The Government: Have they failed?

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oscarBravo

No, it's mine. I'd appreciate if both of you left the moderating to me.

donegalfella, I'm not going to pay $7.50 to read that article. I strongly suspect it's a dissenting view from mainstream opinion. Care to explain how market forces can break down a monopoly?

jmayo

donegalfella wrote: »

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Ah I see, it was all the fault of the Democrats, i.e. Bill Clinton.

The problem I would say with your free market theories is that greed takes over. People are inheritentky greedy and will take any chances if they think they can get away with it.
Hence you need a storng regulatory system to prevent bankers in particular from creating products that can ultimately lead to global castrophe.
Of course if the regulator is weak and government don't care then it compounds the problems.

As for letting the market always handle things, see rail system in Uk, water services in UK as examples where the state should provide some basic services.
Private entities have to pay dividents to their shareholders rather than plough money back into infrastructure.
Our Broadband rollout in this country is hampered by fact that telecoms line infrastructure is owned and run by private company.

ninty9er wrote: »

The government has taken action to ensure the legislation required to combat gangland was introduced.

For the first time we have a dedicated Garda Traffic Corps

But did they get their cars or was it them that was waiting for their cars to be released ?
Oh and they only patrol good straight roads shooting fish in a barrell and they don't do it at night since they do not have adequate resources.

ninty9er wrote: »

The government took decisive action (with the opposition) in tackling the financial crisis that hit the global economy and worked through the night to draft legislation to ensure AIB didn't collapse and bring down PTSB causing a consumer rush on the remaining banks which would have seen the IMF knocking on the doors of Government Buildings on October 2nd looking for the keys.

We have a cost of approx €600m of providing the guarantee, cheaper than any other.

Ps it will cost more since our borrowing now cost more and these borrowing are increasing to meet revenue shortfalls.
If it took them all night to formulate the legislation why didn't they build in the option of taking preferential shares in institutions being helped ?

ninty9er wrote: »

We will have increased unemployment, to be expected as the whole Eurozone is now in recession. The likes of Dell etc will eventually pack up manufacturing. The focus NEEDS to be on getting the workers there upskilled and working for themselves. The era of the multi-national manufacturing base is over as greed has pushed wage demands, inflation and debt skyrocketing. I have been quilty of that myself, but I worked in retail and keep my debt low.

It wasn't just greed, house prices went through the roof dragging everything else with them. Retail prices went up, utility costs went up. Saying that, people borrowed more and wanted to live beyond their means keeping up with the Jones down the road.

ninty9er wrote: »

This is symptomatic of the upper income unemployable arts student with rich parents being the only people willing to run for these positions. You rarely find the sons and daughters of private sector employees who have worked their arses off to send them to college spending this year/2/3/4/5/6/7/8/9/10 running a students' union.

The less well off will now feel the brunt (and I warned the SU President in UL that being unengaging and unreceptive would lead to all student's being shafted before the budget....but nobody would listen)

Funny I always saw the SU as a breeding ground for would be politicans like yourself. Having been in two colleges I always saw them as inaffectual eejits.

ninty9er wrote: »

Athlone is hardly Baghdad!

Well ...

ninty9er wrote: »

I'm sure you'll find another thread with comprehensive views I've expressed on
the education budget.

Failure, no. Could be doing better, YES.

This government is a failure just like it's predecessor whose chickens are coming home to roost.
- They refused to do anything about bank deposit guarantees until Joe Duffy show started a run on deposit accounts. Then they got off their ar*** and upped the guarantee.
- They bailed out good and bad banks and did not stick it to the banks for the guarantee that we will all be paying for.
- They brought budget forward yet it was a shambles.
- They did not touch the public sector in the budget.
- They attacked the old and the young. Any politican should know that was not going to be a good idea.
- They gave 1.65 billion as developer/builder bailout and setup the state as a subprime lender.
- They refuse to admit that the HSE is a shambles costing people their lives. This by far the biggest failure under both this and previous governments. It is a nightmare that costs inocent people their lives.
- They cancelled the cervical cancer vacination that would probably save some lives down the road.
- They allowed the numebr of miniisters of state remain as is when cutting them back would be seen by the public as cost cutting at the top.

