Irish People Say: Default! Other Governments Go MAD – Screwing the Future
December 1, 2010 · Posted in Global Economics
The Independent writes:
A SUBSTANTIAL majority of the Irish people wants the State to default on debts to bondholders in the country’s stricken banks, according to a Sunday Independent/Quantum Research poll.
The finding that 57 per cent favour and 43 per cent oppose default reflects a growing view among policymakers and opinion formers that the State simply cannot support the debt burden it has taken on.
The telephone poll of 500 people nationwide has also found that a majority of around two-thirds opposes the headline measures in the Government’s four-year plan.
Following Fianna Fail’s loss of the by-election in Donegal last week, the findings will add to political uncertainty as an austerity Budget approaches on December 7.
As Ireland awaited the fine details of the international bailout, which are expected tonight, it was learned last night that the Irish delegation negotiating with the EU-IMF last week raised the issue of default.
“The Europeans went completely mad,” a senior government source said.
Mad? Why? Because it’s THEIR ass that’s on the line, not the Irish’s:
Total foreign bank exposure to Ireland’s economy is $844bn, or five times the value of Ireland’s GDP or economic output. Of that, German and UK banks are Ireland’s biggest creditors, with €206bn and €224bn of exposure respectively.
To put it another way, German and British banks on their own have each extended credit to Ireland greater than Irish GDP. Which doesn’t sound altogether prudent, does it?
As for direct bank-to-bank lending, overseas banks have provided Ireland’s banks with €169bn of loans, which is also greater than Irish GDP.
Here is another illustration on Germany’s banks’ exposure to Irish and other gambles:
Screwing the Future
It is important to understand that government debt is always about screwing the future to enrich connected people in the present:
Ironically, when you look at the political stage, all you will hear in regards to “solutions” to deficits in the end, will be tax hikes. These are not solutions. They are the ultimate manifestation of the very problem at hand. They are, in fact, the precise opposite of a solution. Keep this in mind whenever you hear politicians talk about deficit solutions. Raising taxes to reduce deficits is absolutely and 100% an admission that one has completely failed to solve this deficit problem, and in fact laid the final brick that was missing in the very process of the public’s depredation via deficit spending.
Thus European governments will fight tooth and nail to raise as much money as they possibly can in exchange for promising their lenders and increased loot from increased future theft.
In this particular case it will be Irish taxpayers in the future who will foot the bill.
So long as people cling on to the fantasy of the necessity governments, all this stuff will be so completely predictable that it’s almost boring, and it will continue to go on as I have been pointing out from the very beginning of when this financial crisis started hitting Europe.