John O’Hagan on the Treaty

This post was written by Philip Lane

Guest post from my colleague John O’Hagan

Many things in life are complex and are not, understandably, properly understood by most people, unless they devote enormous amounts of their time to do so. That is why we leave so many important decisions to our democratically-elected representatives and not to plebiscites/referendums.
The Fiscal Stability Treaty (FST) though has to be decided by referendum and because of its necessarily complex economic/legal language the electorate must rely partly on expert witnesses, as in any major court case by jury. A key thing for any jury is the credibility and reliability of these witnesses. And so it is with the referendum on the FST.


Many people will have, or want, to depend on the advice and arguments of others. In this context they must ask: which witnesses they can rely on in relation to an issue of such importance and who do they represent?

It is noteworthy in this regard that almost all the main ?witnesses? for the No vote have been against EU integration at every stage of the process. Their opposition in relation to the FST must be seen by the jury or electorate in this context.
The witnesses aligned on the Yes side include representatives of almost all businesses in Ireland, who provide the growth and employment so emphasised by the No side. They also include the two parties of government, elected only last year with a large majority, plus many other organisations and political groupings.
Key to any such decision is for each person to look at the consequences of a Yes, and a No, vote, based either on their own analysis or on the views of others better informed whose judgement they respect. Each person though must make the ultimate decision: a consultant may recommend some medical procedure but it is your decision whether or not to proceed.
As such, each person must take responsibility for his/her own vote and not complain after the event that they were not informed or misled or were not interested. This is especially so in a situation where there will be no second chance, as such an Irish vote will almost certainly not be needed for the Treaty to come into being. If ratified by twelve euro member states the Treaty will be passed.
The fundamental reason for the FST is that a currency union needs rules of engagement for the economic game to take place, as otherwise chaos will result. This is true in any game, be it football, boxing, golf, or whatever. It is to avoid another Greek situation, with its irresponsible past approach to fiscal matters (and earlier France and Germany), that the FST is a necessary first step in establishing and enforcing such rules: to protect each and every one of us from reckless behaviour by another in the currency club. The FST then is fundamentally about the future of the currency union.
Many of the rules outlined in the FST in fact are already enshrined in law, as many expert commentators have demonstrated. So there is really almost nothing substantially new and hence no substantial negative consequences from a Yes vote. To equate a Yes vote with a vote for austerity is at best a highly disingenuous electoral ploy. Fiscal correction is required either way.
A Yes vote of course will not in the short term at least bring about any improvement in the growth and employment situation. Many more things need to be put in place to effect such an improvement, including enhanced competitiveness, realistic pay rates and social welfare payments, proper incentives, increased training, and so on. However, the FST will provide the necessary stability and certainty for these things to happen.
What are the consequences of a No vote? The main danger is that of huge uncertainty, with the possibility of quite dramatic negative consequences. To argue that this amounts to scaremongering reminds one of the last government?s similar claims; when people warned of the pending disaster about to unfold on the banking front. It would be irresponsible in fact not to spell out the possible consequences of a No vote.
The most serious consequence in the long run is that it would represent a rejection of the necessary rules of the club to which we supposedly want to belong. These rules have been agreed and signed up to already by the heads of state of all seventeen members, plus eight others, including Sweden. This is why the FST referendum is fundamentally about Ireland’s future participation in the euro.
To argue that by voting No we could extract more from the others in return for our membership is naive in the extreme. It would only hold if Ireland’s continued membership was considered existential to the future of the euro, which recent events in Greece have clearly shown not to be the case. The poker game has changed, and anyone who wants to lose so much European good will by using the strong arm tactics of the bully in this new situation, holds a very weak hand indeed.
A No vote then would put in jeopardy Ireland’s future membership of the euro. This could come about primarily through in time not having access to funding, at least not at affordable rates for all we need to borrow, following a No vote. Or it could come about because we choose to exit the euro.
In this scenario do we go it alone on the high seas of international financial markets, or aim for self-sufficiency as in the 1930s, or do we put ourselves once again under British monetary rule? The electorate needs to know the answer to this question from the No side, and now.

78 Responses to “John O’Hagan on the Treaty”

  1. David O'Donnell Says:

    Who is right about the fiscal treaty?
    Analysis by Tom O’Connor

    Tuesday, May 22, 2012 The Neu Paper of Record

    ‘If Ireland is to adhere to the new deficit measure, a further €5.7bn “adjustment” in public spending cuts on top of the already planned austerity would be required by 2015.

    From 2008 to 2011, the austerity meted out in terms of spending cuts and taxation increases was €20.7bn. The Government is working towards the established 3% general government deficit (the existing stability pact measure) rules and to bring this to less than 3% in 2015, a further €8.8bn in cutbacks and taxes need to be implemented, as stated in its fiscal outlook last November.

    This general government deficit, not the one used in the new treaty, is what Finance Minister Michael Noonan has publicly stated he is working off at the moment.

    However, the Government’s fiscal outlook of last November does take into consideration what the challenge of using the structural deficit would look like. Based on the Government’s future plans as of last November, the structural deficit will be 3.7% of GDP in 2015. To bring this down to 0.5% as set out in the fiscal compact, would require a further €5.7bn in cutbacks and tax increases, over and above the €8.8bn already set out by the Government. ‘
    Also, there are new measures which will be required if the treaty comes into effect in regard to the general government debt, which have not applied heretofore. On Jan 1, 2013 when the treaty comes in to effect, the Irish debt:GDP ratio is forecasted to be 118% of GDP at €195bn.

    The Referendum Commission states the 1/20th rule on debt reduction won’t technically apply to Ireland until 2019. However, to give some sense of the figures involved, were it to apply to Ireland immediately, it would require a repayment of about €4.8bn a year back to the EU.

    What is also new in the current treaty is the “blackmail clause” which establishes that any eurozone country which does not ratify it, will not be allowed bailout funding under the new European Stability Fund.
    … Overall, it is fair to say that while the broad legislative and institutional scaffolding was present for many of the current provisions in the fiscal treaty, they were absent for others. Further, the specific requirements are almost totally new. It seems Irish people are being presented with momentous economic changes which are new to them and without any great knowledge of what the consequences will be.

    * Tom O’Connor lectures in economics and public policy at Cork Institute of Technology

    http://www.irishexaminer.com/analysis/who-is-right-about-the-fiscal-treaty-194708.html

    I vote NO. For the first time in an EU Referendum.

  2. David O'Donnell Says:

    @John O’Hagan

    Returning to economics, an area where you have demonstrated no little expertise, you might help me out:

    Can you provide any empirical evidence on the social scientific economic validity of the key constraints (0.5; 60.00; 1/20 [+90 billion odious]) within the so-called Fiscal “Corset” (as Der Spiegel terms it) and grounded in any reasonably plausible economic theory? Doesn’t have to be 5* standard, 6-pack journal standardish OK?

