Irish Times

[Lang Spoon]

The 2016 Irish election is over!

This stuff exists in London as well.seeing as almost no one wants to live in the city centre proper, this type of thing could exist as the upper few floors of a mixed use development. DIT should never have been given permission without adequate housing supply being put on the new campus.

[anton pulisov]

The 2016 Irish election is over!

Where is the money in Ireland coming from? The ECB is doing QE big time to bail out Spanish and Italian bonds and, due to their charter, they can't be seen to be helping one country over another, so they are doing QE everywhere, even in northern Europe where it is definitely not required. So there is a mass of spare cash sloshing around in Germany at the moment, looking for a Eurozone destination. We've seen this before. How much is ending up in Ireland? What happens to Ireland when QE stops and interest rates rise? As long as Spain, France and Italy are OK, the ECB is not going to care about Ireland.

[The Awesome Berbaslug!!!]

The 2016 Irish election is over!

Hmm. well, aside from our slight problem with a property bubble, Ireland basically has a really strong, well developed modern economy, based on exporting high value stuff to the bigger markets of europe, and relatively high value services. And tacked onto that is a large state sector, comparatively efficient and effective public sector, and a slightly less productive, but rather job intensive domestic sector.

look at it this way, in 2015, Greece exported goods and services to the value of €4,000 for every man woman and child in greece. (mostly tourism and "shipping services") Spain €5,000, portugal exported goods and services to the value of €7,000 for every man woman and child in portugal. Italy exports goods and services to a value of €8,000 per person, france €9,000, The UK €9,000, germany €18,000

the figure for Ireland for 2015 is €55,000, and rising sharply. because our domestic market is so small, and because we only make a limited number of things, We sell virtually everything we make and do overseas. and import a lot of stuff. Our economy is set up to import economic growth from wherever it is happening. then that growth feeds into the other parts of the economy.

had we manage to avoid creating a massive property bubble, and destroying our banking and building sector, we would have ploughed on through the last eight years, scarcely missing a beat. Now that we've picked ourselves up, dusted ourselves down, and set our government finances on a more sustainable base (income tax rather than property bubble taxes) we can go back to growing like a fucking train again.

[anton pulisov]

The 2016 Irish election is over!

Since when does "facilitating tax loopholes" = "exporting stuff"?

[The Awesome Berbaslug!!!]

The 2016 Irish election is over!

When you make loads of things and sell them overseas. Apple are adding 1000 extra manufacturing jobs and there's a whole network of irish companies that will be expanding on the back if that.

What do you imagine all those highly paid people do in ringaskiddy? Even if half of our exports were on paper, (which is really not the case) we'd still be exporting 50% more goods and services per capita than germany The point still remains that we export a disproportionately massive amount of stuff in comparison with other European countries. (this has always been the case as our economy was basically still integrated into the UK and all pre independence patterns of trade became 'exports'.)

[anton pulisov]

The 2016 Irish election is over!

Is there a breakdown somewhere of that 55k per capita export figure? I.e. how much of it is due to stuff actually manufactured in Ireland, and how much is manufactured somewhere else and booked through Ireland. For example, Ireland exports 750 million worth of "aircraft, helicopters and spacecraft" every year. For the life of me I can't remember flying on an Irish manufactured aircraft. Apparently Ireland also exports "human and animal blood" to the tune of 9.6 billion (!). I know that Twomey's Butcher in Clon has taken off, but that's a lot of black pudding.

I mean, we are talking about the country that just saw its official GDP rise by 26%.

[The Awesome Berbaslug!!!]

The 2016 Irish election is over!

Hmm you're talking about biologicals. Ireland isn't making lots and lots of black pudding. They're treating blood to make biologicals. They're incredibly expensive new forms of medicine to treat immune system problems. My bi monthly shot of (I can't remember the name) costs €4 k a pop. It's twelve grand for a shot in the us. These things are obscenely expensive and very difficult to make. They're also entirely manufactured here with the exception of some of the blood.

Also Ireland is the global headquarters of the world's aviation leasing industry. Every time they sell a used plane that counts as an export of an airplane. If you look closely Ireland for also imports enormous numbers of airplanes.

