Joan Burton (Dublin West, Labour)

Back in 1975, US President Gerald Ford spoke about the possibility of a federal bailout for New York city. His response was clear, simple and made famous by the front page headline the following day: "Drop Dead". New York was in a similar situation then to where Greece finds itself today. It was spending too much, taxing too little, at the mercy of the market and threatened with default. So close was New York to bankruptcy that a petition was being filed in the state supreme court, the police cars had been mobilised to serve the papers on the banks and the mayor had written a speech to break the bad news.

What some may remember, but most probably will not, is that the day was saved by New York's trade unions. With an emergency budget already in the pipeline, complete with a doomsday list of spending cuts which would have decimated essential public services, everyone thought the game was up. At the last possible moment, labour leaders selflessly pledged the use of union members' retirement funds to back the city's loans and stave off bankruptcy.

In Europe, we now face a similar choice. What is to be Ireland's response? Do we act in the spirit of solidarity or do we decide to take our chances on our own and condemn our neighbours to the same fate? Is it to be each to its own or one for all and all for one? Solidarity is a guiding principle not just of the European Union but of the Labour Party. We believe in looking out for our neighbours and in helping those in need to help themselves. As a country, Ireland has benefited enormously from the solidarity of our European neighbours. We were the greatest per capita recipient of European Structural Funds and are still a massive net recipient through the Common Agricultural Policy.

Ireland was once the sick man of Europe but look how far we have come. Notwithstanding our recent fall from grace and Fianna Fáil's wrecking of our economy, it remains true that we have converged with European norms in terms of living standards. Through the wise use of European funds by successive Governments, our national infrastructure has enjoyed a quantum leap forward in the decades since we joined the EEC in 1973. Our farms have been able to modernise and to compete at a global level through the judicious use of CAP. When Ireland was on its knees, Europe did not abandon us. With Greece now at the mercy of global bond markets, it is our duty to hang together because, if not, we may well hang separately.

Underpinning the European project and the concept of ever closer economic, monetary and political union is the overarching principle of solidarity. Some say that money makes the world go round but in Europe, solidarity is the glue that binds together nations with a shared history, identity and destiny. The people who founded the European Union wanted to put an end to war on the continent after centuries of conflict. We truly are all in this together, regardless of whether we sink or swim.

Greece needs to reform its budget and to get its economy in shape but without the breathing space provided by this solidarity agreement over a relatively short three year period, its fate will be infinitely worse. In Ireland, we are not without our own direct interest in saving Greece. Greece was identified by the bond markets as the weakest link, but markets are subject to irrational herd instincts and sometimes make the wrong call. While Ireland's economy is very different to that of Greece – with substantial inward investment from the multinational sector – we can just as easily become a target for bond traders who, having finished off Greece, may move on to other weaker countries such as Portugal, Spain and Ireland. This argument in favour of supporting Greece could be referred to as selfish solidarity, calling to mind Richard Dawkins's references to the selfish gene.

The world is in the grip of a form of hyper-financial capital which operates on a global basis at incredible speed. Ironically, a large component of modern funds for investment is made up of workers' pension funds. As has been remarked, these can be as much the holders of sovereign bonds as hedge funds and private equity. It would be ironic if workers' pension funds, a concept developed by Social and Christian Democrats, were to be the instrument for devouring a country such as Greece. This subject will have to be returned to by the trade union movement and the holders and trustees of workers' pension funds.

We have seen in recent weeks the cost of division in Europe and the futility of struggling alone on the rough seas of the global bond market. Caught between Chancellor Merkel's policy of prevarication and the bond market's ruthless rent-seeking, Greece has been subjected to the nation state equivalent of waterboarding, as expressed by the former Danish Prime Minister, Mr. Paul Rasmussen. As moments of light relief go, it is nice to see Mr. Anders Borg, the Swedish Finance Minister, with his earring and ponytail, among the other Finance Ministers. He spoke recently about the wolf-pack behaviour of markets and how they would tear the weaker countries apart. Mr. Will Hutton, the noted British economist and former editor of The Observer was in Dublin last week, at the invitation of the trade union movement, for a series of important debates about Ireland's future direction. He spoke about hunter gatherers who eat what they kill. That is how he, somebody with long experience of the bond markets, characterised traders. It is not in our interest to let the hunter gatherers in the bond markets kill Greece and eat it because, having done so, they will undoubtedly turn their attention to the next weakest animal in the pack.

The purpose of the package of support for Greece is to prevent the first domino falling in the form of a Greek default. We are not today discussing the €750 billion stability mechanism. Nor are we discussing the draft Commission proposal on reinforcing economic policy co-ordination. Suffice to say the eurozone has a problem, just as we do in Ireland. What is required is substantial reform of public services. We must bring down the deficits, but we must do so while still investing in infrastructure and innovation so that we and the eurozone can maintain and improve competitiveness. If we have the hunter gatherers trying to pick us off as the weakest in the pack, we must work to become stronger. I lived in Africa for a time and often had an opportunity to observe the antics of hyenas and hunting dogs. The strongest pack is the one that shelters its young and ensures that they, as the weaker elements, do not easily become prey.

Too much deflation, too quickly and in the wrong areas, will simply lead to complete depression, huge reductions in income and major increases in unemployment. Ironically, the bond markets, seemingly wishing to have it both ways, reflected this in recent days when they priced down the euro on the basis of fears that growth in the eurozone will not be sufficient. The European Union's Stability and Growth Pact was signed in Dublin. Stability and growth are two sides of the same coin called economic security. If we have one without the other, the system itself will be inherently unstable. To all intents and purposes, the Stability and Growth Pact is dead for a variety of reasons. In better times, it was more honoured in the breach. Before pointing the finger at countries like Ireland, Greece, Spain or Portugal, it should be recalled that some of the larger countries, by virtue of their size, were able to get away with actions never contemplated by smaller states. However, that is now consigned to history.

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