  3. The Dork of Cork Says:

    There is nothing that complex about it on the most basic level … it takes the last tiny bit of money power away from Goverments and gifts it to banks via their catostrophic credit money.
    A proven depletion engine.
    I want nothing more to do with the Euro.
    It is the purest most evil form of Bank currency ever created.

    We have no King.
    We must however face this evil regardless of the cost.

    http://www.youtube.com/watch?v=m4FzOm9HL7c

    http://www.youtube.com/watch?v=m4FzOm9HL7c

  4. Shay Begorrah Says:

    @John O’Hagan

    The witnesses aligned on the Yes side include representatives of almost all businesses in Ireland, who provide the growth and employment so emphasised by the No side. They also include the two parties of government, elected only last year with a large majority, plus many other organisations and political groupings.

    There is a lot to disagree with in your posting but I’ll just mention one startling omission, one which we all know is the Achilles heal of the Yes campaign.

    Why is there no Michael McDowell on posters advocating a Yes? Why no Richie Boucher? Why no Lorenzo Bini-Smaghi? Why no Angela Merkel?

    The most enthusiastic supporters of the Fiscal Compact are those who put Ireland in the perilous economic and political situation it now finds itself in.

    The financial sector whose greed inflated the bubble, the right wing market fundamentalists (many of them economists) who were only concerned with eliminating government intervention when it was badly needed in the financial sector and other markets and the politicians and institutions in Europe who insisted that Ireland spend tens of billions of Euros protecting private investors from their own decisions in order to prop up the Eurozone financial sector and the value of the Euro.

    Can I add that in conversation with ordinary members of the Labour party there is no belief that the Fiscal Compact has a valid economic rationale but instead a belief that we have no choice but to surrender our sovereignty (and taxes) given the forces arrayed against us.

    The Fiscal Compact is overwhelmingly supported by the set of people (very serious people, experts even) who got us into this mess and every Irish voter needs to think seriously whether the people whose greed, cowardice, ideological extremism and ineptitude landed us here should be indulged further or stopped before Ireland, and indeed most of Europe, is further impoverished and weakened.

  5. zhou_enlai Says:

    I agree with most of that post. I agree that these are properly matters for parliaments to decide on and that they should not be given supra-constitutional status. The rest of Europe bent over backwards to avoid a treaty in Europe and our Government, Attorney General and officials failed to achieve that simple task.

    However, I was very much in favour of Lisbon and am quite against this treaty althoguh I recognise there are risks involved. I do not intend rehashing all the issues here. I would like to make some points though.

    “These rules have been agreed and signed up to already by the heads of state of all seventeen members, plus eight others, including Sweden”

    This is not wholly correct. The ratified treaty has only been delivered by three based on what I have heard on the treaty. There is no guarantee that all those who signed up will join and there are doubts about some key members.

    If we accept that the economics of the Treaty are correct (relying totally on the advice of those who are educated in these matters) and that they are already binding (again relying on those educate in EU Law) then there are still serious questions to be answered.

    Foremost amongst them is what political entity and laws are developing that we are agreeing to be part of, who will be in that entity and who will be outside it.

    Voters need to take repsonsibility for the future of europe and not just Ireland. That is what the EU is about - not just our own interests.

    “The fundamental reason for the FST is that a currency union needs rules of engagement for the economic game to take place, as otherwise chaos will result. This is true in any game, be it football, boxing, golf, or whatever. It is to avoid another Greek situation, with its irresponsible past approach to fiscal matters (and earlier France and Germany), that the FST is a necessary first step in establishing and enforcing such rules: to protect each and every one of us from reckless behaviour by another in the currency club.”

    As you say the Fiscal Treaty does not come near establishing a comprehensive set of rules for the operation of the single currency area. It is just a start. It is too little too slowly. Perhaps if we were faced with a comprehensive set of rules we could decide whether to agree to them or not. However, it seems the incumbents in the EZ governments and EU institutions are not capable of designing such rules and would not trust us to understand them anyway.

    Lastly, I would also question the suggestion that this is not an austerity treaty for Europe. Certainly there could well be more austerity in Ireland if we vote no. However, we need there to be economic expansion across europe. It is not clear if this can happen across the euro as other countries not in trouble may be precluded from running deficits to stimulate the Euro economy in the interests of the whole. I would be grateful if economists could address this in their critiques rather than focussing on Ireland alone.

  6. The Dork of Cork Says:

    We would all like to think Patrick the Wizard Traveled to Frankfurt and put on a good show but the events tell a different story , it was good fiction though.

    http://www.youtube.com/watch?v=k8DgAy6zmHc

    Maybe the man is misunderstood but I have my doubts…..
    However I could be wrong I guess.
    He may be simply a good man Trapped withen a banking machine

    http://www.youtube.com/watch?v=lADk0Emxs5I

    But he knows what he has done.
    His flawed ideas have helped the free banking ringwraiths to scour this Shire on a repeated basis….. he must know this now.

    http://www.youtube.com/watch?v=EX7bi3YYefI

    They are everywhere now , searching , searching for a return…….

    http://www.youtube.com/watch?v=ZF-BsB4LSlk

    This will not stop , they have no pity - they will burn every village.

    http://www.youtube.com/watch?v=E1GRlhCrtvE

  7. Georg R. Baumann Says:

    Many things in life are complex and are not, understandably, properly understood by most people, unless they devote enormous amounts of their time to do so.

    Duh?? So what?…

    That is why we leave so many important decisions to our democratically-elected representatives and not to plebiscites/referendums.

    Hahahahaha….pheew. thanks man I need that laugh today.

    ….shaking head in disbelief…. Hahahaha

  8. Georg R. Baumann Says:

    most people…. plebiscites….

    Good Lord! LOLOL

  9. Bemused layman Says:

    Can somebody please clarify the issue of voting a second time? If we vote no, is there any aspect of the treaty itself, or in what has been said by other governments, (ignoring what our own government says) that closes the door on voting yes subsequently, if it seems that we might later want to take advantage of the ESM? Is the treaty, once ratified by 12, or by all others, then no longer open to new members?

    Otherwise what is to stop us having our cake and eating it, ie voting no until it looks like we really will need access to the ESM, and hurriedly arranging a second referendum to change our minds? We’re not too proud to do that, as we have shown in the past.

  10. BeeCeeTee Says:

    On a couple of matters of detail.

    1) Of course there will be a second chance. The Government should accept the first answer it gets from the people, but it won’t if it’s the wrong one. The most compelling reason for having the referendum in May as opposed to the Autumn was so that the Government could stage a second vote if the first one failed.

    2) In addition to committing us to many decisions that have already been made, the Treaty also commits us to agree to unknown future decisions of unknown scope, arrived at through unclear mechanisms. It is, therefore, only marginally relevant that “many of the rules outlined in the FST in fact are already enshrined in law”.