So if that ain't a failure, then I want to know what is ?

Kershaw.D wrote: »

Yes they have failed big time
right now I think that we would have been better staying part of the uk

None of the current gov will be here after the the next election
And now with the country falling apart they decide to go and spend €60000 on Christmas lights for O'Connell st alone

But they are such nice pretty environmentally friendly lights

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djpbarry

jmayo wrote: »

They refuse to admit that the HSE is a shambles costing people their lives. This by far the biggest failure under both this and previous governments. It is a nightmare that costs inocent people their lives.

Our health system is not as bad as many think:

http://www.irishtimes.com/newspaper/ireland/2008/1114/1226408634167.html

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oscarBravo

donegalfella wrote: »

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Nice theory, except that it ignores an important factor in the perpetuation of monopolies: high barriers to entry.

Let's take Eircom as a case in point: suppose you wanted to compete directly against Eircom in the provision of DSL services over phone lines. How much capital do you suppose would rush to your competing firm?

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oscarBravo

donegalfella wrote: »

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And you're conveniently forgetting that you've claimed that the market will inevitably destroy monopolies.

Eircom's control of the "last mile" of telephone network came directly from the fact that the state prevented competition in the sector for decades.

And the fact that Eircom now allow competitors access to that "last mile" is solely and completely a function of government regulation forcing them to do so. In other words, their monopoly would persist indefinitely were it not for the government forcing them to allow competition.

However, as I'm sure you're aware, free-market competitors are successfully providing broadband services by means of satellite and wireless technologies that will eventually render phone-based DSL defunct. This is competition and innovation at work!

Competing technology platforms are slowly making inroads, but the very slowness is a function of the lack of availability of alternative wholesale infrastructure. According to your theory, capital should be flooding to these alternative platforms. I can assure you from experience that this is not the case.

Biggins

Credit to some of the posters here. Ye know your stuff.
I wish ye were running the state - maybe things would be much better off!

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molloyjh

Apologies donegalfella I don't have the time (and don't really have the inclination either if I'm honest ) to address each of your points individually. However there is one huge gaping flaw in your logic regarding the financial industry, and I tried to sum it up using the credit card limit example but perhaps didn't make myself clear enough.

Government can provide the conditions for cheap credit, they can open the door if you will. That does not force the banks to adopt the policy of cheap credit or create or modify existing products to take advantage of that. Those decisions were business decisions. In fact those decisions should give you a good indication of what the financial industry would do in a deregulated market. Once given the opportunity to reduce their rates they leapt at the chance, they were not pushed.

As for the US specific examples I find it hard to believe that you could seriosuly think that Government are driving business over there. It's quite blatantly the other way around with many big businesses forming very powerful lobby groups. In fact Freddie and Fannie were both revealed to have been consistantly "contributing" to most Senators in the US Congress. Both conrtibuted to Obama AND McCain. They weren't doing that for any other reason than to get greater control over their policies. And they certainly weren't doing it to ensure that they had less control over their business. After all Obama got more from them than McCain and he's far more pro-regulation.

oscarBravo

donegalfella wrote: »

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So if the government were to remove its guarantee of monopoly, the monopoly would inevitably disappear? In other words, if the government hadn't mandated competition on Eircom's fixed-line network - had simply sold off the company and walked away - there would now be competition on that fixed-line network?

So we should be grateful to the government for intervening to redress a situation that the government created in the first place? Maybe the government should not have been involved in the telecoms business to begin with?

Maybe, but you're changing the subject. Given the historical fact of a state monopoly - it's hard to change historical facts - you're trying to make the case that the market would be more competitive in the absence of regulation.

Actually, no. Look at the vigorous competition in the mobile phones sector in Ireland.

Yeah, that's why we have the cheapest mobile calls in the world. Oh wait...

Look at the providers now competing to offer mobile broadband access. Do you think Eircom's last-mile advantage will have any relevance whatsoever in another couple of decades?

If you think mobile "broadband" is realistic competition to fixed-line services, you obviously don't use it much.

According to ComReg, mobile broadband subscriptions in Ireland grew by almost 400% in the year to June 2008. That's remarkable "slowness" of adoption.

