Financial Advisor Gives Us An Update On Ireland's Economic Woes

Online, April 8, 2011 (Newswire.com) - Dennis Tubbergen is a financial advisor, advisor to financial advisors, author and radio talk show host. Tubbergen, who is CEO of USA Wealth Management LLC, a federally registered investment advisory company, first wrote about the financial issues facing Ireland a year ago and recently updated those comments on his financial blog.

"Some countries around the world are already dealing with their day of reckoning," Tubbergen wrote in March of 2010. Tubbergen went on to describe what Ireland was then doing to get its financial house in order, which included what The Wall Street Journal called "harsh economic medicine that other countries around the world are putting off."

The article went on to show how officials incorporated stiff budget cuts, including one to a police station in Dundalk. One of the local police officers had expected the Irish government to award him a 6% pay raise and rebuild his recently car-bombed station. The reality was quite different: his take-home pay was cut by 18 percent and the plans for the new station were put on hold.

"Ireland took these actions with a deficit that was 12 percent of that nation's Gross Domestic Product," wrote Tubbergen a year ago. "According to an article published on Fox News February 1, 2010, the United States' current year deficit will be $1.6 trillion. The GDP of the U.S. is estimated to be $14.2 trillion. That means the current U.S. budget deficit is approximately 11.3 percent of GDP, not far behind Ireland's deficit when its government made necessary spending cuts to get its finances in order."

Tubbergen added in his 2010 blog, "I hope someone in Washington is watching."

Now, one year later, the story continues to unfold.

"Elections were recently held in Ireland, and, not surprisingly given the severe austerity measures implemented in Ireland, the ruling party got trounced at the polls," notes Tubbergen.

He refer to a February 27, 2011 article in The Telegraph which reads in part, "Ireland's new government is headed for confrontation with Brussels after the country's ruling party was wiped out on Saturday by voters in a huge popular backlash against a European-IMF austerity programme."

Fianna Fail, the ruling party in Ireland for over 60 years, was decimated. The article goes on to say, "The unprecedented and historic defeat, Fianna Fail's worst result in 85 years, makes the Irish government the first eurozone administration to be punished by voters in the aftermath of the EU's debt crisis. Voter turn-out was exceptionally high at more than 70 percent, indicating public anger at the government and the E.U."

The article lists a few items showing just how much Irish families were affected by the cuts, which included extra taxes of over ₤3,900 per year, reductions in the country's minimum wage, cuts to popular public services and some 90,000 job losses.

"Austerity is ugly," Tubbergen agrees. "Recovering from the hangover of decades of irresponsible spending is painful. But mark my words: this worldwide austerity movement and backlash is far from over. What we've seen recently overseas in Egypt and Tunisia and in the U.S. in the State of Wisconsin, is, in my view, just a preview of what's to come."

Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in the USA Wealth Management Building in downtown Grand Rapids, Michigan. Tubbergen is CEO of USA Wealth Management, LLC and has an online blog that can be viewed at www.dennistubbergen.com. His weekly talk show The Everything Financial Radio Show is simulcast on two Michigan metro stations and also airs to over 600,000 financial advisors, with recent podcasts available at www.everythingfinancialradio.com.

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.