    That said, if we had a chance of an orderly exit from the euro, I would jump at it. Joining the euro was one of the biggest mistakes ever made by the Government and people of Ireland, and we have now been suffering the consequences for four or five years. If separating ourselves from the core gives us a chance of a future agreed and orderly exit, then I would be nuts to vote in favour of the treaty.

  11. Edward v2.0 Says:

    @ John O’Hagan

    Your analysis assumes that the interests of our ‘democratically-elected representatives’ and the average voter/taxpayers are aligned on the FST issue. Another valid analysis that voters should proceed with is to ‘follow the money’ and ask themselves, who has the most to gain from a continuation of the current faux austerity, spiralling troika debt burden and increasing taxes? To my mind the answer is over-paid politicians whose main aim is to cling to power (if needs be and often times at the expense of taxpayers/voters).

    The fact is that both FG and Labour were against taxpayers shouldering the bank bailout burdens, never-ending bailouts etc etc while they were in opposition, but became as meek as kittens once they were elected into power. As any rational human beings would, they have put the short-term interests of their government ahead of the long-term interests of voters/taxpayers in their dealings with the Troika and therefore I find the early part of your analysis to be either naive or offensive.

  12. tullmcadoo Says:

    BCT

    I would agree with you re the Euro but I fear that there is no orderly exit possible. It will be very mess and painful but we might have to go through the door.

    Zhou,
    Your FF partisanship knows no bounds. We are having a referendum because that is the legal advice of the AG. If the govt had gone down the road you suggest we would have ended up in the same place in the Autumn. Do you want the govt to ignore its own legal advice?

  13. Colm Brazel Says:

    John O’Hagan post is filled with a set of arrogant presumptions that contaminate his logic, let me outline some of these:-)

    1. That is why we leave so many important decisions to our democratically-elected representatives and not to plebiscites/referendums

    The messers who’ve made the mess know better than ignorant voters. I disagree. Some votes are made on simple assumptions, such as whether its going to rain. Often the experts get it wrong. We don’t need to rely on experts who make it a practice of being wrong all of the time

    2. No vote have been against EU integration…

    We havn’t had the Referendum and John is an expert on identifying the No vote. I was pro EMU including Lisbon 11 all the way to collapse of our banking sector. I began to research the matter and the more I’ve done this, the more No I’ve become.

    3. The fundamental reason for the FST is that a currency union needs rules of engagement for the economic game to take place, as otherwise chaos will result.

    Quite a lot of propaganda uses this prop to hide the question of why we are having a Referendum in the first place. It would have been helpful to offset this if our AG had published her advice to government. But the simple notion the FST is about rules of engagement avoids the question of what rules favour who, never mind telling us what the rules are, or should be.

    4. So there is really almost nothing substantially new and hence no substantial negative consequences from a Yes vote.

    Propaganda appealing to the emotion rather than the intellect come to the fore here :-) John is not going to bother us with any of those hidden nasty downsides discussed by the No side. He’s not going to tell you about the Trojan Horse that will castrate your constitution and make sure any debt you might dream of defaulting on will be policed by sanctions from the ECJ.

    5. …this amounts to scaremongering

    Yeah, the incorrigible propaganda piece has the same appeal to logic as the hidden hands who persuaded Govt to back the bank guarantee. Its an invite to an even bigger mess by voting Y

    6. …To argue that by voting No we could extract more from the others in return for our membership is naive in the extreme

    This is neither an erudite nor technically objective piece of analysis. Its appeal is to the suspension of the intellect. I’m thinking it would be easier to argue with a Jehovah Witness on the substance of their beliefs than any opportunity I will get on
    foot of this analysis to debate FC, on the lack of substance in the arguments for Yes outlined here

    7…..A No vote then would put in jeopardy Ireland’s future membership of the euro. This could come about primarily through in time not having access to funding, at least not at affordable rates for all we need to borrow, following a No vote.

    I don’t want to tell John we need to leave the euro. The euro as a currency model belongs to history. Spain, Ireland, Greece et al now know it doesn’t work. Its a Titanic ready to sink. We need to be part of the future post euro not caught up in the mess of its past. British monetary rule would be preferable to Frankfurts monetary rule after they finish with us through austerity tubes designed to protect their banks, they’ll loot Corporation Tax and tax till we drop.

    Anyways, good John is thinking of these matters. Stay around on the blog here. Many of us sleep with one eye open on what’s happening in Europe and we’re interested in UK and US perspectives and occasionally raise them here.

    Overall, I would make the point to you that matters beyond the control of the FC render the Treaty redundant at the moment. These are coming to a head in Greece and Spain; its almost a certainty Greece will default. FC will if it goes through be changed by HollandeMerkel so not knowing what we’re voting on, its a case of the blind leading the blind. Vote No.

  14. seafóid Says:

    No second chance

    WHY should I blame her that she filled my days
    With misery, or that she would of late
    Have taught to ignorant men most violent ways,
    Or hurled the little streets upon the great.
    Had they but courage equal to desire?
    What could have made her peaceful with a mind
    That nobleness made simple as a fire,
    With beauty like a tightened bow, a kind
    That is not natural in an age like this,
    Being high and solitary and most stern?
    Why, what could she have done, being what she is?
    Was there another Troy for her to burn?

  15. Colm Brazel Says:

    @BeeCeeTee

    “The most compelling reason for having the referendum in May as opposed to the Autumn was so that the Government could stage a second vote if the first one failed.”

    No, I believe it was simply the urge to go on holidays without being bothered over the Summer with this :-) Shocking, but true. They’ve flagged there won’t be a second vote, which is strange; but not when you consider they rather hoped Sarkozy would still be around and they hoped to impress him with a huge Yes. The way they’ve dealt with this is an abominable mess.

    We must be the laughing stock of Europe’s periphery whose hopes are pinned on Hollande protocols re growth and/or renegotiation of FC.

  16. The Dork of Cork Says:

    Bilbo taking on Steve Keen now….. it that characteristic autustic MMT fashion.
    This is getting silly.
    bilbo.economicoutlook.net/blog/?p=19517

    I am uncomfortable with the MMT perspective that the Treasuary & Central bank are the same thing now… the banks may want it that way but they ain’t.
    They Ain’t.
    en.wikipedia.org/wiki/United_States_Note

  17. paulr Says:

    @John O’Hagan

    “A Yes vote of course will not in the short term at least bring about any improvement in the growth and employment situation. Many more things need to be put in place to effect such an improvement, including enhanced competitiveness, realistic pay rates and social welfare payments, proper incentives, increased training, and so on. However, the FST will provide the necessary stability and certainty for these things to happen.”

    Ahh yes John, all the things that IBEC dream about. You fail to mention how the FST will reduce the costs the ordinary people incur in just trying to live in this so to be wasteland. Yes it will help reduce welfare payments and wages but what about the fees for the so called professional classes, private health care, or gas and electricity prices. More taxes while less money in the pockets of the voters. Seems like a recipe for disaster. And as for our elected representatives having a clue what it is about, pull the other one. They keep proving time and again the opposite is true.

