The Irish government starts to think about its deficit

Ireland was the first country to offer a blanket guarantee on bank deposits, it is also the first to try to curtail its exploding fiscal deficit.

The Irish government came up with an innovative solution; impose a levy on public sector pensions. During the good old days, when the economy was booming and Ireland was universially lauded as the celtic tiger, the government put public sector pensions into a sovereign wealth fund. It was a generous idea, and in principle, offered considerable protection to public sector workers.

Now, the government needs the cash, but the trade unions are in fighting mood. Over 100,000 workers took to the Dublins streets, to gently try to dissuade the government from taking back what it had already promised.

According to the FT, the Irish government is looking at 9 percent fiscal deficit this year. The first attempt to confronting that gap led to massive demonstrations. Proof, if any were needed, that it is very easy to loose control of public finances, but it is extremely difficult to regain it.