As is widely reported today, Ireland is to hold a referendum on the EU's austerity and bailout plans that would lead to a lost generation in Ireland.
The Irish already know that austerity does not work. It does not solve economic problems. It does not solve the problem of zombie banks.
The pressure on the people of Ireland to accept austerity will be enormous.
They have to say no.
This crisis was not created by the people of Ireland. It was created by some politicians, the world's economics profession and bankers with whom they were in cahoots. Now we need to sort out banking, sort out economics and sort out politics.
I call that the action of a Courageous State.
Might Ireland lead the way to a Courageous State?
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I see also that Krugman and Shiller have new books coming out in a month or so: they are two of the small number of economists who predicted the housing bubbles. For those who haven’t read them, Krugman’s articles ‘Running Out of Bubbles’ of May 27 2005 and ‘That Hissing Sound’ of August 8 2005 both make reference to Shiller’s 2nd edition of his book ‘Irrational Exuberance’, in which Shiller, writing in 2004, called the trajectory of US house prices ‘a rocket’. Shiller reflects on this in his article ‘A People’s Economics’ from Jan 20 2011, and Krugman does the same in his blog, ‘Bubble blindness’ from December 23 2008.
I must confess I never heard this. They MUST vote against austerity! They must take the example of both argentina and, in particular, Iceland who largely told foreign creditors to take a hike as it was mostly odious debt!
Hopefully, it won’t be too late for Ireland to turn things around!
Richard, would Iceland be considered a “Courageous State”? I notice they are no longer in the news. I wonder why? 🙂
What happens if Ireland says NO? Do they still have the option to go down the Iceland track or have they already taken on entirely the debt of their broken banks? And if so, where to? Withdrawal from the Eurozone?
Ireland could still do an Iceland – but not within the EU