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Ireland suffers savage budget cuts to stay afloat

Less pay for everyone, from the prime minister to the cop on the beat.

A woman walks past graffiti on a wall in Dublin, April 7, 2009. (Cathal McNaughton/Reuters)

DUBLIN, Ireland ― Pity the Irish prime minister. Brian Cowen has just taken a 20 percent pay cut, leaving him the equivalent of $300,000 a year.

Two years ago the Taoiseach, as he is known, was the highest paid leader of any country in the Organization for Economic Cooperation and Development, the group of rich nations which includes the United States, Germany and France.

His cash remuneration for leading a country of 4.5 million people brings him down to the level of the Prime Minister of the United Kingdom, population 61.5 million.

The salary reduction, along with a 15 percent pay cut for ministers, is designed to lead by example and alleviate widespread anger at reductions in pay and services imposed across the board by Finance Minister Brian Lenihan in the most savage Irish budget in living memory, announced on Wednesday.

If anything it draws attention to how overpaid the leaders of this small nation still are. Vladimir Putin, the prime minister of Russia, draws a mere $137,000 a year.

Ireland is deep in debt and is in a prolonged recession. The government had to find €4 billion in extra revenue ($5.9 billion) just to service the national debt.

Announcing the budget details, Lenihan said the worst was over and Ireland was turning the corner. But the GDP slumped this year by 7.5 percent and is predicted to fall another 1.25 percent next year.

The price of recovery is pain at every level and the anger that has been mounting in Ireland over the mishandling of the economy is more likely to boil over than subside at the harshness of the budget.

The dissatisfaction among public servants, who are to suffer a pay cut of between 5 and 8 percent, is so great that their trade unions are threatening stoppages that could paralyze the country.