Max Doyle: Short view
Published 23/01/2011 | 05:00
FINALLY, the country will get to vote on who will make the big decisions over the coming years.
No matter how committed any new government is to legacy agreements, the forces of hope and imagination are essential now to restore our national confidence. It seems the strategic direction of the new administration boils down to two choices -- stay with or tweak the current austerity programme and hope the tides of growth and inflation lift all boats, or get busy planning a restructuring of our national debt or, preferably, the malignant guarantees on bank debt.
In terms of the restructuring agenda, a nation cannot expect its creditors to agree to take their share of losses and simultaneously protect the wealth of its citizens and corporations.
On the other hand, the nation cannot restructure its liabilities and leave other citizens with a overwhelming burden of debt unadjusted.
This is why distribution of financial loss is rarely achieved consensually amongst stakeholders and so restructuring or defaulting is a last option. Because the gap between Ireland's income and expenditure is so big, if no one will sub us while we try to close the gap, the level of cuts necessary would be so sharp as to sink the country and drive us into poverty.
Simply put, you can't tell creditors you are not paying them and then ask them for more credit. But if we were to reduce the deficit, we would be in a better negotiating position and the IMF/EU have left us with this alternative.
Right now, Ireland needs Europe more than she needs us. So if you vote for a candidate with a restructuring agenda in this election, make sure they are fluent in German.
Max Doyle is a principal of Prime Focus Management specialising in investment and turnaround of Irish companies
Sunday Indo Business