings brought into Election 2016 something missing in Irish politics - integrity, honesty, openness and debates. No matter how strong their showing in the current Election has been, they provided a crucially important alternative to the stale politics of Irish elites: the Axis of FG, FF and Labour.

The most surprising aspect of the Election 2016 is the complete and total disregard by the core political parties for the voter perception of Irish politics as a palace of parochialism, corruption and cronyism. After 5 years of the current Coalition effectively replaying old FF book on cronyism and favouritism, while droning on about the ‘New Era in Politics’, the litmus test of this electoral cycle should have been a focus on political system renewal and reforms. This simple was a task too difficult for the political system to handle and even contemplate. Which, sadly, means that our Permanent Government - the cabal of unelected advisers and senior civil servants - remain in place, aided and abetted by the school of hungry and agile piranhas from the private sector always ready to issue a research note or two about the need for continuity, the necessity of predictability, the value of stability and the fabled markets’ longing for conformity with the status quo.


All hail Tipperary North constituency for delivering much of it in a concentrated form once again… 

Which brings us around to 'predicting the future'. It will be the same as the past.  

Any coalition involving FG will be a poison chalice to either FF or FG or both precisely because although FF lacks ideas, at least it is based on the ideal of a pub-pump-politics that connects with wider ranging population. FG can't even muster as much. Despite the fact that the latter has a better pool of younger cadre than the former, in my opinion, and has been better in governance too (although here we really are setting the bar low to begin with). FG will continue to play the 'extend and pretend' card in any power deal, hoping the miracle of recovery (sooner or later, it is bound to happen in a meaningful way, or so the theory goes) will sustain them into the next election. Which means their track record will be woeful - no reforms, no change, just throwing pennies and dimes at problems as soon as Michael Noonan can rake them in. 

For FF, such a scenario won't be good enough because the party needs desperately to rebuild and re-energise its base (which it started doing in the GE 2016, but is yet to complete).

Any other coalition (involving Independents) will not be stable, as FG seniors clamour for top brass positions, while the Independents largely want the same. Competition is an unbearable condition for Irish elites that prefer to play a 'spread others' butter on your spuds' game.

Alternatively, the whole circus tent might come down and we might go to the polls once again, comes late 2016 - early 2017, especially if the 'fiscal space' gets shocked a tad.

I'd put 30-35% chance on the GE2016.2.0, an a balance on the FF/FG shotgun marriage, and a 40% change on GE2017. Though, of course, miracles of the parish priest and the publican agreeing with the AIB branch manager down at the pub on where to put that new Centra in town do happen, still... Harmony might be attained.

Tuesday, April 22, 2014

22/4/2014: On Irish Taxes, Quangos, Trade and other recent links


Some interesting links from recent media reports:


  1. Apparently, completely unpredictably, unexpectedly, shockingly abruptly etc etc etc... but Ireland-based MNCs are allegedly concerned with the OECD (aka G7-G20 prompted, EU-supported) efforts to reforms international tax systems to close off the more egregious loopholes in corporate taxation: http://www.independent.ie/business/world/major-companies-concerned-over-oecds-plans-for-global-tax-reform-30202748.html Now, with the IBEC, DofF, and everyone else in irish Officialdom repeatedly declaring that our tax regime is above the water and thus not in the firing line, one must wonder just why are these companies concerned with the OECD moves?
  2. On a related note, I just posted a new paper I wrote for the Cayman Financial Review on the above topic - see link here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2427359
  3. Unrelated to taxation issues, but related to fiscal policies of the Irish state, a note from the Irish Times on Government's heroic struggle with one electoral objective they set before 2011 GE: the objective of rationalising the massive spread of quangoes in Irish public policy ecosystem: http://www.irishtimes.com/news/politics/coalition-s-quango-cull-falls-well-short-of-promises-1.1768500. Core facts pointed out in the article are: The Government promised to abolish 100-145 quangoes right before it came to power in Q1 2011. Three years later, 45 have been either abolished or planned for abolition, of which only 20 are likely to be completely shut by the next GE in Q1 2016 net of new created. To-date, only 28 bodies have been abolished, 17 more are set to be culled in the remaining tenure. And 33 new agencies have been created or planned for creation. Net impact: of 732 quangoes in existence in mid-2012, we are likely to have 720 quangoes in existence in mid-2016. 
  4. Now, recall that we are being repeatedly told that life outside the Euro for Ireland means kissing good bye our wonderful exporting capabilities. Here is a chart showing current account balance for Ireland and Germany (two star performers in the euro area in terms of trade) as contrasted by Denmark (a non-euro country that should be suffering from the trade deprivation due to its absence from the euro club). It turns out Denmark consistently outperforms Ireland in terms of current account surplus... So next time one of the Government parties' candidates start talking about Ireland's alleged benefits from the euro membership, do suggest they should take a trip to Denmark...
  5. An absolutely brilliant short summary of Economics as a field of inquiry in 297 words by Professor Thomas Sargent http://www.vox.com/2014/4/19/5631654/this-graduation-speech-teaches-you-everything-you-need-to-know-about It is superb.
  6. On artsy side of things, a stunning and powerfully original statement from China for Milan Expo 2015: http://www.dezeen.com/2014/04/01/china-pavilion-expo-milano-2015/ 
  7. A set of excellent, insightful essays and articles on Ukrainian crisis or more significantly - on Russia's position vis-a-vis the West: http://www.reuters.com/article/2014/04/18/us-ukraine-putin-diplomacy-special-repor-idUSBREA3H0OQ20140418 and http://www.foreignaffairs.com/articles/141018/mitchell-a-orenstein/get-ready-for-a-russo-german-europe and http://euobserver.com/foreign/123879