Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)

The UN states that, as an alternative, increases in spending on infrastructure, social transfers or targeted subsidies for private investors tend to be more effective in stimulating the economy because they directly lead to job creation, purchases and demand.

The argument for stimulus and investment rather than austerity and a focus on bailing out the banks is being put forward by the UN. It is also put forward in today's The Irish Times by Mr. Paul Krugman, one of the most prominent economists in the world. I do not understand why the Government, EU authorities or IMF will not even debate this alternative strategy given the obvious failures of the strategy of austerity and bank bail-outs.

The Minister may say that we have no choice because we are a small economy that is bankrupt and dependent on EU money and that even if the Government agreed with me or with this analysis of the UN there is nothing we can do about it. I put it to the Minister that there is. The Minister, Deputy Howlin, told us recently that our deficit is €15 billion. He said that if we do not do what the EU tells us we will be left with a deficit of €15 billion. The Minister accepted that the €15 billion includes the interest repayments on the loans, which on an annual basis is roughly about €4 billion or €5 billion, leaving a deficit of approximately €10 billion or €11 billion. If one considers that our social welfare budget is approximately €21 billion, it would be reasonable to suggest that half of that results from people who are unemployed but do not want to be unemployed. It is costing us €20,000 per person to keep people on the dole doing nothing when they want to work.

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