  18. Seamus Coffey Says:

    @ David O’Donnell

    Who is wrong about the Fiscal Treaty?

  19. goodgrief Says:

    @Do’d
    Further in the piece you link we get this:
    ” This new provision allows the court to impose a penalty of up to 0.1% of GDP on the country in question. This would be equivalent to €1.65bn at present in the case of Ireland.”
    Tom O’Connor may be a good economist but his maths are not so hot -
    0 .1% = €1.65bn?!

    Seamus Coffey dismantles it all
    http://www.corkeconomics.com/

  20. Grumpy Says:

    @John o’hagan

    ” This is especially so in a situation where there will be no second chance, as such an Irish vote will almost certainly not be needed for the Treaty to come into being. If ratified by twelve euro member states the Treaty will be passed.”

    Is the only reason there would be “no second change” that the government says it will not allow one? Have I got that right?

  21. DOCM Says:

    @ All

    Why is Ireland holding a referendum on a fiendishly complex treaty when no other country in the EU is doing so, that is the question!

    We can take a recent article in the IT by Vincent Martin, a barrister, as our point of departure, including addressing the question of the confidence to be placed in the cornucopia of professional advice now on offer.

    http://www.irishtimes.com/newspaper/finance/2012/0521/1224316453128.html

    The author’s views are clear;

    “This is my favourite case for many reasons: it celebrates the cherished access to justice that an individual is afforded in this country, which should never be taken for granted; the Crotty legal team epitomised the time honoured pro bono tradition of the independent referral Bar, which must be safeguarded; the judgment continues to have a huge impact on our democratic system – the upcoming fiscal treaty referendum would not be taking place were it not for one person’s courageous stand against the resources and mindset of the establishment at that time”.

    However, one must have some doubts as to the rest of the article which deals with what were the political actions surrounding the judgement rather than its content.

    The authors states;

    “The Single European Act (SEA) was an international treaty which aimed to establish closer economic and political co-operation amongst member states. The Government decided that the Houses of the Oireachtas and not the people of Ireland would vote to ratify the treaty”.

    It wasn’t! It was a treaty amending the then Treaty of Rome with two parts; amendments to the existing texts in relation to economic issues (internal market, notably, but also the environment) and introducing some new provisions in relation to European Political Cooperation to be combined in a single [European] act. The Supreme Court found that the first part was covered by the existing constitutional amendment relating to Ireland’s decision to join the EU in the first place while a majority found that the second was not. As the EPC, which has since been transmogrified into the Common Foreign and Security Policy, has never been anything other than an inter-governmental agreement i.e. it is simply an agreement between governments which involves no transfer of sovereignty by definition (i.e. no other authority is given the right to adopt legislation which binds directly the citizens of the participating states), the majority judgement of the Supreme Court is as idiosyncratic and at odds with normal practice in other EU democracies today as it was when adopted.

    This is the issue that needs to be addressed as the referendum campaign in the present instance continues its increasingly surreal trajectory.

  22. Ceterisparibus Says:

    The NTMA gave “independent” advice to the government on the referendum….they won’t be able to borrow any money if we vote No.
    Does Noonan believe we are all gobshits?

  23. Colm Brazel Says:

    @John O’Hagan

    I think you left out these points:

    http://www.youtube.com/watch?v=gNa5k0KCVbw

    National Bank of America, greenbacks, history of money.
    http://www.xat.org/xat/usury.html

  24. seafóid Says:

    “Why is Ireland holding a referendum on a fiendishly complex treaty when no other country in the EU is doing so”

    all the money and hot air result in an increase in GDP equivalent to a Royal Wedding ?

  25. Bunbury Says:

    “Many things in life are complex and are not, understandably, properly understood by most people, unless they devote enormous amounts of their time to do so. That is why we leave so many important decisions to our democratically-elected representatives and not to plebiscites/referendums.”

    My flabber is well and truly gasted by the above. I’m not sure whether to laugh out loud or be disgusted by this contention. Words fail me to describe the mindset that could have written that given all we know about politics and politicians in Ireland. I’m voting yes but I won’t allow Prof. O’Hagan to put me off.

  26. DOCM Says:

    @ seafóid

    You could well be right. It might also be viewed as a form of stimulus for the advertising industry, not to mention a day’s holiday for a lot of people and gainful employment for some.

    What it adds to the sum of human wisdom, however, is another matter. Unless some element of national introspection on the issue begins, we might as well go the whole hog and consider turning counties into cantons. Unfortunately, the country’s economic capacity and prospects are not those of Switzerland.

  27. Colm Brazel Says:

    @ DOCM

    “Why is Ireland holding a referendum on a fiendishly complex treaty when no other country in the EU is doing so, that is the question!”

    I’d like to give a simple answer to that question that can be built upon later if need be.

    Perhaps you’d like to comment on these simple points made here re ESM, or perhaps you havn’t considered these, or you’d rather they remain hidden from view?

    Its self evident why the AG has put this matter to the people by way of Referendum. Its less to do with Crotty than the self evident fact someone could challenge the unconstitutionality of the provisions of the ESM in the same way Crotty did.

    http://www.youtube.com/watch?v=gNa5k0KCVbw

    Now FC is not exactly like the changing of the Weimar Constitution, but its dampening down of sovereign freedom in favour of unelected and authoritarian powers should give one the shivers.

    “In March 1933, with the Enabling Act, was passed by 444–94 (the remaining Social Democrats), the Reichstag changed the Weimar Constitution to allow Hitler’s government to pass laws without parliamentary debate for a four-year period, even such deviating from other articles in the constitution (the Act, forming the legal basis for the regime, was subsequently renewed by Hitler’s government in 1937 and 1941).”

    http://en.wikipedia.org/wiki/Nazi_Germany

    US congress was faced with a similar grab for power by the bankers and its FED but it capped the money that could be given to the banks.

    ESM can grab whatever it wants and sovereign members of the EMU will have to pay up under pain of sanction from ECJ.

    Those powers should be resisted.

  28. Colm Brazel Says:

    should be “Its less to do with Crotty per se than…”

  29. zhou_enlai Says:

    @Tull

    I want the Government to take advice before and during negotiations (which went on for months), not afterwards.

    Glad you are feeling yourself again :)

  30. Paul W Says:

    “Why is Ireland holding a referendum on a fiendishly complex treaty when no other country in the EU is doing so, that is the question!”

    Because that’s the law of the land. Period.

  31. The Alchemist Says:

    If Irish politics wasn’t so dysfunctional and corrupt, there would be a great deal of merit in taking these decisions out of the maws of referendums.

    However, the current givernment parties came into power accompanied by manifestos which they quickly set aside. How can anyone have confidence in a political culture that views such ‘cleverness’ approvingly?

  32. The Alchemist Says:

    @colm b

    Some sense of balance has to be maintained. Comparing the fiscal compact effects to the Enabling Act passed by the Nazis is really casting about more heat than light.

