Comments on: Why do the right continue to support Ireland’s disastrous economic policies?

By: False economy website « 21stcenturymanifesto

False economy website « 21stcenturymanifesto — Thu, 23 Dec 2010 00:28:59 +0000

[…] Right wing UK commentators who have urged the Coalition to cut have been amongst Ireland’s loudest cheerleaders over the past year. […]

By: Mike Guillaume

Mike Guillaume — Thu, 11 Nov 2010 13:58:44 +0000

As I wrote it in a comment on a previous story about Ireland, it seems that the only ways out are either a lower euro -Germany doesn’t want this- or leaving the eurozone.
You can find interesting (and not otimistic) views about the future of the eurozone on http://www.mikeconomics.net.
Read also today: http://uk.reuters.com/article/idUKTRE6A759H20101108.

By: Tyler

Tyler — Tue, 09 Nov 2010 14:25:14 +0000

The article above makes no mention of the huge bailouts necessary for Ireland’s banks and the fact that the country is effectively bankrupt…..so it’s borrowing costs have blown out….and that the only buyer for Irish debt is the ECB.

If they decide not to go for cuts, they’ll never get financing through the bonds markets again, unless the ECB keeps buying them with taxpayer money….which Mrs Merkel seems sure to stop in short order.

The disastrous economic policy was the 10 years in the Euro with massive credit expansion enabled by negative real rates. THis current monetary policy is the only long term option.

By: Raymond Kelly

Raymond Kelly — Tue, 09 Nov 2010 00:59:57 +0000

I assume Guy Fawkes’ comment about Ireland bouncing back faster than the UK is based on the classic view that recession drives wages down and leaves only the most efficient firms in he market. Low wages plus efficiency then attract investment hence the notion of “bounce”.

It is a Social Darwinist view of the economy, it will emerge “fitter” based on the firms that “survive”. There can be a problem, of course, that not enough survives to re-employ most of the workforce. The UK couldn’t regenerate its industrial areas for twenty years after the eighties crash.

It is also the case that no-one will invest while demand is falling since they can’t guarantee a market for their goods and no-one can explain why demand should stop falling if wages keep shrinking.

In the thirties so many people lost their money in the stock market collapse no one wanted or were able to invest. Negative sentiment was entrenched and the system didn’t “bounce”.

Currently there is still a lot of private debt and that will inhibit new investment. That makes it risky to take more money out of the economy right now. Ideologues like Guido don’t appreciate the fact that the problem is not as simple as he thinks.

By: Nick H.

Nick H. — Tue, 09 Nov 2010 00:14:15 +0000

RT @leftfootfwd: Why do the right continue to support Ireland's disastrous economic policies? http://bit.ly/bHlbsc – Boneheads.

By: Mr. Sensible

Mr. Sensible — Mon, 08 Nov 2010 23:23:30 +0000

The Irish deficit has gone up, not down.

By: william

william — Mon, 08 Nov 2010 14:29:39 +0000

You might also look at Samuel Brittan’s last piece in the FT.A man of sound judgement, he compared the future collapse of the euro to the fight against sterling devaluation 1961-7.The pig in the poke is who holds Irish bank and government debt, the future victims of the haircut,step forward German banks.

By: Aaron Peters

Aaron Peters — Mon, 08 Nov 2010 14:22:34 +0000

RT @leftfootfwd: Why do the right continue to support Ireland's disastrous economic policies? http://bit.ly/bHlbsc. yth Comedians

By: Samuel Tarry

Samuel Tarry — Mon, 08 Nov 2010 14:07:54 +0000

RT @shamikdas: Why do the right continue to support Ireland's disastrous economic policies? http://bit.ly/aiLjoQ asks @DuncanWeldon

By: Duncan Weldon

Duncan Weldon — Mon, 08 Nov 2010 12:51:17 +0000

Patrick,

I read that. It’s an awful mess.

I believe the Euro and the ECB have been a disaster for Ireland. I also suspect that the low/negative real interest rates in the decade before the boom explain the vast increase in FDI and the relocation of companies to Ireland far more than the low corporation taxes praised by the UK right do.
I think some form of partial default is now the only realistsic option.