Right-Wing Think Tank Praised Ireland's 'Economic Freedom' ... and Then Its Economy Crashed
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As a result of the continuing euro crisis, European Central Bank (ECB) now finds itself buying up the debt of all the weaker eurozone governments, making it the – perhaps unwittingly – feudal boss of Europe. In the coming years, it will be the ECB and the European Union who dictate policy. The policy elite who run these structures – along with their allies in the private sector – are the new overlords.
We can argue about who exactly are the peasants, the vassals, and the lords under this model – and what services exactly will end up being exchanged. But there is no question we are seeing a sea change in the post-war system of property, power, and prosperity across Western Europe, just as Hayek feared. An overwhelming debt burden will bring down even the proudest people.
Ireland's plight illustrates the lie of the austerity cheerleaders. Austerity does not lead to growth and recovery anymore than the cronyism, deregulation and free-market fundamentalism typical of conservative failure in the realm of economic policy. Austerity means that the "tough" decisions politicos and pundits tell us must be made are invariably toughest on the people already having the toughest time.
Austerity's epic fail has turned the Irish Tiger into a Tiger skin rug for banks and bondholders to trod upon. A similar fate will be the likely reward of any country threat that looks to austerity for growth.