Madam, – I read with interest Garret FitzGerald’s article (“Lost competitiveness did its damage long before credit crunch”, Opinion, June 20th) and wish those in Government would take note of what he has written. It is astonishing that this Government can continue with its refusal to admit that the economic policies pursued since 2001 are at the root of the current economic crisis.
While political and media focus over the past number of months has been on the rapid decline in the public finances and the banking debacle, there is a more serious and fundamental economic problem that must be addressed – the massive unemployment numbers. Since 2001, when the Irish economy was in a fundamentally sound position, the cost of labour and other factors of production increased at rates which were unsustainable, while export growth virtually ceased and was masked by revenues from the construction sector.
Until the Irish economy reverts to a position where it can produce and export goods and services at competitive rates, there is unlikely to be economic stability or full employment. With each job lost there is a cost to the State in terms of social welfare and the loss of revenue from income taxes. Add to this a public sector which would seem to employ more people than necessary at inflated rates of pay and there is little hope of getting the public finances back in line.
Restoring true competitiveness in the Irish economy is going to be a difficult task and there is little indication that the Government or any political alternative has the wherewithal or the will to take the steps required. – Yours, etc,