Friday, 27 June 2008

VRT, McCreevy, and the Lisbon No Vote

The Lisbon Treaty was rejected by the "newly confident" Irish. "No" voters predominated amongst the young - the most spoiled generation in our history. But then again, Ireland has an unhappy history of referendums... the right to divorce was voted down two-to-one in the grim 80s, for instance. The right of women to choose has also been denied when put to the vote.

Now, it looks like we might be back to the 80s - in economic terms at least - which will make the selling of any Lisbon Two even more difficult.

So how can the EU demonstrate the benefits of membership to Europe's newest sceptics? The simple answer is for it to enforce existing legislation that will directly benefit the Irish public. Gombeen Man has three examples.

1) The Irish Government must be made scrap Vehicle Registration Tax, which sees us paying up to 40% more for our cars as those in other EU states. Gombeen commissioner Charlie McCreevy steadfastly refuses to allow this, despite being in direct contravention of the Treaty of Rome. The EU should face him down now, and at the same time give a practical demonstration that tax harmonisation can be a good thing.

2) Irish people are currently barred from investing in the Prize Bond schemes of other EU countries. The Irish Government denies us the right to invest our savings in this way under gambling and lottery legislation - despite the fact that money invested in the British Premium Bonds, for instance, is a form of saving and is State-guaranteed.

3) Currently, large-scale supermarkets such as Carrefour are not allowed to set up in Ireland - due to lobbying from vested interests who don't want competition that will result in lower prices for the consumer. The EU should insist that this uncompetitive practice stops right now.

Brussels has allowed the Irish Government to wriggle out of its obligations to pass on the full benefits of EU membership to its citizens. This must stop, and the Irish Government must be made comply.

It also happens to be the best way to ensure a decisive "yes" vote in any future referendum.

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Thursday, 19 June 2008

Eeeehh... Charlie McCreevy takes the money

Gombeen Nation hasn't showcased a leading public gombeen in some time. So heeeers - eeeeeh, Charlie McCreevy.

Despite trousering a substantial commissioner's salary, McCreevy - along with FF party leader, Cowen - hasn't bothered to read the Lisbon Treaty. McCreevy, who models himself as being some kind of right-wing, free market guru, is frankly a joke in Europe. Despite his avowed support of free-market principles, and his Brussels brief to dismantle barriers to free trade in the EU, he opposes the scrapping of Vehicle Registration Tax in Ireland - which the EU has been trying to get rid of for years. This Irish Government tax means that Irish residents have to pay way for more for their cars than other EU citizens do.

Example, two-seater sports car:

Porsche Boxster, new price in Belfast = EUR 48,000

Porsche Boxster, new price in Dublin = EUR 77,000

Porsche Boxster, new price in Luxembourg = 44,000

Well, reading that, I'm all for tax harmonisation.

It is obvious that McCreevy is not serious about promoting the EU and its aims. In fact, he seems to be set on being as obstructive as possible.

There has been a lot of talk about accountability at EU level lately. How about we start by making commissioners accountable? Rather than seeing the EU institutions as a place to exile errant or incompentent politicians (Flynn, McCreevy, Kinnock, Mandelson), maybe governments should take EU appointments seriously and select high-calibre politicians, who won't be an embarrassment to us in the eyes of the world.

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Tuesday, 17 June 2008

Ireland says "no" to Lisbon... gombeens rejoice!

So, after billions of Euro funding and cohesion money - which is soon to dry up as the we become net contributors in the next few years - it seems that the Irish have become eurosceptics (a term first coined by the Little Englanders of perfidious Albion).

The Lisbon Treaty was drafted over seven years by member states - much of it during Ireland's presidency - and was designed to make the expanding EU easier to run on an organizational level, given its expansion to 27 member states. That's all it was. Qualified majority voting would take the place of unanimity, so as to prevent one state of 27 preventing the others moving forward. Every country would have a commissioner two terms out of three, instead of every country having a permanent one as had been the case when the EU comprised fewer countries - we have the laughable Charlie McCreevy at the moment. That's all it was. So what was the problem?

While there were some honest, earnest people campaigning on issues of workers' rights - this incompetent Government refused to back the EU charter on this issue - Gombeen Man suspects much of the "no" vote was on unrelated issues. For instance, one group with a Gaelic name exhorted people to vote "no" to "keep Ireland Irish". No problem taking all that "foreign" money though.

Others voted to prevent women's right to choose being introduced in Ireland, others voted to prevent immigration, others voted to prevent their sons being drafted into an imaginary European army. The farmers' leaders belatedly backed it after trying to use it as a bargaining chip to get more money - but too late. Rural constituencies overwhelmingly voted it down as did working-class areas with high levels of simmering racism. People voted against "tax harmonisation". So, do they want to keep paying nearly twice as much for their cars, for instance, as they do in some other EU states? Do they want the "right" to continue to be screwed by "their own"?

The Celtic Cubs were out in force. Spoiled by their parents' easy property equity money (thanks to cheap EU credit) they gloated, their crabby, spoiled, overfed faces puffed up with triumph as they sang songs in Irish celebrating Ireland's step back into the past. A past, the misery of which their cossetted upbringings do not equip them to understand.

It will be interesting to see what happens next. Maybe the coming economic slowdown will rid Ireland of much of its new found arrogance? Maybe the EU will forge ahead with tax harmonisation, with Ireland's voice weakened? Maybe they won't, and the multinationals will go to the accession states offering even lower corporate tax and cheaper labour costs? Maybe, in a two-tier scenario, Ireland will not be allowed unfettered access to European markets, and this will sway the multinationals' hand?

Whatever happens, the "no" vote could prove to be a watershed. Erin go bragh, eh?

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Tuesday, 3 June 2008

Property Crash and economic slowdown - Part Two

As opined on this site previously, it really looks like the shameless, steroidal pumping-up of the property sector by the Government through tax breaks and shelters for the well-off and comfortable (some of them politicians) - even during the height of that very boom - has ended with inevitable consequences.

You can't base an economy on building houses, and you can't base real wealth on credit. Now it's time those Celtic chickens came home to roost. Luckily for them, it should be a lot cheaper for them to find somewhere to live in the current climate.

For many years now - especially since 2006, when the madness was at its worst - ordinary young working people have been priced out of the market due to properties being snapped up as investments by the already housed and affluent, who have been aided by tax breaks and shelters such as Section 23s which allow investors to write off rental income against tax on all of their properties.

Potential homes have been flipped, bought-to-let, and simply let lie idle in the expectation of capital appreciation (caused by this very same speculative activity in the market). Such nonsense is unsustainable in the long-term, and now the whole shebang is rapidly sinking into its shaky foundations.

An Irish Independent report claims one quarter (ONE QUARTER) of construction jobs are going to disappear by the end of next year. Gombeen Man wonders how many of these will be foreign workers currently paying rent into the greedy pockets of the new Irish landlord class who have borrowed heavily to get into the buy-to-let game?

If 65,500 construction workers are made unemployed (that's the figure quoted), it's fair to assume that a good number of them will be workers from abroad who will follow jobs elsewhere. That's a lot of empty buy-to-lets, is it not? And selling won't be an option for any Paddy Last wannabe rackrenter who got into the game as late as 2006, as their "investment" is now worth less than the sum they paid/borrowed.

Wait now for the unprincipled opposition to start whingeing about stamp-duty (even though stamp duty did not hinder the market in the boom years) and financial bail-outs for stung investors.