James Reilly (Dublin North, Fine Gael)

I support the Bill because it will go a long way towards preventing the problems of Greece becoming Ireland's problems. It shows that Europe is capable of acting decisively and as one when faced with a grave crisis. However, notwithstanding my support, I have many concerns about the Bill. The root cause of the problem Europe faces is debt. Greece, in particular, has borrowed so much money that its ability to repay is in doubt. The financial markets decided that the risk of Greece defaulting was so high that they must charge the Greek Government crippling rates of interest on new loans. If debt is the root cause of the problem Europe faces, is more debt the answer? One day, Greece will have to source its funding from the markets again in the same way that every other Government in the world does. When that day comes, the country will be even more in debt than it is now. How will the markets react then?

It is nonsense to argue that Ireland will not have to borrow €1.3 billion for this bailout. If we take €1.3 billion from the National Pension Reserve Fund, we will have to borrow an extra €1.3 billion to pump into the banks. To allay investors' fears about Ireland being unable to repay our debts we are borrowing more money to lend to a country that investors believe is unable to repay its debts.

It is possible to calculate the total debt in the economy. EUROSTAT provides figures for every country's national debt and total debt for households and non-profit institutions serving households. This is the best indication of the total debt in Europe's economies. The figures are shocking. Every Greek worker would have to pay €90,000 to clear the total debt in the Greek economy. If this figure appears bad, the equivalent Irish figure is petrifying. Every Irish worker would have to pay €160,000 to clear the total debt in the Irish economy. The average mortgage outside Dublin is €183,000, while the average national mortgage is €205,000, so that puts the €160,000 into perspective. This is almost twice as high as Greece. The figure is astronomical.

This clearly highlights the dangers of the Government's plans for Anglo Irish Bank. It is daft to think that we can take on Anglo Irish Bank's losses when every Irish worker is already expected to repay €160,000. Keeping that bank open will be a catastrophe for this country. We simply cannot afford the money to bail out Anglo Irish bank. We need to terminate the guarantee to the bank and force the bondholders who funded the bank to take the hit. They are responsible for gambling their own money. They made great returns when that bank was expanding. Now there is no choice but to force them to accept and face the consequences of their gambles. We cannot cover their gamble with a two-way bet.

Debt is the root cause of the problems in Ireland and Greece. Instead of treating the root cause of this problem, we are just treating its symptoms. The medicine being taken risks making our problems much worse in the long run if we do not grow our economy and get people back to work. The EU and the Government will argue that they are tackling the root cause. They argue that budget deficits are responsible for more debt and must be tackled straight away and tackled head on. However, they are missing the full picture. Ireland, Greece and Europe will never get out of this mess unless we grow our economies. Economic growth means more jobs, more taxes and smaller budget deficits. Economic growth must play the largest part of the solution.

In the 1980s, the size of the national debt added to a feeling of hopelessness. It seemed insurmountable, yet within a few years Ireland took its place as one of the richest countries in the world. We did not do this by focusing exclusively on cuts. The lion's share of the credit for this turnaround must go to the policies that grew our economy. We slashed corporation tax and devalued our currency, and the result was a Celtic tiger economy that led to full employment and one of the lowest national debts in the world. We need to remember how we dragged ourselves out of despair in the 1980s and we need to ensure that Europe learns lessons from our experience.

Focusing exclusively on cuts will add to the problem. It takes too much money out of the pockets of ordinary working men and women. They cannot spend what they do not have. If they have less money, they will buy fewer goods and services and more people will be made unemployed. This is the vicious cycle in which we are caught. We need to do something to recover our standards of living. Both the Government and the EU are missing this point. Where are our policies to grow the economy? Where are our policies to get people back to work? Nothing is being done to create jobs. Where is the Government's job package? This is the key to our recovery and to a sustainable economy.

For every 100 young men that were employed before the recession, fewer than 50 are employed now. This is a tragedy for them and for their families. They are being forced to emigrate again not by choice, but by financial necessity. Unemployment is forcing the country into more debt because the Government no longer receives their income tax and must pay the social welfare bill for those who stay. A country that tries to get out of a crisis like this by only focusing on spending cuts and tax rises is like a boxer in the ring fighting with one arm behind his back. Both Europe and Ireland need to do something to grow our economies.

Europe needs to encourage economic growth in the troubled countries of the eurozone. All options need to be on the table, and the EU should allow interest rates and the value of the euro to continue to fall. All countries need to play their part. Germany must increase its DIRT rate on savings to encourage its citizens to put more money into the European economy.

I support this Bill because it has bought us time and because Ireland should show solidarity with Europe. We had their support in the past, so we can show ours now, painful and all as it is. However, it is not a solution to our problems. The root cause of this problem is too much debt. This Bill adds further debt to both to Irish and Greek economies. This needs to be tackled urgently not through raising taxes and cutting spending, but by focusing growing our economy and growing Europe's economy.

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