The exchange focused on a leaflet Sinn Fein has produced on the Stability Treaty referendum. The full leaflet can be seen here and this is the part that was in question today.
The comments focused on the sources of the quotes used from some “experts”. Karl Whelan (an expert without the quotation marks) had already flagged this as early as last Thursday. Here is a video showing today’s discussion courtesy of journal.ie.
It is an entertaining exchange but it doesn't add a huge amount to the debate on the actual issues relating to the Treaty. The Sinn Fein leaflet quotes me as saying:
“Had the Fiscal Compact being in place since 1999 it would not and could not have prevented the crisis in Ireland”This quote is 100% accurate and, of course, is true. It is taken from my opening presentation to the Joint Oireachtas EU Affairs Committee meeting from the 22nd of February (transcript) and is also referred to in my written submission to the Committee. Here is some of the text from the transcript surrounding the quote.
However it must be acknowledged that it is not just the treaty that will impact on countries. An important change during the past couple of months has been the adoption of the six pack, which has not received sufficient attention. Had the fiscal compact been in place since 1999, it could not and would not have prevented the crisis in Ireland because we would have satisfied the structural deficit and debt break rule during the last five or six years prior to the crisis. As such, it would not have helped us in terms of avoiding the crisis.
Some elements of the six pack are important and may have to some extent alleviated the crisis in which we now find ourselves.I repeated the view in bold as quoted in the leaflet towards the end of my remarks.
The fiscal compact would not have prevented the Irish crisis. While there are issues about the flexibility it offers, the so-called six pack and the further measures in place would have, if applied retrospectively, had an impact.These measures are the government expenditure rule and the Macroeconomic Imbalance Procedure both of which now form part of the toolkit to be used when fiscal and economic performance in EU members is being assessed but are not included in the Stability Treaty.
In his questioning of Gerry Adams, Paschal Donohoe quoted me as saying:
“If the Treaty is rejected we will be forced to adhere to the budgetary rules anyway but will be denied access the new European Stability Mechanism (ESM) bailout fund. We cannot avoid the fiscal rules in the Treaty. All in all there is little to be gained from rejecting the Treaty.”Again this quote is 100% accurate. This is extracted from the final paragraphs of a recent article I wrote for The Evening Echo.
If the Treaty is rejected we will be forced to adhere to the budgetary rules anyway but will be denied access the new European Stability Mechanism (ESM) bailout fund. This will have no impact on the current EU/IMF programme we are in and, if necessary, this programme can be extended. However if Ireland needs to enter a new programme of assistance at some time in the future we will not be granted assistance via EU loans and may be left in a vulnerable funding position.
There is little that is new in the Treaty, and some of the rules governing fiscal policy in the EU have been left out altogether. It is hard to know why this Treaty is necessary, apart from appeasing voters in France and particularly Germany.
We cannot avoid the fiscal rules in the Treaty. We cannot avoid the measures necessary to bring our deficit under control. The Treaty may be part of a long-term move for a more fiscally-integrated Europe. This would be a real change and one we should be part of. All in all there is little to be gained from rejecting the Treaty.The parts in bold were used by Paschal Donohue today. All in all, it is a little ado about nothing.
There are many strands to the EU response to the current crisis. They won’t all be right but they should not be considered in isolation. Focusing on short, and sometimes abridged, quotes can provide some entertaining parlour games but does not get us any nearer a full understanding of the issues involved. Tweet