Martin asks who on the No side will fill Ireland’s €18 billion shortfall?

A broadside from Micheal Martin the Irish Times today… He warns the Yes campaign not to get bogged down in a rebuttal game, but instead make its own case for a yes vote: namely that “for Ireland to recover we need Europe’s support”… And he explains why he thinks that:

Any alternative funding would lead to billions in extra interest payments, meaning more taxes and less spending. To be fair, some No parties are being honest in admitting that they would impose billions in immediate new “wealth taxes” well beyond anything planned. Because it means cheaper and more secure funding, a Yes is clearly the vote for the least austerity.

He goes on to note that…

In two years’ time Ireland will need to raise at least €18 billion from somewhere. I want Ireland to be able to borrow that money at affordable rates on the open market. If that’s not possible I want Ireland to have a secure alternative that it can afford. Both of these conditions require both proper budget controls and access to the European Stability Mechanism (ESM).

If investors know that Ireland has solid budget controls in place and has the back-up of ESM funding, their willingness to lend to Ireland will increase and the interest rate we pay will reduce. The ESM itself as a final option represents the cheapest possible borrowing for Ireland.

Any alternative funding would lead to billions in extra interest payments, meaning more taxes and less spending. [emphasis added]

And…

Under every conceivable scenario, strengthened fiscal controls are part of restoring confidence and growth to Europe. They cannot and will not deliver growth by themselves, but they will help rebuild confidence and provide the foundation for further moves.

Finally…

If there is a No vote the Government will not fall, but it is the people of Ireland who will suffer from damaged international confidence and having to seek less secure and more costly funding for vital public services.

On the other hand, a Yes vote provides for a safer, more certain pathway out of the crisis.

Mick Fealty

Mick is founding editor of Slugger. He has written papers on the impacts of the Internet on politics and the wider media and is a regular guest and speaking events across Ireland, the UK and Europe. Twitter: @MickFealty