Wim on a whim
BY MICHAEL PIERSE
So Wim Duisenberg, President of the European Central Bank
(ECB), has told those of us living in the 26 Counties that we
need to avoid a `giveaway budget'. So what?
warning came as the Dublin government initiated another of its
good cop-bad cop routines, with Bertie `man-of-the-people' Ahern
playing the nice guy who wants to help everyone and Mary `don't
call me babe' Harney warning Bertie that he has to help her rich
pals first. The Taoiseach boosts his image as the soft-touch
Taoiseach, while Harney keeps in with that small (and dwindling)
group of financiers still willing to back the PDs. Political spin
at its most revolting.
Apparently, Ahern had wanted tax-cuts to benefit the lower
paid, but following the Duisenberg warning, his seemingly simple
and fickle mind has changed. Now, it appears, inflation will be
limiting the fiscal scope for tax reductions.
The old way for tackling inflationary problems was to alter
the interest rates and exchange rate employed by the state.
However, this responsibility has been taken out of the hands of
the too fickle Taoiseach and given to the ECB. And who's the head
of the ECB? None other than our friend Wim Duisenberg - who's
advising us on how to curb inflation. Now I am confused.
This is obviously the start of a government campaign to soften
the public up, with ominous warnings of how a better deal for low
paid workers will be the death knoll of the 26-County economy.
Ironically enough, this also comes in the same week as a Harvard
Economic study published findings that the same economy is the
fifth most competitive economy in the world. That economy's
skilled, capable, world-renowned workforce is now being told that
they cannot be afforded any big share in that economic growth. To
extend the benefits to them would spiral the inflation which is
already eating into their wages, they are being told. But why
should they be surprised? Workers have always been the first to
be told to tighten their belts.
Peter McLoone of IMPACT, one of Ireland's largest trade
unions, which has backed successive partnership pay and taxation
deals, has this week called for a pay increase above the 5.5%
annual increase agreed by his union in the Programme for
Prosperity and Fairness (PPF). The Economic and Social Research
Institute (ESRI) are set to revise their forecast on inflationary
growth to 5.3% for this year and 3.6% for 2001. This will far
exceed the 2.5% annual rise on which the PPF's terms had been
predicated in Febuary.
There is little provision being made by the government for
either prosperity or fairness when it comes to those on low and
middle incomes. But when you're used to spending your holliers
sunning yourself at luxurious foreign villas belonging to
millionaire buddies, all that low pay stuff can seem like a
million miles away.