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Feb 8, 2022Liked by Jim Power & Chris Johns

Unfortunately the left wing populist opposition is loud and clear that it has all the answers and that government intervention is required for every woe in society. The main media players facilitate this approach by giving endless time to opposition spokespeople to stoke misery and discontent amongst the electorate without any challenge to suggest that life is not that bad. We have been in a very negative news spiral since 2008 and despite the reality that Ireland is one of the very best countries in the world to live, you would assess listening to and reading news that we are third world.

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Thanks Jim. I am a little late to this article. I agree with the principle on the expectation that Government will step in with a quick-fix. The recent announcements on energy credits and reduced transport fares, while it had to be positioned to avoid encouraging inflation (no mini budget), but could have been more targetted to those on lower pay. However the reduction in transport fares could help to encourage greater use of public transport (more likely in urban areas). I think where they do need to step in is with a set of longer term policies to mitigate the impacts of inflation, but policy making is not a strength of this Government (and possibly more recent Governments. As Pat Leahy observed in a recent article - now more than ever we need to focus on longer term policies and not short term fixes (https://www.irishtimes.com/opinion/pat-leahy-coalition-keeps-supplying-opposition-with-ammunition-1.4799959).

On the impact of the May increase in carbon tax - yes there may be an impact, but hoping the Government starts to show how the carbox taxes are to be used in mitigating our carbon emissions and in a 'just transition' sense ensuring that we reduce fuel poverty etc.

A final question to you and Chris - given the healthy state of the economy, why could Pascal and Michael not contemplated some tax changes to minimise the impact of inflation such as reduced VAT rates - assuming that this would be passed on?

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Off-topic: To play devil's advocate, isn't Boris Johnson's behaviour pretty typical of European leaders of late? Sarkozy has been convicted of corruption. François Fillon convicted of fraud and charged in an embezzlement case. Need I mention Berlusconi? Closer to home we have the Cash-for-Ash fiasco and even Coveney had his own champagne-partygate. So I put it to you that the state of British politics whilst pretty bad isn't being put in a European perspective by commentators. Politics in France (where I live) are rancid. Most criticisms levied at the Tories are matched here, the old Etonian / Oxford PPE thing; Chirac, Hollande and Macron all come out of the ENA. Never mind Le Pen, I haven't seen much coverage of Zemmour in the UK, the man is perhaps the most vile extremist in European politics since WW2 and he is polling at 14%! To me the atmosphere in Britain looks pretty nice by comparison. The French commentators chastise Brexit Britain pretty regularly, it's puzzling that Brexit negotiations aside, the EU is mentioned either as a social-democratic paradise or not mentioned at all.

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Feb 7, 2022·edited Feb 7, 2022

Very prolific writing from Chris and Jim over the last few days! However, I don't think the dots are being joined here fully. You state that it's not government's fault that the cost of living has increased. But but but!! The money to refloat the banks and keep citizens afloat during the pandemic was never taxpayers' money to begin with. It was money created from thin air and piled on to the national debt. Massive central banks stimulus or QE since 2008 has eventually fed through to the inflationary effects we are seeing now, and spilled over into investment into cryptocurrencies that Chris talks of, like it or not. The BBC series over the last 2 weeks, 'The Decade the Rich Won' explained it well. Loose monetary policy (remember, one of the motivations for Bitcoin) causes money to flow to the wealthiest in society, increasing the wealth divide. And meaning that the less well off suffer when the cost of living increases. Now one could argue that central banks are independent of governments but ultimately it's public money flowing into the system. We're in a debt trap now because we can’t raise interest rates substantially even if we wanted to. The servicing of that debt would become prohibitively expensive, and governments get into trouble. Jill Kirby explained this on the Brendan O'Connor radio show yesterday morning in the context of pensions, but she was shut down. Jim says here that it may have been OK to rescue the banks but not give people a measly €100 credit. Come on. Maybe it's reflective of the authors' previous roles as economists for the high street banks, but I think the blog and podcast would benefit from zooming out and seeing the big picture and philosophical issues around money, banking and government. I remember a previous podcast bemoaning the reduced personal banking services provided by high street banks but not a mention of DeFi. Lads I still enjoy your podcasts and writing - keep it up!

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Yes the cost of living crisis in the main isn’t the fault of the government not withstanding the dreaded carbon tax!

There are people who are genuinely feeling the pinch and it is them who we need to be mindful of. Yes it is borrowed money as we run a deficit already but to hear someone on the radio yesterday say she had €10 to feed herself and her young girl is quite sobering. The opposition is already riding high with their promises of solutions for all problems and their FFG narrative that they only care for the rich. Ignoring those who are in crisis now only opens the door more to those bearing gifts and it is now we need to tackle the housing and inflationary squeeze. The carbon tax hits all but perhaps those who live in older less efficient homes are hit harder. They will never be able to afford the retrofits and there is nothing in it for landlords to do it either.

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The other question is who is going to pay for largesse of our week populist government and their stupidity!! Us unfortunate taxpayers and their offspring for many decades to come!!

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