    What is the point in worrying about democratic deficits in the EU when Ireland’s own body politic could give master classes to any nation in the execution of the same?

    Democracy like debt default has to begin at home.

  33. The Dork of Cork Says:

    Its all talk talk talk.
    If anyone cared to notice , Irish civil society whatever its flaws has disappeared.
    Its been zombified by neo - liberal MTV trash.
    We don’t believe in anything anymore.

    I imagine the last days of the Roman empire went something like this…although they at least broke bread and drank wine rather then sadly staring at a computer which was somehow more human
    - Usury was banned for hundreds of years afterwards….

    Just saying like.

    We have all become atomised.

    Me thinks the shit will hit the fan shortly.
    The psychological stress of the bankers republic followed by the market state torture experiment will reap a whirlwind eventually.
    It perhaps needs another 10 years to stew and then………..

    If a Goverment committed treason like they did with the ESM 40 years ago the bogs would be alive with murmurings
    Now now , its quiet , very quiet as all the orcs waiting in the long grass have been paid off….. for now.

    Although perhaps we live withen a classic Soviet - we all know whats going on but are afraid to speak.
    As for RTE , Pravda was better as it was free at least.

    All I say never underestimate the banks willingness to persue their dark dreams.
    They created the Jackson Pollock that was Flanders fields , if they are capable of that they are capable of anything.

    http://www.youtube.com/watch?v=6ltiVOUmo9o

  34. tullmcadoo Says:

    Alchemist,
    I do not think it is correct to say Manifestos have been set aside. Just parts of them have been negotiated away and parts delayed. Neither Labour or FG got a single part manadate so they had to compromise. Judge in another 12 months. in fact run yourself in the locals in 2014 and see how you get on. If you think politics here is corrupt go to Germany where you will find member(s) of the cabinet who have had large sums of euro resting in their accounts from defence contractors.

    The problem with Referenda is that they get hi-jacked by groups with greviances-Farmers against Europe, Turkeys for Christmas. Thankfully, this time the Fiscal Treaty will cause Abortion crowd did not show up. Although DOD would probably embrace them.

    Zhou,
    Surely you accept that the AG has to have a final draft before opining. Anyway, there would have been a legal challenge in the absence of a vote and God knows how one of the auld lads down in the SC would have jumped.

  35. David O'Donnell Says:

    @Seamus Coffey

    Ta for that. That said I vigorously decline to agree to pay on the way up and 1/20th on the way down for that [a mere €90 billion or so] which is not mine.

    To vote yes is to accept the odious Conflationist Fallacy (originating in dodgy unregulated capital flows from the core) - which, at some stage will have to be dismantled if the EU, and the EZ, is to continue. IMHO, an Irish NO will assist the emerging realism ….

    @Tom O’Connor

    ‘Overall, it is fair to say that while the broad legislative and institutional scaffolding was present for many of the current provisions in the fiscal treaty, they were absent for others. Further, the specific requirements are almost totally new. It seems Irish people are being presented with momentous economic changes which are new to them and without any great knowledge of what the consequences will be.

    Agree. Looking forward to your response on CorkEconomics.

    @CorkEconomics Moderator
    I’m in the “q”.

  36. David O'Donnell Says:

    @Colonel Tull Yellow Ribbon McAdoo (anon,. MRRA)

    http://www.irisheconomy.ie/index.php/2012/04/06/terview-irelands-economy-could-recover-very-strongly/#comment-264413

  37. Paul W Says:

    @ Dork “If anyone cared to notice , Irish civil society whatever its flaws has disappeared…….We don’t believe in anything anymore…….we all know whats going on but are afraid to speak.”

    +1 I think that is the social (as opposed to economic) essence of it. We are no longer “proud to be Irish”. What is really at stake is our “Irishness”, our souls. We have forgotten (or are denying) our “community of neighbours” (unlike the Icelanders for instance). The country is increasingly soulless….something that cannot be measured economically. Sad. Sad. Shame.

    The economic discussion, as DO’D and others have noted, has become circular and fruitless. The old phrase “When God is Money, what is left when the Money is runs out” (or something like that) comes to mind. There is far more at stake here than mere Money.

  38. The Alchemist Says:

    @tull

    ‘If you think politics here is corrupt’

    Come. Come. I am in good company. Did not the recent tribunal report describe politics in Ireland as endemically corrupt?

    Forget about corruption in other nations - sound of brush running under carpet comes to mind. Ireland’s democratic accountability problems won’t be fixed by looking into a neighbour’s rubbish bin.

  39. Tullmcadoo Says:

    Alchemist,
    I suggest you read the section on Cllr John Hannon of FF. Mahon was not all seeing and may have over stated his case on small fry and pulled punches on large fry.

  40. Shay Begorrah Says:

    @Edward v2.0

    @ John O’Hagan

    Your analysis assumes that the interests of our ‘democratically-elected representatives’ and the average voter/taxpayers are aligned on the FST issue.

    A critical insight.

    Our government finds it easier to represent European interests in Ireland than to represent Irish interests in the EU. An easy to thing to happen, the Irish public is placid, deferential and trusting while Germany and the ECB are aggressive, indifferent and powerful. Why confront Merkel about austerity and unemployment when you can ally yourself with her against the unemployed?

    The political and financial classes and the wider set of European insiders have interests that are more closely aligned the neoliberals in the core than the Irish children not yet born who will be deprived because of the never ending bank bailout the Fiscal Compact commits us to.

  41. Bond. Eoin Bond... Says:

    Godwin’s Law alive and well in here i see. Our new currency should be backed by such a consistent and solid benchmark. The No side genuinely are their own worst enemy. Only Ganley actually manages to make some good points, but he has some baggage that he’ll never be able to shake off (with good reason).

  42. Colm Brazel Says:

    @BEB

    “Godwin’s Law alive and well in here i see” The glove fits .

    Socialism for the banks means what it says on the packet, ECM look enviously at the powers vested in the Chinese Central Committee. The economy in China took off under Li Xiannian and Deng Xiaoping in the 1980’s with a blend of private enterprise reforms and state communism.

    It would appear the powers given to itself by private banking interests rejected under QE by congress in the US is now on the agenda of the ECB/ECB as it contemplates its ‘reforms’ of democracy in the EMU.

    The whole project greases its wheels with Goebbels like propaganda telling people not to think but to rely on ‘witnesses’. The people shouldn’t be delving into ‘fiendish’ complexity though they’ll take the brunt of austerity as the 1% who’ve come up with the scheme line their pockets.

    You couldn’t make make a bigger mess if you tried :-)

  43. Colm Brazel Says:

    @Dorc 9:40

    +1

    Re Flander’s Fields, you sound a bit miserable there, cheer up. The payoff is not winning, but in being alive, enough to fight, a la Thermopylae, and enjoying the battle :-)

    “Take up our quarrel with the foe:
    To you from failing hands we throw
    The torch; be yours to hold it high.
    If ye break faith with us who die
    We shall not sleep, though poppies grow
    In Flanders Fields”

  44. seafóid Says:

    I am reading a book called Wars of Words about the Gaeilge and there was one bit in it that struck me.

