A stern test for Trap

The roves of green hats, scarves and headband (all for two euro I'm sure) will surely take a prominent place outside the San Nicola stadium in Bari tomorrow night, priming the Irish fans for yet another assault on a global footballing giant, if only our ailing Taoiseach could inspire and build such confidence within our battered economy and use the green woollies as a eureka moment for the future of the Irish economy.

No, not the manufacture of knitted garments (though if things keep getting worse we may be back there) but calculated, strategic investment in green technology. Our geographical location, wide agricultural base and focus on scientific education act as secondary advantages to why Ireland investment in green technologies is paramount. Solid primary advantages exist now with the cost of capital investment and commodity prices remaining low, augmenting the greatest reason for investment; it will cost us less now than in the future! This argument is vehemently recommended in the Stern Report which establishes that future costs of ensuring sustainability will be significantly higher in the future.

Stern assertions behind of the economics of climate change are simple. If the science is right investment now can save countries (Britain yet equally applicable to Ireland) from spiralling future costs, and even if the science is inaccurate greater levels of sustainability can be achieved, placing countries to the foremost of global sustainability which will inevitably increase in reputation and offer a beacon to market our country from. A win-win situation if you ask me, shame there can't be the same outcome in Bari tomorrow night.

Full Stern Review: http://www.hm-treasury.gov.uk/stern_review_report.htm

Graduate Jokes or Joke Graduates?

"How do you get an Arts students off your front door step? Pay him for your pizza". This is the sort of joke I became accustomed to during my time as a student as many of my peers (non-Arts students) took a playful swipe at their counterparts studying the social sciences. Jokes like this did the rounds and were usually batted away by our Arts friends like water of a ducks back. However with the re-introduction of fees seemingly just around the corner it made me stop and think is there some validity in these seemingly harmless gags.

For example entry into the Bachelor of Arts Degree at Univeristy College Cork in 2008 was a meagre 340 points. Now the maths behind this are quite staggering! It means a student need only get two C3 grades and 4 D1 grades (all at higher level) to gain entry into the programme. Hardly a example of acadmic excellence! In fact according to the Central Applications Office a score of 340 ranks somewhere between 45% to 70% in terms of student achievement with it more like being closer to the 45% mark given the CAOs cuts-off. This means that roughly 50% of Leaving Cert graduates are beter than the participants on the Arts course.

Arts has notoriously poor attendance rates and given the evidence above no wonder. Most participants have not demonstrated a willingness to advance themselves academically and coast along at the expense of the State for three or more years. A return to fees is probably not the answer to this problem but limiting places is. A reduction in the number of places will drive the points for the course up doing two things; firstly the quality of student will improve dramatically and secondly only those that have a genuine interest in the social sciences will obtain places.

There are plenty of excellent Arts students out there the problem is they are being smoothered by the uninterested masses. No to fees, yes to a reduction in college places!

Recessional Rhetoric

There was once a time, in very recent history that when the word billion was mentioned it related to a Jurassic period or an atomic clock measuring the earths age, now however the realms of finance and economics have some how stolen a lead over the field of natural history often placing the terms 'billion' and 'stimulus' in the same breath.

A real yet intangible loss from an Irish perspective which has emerged from a decaying Celtic Tiger is a clear skills deficit. Media attention is growing, from car salesman inability to sell following 10 years of choosing his customers and parents cash rich-time poor lifestyles that fuelled a 'take away' culture thereby diminishing cookery skills, to a complete generation's inability to budget after budding in an era of cheap credit and two foreign holidays a year.

While previously unfamiliar words like recapitalisation and billion have become pedestrian and their effects may eventually stabilise a faltering banking system, this recession's societal implications deserve greater attention. Horatio, CSI Miama's character school of philosophy should remain telling to those who afforded themselves generous Celtic Tiger lifesyles, 'knowledge is knowing a tomato is a fruit but wisdom is knowing a it doesn't go in a fruit salad'. Funny yet ironically applicable given the growing number of stay at home parents.

Irish leaders need to realise that emerging from this recession may be more than a financial problem, but can we re-establish Horatio's insight back into Irish people? Shakespeare’s Horatio was a trusted friend to Hamlet, but just like Prince Hamlet Ireland is struggling to make a decision.

Animal Spirits

How fickle the mob is! 15 guys in green win a game of rugby on Saturday evening. 5 hours later an eight and a half stone Dubliner knocks out a Panamanian boxer. Queue the media with statements that surmounted to as much as thank god for our sporting heroes who have managed to lift the gloom of the recession that has enveloped us since late last year. Talk about animal spirits!

What happened on Saturday evening/night were wonderful national occasions but should not be used in an attempt to stimulate our stalled economy by suggests we need to be more like our sporting icons. The problems with Ireland are very simple. We are paying ourselves too much and taxing ourselves too little. In January and February this year the government collect €5.7 billion in revenue. The same government spent €8 billion. You don't have to be an economist to figure out where this will lead you.

The problems with this economy can be easily sorted if the appropriate issues are tackled. Given the poor performance of tax increasing in the 1980s to fund our budgetary requirements, a cut in public expenditure is probably the best way to sort of this huge deficit in our public finances. A herd mentality has exacerbated the downward spiral that we find ourselves in. What we need now are cool heads - just like Ronan O Gara on Saturday.

The Road Less Travelled

With excessive media hype surrounding economic ‘recovery roads’ and ardent stimulus panacea, quick fix answers need to be replaced with a reality of hard choices and sufferance. Public veracity of past decisions coupled with delusions of continuous economic growth require realignment with emphasise placed on our global economies constant ebb and flow.

Whilst not doubting the extent, unprecedented qualities and inexplicable face of our current global recession I believe it is worth noting that such dysfunctional tendencies must be placed upon a continuum, with resounding Celtic tiger buzz words such as hundred percent mortgages resembling an equal yet opposite form of dysfunctional economics.

Economic flux and variability deserve a greater degree of ‘natural’ focus, departing from the pessimistic rhetoric and accentuating the prevalence of the business cycle. The Austrian school of business cycle theory, rarely considered by mainstream economists, could offer a refreshing analysis of our current plight. While empirical research has dismissed the idea, Hayek’s concept of the inevitability of a recession following excessive credit expansion and maturing bubbles could be worth further investigation in our current climes. Offering not only an explanation to the current crisis but an insight into devising future policy so as to avoid Ireland’s possible boom bust cycle forwarded by Krugman.

Celtic tiger overinvestment and the necessity of natural economic restoration remain vital. Whilst seeing ourselves through a necessary economic storm reform on a national and European level appear sacrosanct; stricter banking regulation and green agendas remain prominent sectors that require improvement, placing Ireland in a foremost, agile position when global recovery begins. Given the two hundred years since his birth and the natural need for readjustment it would be apt that Charles Darwin’s wisdom could offer a ‘road to recovery; “in the long history of humankind those who learned to collaborate and improvise most effectively have prevailed”