Vote Yes...Or kitty gets it

The cacophony of ministerial threats upon the people threatens to drown out all reasoned debate on the Fiscal Treaty. By Michael Taft.

The Government is doing everything possible to prevent a debate on the Fiscal Treaty. The tactic employed is as old as government itself – fear. It is hard to keep track of all the plagues and maladies that will be visited on this fair land if the people dare vote No in the referendum: we will be isolated, we will be turned into Greece, hospitals and schools will close down, public sector workers won’t get paid, the elderly will have to beg for alms on the cathedral steps.

The Minister for Finance came out today threatening people with an even harsher budget if they dare vote No. More tax increases, more spending cuts, more misery to redistribute. People are not being invited to participate in a debate; they are being bludgeoned. The Government has turned on its own people. In such circumstances, debating the treaty is redundant.

Therefore, there is no room for thoughtful contributions. Take Seamus Coffey’s recent post.  Seamus is not anti-treaty:

I’m not advocating a ‘No’ vote, and in my opinion “there is little to be gained from rejecting the Treaty.”

Yet, he takes a forensic look at funding options and finds little evidence for the proposition that we will be denied access to a second bailout in the eventuality of a No vote. He first cites two statements issued by EU leaders. The first was issued last July when the European Stability Mechanism was agreed at EU level:

“We are determined to continue to provide support to countries under programmes until they have regained market access, provided they successfully implement those programmes. We welcome Ireland and Portugal's resolve to strictly implement their programmes and reiterate our strong commitment to the success of these programmes.”

This is unequivocal – support for Ireland will continue until we regain market access. The only condition, naturally enough, is that we successfully implement ‘those programmes’ (never mind that implementing those programmes is actually pushing us away from regaining market access).

But of course, this was issued before the Fiscal Treaty and the clause that requires us to approve it before we can access the ESM. That is why the subsequent guarantee is so important:

“We welcome the latest positive reviews of the Irish and Portuguese programmes which concluded that quantitative performance criteria and structural benchmarks have been met. We will continue to provide support to countries under a programme until they have regained market access, provided they successfully implement their programmes.”

This was issued after the Fiscal Treaty – and the ESM clause – was approved at EU level. Seamus comments:

“That seems pretty unequivocal to me and this statement was released after the Stability Treaty was agreed and the so-called ‘blackmail’ clause had been introduced. It has not been contradicted in any subsequent EU statements, and the applicability of the ‘blackmail’  clause to ‘new’ programmes does leave scope for the current Irish programme to be extended.”

This is crucial. The ESM Treaty refers to ‘new’ financing. This reference to ‘new’ means that the current programme can be extended and financed under the ESM itself – because it would not be regarded as ‘new’. It is merely a continuation of support – support that the EU leaders have already guaranteed.

There is another twist to this – something which Tom McDonnell from TASC and myself addressed: that new, extended or ‘rolled-over’ financing can come from the European Financial Stability Facility up to July of next year. This further underscores the EU leaders’ guarantee to Ireland. The argument that the current programme runs out after the deadline for EFSF funding doesn’t stand up. Greece’s second bailout programme was introduced after the first one was cancelled before it was completed. Deadlines, new programmes, cancelling old programmes – this is all part of the process to ensure that no Eurozone member is isolated.

In short, the Irish Government is the only the government in the EU to claim that Ireland will be isolated.

But I fear that Coffey's arguments – like others who have tried to come to grips with this difficult issue – will not be heard in the cacophony of ministerial threats upon the people. Since debate is redundant, logical argument becomes a sideshow, an irrelevance, inconsequential.

But the Government should be warned: they may well succeed in scaring a portion of the electorate to act in a certain way in the short-term, but if they count this as a ‘victory’, they may be severely disappointed. A government that bludgeons its own people is living on borrowed time.  People will find a way to punish a government that harassed them into a position.

Just remember what happened to Fianna Fáil when people finally got a chance to express their opinion at the ballot box. The current Government may think it’s being tactically clever, but strategically it may be digging its own electoral grave. {jathumbnailoff}