Public sector pay increase

bjork

Riskymove wrote: »

and again just move on

the discussion was about measuring performance

of course there are no solutions provided so instead it moves on to there being too many Fire chiefs!!:rolleyes:

I told you the parameters

Better response times
Training in cutting edge methods
Fitness




You refuse to acknowledge that

KomradeBishop

Iwasfrozen wrote: »

Borrowing to increase debt/gdp ratio to spend on wages is not sustainable.

Money gained from long term borrowing bond markets should be used to increase long term economic potential you do this by upgrading infrastructure not paying higher wages.

You're trying to shift discussion back to how money is spent, changing the definition of 'sustainable' again - I already said we are talking about debt sustainability.

Whether government spending through debt is sustainable or not, depends on whether the interest on the debt is sustainable - interest on debt is at its lowest level for at least 30 years, so it's perfectly possible to spend sustainably.

The specifics of 'how to spend' come after this - whatever way you or I think is the best way to increase spending or reduce taxes, the fact is that the low interest rates on debt, means that there is a sustainable way of increasing debt and spending in this manner.

Riskymove

bjork wrote: »

Better response times
Training in cutting edge methods
Fitness

so if the firemen doesn't get training as the budgets are cut and they don't have enough fire crews so response times are not improved


but they are fit and work their hardest

How would you rate individual performance?

BoatMad

Gebgbegb wrote: »

In relation to the employment survey cso 20090, it just shows that its comparing apples with oranges.
Main thing is, is that qualification levels in PS are higher... so, shock horror... their pay is higher (on average of course).

Thats a abuse of the statistics, many PS do third level qualifications because simply having a masters etc gets you more money , even if its not work related.

In the private sector , credentalism , while important, is less valuable then ability and experience. A factor sadly lacking from promotion decisions in the PS

No one should get more money simply because they have qualification x or Y.

Riskymove

BoatMad wrote: »

No one should get more money simply because they have qualification x or Y.

surely the point of being better qualified is part of the reason of getting a better job or more responsibility?

BoatMad

Riskymove wrote: »

surely the point of being better qualified is part of the reason of getting a better job or more responsibility?

but just being paid to have credentials isn't a good idea. If the PS was a builder firms, brickies would all be doing masters at night to get the increment.

bjork

bjork wrote: »

Top-heavy fire service costing vital frontline
http://www.independent.ie/irish-news/topheavy-fire-service-costing-vital-frontline-26726421.html

As cutbacks bite, fire stations have shut, firefighter job vacancies go unfilled, and millions have been hacked off the fire service budget -- yet there are hundreds of high-earning senior fire officers, research by the Sunday Independent has discovered.
"Compared with other jurisdictions the droves of senior managers is extraordinary," one source in the sector said.


Too many chiefs and not enough Indians

It's the same across the board and not just within the PS either. Older workers haven't been harmed directly too much in the last few years.

Riskymove

BoatMad wrote: »

but just being paid to have credentials isn't a good idea. If the PS was a builder firms, brickies would all be doing masters at night to get the increment.

the only part of PS I am aware of that rewards a certain qualification is in teaching where if you get a masters in Education you get an increase

I am not aware of any sector that gives more pay simply for having ANY qualification

can you provide any ideas?

BoatMad

Riskymove wrote: »

the only part of PS I am aware of that rewards a certain qualification is in teaching where if you get a masters in Education you get an increase

I am not aware of any sector that gives more pay simply for having ANY qualification

can you provide any ideas?

teaching doesn't require a masters in education to get the increment. its broader then that.

the PS always had quite a high standard of entry, compared to private industry ( primarily because private industry is much broader then the PS) , but salaries were lower because of the reasons I gave, The effect of powerful unions and profligate Governments that attempted to " buy" industrial peace, along with a massive expansion in PS numbers has led to the current unsustainable situation.

remember the infamous " it will be like walking up to an ATM" statement

jmayo

KomradeBishop wrote: »

We have the lowest interest rate on government bonds/debt for over 30 years right now - we should be expanding the budget deficit (both through spending and tax reductions), to grow the economy, given that doing so would be so cheap to do right now - and then bring it back to surplus when we have full private sector employment.

If you are up to your ass in debt, sometimes it is wise not to dig any deeper.

Have you been giving advise to Greek government by any chance ?

KomradeBishop wrote: »

Pointless trying to pay down our national debt, when it can be expanded sustainably (due to quarter-century-low interest rates), when we aren't even running at full economic capacity yet - when we've got everyone back working, i.e. when tax income is at its maximum potential and the economy is at full speed, that is when you pay down debts, as you can pay them back much faster then.

