Joseph Stiglitz on the price of inequality

[...] America has the highest level of inequality of any of the advanced countries – and its gap with the rest has been widening. In the “recovery” of 2009-2010, the top 1% of US income earners captured 93% of the income growth. Other inequality indicators – like wealth, health, and life expectancy – are as bad or even worse. The clear trend is one of concentration of income and wealth at the top, the hollowing out of the middle, and increasing poverty at the bottom.

Click here to read the rest of Joseph Stiglitz's piece on the price of inequality, courtest of Social Europe Journal.

Terrence McDonough on the Fiscal Treaty

IRELAND MAY well need a second bailout after 2013. And as treaties are currently worded, a No vote on the fiscal compact treaty will forbid us from accessing funds from the European Stability Mechanism (ESM).

It is claimed this situation will result in disaster, and that even if we believe the fiscal treaty is a serious mistake, we have a gun to our head. In fact, Ireland will have a number of options in this event.

Click here to read the rest of Terrence McDonough's opinion piece in today's Irish Times.

TASC issues new report on State Assets

Click here to download TASC's new report, The Strategic Role of State Assets - Reframing the Privatisation Debate. Comments?

Financial exclusion, financial literacy and making cents

The banking crisis has dominated our headlines during the past three years. But bank guarantees, recapitalisation, NAMA and debt write-downs don’t mean much to those suffering financial exclusion – those who, for a range of reasons, cannot access the banking services many of us take for granted. The European Commission has estimated that 17 per cent of Irish people live in households with no access to a basic bank account. Ireland’s level of financial exclusion is high relative to other EU countries.

Last year, TASC published Life and Debt 2010 – Financial Exclusion in the Age of NAMA, which included a list of recommendations. More recently, the ESRI published a study on Financial Exclusion and Over-Indebtedness in Irish Households, and the Government published its own Strategy for Financial Inclusion Final Report, which noted that “The low level of financial literacy of most financially excluded people can translate into high margins for providers of financial services, so it is critically important to give people the tools to make wise financial choices, and to protect themselves from predatory lenders/insurance providers".

Promoting financial literacy is thus crucial to combating financial exclusion. Research findings published today by the National Adult Literacy Agency and the EBS show that two-thirds of Irish people struggle to understand financial terms. With that in mind, NALA and the EBS have re-vamped their financial information website www.makingcents.ie, a free resource aimed at anyone who wants to understand different areas of finance.

TASC launches new report on health inequalities

Click here to download TASC's new report, Eliminating Health Inequalities - A Matter of Life and Death. A digital version is available here. Comments welcome.

Wage-setting mechanisms: statement by 36 economists, analysts and social scientists

“We broadly welcome the Report of the Independent Review of Employment Regulation Orders and Registered Employment Agreement Wage-Setting Mechanisms. In particular, the recommendation that the basic JLC framework should be retained is good news for many thousands of low-paid workers. We also endorse the conclusion reached by Kevin Duffy and Frank Walsh that reducing JLC rates to the minimum wage level would have important distributional consequences without having any substantial effect on employment.

“We are concerned that recent proposals reportedly made by Enterprise Minister Richard Bruton are not in line with the Duffy-Walsh report [...]"

Click here to read the rest of the statement issued today by 36 economists, economic analysts and social scientists, all members of the TASC Economists' Network.

Is financial repression on the agenda?

Two posts suggest it should be. Aidan Regan proposes that we should go beyond the pension levy and how, through taxation and capital regulation, generate resources for investment and to pay existing debt.  In a separate post, Michael Taft suggests the Government borrow from pension funds at negotiated rates to fund an expansionary investment programme.  Both conclude there are better ways to put private savings to work for the economy than is currently being pursued.

TASC launches discussion paper on debt and banking crisis

TASC today launched a discussion paper by TASC policy analyst (and PE blogger) Tom McDonnell, The Debt and Banking Crisis: Progressive Approaches for Europe and Ireland. You can download the document here. Comments?

Myths of the Irish Crisis: Wages and Competitiveness

TASC has just issued a new discussion paper by TASC economist (and PE blogger) Tom McDonnell examining two distinct but related claims. First that Ireland lost competitiveness within the European Union in the last decade and second that high labour costs in low-wage sectors are contributing to the employment crisis.

Based on a review of the literature together with Eurostat data, the paper concludes that Ireland did not suffer an overall loss of competitiveness prior to the economic crash. The paper also refutes arguments that labour costs in the low-paid services sectors – sometimes viewed as undermining Irish competitiveness – are high by international standards. Instead, an examination of Eurostat data projects that 2010 labour costs were 9.3 per cent below the EU-15 average in the hospitality sector, and 8.8 per cent below the EU-15 average in the wholesale/retail sector. You can download Myths of the Irish Crisis: Wages and Competitiveness here.

Blogging Bretton Woods and other matters

Brad DeLong's blog is worth a read.

Portugal and the Tony Soprano bailout

In the excellent TV series The Sopranos there is an episode where mobster Tony Soprano tells a small-time gambler why he let him play and lose in the big stakes game. "I knew you could never afford it, but your wife had the sports goods store," he explains after stripping the store of its assets and bankrupting it.

