Northern Ireland scarily like Greece

I am concerned again at those, predominantly on the Left but occasionally on the Euro-sceptic Right, who are suggesting that Greece is a victim of circumstances (or of the EU). It is a victim of its own gross stupidity, and the EU has been more than generous with its offers of assistance.

Greece effectively doubled public sector pay in the 2000s, and was then surprised as inflation soared in effect to as high as 30% – based entirely on borrowing money on the back of dodgy finance figures rather than actual exports (in fact its trade deficit came to approach 10% of GDP). In return, the EU offered an exceptional 30-year deal to sort out its government debt and half of private-sector debt was written off. Poor Greece, eh?! And how unreasonable of those pesky Eurocrats!

Northern Ireland has not done anything on that scale, it has to be said. However, it too did gain from a remarkable rise in public spending (and public sector jobs and salaries), with the subvention (the gap between revenue raised in Northern Ireland and public money spent) doubling from 1998 to 2007, plus significant EU funds. The Executive came to think that its job was merely to take credit for doling out money Northern Ireland had not actually earned and, like the Greek Government, made no allowance for the day when financial reality struck. The UK’s offer to Northern Ireland last year of “£2 billion more spending power” was significantly less generous than that of the EU but it was generous and, after all, the average Northern Irish person in the street has not suffered anything on remotely the same scale as the average (not ultra-rich) Greek.

The scales are different but the fundamental problem is the same – the governments involved have failed abjectly to address the basic problem of unsustainable public spending, including one particular party who insists that all the self-created problems were really someone else’s fault (alongside the fiction the restrictions are being imposed by someone else who is actually taking every reasonable step to help).

Northern Ireland and Greece are both behaving like noisy teenagers blaming everyone else for the bad consequences of what were actually their own actions, having been given countless opportunities to sort it out.

So, we now have supposedly “left-wing” parties more interested in deflecting blame for the problem than solving it. The worst thing is that the cost for this ludicrous self-preserving folly will be borne almost entirely by those who can least afford to pay it.

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2 thoughts on “Northern Ireland scarily like Greece

  1. Scots Anorak says:

    I’m surprised that you haven’t mentioned the problems of tax avoidance / evasion and capital flight in Greece. It is absolutely true that the country had a problem with excessive spending (and in some cases excessive tax breaks), but it also has an ongoing one with securing legitimate income. To pretend otherwise is to give only half the story. It’s also the case that the austerity has clearly caused the economy to contract, making payments more rather than less difficult. History will of course be harsh on previous Greek Governments, but it might also judge that more debt forgiveness would have been a sensible move on the part of creditors, who may now end up getting nothing.

    • The issue of self-determination is to be respected though. If the EU rather than design a good bailout deal that they would take, made one that accommodated all of Syriza/ADEL red-lines, but costed them appropriately then maybe we would see more progress here.

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