A 'winter of discontent' and Brexit

The ship of fools (from a 1549 German woodcut) is an allegory, originating from Book VI of Plato's Republic — written in 360 BCE (Before Common Era) — about a ship with a dysfunctional crew (Wikipedia): "Imagine then a fleet or a ship in which there is a captain who is taller and stronger than any of the crew, but he is a little deaf and has a similar infirmity in sight, and his knowledge of navigation is not much better. The sailors are quarreling with one another about the steering––every one is of the opinion that he has a right to steer, though he has never learned the art of navigation and cannot tell who taught him or when he learned, and will further assert that it cannot be taught, and they are ready to cut in pieces any one who says the contrary."

Brexiters dismiss warnings that a 'No Deal' departure from the European Union on October 31, 2019, will trigger chaos at ports with risks of food and medicine shortages coupled with massive disruptions to international supply chains.

Fintan O'Toole Brexit and Irish direct democracy

Fintan O’Toole, the chief political and arts commentator of the Irish Times newspaper, has made a stunning leap from November 2010 when he called the economic bailout of Ireland by the European Union-International Monetary Fund, “the longest ransom note in history,” to a torrent of scathing commentaries since mid-2016 on the Brexit decision by Britain to leave the EU.

Brexit & Global Britain: UK's top global trade surplus in 2018 with Ireland?

In 2018 46% of UK goods and services exports went to the EU while 2% went to Africa. According to the Financial Times in 2018, Chinese goods exports to Africa were eight times larger than those of the UK and even bigger than the top three exporters — Germany, France and the US — combined.

Brexiters with an ambition to make Britain an exporting superpower may be surprised that the UK’s official second biggest global trade surplus in 2018 was with Ireland. The United States was in first place but it’s possible that Ireland should have the top rank as the US claims 2018 goods and services surpluses with the UK!

European Central Bank: German word ‘schuld' can mean either 'debt' or 'guilt'

Emmanuel Macron, French president, with Mario Draghi, ECB president
Brussels, June 21, 2019

The German word ‘schuld' can mean either 'debt' or 'guilt' and Germans have a history of aversion to debt and fiat money (government-issued currency that is not backed by a metal such as gold or silver). The genesis of this obsession pre-dates the hyperinflation in the aftermath of the First World War.

2021 Post: Irish standard of living at 13th in EU27 and 19th among rich OECD countries

This map has the 2020 data

Among the 31 advanced (defined by the International Monetary Fund: IMF1) / rich countries of the 38 member Organisation for Economic Cooperation and Development (OECD) Ireland had the 19th ranking for Household net adjusted disposable income per capita. The poor occupational pension coverage in the Irish private-sector workforce is also relevant to the standard of living.

2021 Post: Irish standard of living at 13th in EU27 and 19th among rich OECD countries

While Ireland had a GDP (gross domestic product) per capita at 87% above the EU28 average in 2018, a proxy for material standard of living per capita was again below the EU28 average and that of Italy despite the latter's long period of economic stagnation.

The poor state of entrepreneurship in Ireland

“Ireland is ranked among the most entrepreneurial countries in the world with increasing opportunities for budding MBA entrepreneurs,” according to a 2018 article sponsored by the UCD Michael Smurfit Business School. A year before Enterprise Ireland, the public enterprise agency, stated, “In Ireland, there was (sic) an estimated 35,000 new business owners in 2016. 1 in every 23 people in Ireland (aged 18 to 64 years) is a new business owner. This is similar to the US (1 in every 25 people), and high compared to many other European countries, where the average is 1 in every 29 people.”

Is Irish public spending out of control?

From economic heyday of British Empire to EU and Brexit

Boris Johnson, a possible prime minister of the United Kingdom, wrote in a column in the Daily Telegraph in May 2016:

Germany's 2018 global goods trade with 237 countries/ territories

Germany had merchandise goods trade with 237 countries and territories in 2018 encompassing every region of the world — with partners that were large, small and tiny. There were trade surpluses with 167 and deficits with 70 partners.

