Ireland today, Britain tomorrow

It was Brian Lenihan yesterday and in a fortnight it will be Alistair Darling’s turn to announce the bad news when he delivers his emergency-in-all-but name budget. Or bloodget. Lenihan, the Irish finance minister, did his best to spread the pain around, announcing tax increases and cutting spending while leaving many of the most difficult measures to next year’s budget. The Irish economy is forecast to contract by 8% this year and, even after the cash-saving and raising measures announced yesterday, the government will run a deficit of 10.75% of GDP. Eye-watering and sobering stuff. 

In the Irish Times Mark Hennessy writes:

For weeks, the Cabinet has debated the options in detail unlike any previous cabinet. Eventually, it decided that it could not cut more than €3.5 billion out of the economy this year, lest it choke what life remains in it – and it had to do it more by tax rises than cuts.