But this is what everyone's gdp/gnp figures look like To a certain degree. They're made up of odd bits and pieces. And flows of money. Ireland's gdp rising at a recorded 26% doesn't say very much about the irish economy, but does say a lot about technical flaws in the way that the figures are derived. The size of the flow of capital involved in a series of inversions was so large relative to the size of the irish economy that it looks absurd. But you wouldn't bat an eyelid if the same flow of money happened between England and France, because it would barely be a blip. (in the order of one to two percent)

The particularly annoying thing about that 26% figure is that is something that appeared when they got down to the technical adjustments at the end. The figure before all of the movement of capital was 8%, which is still a scarcely creditable but consistent with the previous two years, and with an economy engaging on rapid rebound after a recession.

I think the main problem here is that you can't get your head around the idea that cork is one of the leading world centres for the manufacture of hi grade pharmaceuticals, and a European centre for the manufacture of Apple stuff. Those huge chemical plants in Cork are every bit as real as factories in the ruhr Valley or Middlesbrough, you just can't get used to it.

Also any tax issues surrounding companies based in Ireland can only exist with the total co operation of every other country in Europe and everyone else does it. We're just more into fdi than anyone else in Europe so you notice it more. We've been doing this as an explicit policy for nearly 60 years now. We have a substantial degree of prime mover advantage. The

[anton pulisov]

The 2016 Irish election is over!

But that's what I mean... the reason these aircraft leasing companies are based in Ireland is for tax reasons. Somebody in an office in Shannon changes a line on an Excel sheet and an airplane changes ownership from Japan Airlines to Garuda Indonesia. Those aren't real exports. Airbus building planes in Germany and France is an example of real exports, with real jobs and real GDP.

Sure, there are pharmaceutical companies in Cork, but the Ruhr valley it is not. They are mostly in Ireland for tax reasons. A boiler plate with a small factory for laundering stuff. I mean, I've driven through the Lee Valley and the Ruhr Valley many times, I can't believe you are even trying to compare the two.

I'd still like to know how much of the 55k per capita export figure directly related to stuff manufactured in Ireland. It's difficult to find out, however, especially with software. Companies can write software in the USA and then send it to Ireland where a few lines of code are tweaked for the European market. Then it can count as a product manufactured in Ireland. But it's not... Apple were manufacturing actual hardware in Ireland up until the 90s, but all that stuff is made in Poland and Bulgaria now.

[anton pulisov]

The 2016 Irish election is over!

Interestingly, Bermuda's biggest exports also include a shit ton of phamaceuticals and blood.

I've never been there, but I assume it must look just like the Ruhr valley.

[The Awesome Berbaslug!!!]

The 2016 Irish election is over!

But the only reason anything is anywhere is tax and regulatory and trade barriers. Sure tony Ryan managed to negotiate a sweet deal for the aviation leasing industry. The reason we have this regime is because 25 years ago gpa essentially invented airplane leasing and when they over extended themselves and collapsed their executives got a load of foreign investors and set up multiple smaller companies.

But that's just the way things are. If they weren't going to be here, they would just be somewhere else availing of a similar deal. It's no different in any other country. Other European countries have a higher headline corporation tax rate than Ireland, however it's what proportion of that that they collect is what matters.

And in all fairness, these companies actually do employ a large number of people in their highly mechanized factories. There's a hundred thousand people employed in the pharmaceutical industry, half by multinationals, half by irish companies that service them.

That's a meaningful figure. Six of the ten biggest selling drugs in Europe are primarily manufactured in Ireland, four of them in Cork and these companies are pouring huge amounts of money into upgrading these factories.

And apple make all their desktop computers in Cork. That's what the thousand new jobs are for. More people work In apple than worked for o'dwyers and sunbeam at their peak, and they're paid infinitely more.

The thing is that you may not like much of the brutal logic underpinning the drive to attract fdi, but it Is real, and lead to a massive transformation of the irish economy.

The thing that it comes back to is that Ireland understood the opportunities presentes by the European union far better than everyone else and embraced them far more enthusiastically.

Sure we're doing a certain amount of dirt to get them here, but Ireland's tax advantages are entirely dependent on the countries that complain about them to function. It's why we haven't come under any real pressure to change our tax laws, these are not serious complaints as everyone is trying to do the same thing to varying degrees.

[Lang Spoon]

The 2016 Irish election is over!

Isn't there the possibility that without Britain in the EU countries like France might be far more emboldened to turning the screw on our "competitive" attitude to FDI? The Baltic states have less than zero clout really and only the Netherlands among the fully developed, non flat tax, functioning Welfare State economies can match our chutzpah when it comes to revenue farming from what remains of the old 15.