Would you care to tell us for how much of the history of this state we had full employment ?
Without emigration this state would have even more unemployed both today and throughout it's history.
We only ever had full employment for a few years during the height of our bubble.
Reckoning on a return to full employment is one hell of an assumption when you look at this country's history.

KomradeBishop wrote: »

Every government on the planet borrows money - whether it's a good idea or not depends on whether the borrowing is sustainable, and the sustainability is determined primarily by the interest rate (currently at its lowest level in more than 30 years), not by the overall level of debt.

Surely the rates we can achieve is dependent to some degree on our overall debt levels and thus the sustainability of the debt is dependent on the debt levels as well as our growth.

rangler1

Surely if there's more money for the public service it should be used to give the public a service.
We're waiting for hospital treatments/ surgery, we've overcrowded schools, it looks like we won't have a water supply in a another while, not enough guards, not enough help for children with special needs, media says they're swamped with work, I consider myself swamped with work when I'm working six or seven 12 hr days/ wk......a big pay rise wont solve any of the above problems, but longer working hrsand more staff will for the same money

KomradeBishop

jmayo wrote: »

If you are up to your ass in debt, sometimes it is wise not to dig any deeper.

Have you been giving advise to Greek government by any chance ?

Learn basic economics/accounting rather than reaching for bollocks retorts and hyperbole: Debt sustainability is determined by the interest rate on the debt, which is at its lowest level for over 30 years now with Ireland (and the highest level in years for Greece).

BoatMad

Originally Posted by KomradeBishop View Post
We have the lowest interest rate on government bonds/debt for over 30 years right now - we should be expanding the budget deficit (both through spending and tax reductions), to grow the economy, given that doing so would be so cheap to do right now - and then bring it back to surplus when we have full private sector employment

.
If you are up to your ass in debt, sometimes it is wise not to dig any deeper.

Have you been giving advise to Greek government by any chance ?

Actually I would agree with KB. our issue is that expansion should be limited to non recurring items the difficulty is reigning in current spending when the next downturn occurs.

Originally Posted by KomradeBishop View Post
Pointless trying to pay down our national debt, when it can be expanded sustainably (due to quarter-century-low interest rates), when we aren't even running at full economic capacity yet - when we've got everyone back working, i.e. when tax income is at its maximum potential and the economy is at full speed, that is when you pay down debts, as you can pay them back much faster then.

Would you care to tell us for how much of the history of this state we had full employment ?
Without emigration this state would have even more unemployed both today and throughout it's history.
We only ever had full employment for a few years during the height of our bubble.
Reckoning on a return to full employment is one hell of an assumption when you look at this country's history.

full employment is predicted within 2 years. again one cannot fault Kbs logic , however the issue is how long you can sustain an economy at full employment.

Originally Posted by KomradeBishop View Post
Every government on the planet borrows money - whether it's a good idea or not depends on whether the borrowing is sustainable, and the sustainability is determined primarily by the interest rate (currently at its lowest level in more than 30 years), not by the overall level of debt

.
Surely the rates we can achieve is dependent to some degree on our overall debt levels and thus the sustainability of the debt is dependent on the debt levels as well as our growth.

NO not really, its a fiat currency and we are in the middle of a massive money expansion , in effect endless amount of capital are available.

debt sustainabilty is more about investor confidence then actual ability to repay.

Galwayguy35

Riskymove wrote: »

of course they all do

all private sector workers work fully without any slacking for 80 hours a week for half pay etc...

while all PS slack for 20 hours a week for double pay

yeah grand sure we know this

Well when you work for the person who owns the place you're damn right there is no slacking or the door will be shown fairly sharpish, seeing as the wages come out of his/her pocket.

Also many private sector workers, myself included ofton have to work weekends for a flat rate.

crusier

I begrudge anyone other than myself who gets a pay rise wheather they deserve it or not, i'm irish!

darkpagandeath

crusier wrote: »

I begrudge anyone other than myself who gets a pay rise wheather they deserve it or not, i'm irish!

:pac::pac::pac:

osarusan

bjork wrote: »

I told you the parameters

Better response times
Training in cutting edge methods
Fitness




You refuse to acknowledge that

No you didn't, you should they should put out more fires, and faster.

For heart surgeons, you said they should do more operations.



When the utter stupidity of this was pointed out to you, you moved the goalposts.