Mobile "broadband" is a symptom of market failure, and the absence of fixed-line competition. Why do you suppose mobile "broadband" penetration is so much higher in Ireland than in other OECD countries?

Rather than assuring me from your personal experience, why don't you provide some figures to demonstrate that capital is not flooding into Ireland's mobile infrastructure?

I didn't say anything about Ireland's mobile infrastructure. You're the one confusing mobile Internet access with broadband.

But, tell you what: if you're so convinced there's a flood of capital into competing technologies, why don't you set up a wireless broadband company in Ireland? Let me know how you get on.

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molloyjh

donegalfella wrote: »

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So why is there a bit of hoo-ha at the moment over whether the banks will pass on the ECB rate cuts to their customers? If an ECB rate cut automatically means bank rate cuts then surely this would not be an issue. Also why is there such a thing as a tracker mortgage as a product if all banking products track the ECB rate automatically?

donegalfella wrote: »

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Didn't I leterally say the opposite, that if the door is open to them they will jump at it???? Doesn't this point contradict your other points that a free market will regulate itself? How many ravenous five-year-olds do you know that can regualte themselves?

donegalfella wrote: »

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True. And your point is? If we did away with criminal law there would be no crime. That doesn't mean doing away with criminal law is the answer.

donegalfella wrote: »

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I think maybe you;ve misunderstood the difference between true free market and movement towards true free markets. I never said anywhere was a true free market, I did say the US over the last 8 years has moved more in that direction.

oscarBravo

donegalfella wrote: »

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And yet, you would have us believe that leaving five-year-olds to their own devices will have a happier outcome than supervising them.

brianthebard

donegalfella wrote: »

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Vigourous competition?

When the market is shared by two companies, as in the Irish mobile telecoms market, they are called a duopoly. O2 and Vodafone have a combined market share of 94% of the Irish mobile telephone subscriber base. In other words, 94% of all mobile phone users subscribe to one of the two networks. Such a market is said to be highly concentrated, i.e., market share is concentrated amongst a small number of companies.

from here

The market is inherently stable and will inevitably gravitate towards monopoly. So says Paul Sweezy. Can you give us some examples of monopolies being broken down and not being replaced by another monopoly? Without government intervention?

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djpbarry

donegalfella wrote: »

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My fixed-line broadband connection has a speed of 24Mbps. Fiber-optic communication systems can achieve transmission speeds several orders of magnitude higher than this.

oscarBravo

donegalfella wrote: »

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But you can expect it to dissolve any other kind of monopoly overnight? Wouldn't it be fair to say that it can take decades to dissolve any kind of monopoly?

There you go again, arguing from a completely static perspective.

On the contrary, I'm arguing from the perspective of actually knowing what I'm talking about.

Do you use fixed-line broadband, or are you reliant on one of the mobile "broadband" services you're so strongly lauding?

Fixed-line services will fall by the wayside—probably sooner rather than later—and will be replaced by mobile services. How do I know this? Most young people are already going in this direction. Google the term "digital nomad" if you don't believe me.

So set up a mobile broadband business. You can't possibly fail. Capital will flood to you - you've said so yourself.

No, mobile broadband arises from market demand: Many people want to use their Internet connections in places other than their homes.

Yet again, you're demonstrating your total ignorance of the broadband marketplace in this country.

So you're now arguing that there is no such thing as "mobile broadband"?

How many OECD countries include mobile Internet services in their broadband penetration statistics?

Now you're just being facetious. I've asked you to back up your assertion that alternative Internet access technologies aren't attracting significant investment—and you can't.

Have you set up an alternative Internet access technology business lately? Planning to, anytime soon?

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djpbarry

donegalfella wrote: »

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Mobility maybe, but speed? Doubtful. As I'm sure you're aware from personal experience, mobile broadband is no substitute for fixed-line. While you are correct in assuming that mobile broadband service will improve in the future, you seem to overlook the fact that so too will fixed-line services.

donegalfella wrote: »

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And what do people use to avail of VOIP?

oscarBravo

donegalfella wrote: »

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You didn't. You've said that government should never intervene to prevent monopolies, but should leave it to the market to take care of itself. As always, your attachment to free-market ideology blinds you to the fact that sometimes a market can take a very long time to correct itself, and that the wider economy can suffer as a result.

