Slí Eile: Over on Irisheconomy.ie Colm McCarthy is warning against nostalgia about going back to 2007. We must agree. But that is about the extent of it. The orthodoxy is, to quote McCarthy's own words:
"(i) Government debt ratios stabilised and sovereign credit spreads back to low levels;
(ii) competing banks strong enough to lend (a little);
(iii) a competitive economy producing more exports, less houses, and
(iv) a smaller and less leveraged balance sheet."
The problem with these four is that they leave out another four points without which a recovery is neither feasible or just:
(v) direct measures to arrest job losses through activation, training, re-skilling and emergency credit;
(vi) measures to shift de-leveraging away from welfare recipients and low to middle-income earners to those in high-income and high-wealth owning groups;
(vii) begin the slow and painful process of reforming political, public service, corporate and social institutions (including what remains of social partnership); and
(viii) nationalise banking once and for all and retain at least one State Retail Bank and one State Industrial Bank to compete on financial markets for deposits and lending.
Says Colm McCarthy:
'All policy wheezes emanating from the commentariat over the next few months should be smell-tested for 07 Nostalgia, and rejected at the merest whiff. We have been there and it did’nt work.'
Can we suggest, rather:
All policy wheezes emanating from the commentariat over the next few months should be smell-tested for 1987 Nostalgia, and rejected at the merest whiff. We have been there and it did’nt work. First we had growth without jobs, then we had growth with jobs but light-touch regulation and primitive public services and rising inequality and missed opportunities, then we have revelations of corruptions, bribery, incompetence and recklessness, then we had a credit boom. Finally we had bust. Would you not agree Colm?