Adrian Bourke, the brother of ex-president Mary Robinson, will presumably make a nice capital gain from the sale of his Ballina premises to Mayo County Council.  It’s supposed to be bought for €665,000 and be used as Ireland’s first presidential library, housing his sister’s papers.  However  recent reports suggest that the sale has stalled for reasons unknown.

In fact the whole project has come under fire recently, with RTE’s Prime Time last week raising various questions about whether this is a good use of public money, and historian Diarmuid Ferriter writing “If Robinson wants to encourage research into her career, or assessments of her legacy, she should follow the practice of her predecessors and donate her papers to the National Library, the National Archives or one of the national universities, without any need for tax credits or valuations by auctioneers and with no excessively expensive, publicly funded vanity centre.”  Ouch.

And Michael McDowell has raised similar concerns in his most recent Sunday Business Post contribution:  “Are all former office-holders to benefit by tax holidays based on donating their papers, documents and memorabilia to publicly funded ‘libraries’ in future? Or is this to be a one-off?   In my judgment, the Ballina scheme should be called off before it does further damage to Irish public life. And before it needlessly damages the presidency – not to mention damage to her own place in our history.”  Double ouch.

I’m tempted to ask why it has taken so long for these worthies to train their gaze on this project, which is being funded by the public purse to the tune of about €5 million.  Yours truly was a lot quicker into the fray, asking a few pertinent questions 11 months ago.

Mrs Robinson has also been in the news recently as she is selling her home in Mayo. The plug for the house in the Irish Times reveals that “Former president Mary Robinson and husband Nick are selling their Co Mayo home for €2.75 million. Massbrook, a 113 acre estate on the shores of Lough Conn, is located about 20 minutes from Mrs Robinson’s childhood home of Ballina, and has served as the couple’s primary Irish base since they purchased it in 1994.”

Those of you who (unlike me) are familiar with tax matters will be aware that the sale of one’s principal private residence is exempt from Capital Gains Tax (CGT).  However, the relevant legislation, section 604 of the Taxes Consolidation Act 1997, provides that the exemption only applies to the residence plus its “garden or grounds up to an area (exclusive of the site of the dwelling house) not exceeding one acre“, so Mrs Robinson is presumably looking at a CGT bill, calculated at 33% of any gain she and her husband make on 112 of the 113 acres.  Based on an apportionment of the sale price being asked, I’m guessing that the gain might be in excess of €1 million, since the 1994 purchase price allowed as an offset would have been quite small.

However as the State has given her a tax credit of €2 million for “donating” her archive, she will not have to worry about handing over any of the sale proceeds to the Revenue Commissioners.  She will also presumably have plenty of tax credit left over to cover other tax liabilities – such as her Presidential pension, for instance?  On the other hand, wouldn’t it be great if she could let her brother share in the tax credit, so as to cover the profit he will make on the sale of his premises in Ballina?

 

 

 

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I see that the Austrian parliament has passed reforms to the country’s century-old ‘Law on Islam’.  Amongst other provisions, the new law bans foreign funding for Islamic organisations.  Muslim groups say the ban on foreign funding is unfair as international support is still permitted for the Christian and Jewish faiths.  They are right, but only up to a point.

I find it unacceptable that any religion should be allowed to accept funding from external sources, just as most countries prohibit political funding from outside the jurisdiction.  If such funding is going to be allowed, then at least it should be excluded from the general tax exemption from which most religions benefit.

But where I would absolutely draw the line is where religions or religious lobby groups obtain direct or indirect funding from foreign governments, or foreign-government-sponsored entities.  Clearly in these situations the line between religion and politics has been crossed.  And this is where the Austrians have got it right: Islam is noteworthy for the fact that states such as Saudi Arabia and Qatar give generous financial support to Islam (or particular strains of Islam) across the globe.  And unfortunately the type of Islam they are promoting is one where there is no separation between Church and State, and where the dictates of the Koran and the hadiths are considered to be justification for horrific crimes.

I would like to see a law in Ireland which (a) prohibits religions and religious organisations from receiving funding from foreign governments and (b) removes tax-exempt status from funding received from all non-residents, private or governmental.  This would incidentally stop any funding of the Catholic Church or Catholic organisations by the Vatican, as the latter claims to be a State, but this is something with which I could live …..

