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Harsh austerity `imposed on Ireland' by Berlin, says ex-official
Ireland was hit with unnecessarily harsh austerity measures a decade ago at Berlin's behest, a former German finance ministry official has conceded.

Minister for Finance Paschal Donohoe is in the German capital today and will meet federal finance minister Olaf Scholz and his predecessor, Wolfgang Schäuble.

But Prof Christian Kastrop, a former Schäuble aide, suggests Ireland was caught in the euro crisis crossfire between Germany and southern European bailout countries.

"We needed different antibiotics for different programme countries but there was a tendency to see [them] as a group," said Prof Kastrop, an economist and now head of the European programme at the Bertelsmann Foundation.

He says the dominant view in Berlin at the time - particularly in the Merkel chancellery and cabinet table - was to ensure all countries swallowed strong austerity medicine.

But this rigidity did not reflect differentiated thinking then towards programme countries, according to the economist, in particular optimism towards Ireland once it mastered its banking sector problems.

"I never understood back then why programme countries making progress were hit with overblown austerity measures rather than more restraint," said the former finance ministry official. "To be fair, when it comes to other countries, and I don't mean Ireland, it was right to hold them to certain fiscal discipline."



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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Tue Nov 26th, 2019 at 08:02:58 PM EST
Nice to at least see it admitted. In truth it was totally unconscionable. Bad behaving Irish AND German banks should have equally taken losses.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Nov 26th, 2019 at 08:46:46 PM EST
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Word on the street, lo these many years, is that there is one German bank and its name is DB.

DB took a "share" long, hard, and "humiliating."

What about AIB and the Quinn clan? lol

Diversity is the key to economic and political evolution.

by Cat on Tue Nov 26th, 2019 at 10:22:34 PM EST
[ Parent ]

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