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Austerity is not working

It seems like every time you turn on the news or open a newspaper there is a new crisis in the Eurozone. Last Friday’ decision by the credit rating agency Standard and Poor (an ironic name for such a body in the current context) downgraded France’s AAA credit rating. It also lowered that of 8 other European nations.

The immediate consequence of this was for stock markets and the value of the Euro to drop.

Sinn Féin will be meeting the Troika representatives, who are currently in Dublin, on Monday afternoon – it will be our second meeting . For those readers unfamiliar with the term the Troika is the title given to the International Monetary Fund/European Central Bank and European Union bodies that have provided the bailout fund to the Irish government. They are in Dublin to check the government’s books and to make sure that it is keeping to the austerity programme that the previous Fianna Fáil led government entered into.

The purpose of the meeting is to provide  an opportunity to spell out our strongly held view that their programme is not working and that its implementation by the Fine Gael/Labour government is causing huge distress for citizens.

One example of this will come into effect tomorrow when the government decision to eliminate concurrent payments for new participants in Community Employment schemes comes into effect. This move also includes cutting the qualified child payment for existing lone parent CE participants by €29.80 per child per week.

It was the special arrangements for lone parents on Community Employment schemes which made this project work for lone parents who wanted to get back into the job market.

The government’s cuts will put Community Employment schemes out of reach of most lone parents. It is another example of the government’s December budget that protected the wealthy while penalising low and middle income families, the poor and disadvantaged.

The reality is that the government’s policies are not working. This is evident in the unprecedented levels of unemployment; the numbers of young people that are immigrating; the crisis in our health and education systems; the attack on our public services; the debacle around pensions, and the huge distress for individuals and families.

Austerity is not working. The domestic economy is on the floor.

People are worried about paying their bills, putting food on the table and keeping a roof over their heads. The failure of this government to defend workers rights has also created a climate in which employers believe they can abuse workers. Employees at Vita Cortex in Cork and the La Sensa retail chain were denied their redundancy payments. Both engaged in sit-ins in an effort to get the money owed to them. The La Sensa workers, with the solidarity support of many people, successfully secured their redundancy money. The Vita Cortex workers are still battling.

Fine Gael and Labour also plan to hand €1.2 billion of taxpayers money over to unguaranteed unsecured bondholders on January 25th. The government will also pay out €3.1 billion in March to a toxic bank – Irish Bank Resolution Corporation, formerly known as Anglo.

Citizens are paying for the greed of bankers and the bad policies of the former Fianna Fail/Green government.

The €4 billion that this government will give away in the next three months is more than the €3.8 billion in cuts and new taxes it introduced in December. This government, both Fine Gael and Labour, is ideologically committed to austerity and plans as part of the Fiscal Compact agreed with the other EU governments, to write this into the constitution locking future governments into austerity programme.

The government’s policy is wrong and short sighted. The money being handed over to unsecured and unguaranteed bondholders and toxic banks should instead be used to retain jobs, create new jobs, run our public services and stimulate growth in the economy.

Our conversation with the Troika will be an opportunity to raise these issues and to challenge the government’s excuse that is no alternative to the austerity programme, and we will explore with the Troika how much room for manoeuvre there actually is.

For example, what is their view of investing a portion of the National Pension Reserve Fund into job creation and economic recovery? What is their view of progressive tax reform that places the burden on those most able to pay rather than low and middle-income families? What is their view on the future of the Anglo Irish promissory note? And do they believe that Ireland will be able to return to the markets fully in 2013 on the basis of current trends?

People are only beginning to fully understand the impact of the cuts and extra charged meted out in December’s budget by Fine Gael and Labour. For many 2012 will be a year of increased hardship. Sinn Féin wants to demonstrate that there is an alternative, that there is hope.

One Comment

  1. Laban Tall says:

    I didn’t realise murderous Nationalism, with a side dish of torture, was considered “the best that’s Left in Labour”. I suppose as long as it’s not British or English nationalism, it’s OK no matter how many are killed.

    How’s Jean McConville, Gerald ? Back from the grave, soon ?

    You have to pull a wry grin though at the historical irony. Here’s a nation that, a/c/t its own national mythology, took up arms in order to be in control of its own destiny – and now its proposed budgets are leaked in Brussels, and have to be approved by Eurocrats before the voters get a look-in.

    (Nonetheless I wish them well, the austerity is working a lot better there than it is here – and in Ireland the oligarchs were left to go bust. In the UK the taxpayers were forced to bail them out – by a Labour government.)

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