 

There is a head of steam building up in the UK and Ireland on the issue of reducing the minimum voting age for parliamentary elections to 16 or 17 from the current minimum of 18. Even the normally sensible Electoral Reform Society has weighed in behind the proposal. I think it is a very bad idea.

Yes, you can join the army before you are 18. But in the army you are told what to do, and you don’t have a say in how it’s run. In our democratic system, you as a voter have the right to tell the politicians what to do. And quite simply, 99.9% of 16 year olds haven’t a clue as to how to run a country.

Yes, 16-year olds pay taxes: income tax if they have income, and VAT on most stuff they buy. But so do 10-year olds , and we aren’t suggesting that they be allowed to vote.

Ask anybody in their twenties, thirties, forties or older whether their views on politics as a 16-year old were sensible and well-informed and you will find that the universal answer is NO. Many people are frankly embarrassed by the stuff they believed at that age.

I think 18 is the right age to set as the minimum voting age. It is an age of independence for many, when they go to university or start to work. It is the age at which people start to take responsibility for themselves. The legal age for buying alcohol or tobacco is 18.

If we allow votes at 16 or 17, what’s next? Many of the same arguments for votes at 16 can be applied for allowing 14-year olds to vote. Any mandated minimum age is necessarily arbitrary, but we have to have one, and 16 is frankly too low.

You may think that I am on occasion anti-public sector in my pronouncements (actually I’m not; I just think that Irish public sector management is lazy and inefficient and provides poor leadership).  Anyway, compared to the guy quoted below, I am a pussycat.

Dr J C Lester argues that only (net) taxpayers should be allowed to vote, thus ruling out state sector employees!

Why should people who are not taxpayers be allowed to vote money away from those who are? If we must have state services, it should at least be for those who pay for them to vote for which services they want and how much they wish to pay. To allow those providing, or living off, the services to vote is like allowing a shopkeeper to vote on what you must buy from him, or a beggar to vote on what you must give him….

… Consider state distribution of tax-money. We can see that this must create two social categories: those who are net taxpayers and those who are net tax recipients. Only the net taxpayers can be said to provide the state with tax-funds. The net tax recipients are paid out of taxation, plus any payments in newly created state-currency (which effectively taxes those who hold money). So to the extent that people are in the pay of the state they cannot be genuine taxpayers. A proof of this is that if their jobs were abolished the state would have more money to spend elsewhere, unlike those jobs in the genuinely taxpaying sector.

The writer, Jan Lester, is a leading member of the Libertarian Alliance.  The public sector seems to be a prevalent theme of writing on the LA website.  Its home page currently has a lead article by D.J. Webb called “Living off our Taxes”, of which the introduction gives a flavour:

There is nothing more frustrating than having to pay tax and national insurance so that public-sectors workers can earn more than you. People in the private sector face greater job insecurity and have less lavishly funded pension arrangements, where such arrangements even exist, and yet they are the golden goose that has to be repeated slaughtered in order that state workers can have secure and higher-paid jobs with astonishingly generous pension provision.

In case you were wondering, Webb was writing about the United Kingdom, not Ireland.  But, let’s be honest, he could have been writing about Ireland.

At least it’s bad news for Obama.  His best hope for re-election as POTUS was to have as an opponent a bonkers Tea-Party type (pardon the tautology).

His next best hope is that Michelle Bachmann is selected as the Republican contender.  In terms of who would be the ideal head-banger for Obama to have as an opponent, Bachmann runs Palin a close second.  The evidence for her madness is not hard to find, but I particularly like the following example, quoted from an article in the New Yorker, August 2011:

In the spring of 2009, during what appeared to be the beginnings of a swine-flu epidemic, Bachmann said, “I find it interesting that it was back in the nineteen-seventies that the swine flu broke out then under another Democrat President, Jimmy Carter. And I’m not blaming this on President Obama—I just think it’s an interesting coincidence.”

Rick Perry is a paragon of sanity and erudition by comparison with Palin and Bachmann.

