Ireland: for the UK, the unwelcome shape of things to come?

Whatever you do, don’t bracket Ireland with Greece – but Larry Elliot Economics Editor of the Guardian just has. The argument is hardly new to Slugger, but here, it’s also invoked to say how right Britain was to stay out of the euro and contains a warning against a particular view of public spending cuts.

Ireland is Labour’s dystopia of a Tory Britain The consensus view in the markets is that Ireland will be rewarded for its prudence …. (but) there is a considerable risk that removing spending power from the economy will lead to more companies going bust and deter the survivors from investing more..

The onset of austerity, according to some commentators, has been greeted with a certain stoicism, as if there had to be payback time after the excesses of the boom years. Even so, the fiscal retrenchment is stretching the social fabric to its limits…
Ireland’s property boom-bust during the noughties was a textbook example of what can happen if a country loses control of its own monetary policy – rates were too low early in the ­decade, leading to a colossal misallocation of resources away from exports towards construction, whose share of the economy more than doubled from 6% to 14%

Former BBC journalist and manager in Belfast, Manchester and London, Editor Spolight; Political Editor BBC NI; Current Affairs Commissioning editor BBC Radio 4; Editor Political and Parliamentary Programmes, BBC Westminster; former London Editor Belfast Telegraph. Hon Senior Research Fellow, The Constitution Unit, Univ Coll. London