CAMPAIGNERS ON EITHER side of the Fiscal Compact referendum have again clashed on the question of whether Ireland could have access to funding from the European Stability Mechanism if it rejected the treaty this week.
In a debate on RTÉ’s Today with Pat Kenny show, the Socialist Party’s Clare Daly argued with Fianna Fáil’s Micheál Martin about the possibility of Ireland being able to access the ESM, irrespective of whether voters chose to ratify the treaty in Thursday’s vote.
Daly, taking issue with claims that a Yes vote would guarantee access to the fund, said any of the 17 Eurozone countries “can block an application to the ESM, whether we accept this treaty or not.”
This was in response to claims from Martin that it was “very clear that legally we won’t have access” to the ESM if Ireland was to vote No.
Daly also asserted that irrespective of whether any applications were approved or not, Ireland would still have the right to apply for funding from the fund – a statement contested by both Martin and the EU Affairs minister Lucinda Creighton.
Martin claimed clauses limiting access to countries which had ratified the Fiscal Compact were “there in black and white”, though Daly said such clauses were part of the ESM treaty’s ‘recitals’, or preamble, which she contested had lesser legal standing.
Creighton argued that removing the “safety net” of ESM funding would make it more difficult for Ireland to access funding on the open bond markets, which would be necessary to cover the budget deficits that Ireland would return in the coming years.
Lawyer Caroline Simons, representing the No side, said the treaty had failed to address the “elephant in the room” of Ireland’s banking debts, and that the ESM created confusion by not making it clear the rates at which member states would borrow.
Later, Daly suggested the economic turmoil that would be seen if Greece left the euro would likely be replicated if Ireland did likewise, and it was therefore “true to say they wouldn’t leave us short”.
Creighton believed there was “no comparison” to be made between Greece and Ireland, saying Greece was in particularly “profound difficulty” and was “experiencing indescribable poverty” which would probably take decades to recover.
There was also conflict between the sides on whether the Fiscal Compact would address the factors that caused the current financial difficulties in the first place; Simons claimed banking debts accounted for 30 per cent of the government debt, a statistic questioned by Creighton.
Elsewhere, there were conflicts over whether the pursuit of a default like that of Iceland would be advantageous to Ireland; Daly argued that Iceland was now benefiting from higher growth and lower unemployment, though Martin said this was at the cost of seeing personal savings lose much of their value, while corporate debt had ballooned.
All four participants agreed that they wished for Ireland to remain part of the Eurozone, irrespective of their stances, though Daly said Ireland’s continuing membership “wasn’t up to us” while Simons feared the ESM would be exhausted by the time Ireland required it.
“If Spain is first, there’s nothing left for us,” Simons said, later telling Martin: “You’re trying to deal with loaves and fishes… the problem is, Mr Martin, you are not God.”
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