KomradeBishop

BoatMad wrote: »

Actually I would agree with KB. our issue is that expansion should be limited to non recurring items the difficulty is reigning in current spending when the next downturn occurs.



full employment is predicted within 2 years. again one cannot fault Kbs logic , however the issue is how long you can sustain an economy at full employment.




NO not really, its a fiat currency and we are in the middle of a massive money expansion , in effect endless amount of capital are available.

debt sustainabilty is more about investor confidence then actual ability to repay.

The thing about full employment, is that economies should be working at full employment 100% of the time - because when you think about it, when you have workers and resources/industry laying idle, that is a massive inefficient waste, which keeps our GDP far below potential.

If you have large public debts, you pay them off faster when you have full employment, as you're getting the most out of your economy then (and that keeps tax income at its maximum potential as well) - even if that means staying in high deficits, by (sustainably) increasing debt at the beginning, so government can employ the workers the private sector doesn't want (both providing employment, and boosting money going into the private sector).

The main important thing, is that you just need to avoid placing investment/employment into sectors of the economy going through a bubble - such as the property bubble in the 2000's; you can aim taxes at sectors going through a bubble, to deflate the bubble.

Iwasfrozen

KomradeBishop wrote: »

You're trying to shift discussion back to how money is spent, changing the definition of 'sustainable' again - I already said we are talking about debt sustainability.

Whether government spending through debt is sustainable or not, depends on whether the interest on the debt is sustainable - interest on debt is at its lowest level for at least 30 years, so it's perfectly possible to spend sustainably.

The specifics of 'how to spend' come after this - whatever way you or I think is the best way to increase spending or reduce taxes, the fact is that the low interest rates on debt, means that there is a sustainable way of increasing debt and spending in this manner.

I'm glad you seem to agree long term money borrowed to fund wages is a bad idea.

Borrowing money when the interest rate is low is not automatically a good thing. The profit investment needs to be greater than the cost of the loan.

darkpagandeath

osarusan wrote: »

No you didn't, you should they should put out more fires, and faster.

When the utter stupidity of this was pointed out to you, you moved the goalposts.

What if there are no fires to put out ? Do you keep a high volume of staff just in-case ?

ardmacha

BoatMad wrote: »

primary issue with state funding was the current deficit , that was unconnected to the banking re finance. That state deficit is directly connected to the PS employment costs , which are the biggest single item in that current budget.

The biggest item in the State budget is welfare payments.

Look at the PS expansion from 1995, we have over 100,000 extra PS staff, these all have to be paid for.

Indeed, and the population of the state has increased by 30%.

Banking debt was primary raised via raiding the pension reserve ( no borrowing ) and promissory notes ( in effect printing euros)

True, the PS paid for this through their pension reserve. No doubt people appreciate this.

Riskymove

darkpagandeath wrote: »

What if there are no fires to put out ? Do you keep a high volume of staff just in-case ?

The question is still about individual fireman performance and you keep raising a different issue

on that other issue, if there are no fires in 2014 does that mean there will be none in 2015?

is that how you would base service levels?

BoatMad

KomradeBishop wrote: »

The thing about full employment, is that economies should be working at full employment 100% of the time - because when you think about it, when you have workers and resources/industry laying idle, that is a massive inefficient waste, which keeps our GDP far below potential.

If you have large public debts, you pay them off faster when you have full employment, as you're getting the most out of your economy then (and that keeps tax income at its maximum potential as well) - even if that means staying in high deficits, by (sustainably) increasing debt at the beginning, so government can employ the workers the private sector doesn't want (both providing employment, and boosting money going into the private sector).

The main important thing, is that you just need to avoid placing investment/employment into sectors of the economy going through a bubble - such as the property bubble in the 2000's; you can aim taxes at sectors going through a bubble, to deflate the bubble.

Well its not so simple, keeping an economy " on the boil" , is very difficult as the lag time in resource provision is often much longer then the changes happening in real time.

while what you say is technically correct, its very difficult to sustain and manage, ecomonies are always growing and declining

osarusan

darkpagandeath wrote: »

What if there are no fires to put out ? Do you keep a high volume of staff just in-case ?

"No fires to put out lads, go home."

"No emergencies right now lads, park the ambulances and off you go."

Utterly simiplistic.

Yes, you keep the appropriate volume of staff just in case, with 'just-in-case' being based on reliable statistics and projections and erring on the conservative side.

Riskymove

Galwayguy35 wrote: »

Also many private sector workers, myself included ofton have to work weekends for a flat rate.