    ..James (1) himself was concerned that Trinity College Dublin (founded in 1592) fulfil its mission to train Irish speaking clergy

    James I would have been the equivalent of Merkel

    Carry on

  45. DOCM Says:

    @ All

    Referendum anyone?

    http://www.irishtimes.com/newspaper/ireland/2012/0524/1224316607968.html

    The ESM is a treaty, after all.

  46. Bond. Eoin Bond... Says:

    Do we have a Godwin’s Law equivalent for references to Chi-Com’s? This place gets nuttier by the day. As mentioned above, i reckon that if the No side stopped campaigning they’d actually see a bump in their support.

  47. bazza Says:

    Life may be “complex”, but some things are not. One thing that is plain for all to see is that Irish government debt, stretching past 140% of GNP is unsustainable. There will be no “stability” in Ireland until the costs of the bank bailout are addressed and that will not happen until the government and the EU/ECB are forced to take their heads out of the sand.

    Do you serious believe that it will be possible to spend the next 20-30 years bringing the government debt from 120% of GDP to 60% of GDP, while we have low inflation, huge household indebtedness, broken banks and, eventually, much higher ECB interest rates. And do not bother appealing to the official estimates of nominal growth rates: 4.5-5.5% in the second half of the decade just will not happen. If you think it will be possible to have nominal growth of 4.5% in 2015, ask yourself what interest rates will be like in that scenario.

    To address your arguments, beginning with “which witnesses they can rely on in relation to an issue of such importance and who do they represent?”. You rightly note that most establishment parties are for this treaty. Are you seriously arguing that we should look for advice to an Establishment that gave us one of the largest housing bubbles in history, an atrocious bank guarantee and bailout and who regards 15% unemployment as “stability”? In contrast there are many voices on the No side who have been Europhiles or are even Euro-federalists. And since when did business people become economists? How will these business people react when the EU is setting our corporate tax rate in return for a future bailout? The presidential campaign of Mitt Romney shows us why businessmen are famously bad at economics: a state is not like a business.

    A lot of your arguments are centred around the fact that “Many of the rules outlined in the FST in fact are already enshrined in law”. Has it escaped your attention that the current policy mix, based around the current set of laws, is not working. That alone is reason enough for voting No.

    Voting No is not a rejection of the Euro or the “rules of the club to which we supposedly want to belong”. This type of scare-mongering is disappointing coming from a supposed economist. The FST is not even an EU treaty and the ESM doesn’t even exist yet, so how could a rejection jeopardise our membership of the Euro. If anything, recent events in Greece and argument like those coming from Martin Wolf, have shown that once a template is set for the a state leaving the Euro, then the whole house of cards will come crashing down. If Greece or Ireland or anyone else goes, so too will the whole Euro system.

    Your last paragraph is truly bizarre. You present a false set of choices. Do you think Switzerland or Denmark or Sweden practice Irish style “self-sufficiency as in the 1930s”? And given a choice between British or German monetary “rule”, I would opt for the former any day as the Bank of England has shown itself to be a far more competent and less ideological institution than the ECB in the face of the crisis. I can’t recall a governor of the BoE stupidly arguing the case for expansionary austerity, as Trichet did, or forcing the private unguaranteed debts of a bank on the citizenry.

    It is highly disappointing that many establishment economists and commentators, who really should know better, have come out for this treaty (fair-played to Kevin O’Rourke, Namawinelake and others who have swam against the tide). But as Upton Sinclair once famously said “it is very difficult
    to get a man to understand something when his income depends on his not understanding it”.

    I guess for many, a definition of “stability” is being able to continue enjoying their current standard of living and to hell with the young, the unemployed and the future of the state.

  48. Colm Brazel Says:

    @The Alchemist

    “Comparing the fiscal compact effects to the Enabling Act passed by the Nazis is really casting about more heat than light.”

    Let’s see now, we have Goebbels like propaganda telling people not to think. We have austerity prescriptions that will have to policed. We have a budget requiring approval from the Bundestag. We’ll have no say in budgetary matters other than outside consultant role.

    Dáil Éireann will be an ESM Dept of Finance among many others similar stripped of their powers across Europe. Divisions between the inner core and the outer core will involve a separation of powers stripping the outer core of any say in EMU.

    We don’t know, nor will have any say, in who the members of the ESM are. But if any country within Europe control that committee, next step is gaining full control of parliamentary democracy in Europe. That shouldn’t be too difficult given the austerity torture that will be required under FC. Divisions in EMU will be exacerbated by the strict terms of the ESM.

    This will lead to the growth of extremist parties conceivable many of them having neo nazi tendencies, already happening. So-called guardians of democracy turned into zombies lured by the payoff in blood of ESM riches endowed by favoring the financial sector and 1% at expense of the 99%.

    Interesting times when truth is stranger than fiction, above are legitimate concerns. I’m voting No.

  49. Colm Brazel Says:

    @ Bond

    “This place gets nuttier by the day”

    Just put your blinkers back on there and don’t be upsetting yourself. You can always call on fellow worshippers, the ‘witnesses’ from the Holy FC, to tell ye what to think, not that you would ever get the urge to. Lol

  50. Colm Brazel Says:

    @ bazza

    +1

  51. grumpy Says:

    @Eoin

    ” As mentioned above, i reckon that if the No side stopped campaigning they’d actually see a bump in their support.”

    Yes, if I were actively seeking a No vote I would be suggesting the campaigners stop being so vocal in trying to square circles in their arguments and pipe down rather. The ‘Yes’ campaign has been so heavy-handed, clumsy and at times downright shabby, as to do some of the ‘No’ campaign’s work for it.

    I think what is really going on is a jockeying for position in terms of who or what constitutes the opposition in Irish politics. People will remember Enda’s apparent timidity, FF’s falling in line and three line whip and SF will come out of it having lost the referendum campaign, but nicely positioned to say ‘we told you so’ if voters go looking for an alternative as the result of further recession.

    Politics is grubby.

    If SF eventually form a government it would be ironic if the constitutional amendments they opposed were to facilitate policies they would like to carry out.

  52. Colm Brazel Says:

    Gilmore is touting the nonsense of no change to FC

    http://www.limerickleader.ie/news/national/no-change-to-eu-fiscal-treaty-1-3875902

    He must be very relieved they havn’t withdrawn the blackmail clause and included protocols enabling writedown of ELA/PN debt.

    “Mr Gilmore told RTE that future growth talks will include ideas to make project bonds available to smaller countries, which means money available for things like infrastructure projects.

    Discussions on structural funds may also take place, which could see the transfer of funds that had been allocated to one country but not used transferred to another that needs them for areas including youth unemployment.”

