Electorate must reward prudence or else risk falling for empty promises

With weeks to go to general election 2016, the political heat is rising.

To date, only one political party, Renua, has launched its election manifesto.

Over the next couple of weeks the others will follow and we can be sure generous promises will come thick and fast.

All parties will promise, to varying degrees, that if elected to government they will solve hospital waiting lists, homelessness, the crisis in the rental market, flooding in towns, the crisis in the childcare system, and much more besides.

There will be general pledges to reduce the personal tax burden, increase taxes on the so-called wealthy, and increase expenditure on all areas of social expenditure.

If only life were that simple.

One can be as cynical as one wants to be about the political process and the way that politicians behave.

However, inevitably large swathes of the electorate will be won over by the promises and will be hoodwinked into voting for certain parties, just as they are before every election.

That is the nature of politics as practised in Ireland in a system that can only be described as a very diluted form of democracy.

If a politician promised not to cut taxes, to keep tight control over expenditure, and be realistic in terms of how effective they would be if elected into government, they would be committing political harakiri.

However, such an honest approach would be totally appropriate in current circumstances, but is very unlikely to be seen from any politician over the coming weeks.

The reality is that despite signs of recovery, there are still areas of intense difficulty in the economy and in society at large.

The key areas of difficulty include the homeless crisis; the rental crisis; a health service that is failing abysmally to deliver what a proper health service should deliver; a massive problem with crime in rural and urban Ireland; a childcare system that is totally inadequate; a roads infrastructure that is crumbling, particularly following another very difficult winter; and many towns in rural Ireland are not feeling the recovery and are actually still in decline.

I could go on, but I think that most objective people can recognise and relate to the problems and challenges still facing the country.

The harsh reality, of course, is that it will take vast quantities of money and a level of public sector management that is alien to this country to address these problems in an effective way.

The risk, now, is that politicians of all hues will engage in aggressive auction politics over the coming weeks, and on the basis of the most generous promises, a government will be elected that will inevitably fail to deliver on its extravagant promises and the electorate will be disappointed once again.

What Ireland needs from the next government is a sensible and prudent approach to economic and fiscal management.

Despite the recovery, the country still has serious imbalances in its public finances and must do its utmost to maintain confidence and a stable growth environment.

The need for a cautious and approach to economic and fiscal managements has been highlighted in a significant way over the past few weeks.

Global markets are in a state of serious chassis; the Chinese economy delivered the lowest growth in 25 years in 2015; and the latest prognostications from the International Monetary Fund (IMF), while very realistic, do not make for particularly compelling reading.

While global growth is projected at 3.4% this year, up from 3.1% in 2015, the IMF believes that the risks to growth remain tilted to the downside.

Life is expected to remain challenging for the emerging and developing economies, and the recovery in the developed world is expected to be modest and uneven.

The re-balancing of the Chinese economy, low commodity prices, and the gradual tightening of monetary policy in the US are all identified as key risks to growth in 2016.

It is hard to argue with this view of the world.

The recent ‘Brexit’-induced weakness of sterling is also a cause for significant concern.

For our domestic politicians over the coming weeks, the phrase that ‘the risks to (global) growth remain tilted to the downside’ should be etched in their brains.

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