I have worked weekends for free in the PS.....so where does that leave the discussion?

darkpagandeath

Riskymove wrote: »

The question is still about individual fireman performance and you keep raising a different issue

on that other issue, if there are no fires in 2014 does that mean there will be none in 2015?

is that how you would base service levels?

Nope would go on historic data keep a reasonable reserve then discard any that are not needed. On the other hand other posters are saying keep them just in-case.

Riskymove

darkpagandeath wrote: »

Nope would go on historic data keep a reasonable reserve then discard any that are not needed. On the other hand other posters are saying keep them just in-case.

do you think we have too many firemen?

darkpagandeath

osarusan wrote: »

"No fires to put out lads, go home."

"No emergencies right now lads, park the ambulances and off you go."

Utterly simiplistic.

Yes, you keep the appropriate volume of staff just in case, with 'just-in-case' being based on reliable statistics and projections and erring on the conservative side.

Yes and if they are overstaffed you shed some.

darkpagandeath

Riskymove wrote: »

do you think we have too many firemen?

Jesus, this is all on a hypothetical proposed by someone else now who's moving the goal posts ?

Riskymove

darkpagandeath wrote: »

Jesus, this is all on a hypothetical proposed by someone else now who's moving the goal posts ?

I asked to show that this is a pointless aside to the discussion about performance management

so perhaps we can either stick to talking about the issues around that or just leave it altogether

If there are surplus staff with insufficient work in any PS area then redeployment to an area that needs staff followed by redundancies should be carried out. It is that simple

but it has little to do with either pay or performance management

BoatMad

ardmacha wrote: »

The biggest item in the State budget is welfare payments.

when you add PS pay and pensions , you are tieing for first place

see https://www.google.ie/url?sa=t&rct=j&q=&esrc=s&source=web&cd=9&ved=0CFMQFjAI&url=http%3A%2F%2Fwww.per.gov.ie%2Fwp-content%2Fuploads%2FExpenditure-Report-2014.pdf&ei=9r0_Vb-CIdSp7AaAzYDAAQ&usg=AFQjCNHqhMtn_2HWME0rwiu9mFYg3hemXw&sig2=8ilTM00bhXX1kg2iP6QX5g&bvm=bv.91665533,d.ZGU

Indeed, and the population of the state has increased by 30%.

no linear relationship has ever existed.

True, the PS paid for this through their pension reserve. No doubt people appreciate this.

No they didn't, the reserve was money out aside from previous Gov surplus , the PS maintains in effect no reserve

test3test

uch wrote: »

Debt level was caused by Banking, a Private industry, nothing to do with PS

And who was supposed to regulate and control the banks and the economy?

The regulator, the central bank, the dept of finance, the government....all public service.

Now people on the PS want a payrise and yet we still are borrowing many billions per year and the country owes 200 billion debt .... no way should the government award pay rises. There are lots of other areas that were decimated during the crash. The public servise is still overpaid.

darkpagandeath

Riskymove wrote: »

I asked to show that this is a pointless aside to the discussion about performance management

so perhaps we can either stick to talking about the issues around that or just leave it altogether

If there are surplus staff with insufficient work in any PS area then redeployment to an area that needs staff followed by redundancies should be carried out. It is that simple

but it has little to do with either pay or performance management

Of course it does, Doing more with less like the private sector. You don't need 2 people to do 1 persons amount of work for example.

jcon1913

KomradeBishop wrote: »

Study economics and the economic crisis - it's a bit more complicated than 'all borrowing = bad'.

Well can you explain why you borrow more when you are up the creek with debt already? I havent time to debunk a theory if you cant explain it in a few paras.

KomradeBishop

Iwasfrozen wrote: »

I'm glad you seem to agree long term money borrowed to fund wages is a bad idea.

Borrowing money when the interest rate is low is not automatically a good thing. The profit investment needs to be greater than the cost of the loan.

I didn't agree, I haven't commented on that - I avoided the "how to [not] spend", and focused solely on how debt sustainability shows increased spending is possible (without getting into what people think the best way to configure that spending is).


Government borrowing doesn't work on the basis of profits, because government finances don't work like business finances - with governments, a better measure of the success of spending is GDP growth.

If government spends money gained from low-interest debt efficiently - say, on a high benefit infrastructural project - the increase in GDP will improve overall debt sustainability and will increase tax intake for paying down debts.

