Home > Uncategorized > What did Ireland get wrong, Rupert?

What did Ireland get wrong, Rupert?

Ben ChuBy Ben Chu

What did Ireland get wrong, Rupert?, eagle eyeRupert Murdoch puts his finger on something in his Inaugural Margaret Thatcher Lecture for the Centre for Policy Studies. Although not in the way he imagines.

“The good news is that Britain is not in quite the straits that it was in 1979. The bad news is that the cost of getting it wrong has risen exponentially. Ask the people of Greece and Ireland.”

Never mind Greece for a moment, what did Ireland get wrong? For the past decade Dublin has followed all the advice proffered by neoliberal economists and wealthy businessmen like Murdoch. It slashed corporation tax rates. It held down public spending, running fiscal surpluses. It kept the stock of public debt low. It won plaudits from neoliberals everywhere for its wide open economy and its “business-friendly” environment.

Except its economic success turned out to be built on the flimsy foundations of a property bubble. Irish banks were out of control. And the public finances were only healthy thanks to the tax revenues of an unsustainable credit boom. When the party stopped, the banks turned out to be bust and the deficit ballooned.

But Ireland continued to take the advice of the neoliberal economists. Dublin slashed public spending hard and early. They were told that they would be rewarded by the financial markets for taking their medicine in this way. They were told that private sector confidence would come flooding back as people saw that the government would do what was necessary to bring down the deficit. Growth, they were told, would return surprisingly quickly.

Well, the Irish people are still waiting. The bond markets have punished Ireland with high interest rates, not rewarded it by driving down its bond yields. And growth in the second quarter turned negative.

Ireland has done everything that the economic philosophy of Murdoch has dictated. Perhaps following that philosophy was what Dublin got wrong.

That aside, the speech was not uninteresting. As Paul Waugh of the Evening Standard, has noted, in parts the media boss comes over as almost liberal, complaining about “an endless cycle of incarceration” and saying Britain should “be a magnet for the best students and best workers from around the world”. Stand by for The Sun campaign for the migrant cap to be lifted and for less incarceration.

But its amusing to see that Murdoch still got a massive chip on his shoulder about the British class system after all these years:

“I am something of a parvenu, but we should welcome the iconoclastic and the unconventional. And  we shouldn’t curb their enthusiasm or energy. “

In other words: don’t refer my move to buy all of BSkyB to Ofcom. Here’s the peerless Martin Wolf of the FT (subscription) on why the Business Secretary, Vince Cable, should not listen.

BACK to margotbworldnews.com

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