Monday, January 18, 2010

Will it get any better

So new information released today from Ernest and Young is showing that they expect that the UK is facing a decade of pain in its attempt to move from the current down turn.
This to me seems very interesting as it shows that we as a country must be very much further behind in our own current attempt to move from this cycle.
If we look at the main difference between the two governments economic strategy there is a stark difference whilst in the UK they have said that there would be the need to start reducing the countries deficit over the next number of years they have vigorously pumped billions into the economy through quantitative easing and a major focus on both capital programmes and support for SME's through government loan guarantee schemes.
Here in Ireland our government has taken the coarse of removing cash within the economy through social welfare cuts, wage cuts and departmental spending. This is fine in there attempt to reduce the public spending which they themselves have made uncontrollable but there short sightedness in doing so along with the new wave of cross border spending has in effect taken a total of over 8 billion Euros per year out of an economy that is free fall due to its over reliance on the property sector for both employment and tax returns.
So what happens next well if we look closely at the governments plan they have stated that a further 4 billion in cuts is needed to reduce the current spending by government. So we now face a scenario that if the cross border spending stays current which i would see as there is no reason for this position to change we will now face a total reduction of cash into the economy of 16 billion within a 2 year period.
To me i think that this will be to tipping point that will put this country into a depression that this country has never seen before with mass emigration, huge mortgage defaults, broken families, increased homelessness, a rise in crime and a huge increase in mental health problems as the reality of families situations come to bear on them.
This country needs to be stimulated both economically and mentally to give the people of this nation any chance to move forward.
We are a productive nation as history shows we have some of the worlds greatest talents in education, science, business and entertainment. We also have a country of people who given the chance can make the correct social choices when needed.
I for one cant see any current political party within this country that has the determination to make the huge changes that are so much needed within the establishment so to enable us as a nation to rebuild in a fair and social equal way.

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