Quote:
Originally Posted by dalywise The thing that was pounded into the thick heads of McCreevy and Cowen years before the Euro started was the need for fiscal discipline. The temptations of low interest rates were always known. Tha's why the Germans would have preferred countries like Ireland, Italy, Greece etc stay out of the Euro because of their previous records of mad spending sprees.
But Ireland clambered to get in to the Club. The warnings were there from the EU but Ireland and others chose to ignore them. We failed to put the correct balancing mechanisms in place to compensate for a monetary policy that some countries, like Ireland, were just not politically mature enough to handle with care.
Fianna fail destroyed the economy too between 1977 and 1981. There was no Euro then. But they followed the same policies as in the 2000s, and got the same result.
Don't blame the Euro or the EU. Blame corrupt Fianna Fail and their lust for popularity power. |
I blame both
FF and the Euro and text book economics would support me. Spain has had pretty good fiscal discipline and is still a basket case post Euro. Capital from all over the E.U fuelled that particular bubble, is there a
FF equivalent in Spain too, considering it has had both the left and right in there this past decade?
Strong stabilisers for inflationary booms and asset price bubbles are monetary policy and exchage rate policy, inc exchange controls, we have had no control of these for quite some time now. I would love to be able to blame all our woes on
FF, and yes they managed the boom to suit their own electoral ends, but ignoring the role of the Euro is a bit ostrich like to say the least and the proverbial chickens are coming home to roost now in Greece, Portugal, Spain, and here, none can devalue so wages instead are being slashed and asset prices adusted downwards to their real values, the market in the end tells the truth, only for so long can it be contrived and illusions of wealth created.