Fiscal measures shake up Ireland’s financial house
TEXT OF STORY
Steve Chiotakis: Over in Ireland, big cuts in the budget there were a shining example of how to get a financial house back in order. But it seems as though those Irish fiscal measures are shaking up its financial house. The BBC’s Rebecca Singer has that.
Rebecca Singer: Ireland sold $2 billion worth of government debt today to fund its country’s budget. But it was more expensive after Moody’s cut Ireland’s credit rating yesterday. One concern is that massive spending cuts have put too strong a break on the recovery.
Finton O’Toole of the Irish Times newspaper says the country hasn’t been rewarded for its drastic action:
Finton O’Toole: The markets, in their wisdom, don’t really believe that the medicine that Ireland is taking, which is the very medicine they themselves proscribe, is going to make the patient better.
But the Irish government disagrees. Dara Calleary is minister of state at the Department of Finance:
Dara Calleary: The European commission, the OECD, does recognize that the way we are pursuing these policies is the correct way to do it.
But O’Toole with the Irish Times says there’s a lesson here for other countries:
O’Toole: Expecting that somehow if you go into a masochistic frenzy and punish yourself, that the international markets will say, well, they’re really good people everything is going to be fine — it just doesn’t work like that.
The Irish cabinet meet this week to work on next year’s budget. They say even further cuts are required.
In London, I’m the BBC’s Rebecca Singer for Marketplace.
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