Crisis requires action from Minister Noonan, not more “we are not Portugal” T-shirts
Reacting today to news of the downgrading of Portuguese debt to junk status, Socialist Party MEP, Paul Murphy has criticised the Government for its ostrich-style economic policy on sovereign debt.
Mr Noonan’s policy of sticking his head in the ground and ignoring the inevitable march of events, makes him look rather silly today. I hope he has come to the realisation that, with the downgrading of Portuguese debt and its impact on Ireland, printing up T-shirts declaring ‘we are not Portugal!’ will not save us.
Ireland now sits just above the relegation zone, two places above Portugal in the ratings table. The fact that the only people interested in trading in Irish debt are the hedge funds who are partial to junk bonds, knowing that in the event of any further downgrading of Ireland the troika and the Irish government will still seek to have them repaid at the expense of working people.
With every passing day, a downgrading of Ireland’s debt becomes more likely, which will hasten Ireland’s default.
The downgrading of Portugal raises the question of the untouchable position occupied by these rating agencies, who are given free-reign to pronounce on the worthiness or otherwise of a country’s debt. Their papal bulls are a green light to the bond markets to orchestrate a sovereign debt crisis, provoking the IMF and ECB to step in and underwrite their speculation.
Such obscene speculation must be ended through the nationalisation under democratic public ownership of the ratings agencies and the key financial institutions.