The Sopranos is available in Portuguese. Viewers will find out more about their fate than from most media coverage now Portugal is the latest economy to fall into the clutches of the European commission and, possibly the IMF. It is a mobster's embrace, as Irish and Greek citizens can testify.

You can read the rest of PE blogger Michael Burke's piece on the Guardian website here.

Forthcoming events

A few forthcoming events may be of interest to PE readers; continue below the fold for more information.

TASC and Smart Taxes are collaborating to host Lessons from the Crisis: Money, Taxes and Saving in a Changing World, a symposium due to be held on May 9th in Croke Park (9.30 am - 4 pm). Speakers will include Marshal Auerback of the Roosevelt Institute and Randall Wray of the University of Missouri - Kansas City, both of whom are known for their work on Modern Money Theory, as well as Tom McDonnell and Michael Taft, both known to PE readers. For further information go to www.tascnet.ie.

The morning session will be chaired by Paul Sweeney (Chair of the TASC Economists' Network and PE blogger), who is also President of the Statistical & Social Inquiry Society of Ireland.

A meeting of the SSISI will take place on Tuesday, 12th April 2011, starting at 6:00 pm [SHARP], in the Royal Irish Academy, 19 Dawson Street, Dublin 2. The session is titled Symposium on Research Capacity and Policy Making, and contributions will be made by Dr Rory O’Donnell (NESC), Prof. Frances Ruane (ESRI), Prof. Brendan Whelan (TILDA, TCD), and Mr Robert Watt (Department of Finance). This symposium will consider the use of research to generate evidence for economic and social policymaking in Ireland over the last 50 years, the ways in which research enters the policy formulation process and the development of Ireland’s capacity in this area.

Non-members are welcome to attend and participate in the discussion, and there is no need to book.

The 2011 AGM will take place on May 19th, when a paper will be presented on Compilation of a National House Price Index for Ireland, by Niall O'Hanlon (CSO): Royal Irish Academy, 19 Dawson Street, Dublin 2 at 6:00pm.

Over-enthusiastic spam checker

Apologies to any PE readers who've had their comments filtered as spam. During the past week or so, the automatic spam checker has been over-enthusiastic. Unfortunately, turning off the spam filter would result in a deluge of highly annoying material. We are checking the spam box at regular intervals - so please be patient, your comment will appear!

Research indicates reducing JLC rates will cost Exchequer and depress consumer demand

Research published last week by TASC indicates that any moves to reduce Joint Labour Committee rates will involve significant direct and indirect costs to the Exchequer. The research is contained in TASC’s Submission to the Independent Review of ERO and REA Wage Setting Mechanisms. Comments welcome.

Policy Analyst wanted ...

TASC is recruiting a Policy Analyst; full details on www.tascnet.ie.

Note from Admin: comment rules

progressive-economy@TASC welcomes and aims to promote lively debate. However, please note that inappropriate or discourteous comments will not be published, since they merely serve to put off other readers and commenters.

If possible, Admin will contact the commenter asking him/her to rephrase the comment. If this is not possible, the comment will be rejected or deleted.

At present, comments are being moderated. However,we will try to keep the moderation queues as short as possible, and hope to revert to unmoderated status soon.

Any queries regarding moderation may be addressed to aklemm@tascnet.ie

TASC launches 'Failed Design? Ireland's Finance Acts and their Role in the Crisis'

This morning, TASC launched Failed Design? Ireland's Finance Acts and their Role in the Crisis. The accompanying press statement is available here. All comments welcome!

Note from Admin: Comment rules

progressive-economy@TASC welcomes and aims to promote lively debate. However, please note that inappropriate or discourteous comments will not be published, since they merely serve to put off other readers and commenters.

If possible, Admin will contact the commenter asking him/her to rephrase the comment. If this is not possible, the comment will be rejected.

At present, comments are being moderated. However,we will try to keep the moderation queues as short as possible, and hope to revert to unmoderated status soon.

Any queries regarding moderation may be addressed to aklemm@tascnet.ie

Progressive Economy Review 2009 - out now!

A selection of posts written during 2009 has been published as Progressive-Economy@TASC 2009 Review.

The digital edition is available here:

Wanted: an Economic Policy Analyst

TASC is recruiting an Economic Policy Analyst. The successful candidate will be responsible for researching, analysing and advising on public policy from an economic perspective. S/he will be a trained economist with excellent research and analytical skills and highly developed written and oral skills. S/he will have had extensive engagement with Irish economic and social issues, and will relish the challenge of developing progressive approaches to these issues.

The Economic Policy Analyst will report to the Head of Policy. There is an attractive remuneration package commensurate with experience. Secondment arrangements will be considered. TASC is an equal opportunities employer.

Click here to download a job specification.

Application with CV to be forwarded by email or post to the Director at the address below by 26th November 2009. Interviews week of 14th December.

13-17 Dawson Street, Dublin 2. T: +353 1 6169050 F: +353 1 6753118