Drastic Cuts and Punitive Interest Rates: The EU Is Pushing Ireland to the Brink of Ruin

[marmar]

from Der Spiegel:



The Irish government has just passed its fourth budget in two years. But the drastic savings measures it contains will not help the country's massive debt problem. Some economists are now predicting it is only a matter of time before Ireland defaults.

The sum is enormous: €6 billion ($7.9 billion) is how much the Irish government wants to cut from the public finances next year. The drastic course of treatment, the fourth budget in two years, was passed by the Irish parliament late on Tuesday night. It will be a huge test of strength for the small country: The average Irish household will be €7,500 worse off by 2012, according to the Irish Independent.

The Dublin government has been congratulated and encouraged from across the European Union for being so brave in sticking to its austerity goals. The unemployed, low-income workers, pensioners, students -- hardly any sector of society has been left unscathed.

Yet this huge national sacrifice will not significantly improve the country's massive debt problem. The sometimes severe cuts to social welfare payments, public sector pay and state investment pale into insignificance when compared to the massive gaps in the Irish banks' accounts. That is why investors are continuing, undeterred, to speculate on Ireland's eventual insolvency.

Irish Taxpayers Paying the Bill

The bailout loan of €85 billion that the EU, the European Central Bank and the International Monetary Fund agreed to extend to Ireland just over a week ago had failed to calm market jitters. And why would it? After all, it actually exacerbates the country's financial problems. ..........(more)

The complete piece is at: http://www.spiegel.de/international/europe/0,1518,733522,00.html

[angstlessk]

1. ALL THIS TO SAVE BOND HOLDERS..WHO HAVE INSURANCE....

WHY THE FUCK DO BOND HOLDERS NEED INSURANCE WHEN THE TAXPAYERS ARE THEIR INSURANCE?