The Fiscal Treaty in the Sunday Papers
This post was written by John McHale
The Sunday papers/blogs have some good contributions to the Fiscal Treaty debate. In the Sunday Independent, Colm McCarthy cuts through much of the confusion with his usual clarity:
This referendum has consequences and is not just an opinion poll on whether people are pleased that we have an enormous debt and an ongoing deficit.
There are two net issues. The first is whether a ‘Yes’ vote would result in additional constraints on Irish budgetary policy in the years ahead.
The second is whether a ‘No’ vote would make the financing of the Government more difficult once the EU/ IMF programme ends in December 2013.
You should read the full article for Colm’s analysis of the two issues. But it is worthwhile to note the conclusions:
The fiscal treaty does not, in the short or long term, create new commitments to budget cuts beyond what is in store anyway. But rejection could result in a sudden drying up of access to finance — and hence an immediate requirement to balance the books — and would be highly disruptive.
This treaty will not solve Ireland’s problems, but voting it down could make a bad situation worse, for no obvious gain.
Cliff Taylor echoes these conclusions in the Sunday Business Post. The article is behind a paywall, but a fair-use quote gives the gist:
So there is no additional austerity for Ireland which will result from voting Yes. Austerity is inevitable – we just have to hope that some pick-up in growth will make the sums easier. And let’s not fool ourselves that a vote here would in some way change the course of what might happen in Europe. That will depend on the big countries. Full stop.
If a No vote brings no obvious advantages, it does bring risks. As the rules stand, we would not have access to the European Stability Mechanism, the new permanent bailout fund. So, if we need more cash after this bailout runs out – or other forms of support, such as further underwriting – we will not qualify if we vote No. Sinn Féin has argued that the EU and IMF will not see us stuck. But why try to find this out?
Finally, Nama Wine Lake, our new national treasure, provides a useful overview of the arguments here.