On what basis do you "know what you're talking about"? You've provided absolutely no evidence that you know anything much about antitrust economics or the telecoms industry. Repeated insistence does not an argument make.

I own and run a broadband business based on alternative access technologies. I'm still waiting for the market to dump large quantities of capital in my lap. Hell, if you can tell me where I could secure an overdraft, that would be nice.

My partner and I have fixed-line DSL; we also have mobile broadband from 3. I am not "lauding" the latter, since it currently has its shortcomings; but I can envision the potential of the technology. As I said, I'm not arguing from the assumption that we live in a static world where technology does not evolve.

Nope, you're arguing from ignorance of the intrinsic limitations of the technology.

When you ditch your DSL line in favour of mobile "broadband", come back to me.

Got an answer as to the number of OECD countries that include mobile Internet in their broadband statistics? I'll give you a clue: it's less than two.

Again, you're trying to deflect my request for evidence that capital is not flowing into alternative Internet access technologies.

I'm pointing out that it's easy for an armchair economist to sit there and talk the talk. Some of us walk the walk.

I am quoting authoritative statistics...

...but you're misinterpreting them to suit your point.

Totally irrelevant to the discussion at hand. Again, my point is that the free market is breaking down the legacy of Telecom Éireann by investing capital in new, innovative technologies that supersede those on which the monopoly relied. Continue to deny that if you will, but time will prove you wrong.

Talk. Walk.

brianthebard

On what basis do you "know what you're talking about"? You've provided absolutely no evidence that you know anything much about antitrust economics or the telecoms industry. Repeated insistence does not an argument make.

Your claim about vigourous competition in the telecoms industry shows how little you know about it tbh.

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molloyjh

donegalfella wrote: »

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There's a word for what you're doing here: Speculation. You can't possibly know what will and what won't win out in future. There are plenty examples of worthwhile technology that for some reason or other never "made it". Mobile broadband may well take off or it could fizzle out and die. Only time will tell.

I fear we've wandered into a far greater debate than the OP intended, and one that is more idealogical in nature. At the end of the day donegalfella we live in a democracy where most people do not believe what you believe. We can only judge our Government based on the mandate given to them by the people. The rights and wrongs of their idealogy and that mandate are, to me at least, a seperate question. I'll happily partake in a thread on the idealogy, but for my part anyway this thread has run its course.

I think the Government have failed, but most importantly have been doing so for the last decade at least. Many people saw this situation coming, although I doubt any of us could have predicted the global recession and our own domestic woes would hit at the same time. It was part of the mandate of this Government to plan for the future and in many ways it seems they were not doing that, and it is on that basis that I judge them to have failed.

Time Magazine

brianthebard wrote: »

Vigourous competition? from here

You're arguing that the market wasn't liberated enough. I'm glad we agree on something, Brian .

In the first place, the market was a monopoly of the State. Rather than having nice, benevolent prices for the masses, we were ripped off. Really, really ripped off. Competition, albeit limited, was introduced when Esat were given a licence. Prices plummeted. You should see the graphs. Remember when everyone started to get phones around 1998? Thank you, Europe. (However our deregulation was crap. Why? Because the unions threatened to pull out of social partnership is our telecommunications industry was deregulated! Bloody stinking f*cking unions!)

Real price competition only occurred after Full Mobile Number Portability was introduced. This allowed Meteor to get your on their network without losing your number. The effect was considerable.

The market is inherently stable and will inevitably gravitate towards monopoly. So says Paul Sweezy.

Industrial organisation theory has developed ever so slightly since 1960.

Can you give us some examples of monopolies being broken down and not being replaced by another monopoly? Without government intervention?

US aviation
European aviation
Fixed line telecommunications (there was too much intervention tbh)
Dublin-Galway bus routes
Dublin-Cork bus routes

You also need to define what "intervention" means. The rabid right-wing capitalist in me still wants a competition authority stepping in when necessary - would you consider that intervention?

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