    Now there may be some fools about who’ll blow away such promises as election promises and refuse to believe them wanting them to be signed on the dotted line. Other fools see lack of promises on ELA/PN debt writedown as casting Irish taxpayers to the wolves.

    Gilmore will have none of this nonsense. This FC is the way Irish Govt do business. You simply agree a UTurn tender with one of your cronies, have them draw up a contract, sign it and the contract allows dynamic alterations eg increasing costs to be included later :-)

    They’re maybe brown paper bags full of ‘project bonds’ later if UTurn Gilmore behaves himself :-)

  53. Ceterisparibus Says:

    Noonan live rte 1…….they definitely think we are all gobshites.

  54. Ceterisparibus Says:

    Follow up.

    Mickey explained the Treaty very well. “it’s like you have four members of a family with each having a cheque book drawing on the one account”

    How’s that for clarity? Any eejit can figure out that you must vote yes because one of the family will empty the friggin account.

    That’s a relief.

  55. Shay Begorrah Says:

    @Ceterisparibus

    Mickey explained the Treaty very well. “it’s like you have four members of a family with each having a cheque book drawing on the one account”

    Like I said before, the pro Fiscal Compact are juvenile and paternalistic at the same time. Creepy.

    Whether they drank the neoliberal Kool-Aid they or took the European political establishment soup our government and their fellow travellers in the media and academia are willing to dissemble and bully in order to put their class interests ahead of the nations.

    It is the establishment against the people. Disgusting.

  56. scorpio Says:

    @John O’Hagen - great to see someone pointing out a few (political) facts. It does not matter what treaty is put in front of those campaigning for a no - they will be against anything from the EU because they are fundamentally anti EU.-It is interesting to see how spectacularly wrong they were on many aspects of previous treaties that they campaigned against. I can remember the no campaign on the Mastricht Treaty telling us that it would imply a loss of Ireland’s neutrality - the evidence shows that this was rubbish. Now we are told all sorts of fairy tales again - the problem is that there are plenty of people who would like to believe in the fairy tales.

  57. Colm Brazel Says:

    @scorpio

    “a loss of Ireland’s neutrality - the evidence shows that this was rubbish.”

    I voted for Maastricht, ESM goes a lot further than loss of neutrality…but don’t take my word for it, look it up yourself :-)

  58. Shay Begorrah Says:

    @bazza

    Life may be “complex”, but some things are not.

    That was the perfect response Bazza. Thank you.

    <a href=”http://www.irisheconomy.ie/index.php/2012/05/23/john-ohagan-on-the-treaty/#comment-287182″Read it again folks, post the link on to your friends, and ask yourself why the collected wisdom of Ireland’s pro Fiscal Compact advocates seems so empty, short sighted and child like in comparison.

    http://www.irisheconomy.ie/index.php/2012/05/23/john-ohagan-on-the-treaty/#comment-287182

    If you are pro Fiscal Compact and well informed you might ask yourself why it is proving so hard to win this argument.

    It is not because the issues being argued are too difficult and complex for the layperson to understand, it is because even experts find the argument too difficult and complex to make.

  59. seafóid Says:

    @ CP

    “Noonan live rte 1…….they definitely think we are all gobshites”.

    20 minutes of sport on the RTE sunday evening news - that must be the working thesis

  60. Shay Begorrah Says:

    Off topic but indulge me, because it relates to the character of the witness.

    @scorpio

    I can remember the no campaign on the Mastricht Treaty telling us that it would imply a loss of Ireland’s neutrality - the evidence shows that this was rubbish.

    Of course, of course we are still neutral.

    This is what new neocon-alike Eamon Gilmore said when signing up to the US campaign to economically cripple its strategic competitor Iran.

    “Here we’re dealing with an undisputed fact that Iran is militarising its nuclear set-up. There is no argument about the threat that that poses,” Mr Gilmore said after the decision was announced.”

    Secret sources. Iran suspected of nuclear thought crime. It sounds like aslam dunk to me, eh?

    Needless to say there is no such proof and the spectacle of supposedly neutral Ireland taking such a position against a non nuclear weapon state in concert with several states who have thousands of nuclear weapons is almost too nauseating to face.

    Ireland’s neutrality has been seriously compromised by the last two EU treaties and the CFSP is one of the most retrograde and anti-popular democratic undertakings the EU has ever set out on.

  61. scorpio Says:

    @Colm Brazel -” ESM goes a lot further than loss of neutrality” - no it does not require us to fight in wars etc. as was claimed by the no camp on Maastricht. The FST will require us to live within our means - is that so bad???

  62. Bond. Eoin Bond... Says:

    Citigroup/Buiter looking for Greece exit early in 2013

  63. Peter Says:

    There is a stigma that all government spending is unproductive. Our population is growing faster than any other in Europe and we have a lot of first generation Irish to integtrate. The census found that one third of people born outside the Dublin area now reside in Dublin. Youth unemployment is at an unhealthy level and prospects have been drained for most people starting out at work. Our society is under pressure. This is a time for the government to invest in education and community supports.

    We only need to look across the water to see more advanced inequality - often argued to be a result of the hard-nosed Thatcher years.

    Most quoted “people in business” do not work in lartge capital intensive industries. They would be more likely to think in terms of re-investment as opposed to realistic appraisal processes (clear cashflow assessment doesn’t always apply either). Business people naturally serve their own interestss and do not think beyond 5 year horizon. These are responsibilities a government is tasked with. I see no comparison between household budgeting and government spending programs. It’s terribly simplistic.

    The monetary policy persued by the ECB is proof that there is not a “one size fits all” solution for Europe at present. The same applies to budgetary rules/constrains. The Fiscal Compact is not even part of the solution. Fiscal transfer is an argument more easily advanced - it’s about the only thing that could have curtailed our boom/bust.

  64. Shay Begorrah Says:

    HTML fail in previous post. My apologies.

    @bazza

    Life may be “complex”, but some things are not.

    That was the perfect response Bazza. Thank you.

    Read it again folks, post the link on to your friends, and ask yourself why the collected wisdom of Ireland’s pro Fiscal Compact advocates seems so empty, short sighted and child like in comparison.

    http://www.irisheconomy.ie/index.php/2012/05/23/john-ohagan-on-the-treaty/#comment-287182

    If you are pro Fiscal Compact and well informed you might ask yourself why it is proving so hard to win this argument.

    It is not because the issues being argued are too difficult and complex for the layperson to understand, it is because even experts find the argument too difficult and complex to make.

  65. Ceterisparibus Says:

    @Bond. Eoin Bond

    I think Citi said 1st of Jan but I can’t see it going on that long. Probably be a good time to do it with Christmas hols and all that. At the rate their 10 yr is going (14.20 today) you probably will get them for fiver by December.
    I suppose you could paper the loo with them.

  66. Ceterisparibus Says:

    @Peter
    ” I see no comparison between household budgeting and government spending programs. It’s terribly simplistic.”

