by Sunny Hundal

The Indy’s leader writer Ben Chu said the other day:

Until very recently Ireland was the neoliberal darling, despite its membership of the euro and despite its insistence that every bondholder in its banks needed to be made whole. And the right in this country genuinely believed that Ireland could cut its way to health at a time of depressed European and global demand.

He adds: “What happens when right-wing economic ideology meets reality? The answer in one word: Ireland.”

And it’s worth showing how badly right-wingers in the UK got it wrong over Ireland, and why they’re now trying to blame the Euro.



1. George Osborne in The Times (February 23, 2006): Look and learn from across the Irish Sea

Economic stability must come before promises of tax cuts. If, over time, you reduce the share of national income taken by the State, then you can share the proceeds of growth between investment in public services and sustainably lower taxes. In Britain, the Left have us stuck debating a false choice. They suggest you have to choose between lower taxes and public services. Yet in Ireland they have doubled spending on public services in the past decade while reducing taxes and shrinking the State’s share of national income.

Funny, that deregulation and ‘economic stability’ didn’t quite work according to plan did it?

2. Hamish McRae in the Independent (December 16, 2009): We have a lot to learn from Ireland

So what should we learn? Ireland last week moved to correct its fiscal mistakes, whereas we are still in denial about them. Just as important, the austerity budget it brought in seems to have been largely accepted by the Irish people. And if past experience is any guide, this budget will start to lay the basis for a return to solid growth.

Moral: never take lessons from the past from right-wingers.

3. Guido Fawkes with his crystal ball (December 9, 2009): The budget Britain needs was delivered in Ireland

By coincidence here in Ireland it was also budget day, the Finance Minister Brian Lenihan delivered a 7% cut in public expenditure to match the 7.5% fall in GDP in 2009. To equal that Alastair Darling would need to have announced £40 billion in public expenditure cuts today. Here are some of the reasons Guido thinks Ireland will bounce back faster than the UK…

(And before that in 2008… Ireland “safest place to deposit money”)

4. Iain Dale on his blog (December 10, 2009):

Darling said on TODAY this morning that the non ringfenced departments’ budgets would be “broadly flat” in the years after 2011. So, how, exactly, does he intend to cut borrowing by half? The answer is that he intends to do it by the extra tax proceeds which will be raised by the economy growing at 3.5% a year. The only trouble with that hypothesis that no serious economist agrees with the Chancellor that growth will be at that level. Indeed, you don’t have to look too hard to find economists who believe there will be very little growth at all. Guido is right. The PBR the British Chancellor should have delivered, was delivered yesterday in Dublin. Hopefully George Osborne is studying it in great detail.

5. Daniel Hannan MEP on his blog, also praising ‘tough’ action (March 24, 2010):

Could any Chancellor get away with such a speech? Yes: these very words were spoken by Brian Lenihan, the Irish finance minister, when he introduced his budget three months ago.

…

Gordon Brown, uniquely, seems to believe that you can inflate your way out of trouble, spend your way out of recession, borrow your way out of debt.

(And remember Hannan’s fabled predictions about the Icelandic economy?)

6. Liam Halligan in the Telegraph (Apr 03, 2010): Rebounding Celtic tiger offers UK harsh lessons in demolishing debt

True, Ireland has racked up a 2009 budget deficit equal to 11.7pc of national income – almost as ghastly as that of Greece. The difference is that Ireland took, and is continuing to take, genuinely decisive action to get its fiscal house in order. There’s little talk among ministers in Dublin of “just a few more months of Keynesian boost”. The Irish have rolled up their sleeves, spat on their hands and are getting on with the job. As a result, the country’s government and taxpayers have been rewarded

It seems the only people ‘rewarded’ are the country’s bankers.

* * * * * * * * *

Caught so badly with their pants down and predictions dumbfounded, the Right has decided that the blame lies squarely with the Euro. Apparently they predicted this all along.

But that wasn’t the case at all. As Ben points out, the above had…

No mention of the Euro. No mention of a property bubble. No mention of crony capitalism. Just blind cheerleading for a deregulated, low-tax economy.

And look where that got the Irish. Says it all really.