However (and this is very important): Even if government spends that money in a completely inefficient way - e.g. something silly like paying people to dig holes in the ground and fill them up again - that is still flooding money into the private economy, which itself will still increase GDP and tax intake, which can still provide a net-gain in debt sustainability (albeit far less of a gain than the previous scenario).


Obviously, the money should be spent in as efficient a way as possible - but if you see my point there, no matter how it is spent, it is still our ticket to a speedy economic recovery.

Señor Fancy Pants

Just for a bit of transparency.

With a total of 15.5 years service, 1.5 years at my current rank. A 2% pay restoration for me is about €15 per week before tax.

KomradeBishop

BoatMad wrote: »

Well its not so simple, keeping an economy " on the boil" , is very difficult as the lag time in resource provision is often much longer then the changes happening in real time.

while what you say is technically correct, its very difficult to sustain and manage, ecomonies are always growing and declining

I agree that, if you are relying only on the private sector to provide full employment, it is very difficult - I'd actually say it's not possible, if relying only on that.

If, however (and this seems to be a taboo topic), you have government employ workers that the private sector does not presently want (say, on infrastructural projects that increase economic efficiency), then you can have permanent full employment, so long as you have sustainable public debt.

You are right that resource provision i.e. supply of resources may lag, and yes this will cause inflation - but the simple solution to that, is to have an inflation target (e.g. 2%, like central banks tend to), and just stop increasing spending when that's reached.

Eventually, the markets will automatically fix the supply problem, bringing inflation back down, and then you can push spending again - and keep doing this until you reach full employment.

BoatMad

KomradeBishop wrote: »

I agree that, if you are relying only on the private sector to provide full employment, it is very difficult - I'd actually say it's not possible, if relying only on that.

If, however (and this seems to be a taboo topic), you have government employ workers that the private sector does not presently want (say, on infrastructural projects that increase economic efficiency), then you can have permanent full employment, so long as you have sustainable public debt.

You are right that resource provision i.e. supply of resources may lag, and yes this will cause inflation - but the simple solution to that, is to have an inflation target (e.g. 2%, like central banks tend to), and just stop increasing spending when that's reached.

Eventually, the markets will automatically fix the supply problem, bringing inflation back down, and then you can push spending again - and keep doing this until you reach full employment.

I agree that we should be dramatically increasing capital spending, roads, water and waste systems etc. current spending that continues forever , is different and most be controlled.

We should be throwing money at infrastructure , ( at I suspect soon we will )

KomradeBishop

jcon1913 wrote: »

Well can you explain why you borrow more when you are up the creek with debt already? I havent time to debunk a theory if you cant explain it in a few paras.

Whether or not you can sustainably borrow more, does not depend upon the overall level of debt, it depends on the interest you pay on that debt - forget the overall debt, and look at the interest payments.

When debt has extremely low interest rates - as it does now (the lowest interest rates for 30+ years, if not way longer) - you can expand debt sustainably.

The real question of how sustainable debts are, is: How much interest are we paying on all of our public debt, as a percentage of GDP?

osarusan

Truffle Pig wrote: »

Just for a bit of transparency.

With a total of 15.5 years service, 1.5 years at my current rank. A 2% pay restoration for me is about €15 per week before tax.

LOOK AT YOU AND YOUR MANSIONS!

BoatMad

KomradeBishop wrote: »

Whether or not you can sustainably borrow more, does not depend upon the overall level of debt, it depends on the interest you pay on that debt - forget the overall debt, and look at the interest payments.

When debt has extremely low interest rates - as it does now (the lowest interest rates for 30+ years, if not way longer) - you can expand debt sustainably.

The real question of how sustainable debts are, is: How much interest are we paying on all of our public debt, as a percentage of GDP?

well there is a constraint in a fiat currency, and that is the broad money market view of soverign debt sustainability. Once you manage that then you can increase debt

KomradeBishop

BoatMad wrote: »

I agree that we should be dramatically increasing capital spending, roads, water and waste systems etc. current spending that continues forever , is different and most be controlled.

We should be throwing money at infrastructure , ( at I suspect soon we will )

Well we're agreed with that anyway That, infrastructure, seems to be much more of an agreeable/less-thorny topic than wages.

Señor Fancy Pants

osarusan wrote: »

LOOK AT YOU AND YOUR MANSIONS!

How dare you talk to me! Direct any comments through my butler!

bjork

osarusan wrote: »

No you didn't, you should they should put out more fires, and faster.

For heart surgeons, you said they should do more operations.



When the utter stupidity of this was pointed out to you, you moved the goalposts.