This short paper (Smart Taxes: An Open Invitation to Join the Pigou Club) is worth reading for its discussion of Pigovian taxes, of gasoline taxes (in a USA context), and generally of “topics about which there is a large gap between the beliefs of economists and those of the general public”. It’s written by an economist whom I have mentioned previously, Gregory Mankiw.

As the financial world goes into meltdown mode, the following extract from Mankiw’s paper struck me as an encapsulation of where it all went  wrong for free-market democracies in most of the western world.

In a democracy, of course, economic policy is set not by economists but by the general public. One of my favorite books of recent years is Bryan Caplan’s treatise The Myth of the Rational Voter, subtitled Why Democracies Choose Bad Policies. The answer Caplan offers is that voters are worse than ignorant about basic economic principles of good policy. Ignorance, at least, would have the virtue of being random and so perhaps would average out to zero in a large population. Instead of being merely ignorant, voters hold onto systematically mistaken beliefs. And politicians, whose main job is to get elected, mold those mistaken beliefs into bad public policy. To quote Caplan, “What happens if fully rational politicians compete for the support of irrational voters–specifically, voters with irrational beliefs about the effects of various policies? It is a recipe for mendacity.”

Of course, while admitting that free-market democracies are having it tough, it must also be emphasised that alternative systems work even less well, at least in anything other than the short term – as the USSR found out, and as China undoubtedly will in the near future.  That’s why it’s distressing to find commentators wobbling in their support for free-market solutions.  See, for instance, the Telegraph’s Charles  Moore who wrote a recent article* headlined “I’m starting to think that the Left might actually be right”.  Just the bathwater, please, not the baby too.

Not surprisingly, there’s no easy solution to this crisis of economics and politics. But any long-term fix must include a much more rigorous teaching of the basic principles of economics to all citizens. We allow all those of a certain age to vote for whatever government they want, yet we fail to educate those voters properly about the economic consequences of so doing. We should not then be surprised when (as Caplan noted) rational politicians compete for the support of irrational voters with ultimately calamitous policies.

*Although one is tempted to have some sympathy with Moore’s views on banks: “…. when the banks that look after our money take it away, lose it and then, because of government guarantee, are not punished themselves, something much worse happens. It turns out – as the Left always claims – that a system purporting to advance the many has been perverted in order to enrich the few. The global banking system is an adventure playground for the participants,  complete with spongy, health-and-safety approved flooring so that they bounce when they fall off. The role of the rest of us is simply to pay.”

This article  in yesterday’s Telegraph is the most interesting and effective summary (so far, and to my eyes) of the infection of British politics by the Murdoch virus.  The relegation of the role of Westminster to a bit player in policy formation, and an afterthought in policy announcement, has echoes in the Irish political scene.

Here are a couple of extracts from a fascinating article.

During the Blair years, News International executives, Mrs Brooks among them, would attend the annual Labour Party conference, but they were scarcely treated as journalists. When Tony Blair gave his leadership speech, they would be awarded seats just behind the cabinet, as if they had been co-opted into the Government. Arguably they had. The first telephone call that Blair made after he had escaped from the conference hall was routinely to Rupert Murdoch himself….

…There was a very sinister element to these relationships. At exactly the same time that Mrs Brooks was getting on so famously with the most powerful men and women in Britain, the employees of her newspapers (as we now know) were listening in to their voicemails and illicitly gaining access to deeply personal information.

One News of the World journalist once told me how this information would be gathered into dossiers; sometimes these dossiers were published, sometimes not. The knowledge that News International held such destructive power must have been at the back of everyone’s minds at the apparently cheerful social events where the company’s executives mingled with their client politicians.

Let’s take the case of Tessa Jowell. When she was Culture Secretary five years ago, News International hacked into her phone and spied on her in other ways. What was going on amounted to industrial espionage, since Ms Jowell was then charged with the regulation and supervision of News International,  and the media group can scarcely have avoided discovering commercially sensitive information, even though its primary purpose was to discover details about Ms Jowell’s private life.

Couldn’t happen here, of course.  Irish politicians traditionally don’t have a great fear of what newspapers might reveal: the thicker the envelope, the thicker the skin.