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  • irishtimes.com - Posted: February 4, 2009 @ 11:45 am

    Eaten bread…

    Harry McGee

    I wasn’t a huge fan of the novels of John Updike, who died last week, though the writing itself was always remarkable. The stories themselves, the characters, never really gripped me. I interviewed him about 15 years ago and asked him a lot of stupid and forgettable questions.

    Updike had a prodigious output. And all at a scary quality. The writing of his that I loved was his essay-writing. He was mad into golf and wrote about it from time to time. One of the things he observed of golf and sport was that in no other walk of life was so much passion and do-or-die invested in goals or bouts that would be so quickly forgotten. In other words, sport (and I think he was talking about participation) was the ultimate momentary experience. To continue the golf analogy (and how I despise that game) the par you saved on the first hole (having gone through the hobs of Hell to do so) will slip away from the memory banks as the next epic is fought on the next and subsequent holes.

    Brian Cowen had a good day yesterday, all told. It didn’t make up for the fistfuls of bad days he has had. But he achieved what he needed to achieve. But it’s momentary. Enda Kenny and a couple of others used the sticking plaster analogy. And that’s what it is. The more you learn about the economic hole the more you start thinking of infinity and of infinite gloom. The €18bn deficit is, in one word, petrifying.

    And then ot on the heels of the package came the latest unemployment figure that disclosed a rise of 36,000 in January. That means that unemployed people now make up 9 per cent of the total workforce. Every unemployed person costs the State €20,000 a year in benefites and tax foregone. That’s €2 billion for every 100,000. A little tot-up will tell you that at the end of the year the €2 billion in savings will be wiped out by this.

    And the momentary victory of yesterday. A total of 16.5 billion in savings will have to be found over the next five years. That’s more than gouging at the margins. That will effectively mean that our economy will have to accommodate a contraction of a third which will bring us back a decade. No Government, no matter, what its majority is going to survive a full-term in those circumstances. There won’t be an election this year, but I’ll be very surprised if this administration survives to the end of 2010, especially when people start coming out on the streets.

    Focal scoir: One of the interesting developments politically is that parties are all beginning to discover a long-lost friend they thought had disappeared forever. Its name is ideology.

    It is clear from this morning’s Leaders Questions that Fianna Fail and Labour both have a radically different approach on how to fix the economy (Fine Gael are still in ‘I-told-you-so’ mode). Labour wants to go down the Obama route and spend money to make money. Eamon Gilmore mocked Cowen’s approach as old-fashioned.More...

    Cowen shot back that Gilmore was being old-fashioned, that spending our way out of recession was tried before in the 1980s and resulted in the country sliding even deeper into the mire…

    In hard times (and only in hard times, sadly) politics always recovers its spirit.

    • DesJay says:

      Harry, If there’s a ray of hope here, the light at the end of the tunnel, it’s that much of the world is in the same pickle. In that darkness, even the glimmer of a watch dial can look like the sun.

      Banks cut credit, and perfectly good businesses closed shop, putting people on the street. They and many others stopped being rampant consumers, sales fell, production lagged, and more people lost their jobs.

      You’re right to mention ideology. That won’t solve anything. For example American Republicans want more tax cuts for corporations. It will create jobs, they say.

      How? Unless people become consumers again, however modestly, corporations will continue to lay off workers and pocket their tax breaks. The American economy, as one businessman said, is highly exposed to consumers, 80% or maybe more.

      But if not ideology, what then? There must be some thought, some structure, behind a recovery effort. Call it philosophy. Call it pragmatism.

      So Reaganizing state pensions will help the exchequer. But how will it create jobs? Is Ireland totally at the mercy of America and its consumers and tourists? So much so that you can only hold on and wait?

    • Dan Sullivan says:

      “spending our way out of recession was tried before in the 1980s and resulted in the country sliding even deeper into the mire…”

      Hmm…I think it was FF that tried that approach. The problem was not that they spent money but what they spent it on – current expenditure adding many thousands to the public payroll for what were little more than make work jobs – instead the infrastructural spending that would have set us up for the upturn. Now again they have adopted a policy without reading the fine print, it’s not just that we need to reduce the amount that the state spends but how and where to make that reduction. I would personally have favoured something more like a cut of 5% in salaries from 30K to 50K, 10% from 50-100K, 20% from 100K-160K and 25% bar the rest instead of this pension levy nonsense.

    • Harry says:

      What amazingly perceptive intelligent and adroit etc. etc. etc. commentators we have on these pages. I am unable to quibble with a word that either Dan or DesJay have written. So I won’t! Well said, both.

    • Dan Sullivan says:

      Harry, I’m thinking that if I dye my hair that I might get on Vincent Browne half as much as some of his other contributors!

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