European markets fall as Ireland reveals further austerity plan

[Hannah Bell]

Ireland’s government unveiled its four-year “recovery plan” yesterday, which will aim to reduce its budget deficit to 3 percent of GDP by 2014. The plan, the imposition of which was demanded by the European Union and the International Monetary Fund in order to secure a bailout, will see the budget cut by €15 billion—€10 billion in spending cuts and €5 billion in tax hikes.

The measures did not have their desired impact, as markets fell sharply across Europe. Government bonds for the most indebted countries rose once again, and bank shares fell steeply. Ireland’s 10-year bond yield rose to near 8.8 percent yesterday afternoon, with Greece also suffering badly.

The fears were driven by news that Ireland would likely be forced to nationalise two more banks, Allied Irish Bank and Bank of Ireland...

The National Recovery Plan 2011-2014 outlines one of the most severe austerity programmes ever in post-war Europe.

The €10 billion in spending cuts over the coming four years will see government expenditure fall from 49 percent of GNP in 2010 to just 36 percent in 2014, which is the equivalent of a decline in budgets by more than a quarter, on top of a €14.5 billion package already implemented.

In estimating these figures, one must always keep in mind the fact that Ireland’s population is just 4.5 million. The cuts double a previous €14.5 billion cuts package that saw Ireland’s government slash public sector spending by 7.5 percent of GDP, public sector pay by 15 percent, child benefit by 10 percent, and unemployment benefit by 4.1 percent. If this had been done in Britain, for example, it would be equivalent to £150 billion. Now that figure is being doubled.


http://www.wsws.org/articles/2010/nov2010/irel-n25.shtml

[UrbScotty]

1. But conservatism is the way to go!

:sarcasm:

:mad:

[dkf]

2. They are raising taxes too.

Would you rather they go bankrupt?

[provis99]

3. they are raising sales taxes and taxes on the poor.

Corporate taxes aren't being raised at all.

[Hannah Bell]

9. they're being lowered in some jurisdictions, in fact.

[jannyk]

5. They are refusing to raise the puny Corporate Tax for those on the top....

but dropping the minimum wage by 1 Euro an hour!!!

:puke:

[dkf]

6. Those at the top are experiencing an increased tax rate.

[Hannah Bell]

10. link? link?

[Starry Messenger]

12. That's pretty much BS. Link?

[Starry Messenger]

13. Low Tax Rate for Business Is Sacrosanct in Ireland

http://www.nytimes.com/2010/11/26/business/global/26tax.html?src=busln

DUBLIN — Cut Ireland’s minimum wage? Check. Collect more in property taxes from beleaguered homeowners? Check. Raise the corporate tax rate, which could plug the gaping hole in Ireland’s tattered balance sheet even faster? Well, no.

The austerity plan Ireland released Wednesday to secure a bailout from its international partners makes one thing clear: Most of the €15 billion, or $20 billion, in savings the government has pledged to find over the next four years will come from the welfare state and the working class. But the measures will not touch large businesses like Microsoft, Intel or Pfizer, which have created hundreds of thousands of jobs and fueled exports in Ireland for years thanks to one of the lowest corporate tax rates in Europe.

[UrbScotty]

7. ...

Would you rather they go bankrupt?

WHAT?! NO!

I was just saying, conservatism is bad. But doing so in a sarcastic way.

[HCE SuiGeneris]

4. Banker kids playing World Monopoly.

The whole fucking system is nothing more than an arcade game for the elite.

[XemaSab]

8. Fuck the IMF

n/t

[StarsInHerHair]

11. I second that

nt