McWilliams: Plan will vaporise the economy

ECONOMIST David McWilliams has warned the Irish economy will “vaporise” if the Government presses ahead with its four-year austerity plan.

Speaking at Glor in Ennis, Mr McWilliams said the Government’s four-year National Recovery Plan will drive down wages and prices for four years.

“Maybe we will get competitive, but the economy will vaporise, there will be nothing productive left,” he warned.

In a question and answer session with the audience after a performance of his Outsiders production, Mr McWilliams warned that the austerity plan will result in increased unemployment and emigration.

The author said: “Irish people need to take back decision-making. Our political class needs to be aware that the deal with the International Monetary Fund (IMF) is not in our interests. We need to make our politicians aware of the fact that they won’t get our vote if they stand over the deal with the IMF.”

Mr McWilliams said the deal between the Government and the IMF and the EU “is not worth the paper it is written on”.

Mr McWilliams also hit out at the bondholders, describing them as ‘bullies’.

He said: “They need to be told what to do. Rather than stand up to the bullies, every single time we get an opportunity to stand up to them, we say ‘what would you like us to do?’.”

Mr McWilliams said that instead of paying off the banks’ debts, there needs to be a debt equity swap with the European banks owed money.

He said: “We should tell them that we can’t pay you all of the debts, but we have a plan, ‘you take a share of our banks and we work together and the banks are still breathing and then recover and then you get paid back’.”

He pointed out: “This allows us to grow and recover and prevents the crisis that is happening all over Europe.”

He said: “We need this deal, because the Irish economy will sink otherwise.”

He added: “We don’t want to default. We are not a delinquent nation, but the figures are just too big.”