EU/ECB needs to realise debt burden must be shared

When our economy imploded in 2010, the bailout provided by the Troika in 2010 was calculated on the best estimates of how long it would take Ireland to balance its day-to-day income and expenditure and the best estimates were this could be achieved by about 2014/15.

The Troika were also able to take advantage of a weak government, for whom no stroke was too risky if it meant Fianna Fáil clinging to power for longer, and demand that it issue a blanket bank guarantee before there would be any bailout provided. The result was that Ireland received a bail-out of €85bn, which was €35bn for the banks and €50bn to be used for day-to-day spending in the years ahead until we were able to cut our coat to our cloth and this was to repaid with interest.

If the bank guarantee had never been agreed to, it is not unreasonable that affected banks would have restructured their bad debts long ago and agreed debt write-offs to consumers and business. The sky wouldn’t have fallen in and some semblance of normal economic activity would have restarted. As a country, we would also now be far ahead of where we were expected to be at this stage in getting our day-to-day spending under control and the Government would have some room to afford a stimulus package.