There is a sense the tide is turning worldwide toward populist protectionism (and certainly away from tolerating cute hoor states facilitating tax avoidance) and then the whole Lemass model becomes irrelevant. I do hope you are right that Munster is the new Ruhr valley/hi-tech manufacturing capital of Europe, but colour me sceptical about their long term viability.

Do Apple really make all their European overpriced Graphic Designers tat in Ireland? Everything I've seen in (the obviously dirty Brit biased, except they were right from 2002 on about Ireland's paper tiger economy bubble) FT/Economist/Grauniad seemed to suggest the manufacturing part of Apple's Irish ops were at best exaggerated.

[The Awesome Berbaslug!!!]

The 2016 Irish election is over!

I'm curious to know what exactly people think they get up to in these factories? And sure you didn't have to be a genius to spot that we had a property bubble, however that didn't say very much about the underlying. economy, which came riding to our rescue like a non genocidal version of the seventh cavalry.

And also I didn't say that cork was like the ruhr Valley, just that the chemical factories in Cork were every bit as real as the ones in Germany.

To be honest a bit of tightening of the eu's rules would probably benefit Ireland substantially. Those companies that are here could do with paying a bit more tax, and it would help if the EU forced that on us, and it was on a European wide basis, so it didn't suddenly become more attractive to go elsewhere. France might be keen on us increasing our corporation tax and tightening up various loopholes, but those companies are not going to move to France.

[anton pulisov]

The 2016 Irish election is over!

Of course factories exist in Ireland.

It's the 55k / capita export figure which is bollocks.

[via vicaria]

The 2016 Irish election is over!

Well. this seems timely. And suggests that Ireland isn't wild about any 'tightening of tax rules forced by the EU'

[anton pulisov]

The 2016 Irish election is over!

It's illegal and against EU rules. While I agree, where were these rules when Deutsche Bank was being bailed out.

It's almost like the EC is daring Ireland to leave the EU.

[Tubby Isaacs]

The 2016 Irish election is over!

Can Britain sit outside the Single Market and dole out state aid?

Might have helped if this had been announced just as we were voting. Would have confused Lexiters if nothing else.

[Lang Spoon]

The 2016 Irish election is over!

antoine polus wrote: It's illegal and against EU rules. While I agree, where were these rules when Deutsche Bank was being bailed out.

It's almost like the EC is daring Ireland to leave the EU.

I still see the appeal watering this down and saving Baldy Noonan's face. Maybe a 100 million or so that the egregious prick Tim Cook will have to pay down.

[ursus arctos]

The 2016 Irish election is over!

Can Britain sit outside the Single Market and dole out state aid?

All depends on what the deal is, of course. While the EU state aid rules are generally thought to be the strictest and most often enforced (except in financial services), other regimes/agreements (including the WTO) incorporate the concept.

[garcia]

The 2016 Irish election is over!

There's a hundred thousand people employed in the pharmaceutical industry, half by multinationals, half by irish companies that service them.

this sounded like a lot to me and i too have noticed how different cork seems to be from an actually industrialised place like the ruhr valley. so i checked and as far as i can find out, there seem to be about 25,000 people employed directly by the irish pharmaceutical injury, with another 25,000 "indirectly" employed.

one depressing aspect of the apple tax ruling is how little we were getting out of the deal. we're helping one of the world's richest companies to dodge gigantic quantities of tax, with obvious harmful implications for civilisation, and we're doing it for coins. the state aid to apple amounts to €2.5m per employee in ireland. (maybe almost €4m if higher estimates of apple's liability prove accurate). so, not only are we helping apple to swindle humanity, we're shamefully abasing ourselves in the process.

[Lang Spoon]

The 2016 Irish election is over!

But, but, Jobs!

[Guff Daddy]

The 2016 Irish election is over!

Lang Spoon wrote: But, but, Jobs!

He's dead, move on.

[Mr Beast]

The 2016 Irish election is over!

Tinpot morally indefensible tax policy no better than borderline criminal dependencies like the Cayman Islands. And they've asked for so little in return and are so grateful for the buttons they've taken.

[garcia]

The 2016 Irish election is over!

christ. richard bruton was just on the radio arguing furiously that ireland is the very last entity in the queue for a claim on this €13 billion. how the fuck are fine gael going to fight an election after this?

[garcia]

The 2016 Irish election is over!

joseph stiglitz is on now demolishing bruton's argument as "balderdash".

[garcia]

The 2016 Irish election is over!

theoretically yes, but you can then borrow it again and be in the same position you were in before except you've now got €13-19 billion to spend on stuff you need.