Yes, I know it wasn’t much fun. But these are the times we live in. I am an optimist by nature (really!) and think we will get through this ok. The silver lining, which I should have mentioned, is that this will accelerate the green energy transition
The era of helicopter money MMT fantasyland is now well and truly over. This is the third big crisis in quick succession where the only policy response up our sleeves is to borrow loads, and this time at far higher interest rates. That cannot keep happening.
Indeed we should look at where that money is going to go, and if there’s a way of clawing some of it back through taxation then good. I don’t have confidence that we can or are willing to.
I often hear commentators say that any relief on energy costs should go to the poorest. A noble suggestion. But I’m yet to hear a compelling case for how to administer that effectively. You could assuming income is the best barometer and pile more tax on higher earners (we’ve discussed this very recently). You can’t assume lower energy usage because the best insulated homes of the wealthier use less. Short of returning to butter vouchers, how do you target energy cost relief to the poorest?
Perhaps the SEAI needs a kick up the backside. It’s all about the rolls royce one-stop-shop solutions which are difficult to administer and target unbelievably high specs. Whereas what we need (and we’re probably too late for this) is an immediate rolling out of cheap subsidised insulation solutions that any builder or fitter (or a homeowner doing DIY) can bang together very quickly and move on without all the red tape attached. SEAI perfection is being the enemy of the good.
Policy design is of obvious importance. Are we any good at it? Do we have state capacity fit for handling complexity? We have neither time nor expertise to do the ‘target the poor’ thing properly. So the second best thing would be to hand out universal benefits (easy to administer) and claw at least some of that back via income tax rises (easy to implement). The poorest typically pay little or no income tax. But that will be deemed to be politically toxic. You could, as the EU is doing, try to break the link between gas and electricity prices - the cost of nuclear, oil, wind, solar or coal generated electricity hasn’t gone up. Not sure how far that will get them or how quickly it can be done. Governing is about hard choices. There is only one other option left to governments everywhere: do nothing.
Okaaay... we need to ensure there isn’t heavy profiteering in the energy sector (fossil & green)!
The message needed to be delivered ... the question is ... who is listening & will they act?
Well done on your solo run!👍
Wow!!!
That was much darker messaging than I expected!
So let’s hope both governments had people listening👍
Yes, I know it wasn’t much fun. But these are the times we live in. I am an optimist by nature (really!) and think we will get through this ok. The silver lining, which I should have mentioned, is that this will accelerate the green energy transition
The era of helicopter money MMT fantasyland is now well and truly over. This is the third big crisis in quick succession where the only policy response up our sleeves is to borrow loads, and this time at far higher interest rates. That cannot keep happening.
Indeed we should look at where that money is going to go, and if there’s a way of clawing some of it back through taxation then good. I don’t have confidence that we can or are willing to.
I often hear commentators say that any relief on energy costs should go to the poorest. A noble suggestion. But I’m yet to hear a compelling case for how to administer that effectively. You could assuming income is the best barometer and pile more tax on higher earners (we’ve discussed this very recently). You can’t assume lower energy usage because the best insulated homes of the wealthier use less. Short of returning to butter vouchers, how do you target energy cost relief to the poorest?
Perhaps the SEAI needs a kick up the backside. It’s all about the rolls royce one-stop-shop solutions which are difficult to administer and target unbelievably high specs. Whereas what we need (and we’re probably too late for this) is an immediate rolling out of cheap subsidised insulation solutions that any builder or fitter (or a homeowner doing DIY) can bang together very quickly and move on without all the red tape attached. SEAI perfection is being the enemy of the good.
Policy design is of obvious importance. Are we any good at it? Do we have state capacity fit for handling complexity? We have neither time nor expertise to do the ‘target the poor’ thing properly. So the second best thing would be to hand out universal benefits (easy to administer) and claw at least some of that back via income tax rises (easy to implement). The poorest typically pay little or no income tax. But that will be deemed to be politically toxic. You could, as the EU is doing, try to break the link between gas and electricity prices - the cost of nuclear, oil, wind, solar or coal generated electricity hasn’t gone up. Not sure how far that will get them or how quickly it can be done. Governing is about hard choices. There is only one other option left to governments everywhere: do nothing.