Minimum corporate tax rate to imperil Ireland's FDI model

For decades Ireland felt assured that it would maintain the tax advantage that was first provided in 1956 to lure mainly American foreign direct investment (FDI) to Ireland. On Friday (May 31) in Paris 129 member countries of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) adopted a Programme of Work laying out a process for reaching a new global agreement for taxing multinational enterprises.

Ireland in top 10 for competitiveness in world in 2019 - Fact or Fiction?

IMD, the Swiss business school, released its World Competitiveness Rankings for 2019 this week with Singapore at the top of ratings of 63 countries. Ireland returned to a 7th ranking it had achieved in 2016 based on data for 2015 — the year of Leprechaun Economics when moves by Apple and other multinationals to reallocate via accounting entries (not relocate) assets such as intellectual property (IP) to Ireland, had resulted in GDP (gross domestic product) rocketing over 26%.

Ireland wants ‘modest’ global corporate tax reform

OECD data published earlier this year showed show that corporate income tax remains a significant source of tax revenues for governments across the globe. In 2016, corporate tax revenues accounted for 13.3% of total tax revenues on average across the 88 jurisdictions for which data are available. This figure has increased from 12% in 2000. Corporate taxation is even more important in developing countries, comprising on average 15.3% of all tax revenues in Africa and 15.4% in Latin America & the Caribbean, compared to 9% in the OECD.

The Irish Government had hoped that global corporate tax reform was on a “slow boat to China” but the winds of change are accelerating and on Thursday this week, Pascal Donohoe, finance minister, told a conference in Dublin that he wished for “modest” reform.

New Cold War: Containing China is a dumb policy

At current prices combined US-China GDPs of $21.3trn & $14.2trn is 41% of global GDP of $87trn in 2018. Using Purchasing Power Parities the International Monetary Fund estimates China's value at 19trn & US at 15trn. China had been the world’s biggest economy for about 2 millennia & in the 1890s was overtaken by the United States.

Martin Wolf, chief economics commentator of the Financial Times, this week quoted lines from a poem by Robert Frost (1874-1963), an American poet, “Some say the world will end in fire/ Some say in ice.” Wolf said these lines "capture the world’s possible economic prospects. Some warn that the world of high debt and low-interest rates will end in the fire of inflation. Others prophesy that it will end in the ice of deflation." The more present economic danger this week is addressed in a special report in The Economist and David Rennie, the Beijing bureau chief and author of the Chaguan column on China, writes, "If a vengeful America wants to hurt China, there are few incentives for Chinese officials to propose imaginative concessions or urge reforms that might repair ties with America. In geopolitics as in marriage, contempt is an emotion that leads to bad outcomes."

Trade dispute

The fiction in Irish Times Top 1000 2019 leading companies

This week the Irish Times announced the publication of its ‘Irish Times Top 1000 2019, the definitive guide to Ireland’s leading companies’ with a headline ‘Apple is still on top but Google is surging ahead in business league table.’

Idiots reject compelling science of climate change

I was in Jeddah, Saudi Arabia, on a day in July 1995 when the noontime temperature rose to almost 50 degrees Celsius. Saudi Arabia had its record hottest temperature on June 22, 2010 at 52.0°C (125.6°F) in Jeddah. The record heat was accompanied by a sandstorm, which resulted in 8 electric power plants to fail.

Irish Government as alchemists in innovation game

In the Middle Ages, alchemists searched for the philosopher’s stone to transmute or transform common metals to gold. However, despite failures, their work was the genesis of modern chemistry. Ireland will have failed twice — 2013 and 2020 — to meet innovation goals and with some help from our old friends the leprechauns, 3 significant global innovation rankings have given the country ranks of 10, 14 and 21 in the past year. However, the Irish Government is still at the level of the alchemists as any young knowledge economy startup that has international appeal and is funded by venture capital is inevitably acquired by a foreign company.

Ireland's underperforming indigenous exporting sector

Ireland has two economies: the foreign-owned exporting sector that has driven economic transformation and its underperforming indigenous counterpart which is vulnerable to Brexit. Ryanair — Europe’s biggest individual airline brand in 2018 carried 139m passengers — for example, has been a rare significant international success in recent decades. Ireland’s annual indigenous exports to the other 18 countries of the eurozone are less than €5bn or 20% despite currency stability, while 40% of food exports go to the UK.