    Angela Merkel doesn’t think so and our own Mickey Noonan warns of the dangers of giving cheque books to family members without having a family fiscal compact in place.

  67. Peter Says:

    @ Ceterisparibus

    “giving cheque books to family members” is an anti-intellectual statement for a finance minister to make. He seems to make one per day. I assume he writes them down and takes beaming pride in them later.

    Some fine points made here: http://www.irishtimes.com/newspaper/opinion/2012/0524/1224316608249.html#

    It’s a crying shame the “no” argument was discounted as “looney left” before any real debate could take place. The representation has been generally weak but the overall handling brings McCarthyism to mind.

    Bread and Circuses…..

  68. seafóid Says:

    Alphaville on that Citi Grexit piece

    http://ftalphaville.ft.com/blog/2012/05/23/1013951/from-citi-another-grexit-scenario/

    How does one build all this political risk into an Excel model ?

  69. V Barrett Says:

    @Scorpio

    Lucinda Creighton of Lisbon I & II fame derided ‘no’ advocates for peddling fear by making the “alice in wonderland/ludicrous/ridiculous’ suggestions that closer integration with Europe would mean our Corporate Tax would come under pressure. She told us the veto was the veto was the veto (a la Maggies “a crime is a…” speech)…..

    To my mind we have not signed up to any treaties since the passing of Lisbon II and so one would imagine the power of the ‘veto’ Lucinda assured us of would be still the trump card….but low and behold we now have Lucinda telling us that if we do not pass the Fiscal Treaty, our Corporate Tax rate will come under severe pressure…..now is that because the “no” campaigners in Lisbon I and II were actually right or at least on the right track notwithstanding what was in the “wording” of the treaties or is it because a veto means nothing in new dawning europe/fatherland!

    Either way Loose Lips Lucinda’s got some explaining to do…

  70. scorpio Says:

    @V Barrett - the last time I looked the veto on corporation tax is still there so LC was absolutely right then. The FST has nothing to do with corporation tax.

    It is a fact that the anties do make up lots of fairy tales to scare voters when they are simply anti EU and don’t care about the substance of any treaty. Of course they also have no credible alternative - how do you propose to fund our deficit?

  71. seafóid Says:

    http://www.guardian.co.uk/business/2012/may/23/challenges-to-crazy-economic-orthodoxy

    The “muted” response of US academic experts to the global financial crisis has been noted, as has its partial nature. (Heist – Part 2, G2, 22 May). More remarkable, perhaps, has been the extraordinarily limited response to the crisis of the mainstream economics profession as a whole. The background to this lies in the extent to which so-called “neoclassical” economics has succeeded in purging the subject of the so-called “institutional” factors that embrace the political, economic and social organisations primarily responsible for the creation and management of the crisis in the first place.
    And so long as prevailing economic theory is dominated by models abstracted from such “exogenous” factors, it is unsurprising that its practitioners have so little to say about the real world. I found this illuminated, if parochially, by the University of Glasgow finding, some decades ago, that the name of Adam Smith’s “department of political economy” was unfortunate, being a possible deterrent to the recruitment of students from countries such as Saudi Arabia. The “political” element in the economics of its founding father was therefore removed, with the Adam Smith Building now housing the more respectable “department of economics”.
    Brian Pollitt
    Honorary senior research fellow, department of economics, University of Glasgow

  72. V Barrett Says:

    @Scorpio

    ….I agree with you the veto is still there…..so can how Lucinda Creighton lambast the Nos for scaremongering in previous treaties on our corporate tax and then tell a press conference just two days ago that our Corporate Tax will come under serious pressure if we vote No.

    Its okay for LC to play the fear card on corporate tax in this referendum because it suits her ends but it wasn’t okay for the no side to do so in the Lisbon 1 and 2?

    I think the hypocrisy is self evident. It is not good enough that she envisages new scenarios that could dilute the value of the veto simply because it is convenient to her case….she might even be right about it but the bottom line is that she is now saying a veto may not be a veto….while Lisbon 1 and 2 she was resolute and very vocal in her view that a veto was indeed a veto…in the meantime nothing in law has changed….but much has changed in Lucinda’s mind

  73. V Barrett Says:

    @scorpio

    …further….if Noonan can tell us that the Fiscal Treaty is now a stepping stone to Eurobonds….i can tell you that there is no chance on earth of seeing our corporate tax regime co exist with a Eurobond regime which we are part of!

  74. scorpio Says:

    @V Barrett - didn’t hear those LC comments but clearly not correct. I wouldn’t get too excited about Eurobonds yet, as I dare say there will be German veto on that no matter how much the media need to fill airtime and column inches (and by the way remember France is still awaiting another election).

  75. Ceterisparibus Says:

    @Peter

    Thanks for link. Compelling argument and it doesn’t look like he is from the looney left.

    But don’t you just love Mickey Noonan’s little homilies. He would have made a great preacher….

  76. Joseph Ryan Says:

    @Seafoid

    re”How does one build all this political risk into an Excel model ?”

    I note you are a reader of WB Yeats. May I suggest that the excel sheet people should try either of the following for a evaluation of political risk, particularly that of a hasty Greek exit.

    “A shadow of cloud on the stream
    Changes minute by minute;
    A horse-hoof slides on the brim,
    And a horse plashes within it;
    The long-legged moor-hens dive,
    And hens to moor-cocks call;
    Minute by minute they live:
    The stone’s in the midst of all.”

    or
    “Surely some revelation is at hand;
    Surely the Second Coming is at hand.
    The Second Coming! Hardly are those words out
    When a vast image out of Spiritus Mundi
    Troubles my sight: somewhere in sands of the desert
    A shape with lion body and the head of a man,
    A gaze blank and pitiless as the sun,
    Is moving its slow thighs, while all about it
    Reel shadows of the indignant desert birds.
    The darkness drops again; but now I know
    That twenty centuries of stony sleep
    Were vexed to nightmare by a rocking cradle,
    And what rough beast, its hour come round at last,
    Slouches towards Bethlehem to be born? “

  77. David O'Donnell Says:

    No vote a first step towards growth

    By Michael Taft

    Friday, May 25, 2012 in The Neu Paper of Record

    The kernels of the crisis, bank debt and growth, are not in the treaty, writes Michael Taft

    THERE are two forces driving the European crisis. The first is the continuing instability in the European banking system. The second is the spectre of low growth and stagnation. The fiscal treaty has nothing to say about the banking crisis and it will make the low-growth crisis even worse.

    That is why the fiscal treaty is bad for Ireland and bad for Europe.

    The fundamental flaw of the treaty is that it badly misdiagnoses the European “disease”. It mistakenly assumes the crisis started with state debt. Instead, the crisis was started by the private debt of badly regulated and profligate financial institutions — a situation we know all too well here.

    http://www.irishexaminer.com/analysis/no-vote-a-first-step-towards-growth-195087.html

    +1

  78. seafóid Says:

    @JR

    There is definitely an air of systems breaking down and centres that cannot hold

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