Now it may not surprise you that I’m not the biggest fan of Daniel Hannan, but I’m really only mentioning him in this post because he’s a convenient person to hang my thoughts off.
“If you were overdrawn and in negative equity, with debts on a dozen credit cards and unpaid bills littering the table, what would you do? Would you try to spend less, or would you set out to spend more?
“Ireland is trying to spend less, with cuts across the board. Everyone will share the pain, from cabinet ministers to benefits claimants. The Taoiseach, who is expected to take a 20 per cent salary reduction, reckons that the new budget will reduce Ireland’s deficit by 4 billion euros.
“The United Kingdom, by contrast, wants to spend more. Alistair Darling will continue to expand the budget, and will raise taxes accordingly.
Well, it turns out not everyone in Ireland is sharing the pain (H/T The Irish Economy)
On budget day, the Minister for Finance announced that civil servants earning between €165,000 and €200,000 would take pay cuts of 12% while those earning over €200,000 would take pay cuts of 15%. Yesterday, with the public focusing on their pre-Christmas preparations, the government announced that this would not be happening after all.
Hmmm, I’m not entirely sure this is where I think fiscal stimulus should be directed.