The choice is clear – austerity or jobs and growth

Posted: April 27, 2012 in Austerity, Austerity Treaty, European Union

In today’s Iris Examiner Eoin O Broin outlines Sinn Féin’s alternative to austerity.

Austerity isn’t working. 434,800 are out of work. 15,000 people are emigrating every week. 92 households are falling into mortgage distress every day.

The deficit, according to Eurostat has risen from €13bn in 2008 to €20.5bn in 2011. And the state remains locked out of the sovereign bond markets.

Every single indicator of social and economic well-being clearly demonstrates that the austerity policies of Fine Gael, Labour and Fianna Fail are failing.

These policies are hurting citizens and blocking a return to economic growth.

Sinn Féin has consistently said that there are no easy solutions to our current economic and social crisis – but there are alternatives.

We have repeatedly put forward detailed and costed proposals for reigning in the deficit, reducing Government debt and restoring economic growth.

Fine Gael, Labour and Fianna Fail believe that you can cut your way out of a recession. Between the three parties they have wrenched €24.6 billion from the domestic economy in tax hikes on low and middle income earners and cuts to front line services.

Last year alone Fine Gael and Labour poured €21 billion into the banks including €3.1 billion into Anglo Irish Bank. Yet they tell us they have no money for teachers, nurses or community employment schemes.

They Government tell us that their policies are working. But the facts tell a different story. Our debt-to-GDP ratio has risen, are deficit has risen, and unemployment has risen.

So what is the Sinn Fein alternative?

In place of regressive taxes and stealth charges on low and middle income families Sinn Fein advocates progressive tax reform. In our 2012 alternative budget we outlined a net increase in tax revenue of €3.26 billion. This included a third bad of tax at 40% on high earners; reform of reliefs including pension tax relief; a wealth tax and the total abolition of the USC. Under Sinn Fein’s proposals all those earning less than €75,000 per year would see their tax burden fall.

In place of cuts to vital front line services in health education and community facilities we advocated elimination of waste in public expenditure. Our alternative budget detailed a net savings of almost €1 billion for 2012.

But the crucial difference between Sinn Fein and the consensus for cuts parties is our jobs and family stimulus proposals.

The alternative budget detailed a massive investment in job creation and retention. Taking money available to the Government from the National Pension Reserve Fund and the European Investment Bank we outlined how a €7 billion investment programme over 3 years could save and create over 100,000 jobs.

We also outlined a further investment of almost €600 million to help families struggling to cope with the economic crisis and undo the poverty and inequality created by this Government and their predecessors.

Sinn Fein has also argued that our current debt-to-GDP ratio is not sustainable. The best way to reduce this is to secure a full write-down of the Anglo Irish promissory note, which would reduce our debt-to-GDP ratio by almost 20%. This would not only reduce our debt servicing costs, it would also dramatically improve our ability to return to the sovereign bond markets.

Every year since the economic crisis Sinn Fein has outlined a fully costed alternative budget. We have met and in some cases exceeded the Governments own fiscal targets. But crucially we have shown that there is a better and fairer way to reign in the deficit, reduce Government debt and restore economic growth.

Opposition to austerity is growing. This is because people know, from their own lived experience, that it isn’t working. People are, by their actions, passing judgement on the governments failing policies. The huge number of people refusing to pay the household charge; the opposition to septic tank and water charges; and the dramatic slump in the Governments approval ratings are all saying the same thing. People are hurting and the Government must listen.

Unfortunately rather than change course, the Government is now asking people to support even more austerity.

On May 31st we are being asked to support an Austerity Treaty that will result in €6 billion of extra spending cuts and tax increases being imposed on people post 2015. This is on top of the €8 billion the Government intends to cut in the coming four years.

If you are against austerity you must vote against the Austerity Treaty.

We need a new approach. One based on the principles and policies outlined above.

There are no soft options, but there are real choices – and this Government, like their predecessors are making all the wrong ones. Today the choice is clear – more austerity or investment in jobs and growth. The Government is for austerity and the Austerity Treaty. Sinn Fein is for jobs and growth.

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