The IMF has a useful new paper on the possibility of self-defeating austerity. Paul Krugman responds here. The paper shows that fiscal adjustments will bring the debt to GDP ratio down over time relative to a no-adjustment baseline, although the ratio will rise in the short run when the multiplier is greater than one. For the Irish case, this phenomenon was pointed out in the April 2012 Fiscal Assessment Report from the Irish Fiscal Advisory Council (see Box C, p. 45). See also posts here and here. The IMF paper also has an interesting suggestion for setting and monitoring debt targets in cyclically adjusted terms.