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A state worse than default

If the Irish are, as the latest edition of the world travel guide Lonely Planet claims, "fatalistic and pessimistic to the core", one could hardly blame us.

Still, those journalists who fear extinction, if politicians ever learn from history, should at least be hopeful, for nothing epitomises the apparent determination of this administration to voluntarily strew land-mines in its path more than its plans to hold a series of referendums on issues such as the abolition of the Seanad.

The problem with such proposals is not just that in terms of political importance, the existence or otherwise of the Seanad ranks barely above the dress code of the Dail. Instead, the most deleterious consequence of such campaigns, as Garret discovered courtesy of his ill-fated 'constitutional crusade' is that chasing after constitutional chimera diverts the attention of politicians from more serious issues.

The Government claims politics needs to regain public respect, but, if it is sincere, a far simpler road to that goal would consist of a new culture of honest speaking and acts of good authority. Such virtues were not evident, to the naked eye at least, last week, as in a reprise of the delusionary 'Ireland is fully funded' politics of its predecessors, a Government that is losing rather than creating a thousand jobs a week absolutely dismissed the possibility of a second Irish bailout.

We are used to delusional Irish politicians, but those who are naturally suspicious will suspect the EU is being desperate, or worse still disingenuous, when little commission bureaucrats are trotted out to claim talk of a second bailout is unhelpful when "Ireland is progressing well and enjoying economic growth". In fairness, the Taoiseach, and the Finance Minister, have to put the good side out when visiting or talking to foreign friends. It would, however, be a matter for serious concern if they or the NTMA really believed the nonsense they spoke last week.

The objective truth is that five years into the great disruption one fundamental economic fact has not been recognised or is being deliberately evaded. Ireland could deal with a sovereign debt or a banking crisis in isolation. But, when the two are entangled, as is the case here and in Europe, the self-defeating economics of dumb austerity offer us nothing more than the economic equivalent of endless night. Within the Irish economic experiment, in particular, the inevitable consequence of the failure to find a solution to the banking crisis has consisted of a collapse of confidence. Now all we can do is pray, that some day our Department of Finance-led political slow-learners will resolve the banking crisis/growth/confidence Gordian knot and carve a way out of the current slow, sad, self-fulfilling prophecy.

It can only be hoped, in this regard, that Mr Kenny is playing a cleverer game than we think him capable of, where the current immoral reparations will be mitigated by ongoing adherence to the terms of our fiscal probation act. On a good day it might even happen, but, if we continue to protest too little, the concern must be that Ireland will be turned into the fiscal equivalent of one of those 'respectable' fallen Victorian women, where if Mr Sarkozy annexes our corporation tax rate, we will be allowed to live in "frugal discomfort" so long as we remain conscious at all times of our "shame" and properly grateful to the parsimonious charity of Frau Merkel.

Some would call that a state worse than default.

Sunday Independent