If you read Morgan Kelly in yesterday's Irish Times and David McWilliams' column from last week, you'll know exactly what I'm talking about. "The end is nigh" doesn't have half enough urgency to it.
Last week I was talking to a friend of mine about what might happen if we defaulted on our debts. And although I wasn't lying, I don't think I really believed it was possible. I thought I was too negative. I was really only guessing, but I told my friend that if we defaulted I thought the Germans would basically come in and call the shots. All state obligations would be out the window. Those include public sector pension entitlements, salaries for teachers, nurses, etc., infrastructural spending, ... I painted a pretty gloomy picture.
Then I saw the weekend reports that said that Ireland could, in fact, default. And yesterday Morgan Kelly spelled out what default might look like.
We would be forced to seek an international bailout, with the International Monetary Fund and European Union playing bad cop and good cop. We could expect cuts of one-quarter to one-third in public sector wages and social welfare benefits, and draconian tax rises to bring the deficit back to around 5 per cent of national income in two years.And that's if the IMF & EU can bail us out. If other EU nations happen to be in a similar situation, then all bets are off. Kelly talks about a nightmare situation that would lead to "unprecedented civil disorder."
I wonder if they do MRE's at Lidl?