SEE: Irish Government as alchemists in innovation game

Irish median income at 13th in Europe, UK at 14th rank

Irish median income in 2017, adjusted for price differences called PPS, was at 13th in Europe (EU28 + Switzerland [2016], Norway and Iceland [2016]) closely followed by the UK and Malta, according to data this year from Eurostat. 

The median is the mid-point where half or 50% of a sample is above and 50% below.

The Blame Game and its Irish connections

 Google Books Ngram Viewer: 1950-2019

Last month the Financial Times headlined a report ‘The British begin the Brexit blame game: PM and her ministers are already pointing the finger at EU for impending failure' and this week the Irish Times published an opinion piece ‘Internal British bloodletting is the biggest worry of the Brexit blame game’ from a former Irish ambassador to the UK — just a decade ago the politicians, civil servants and media cheerleaders, who brought the Irish economy to the brink of ruin for the second time in a generation, not surprisingly had played the same finger-pointing game.

Few Irish firms in FT 1000 & Inc. 5000 Europe lists of fastest-growing companies

The FT’s 2019 annual list of the top 1,000 of Europe’s fastest-growing companies, was published by the Financial Times in March and this week INC. — the American entrepreneurship magazine — published its Inc. 5000 Europe list of the top 5,000 fastest-growing private companies in the region.

Ireland has one legitimate entry in the FT 1000.

Time for Internet change 30 years after first website

The revenues of the top 5 US tech firms in 2018 exceeded the IMF's 2018 forecast for the gross domestic product (GDP) of Switzerland — a country of 8.5m people with an income per capita that is among the highest in the world. Amazon's high growth strategy focuses on high profitability in the long term; tax provisions in accounts may not correspond with what is paid while Microsoft's tax amount in 2017/2018 is not at a normal level. Alphabet is the parent company of Google.

Facebook's net profit margin of 45.5% reflects its near-monopoly position while not having to make capital investments on a scale with large non-digital companies.   

European Globalization 500 years ago: Girolamo Savonarola; Michelangelo Buonarroti; Niccolò Machiavelli

This year is the 500^th anniversary of the death in France of Leonardo da Vinci (1452-1519), the multi-talented artist of the Italian Renaissance. He lived in a period of tumultuous change that has parallels with modern times — an information revolution; technological change; the advance of science; challenges to traditional verities; European globalization in what was called the Age of Discovery; populism and rejection of change.

Ireland’s Faustian Bargain with hyper- globalization

Hyper- globalization, boosted by the digital revolution and mobility of capital in recent decades, has enabled a small number of global firms to make “free trade” a “delusion” according to a United Nations agency. Ironically in a decade when corporate tax avoidance has become a topic of global public interest and the malcontents of globalization have had an impact on elections in several countries, Ireland has become even a bigger facilitator of international corporate tax avoidance while gaining unexpected tax windfalls.

Paddy Agnew in Irish Times’ gig economy for 31 years

Sunday Times - Ireland

The Irish Times newspaper is involved in an international labour dispute with Paddy Agnew, an Irishman, who worked as Rome Correspondent for the Irish Times for 28 years on a monthly salary plus expenses, without interruption.

Top Swiss bank says tax evasion not crime in Switzerland after huge French fine

Who Owns the Wealth in Tax Havens? Macro Evidence and Implications for Global Inequality Annette Alstadsæter (Norwegian University of Life Sciences) Niels Johannesen (CEBI, University of Copenhagen) Gabriel Zucman (UC Berkeley and NBER) December 27, 2017

After a French court had heard that UBS, the biggest Swiss bank, had engaged in “James Bond”-like tactics to illegally solicit French clients and help launder more than €10bn, a judge on Wednesday imposed a €3.7bn fine and ordered the bank to pay €800m in damages following a guilty verdict of aiding tax evasion. Five of six ex-bankers were convicted and given suspended jail sentences together with combined fines of €950,000.