Well, I have now then. Hopefully in a manner suitable for your liking. :rolleyes:


Show me where the utter stupidity is?

How would you rate performance? Whoever wins the game of poker?

smurgen

Riskymove wrote: »

what if Government wont replace vacancies and there are not enough firemen to tackle all the fires

what if they don't get the equipment needed


what if Govt close wards and cut Health budgets

In any of those instances pay increases for current staff would be indefensible.

KomradeBishop

BoatMad wrote: »

well there is a constraint in a fiat currency, and that is the broad money market view of soverign debt sustainability. Once you manage that then you can increase debt

That's true with the Euro, yes, because Ireland does not have control over the currency. It would be less true for the UK though, as (and this is getting into a different topic) their ability to issue money, means they can avoid ever defaulting on debts if they want.

What I've been discussing in this topic - which many people (even of the free market variety) seem to find very agreeable - is actually MMT (Modern Money Theory), but without the money creation (which is something that people have such a strong kneejerk reaction to, that they are unable to discuss it), with low interest public debt taking its place instead.

If you think about it - low interest public debt, where the ECB is presently printing money to buy government bonds off of banks right now, who in turn buy the bonds off government, is pretty much the same end result, just with a few more layers of abstraction.

ardmacha

BoatMad wrote: »

ardmacha wrote: »

Indeed, and the population of the state has increased by 30%.

no linear relationship has ever existed.

Really? Demand for public services is not connected to population? So, for instance, the third of the PS who work in education are not connected to the number being educated and the increase in the number attending third level etc.?

Iwasfrozen

KomradeBishop wrote: »

I didn't agree, I haven't commented on that - I avoided the "how to [not] spend", and focused solely on how debt sustainability shows increased spending is possible (without getting into what people think the best way to configure that spending is).


Government borrowing doesn't work on the basis of profits, because government finances don't work like business finances - with governments, a better measure of the success of spending is GDP growth.

If government spends money gained from low-interest debt efficiently - say, on a high benefit infrastructural project - the increase in GDP will improve overall debt sustainability and will increase tax intake for paying down debts.

However (and this is very important): Even if government spends that money in a completely inefficient way - e.g. something silly like paying people to dig holes in the ground and fill them up again - that is still flooding money into the private economy, which itself will still increase GDP and tax intake, which can still provide a net-gain in debt sustainability (albeit far less of a gain than the previous scenario).


Obviously, the money should be spent in as efficient a way as possible - but if you see my point there, no matter how it is spent, it is still our ticket to a speedy economic recovery.

The point you're missing is that the gains from investment have to be greater than the cost of the loan. In the former scenario this is true, in the second scenario this is unlikely.

Borrowing on the long term bond markets to pay wages is a very inefficient use of money, you have avoided commenting on this but there is not way to separate these issues.

KomradeBishop

Iwasfrozen wrote: »

The point you're missing is that the gains from investment have to be greater than the cost of the loan. In the former scenario this is true, in the second scenario this is unlikely.

Borrowing on the long term bond markets to pay wages is a very inefficient use of money, you have avoided commenting on this but there is not way to separate these issues.

No, you are missing the point by treating government finances like business finances. There are no 'investment gains' like in a business - there is GDP growth, which contributes to taxes and debt sustainability.

Completely different dynamics.

Any government spending funded by low interest debt, is going to increase GDP, simply by putting money into the private sector.
I agree that it's better to do this in the most efficient way possible, but even if you do it in the least efficient way possible, it still leads to GDP growth.

jcon1913

KomradeBishop wrote: »

Whether or not you can sustainably borrow more, does not depend upon the overall level of debt, it depends on the interest you pay on that debt - forget the overall debt, and look at the interest payments.

When debt has extremely low interest rates - as it does now (the lowest interest rates for 30+ years, if not way longer) - you can expand debt sustainably.

The real question of how sustainable debts are, is: How much interest are we paying on all of our public debt, as a percentage of GDP?

Say you owe 100 at 01/01/13. You have a shortfall of 10 for the year. At the end of the year 31/12/13 you owe 110. Repayments in 2013 were 10 and interest was 3. In 2014 repayments are 11 and interest is still 3. The 10 extra you borrowed is gone because you import a lot of consumer goods. Taxes went up but spending went up too. And now you owe more than at the start of the year.

It makes no sense. None at all.

Heres a fact for you recently the UK finished oaying the US some loans. For World War 2. So its future generations of Irish people who will eventually pay back lenders children money borrowed to fund shortfalls in taxes as against spending. No sense.

How am I doing?