In The Standard LPRENT gloats over the Prime Minster’s past praise of Ireland’s economic model. In ridiculing the PM, not once is Ireland’s membership in the Eurozone broached.
This is a form of the fallacy post hoc ergo propter hoc whereby it is assumed:
- X occurred and then Y occurred.
- Therefore, X caused Y.
In the mind of LPRENT
- Ireland lowered its corporate tax rate and then it needed a bailout.
- Therefore, the tax rate caused the bailout.
Wishful thinking, I surmise.
About a month ago, Allister Heath succinctly explained the root of Irish woes:
There is a crucial aspect of the Irish crisis that everybody appears to have forgotten, which goes a long way towards explaining Ireland’s problems: its membership of the dysfunctional single currency, an institution it should never have joined. Ireland, like Britain, had its economy deformed by debt — the result of year after year of dangerously cheap credit, aided and abetted by central banks. Ireland’s cheap money came from the European Central Bank, which kept interest rates even lower than the Bank of England, thus guaranteeing an even greater boom and subsequent bust. Even in January 2006, when many of the stupider lending decisions taken by Irish banks were being planned, eurozone interest rates were only 2.25 per cent. This arguably made sense for Germany, but was absurdly low for Ireland; it could have done with 9 per cent.
I am assuming Mr Key has never advocated our entering the Eurozone, but am open to correction.