Catherine Murphy (Kildare North, Independent)

This week the House is dealing with two Bills on European issues and the forthcoming European Council meeting, all of which are related to the current crisis. I have lost count of the number of times the European Council has met to discuss solutions to the crisis without getting to the heart of the problem. Tonight the House is discussing the European Communities (Amendment) Bill, the purpose of which is to amend the founding treaty. A major debate on the European Stability Mechanism Bill has been ordered for tomorrow. All of these debates roll into one and it is difficult to contribute to one of them without straying into the issues addressed in the other business because the issues are interrelated. At the same time, we are failing to address the issue at the heart of the problem, namely, the private debt incurred by the State as a consequence of transforming bank debts into sovereign debts.

I understand the reason people outside the House are bewildered by all of this. Many of those who voted "Yes" in the referendum, including a large number who did so through gritted teeth, had great expectations that some positive signs would emerge from the European Union. We were informed that telephone calls had been made to European leaders, yet news programmes are reporting that, when asked about debt relief in respect of the banking bailout in response to the "Yes" vote, the President of the European Central Bank, Mr. Draghi, stated: "I do not think there was any ground or any statement of a quid pro quo." In other words, the outcome of the referendum is not linked with the bank debt issue.

He went on to say that the spread on government bonds had fallen further in Ireland than in other countries, which showed that "a return to market access is not a far distant perspective". He said that Ireland had made substantial progress on fiscal restructuring and bank consolidation. Mr. Draghi stated that the board of the IMF would be presented with a report on Spain this Friday. The difference between us and Spain is that Spain is a big country. Spain is a problem and we are not a problem, so there will be no rush to solve something that is not seen as a problem. I think that was the point some of us were trying to make.

I do not understand this Government's negotiating strategy, and we are signing up to things and making amendments to European treaties in the absence of any understanding of what that strategy might be. I want to know what kind of European Union we are designing, because we are re-designing it at the moment. I thought we belonged to a European Union that had values such as democracy, solidarity and cohesion, but these have been absent. The German Chancellor proposed that countries in programmes would lose their entitlements to a veto and other things. Obviously that proposal did not happen, but it shows a mindset. In the absence of having something clearly spelled out about what exactly we are trying to create, how can we continue to plough ahead with amending treaties?

This will be brought to a head when it begins to affect Germany. I was reading an article in Der Spiegel from 6 May, called "The End of Germany's Illusions". This is the kind of thing that will bring people to their senses, because essentially there are creditor countries and there are debtor countries, and everything is being designed with the creditor countries in mind. We are in a weak position and I do not understand why we are not trying to build solidarity among other debtor countries, but that is not happening. The article in Der Spiegel opened with the following statement. It states:

Germany's booming economy and plummeting unemployment has long insulated the country from the euro crisis on Europe's periphery. Those times, however, are coming to an end. The German economy is now showing it is vulnerable after all, and Chancellor Merkel will now be forced to make sacrifices.

I do no wish any country in Europe to make sacrifices, but there has to be an element of reality. I have quoted a number of German people who are opposed to Chancellor Merkel. The article goes on to state:

For Germans, it was always a crisis that belonged to others - the Greeks, Portuguese, Spanish and Italians. That is, those who didn't have their finances in control and were expected to kindly atone for it by adopting the German model. Back home in Germany, by contrast, the economy was booming and people had work. In a sea of misery, Germany was an island of bliss.

It is interesting to read that, even if it is not a Christian Democrat Union viewpoint, as this newspaper would not tend to be. However, due to the two thirds majority required in the German Parliament, the CDU requires the Social Democratic Party to vote with them. The article goes on to recommend letting go of power. It states:

Thus it is in Germany's interest to solve the life-threatening problems within the currency union both swiftly and sustainably. But steps more radical than Germany has been willing to take will be necessary to achieve this - and that goes for both Chancellor Angela Merkel's government and the German people at large, who have vehemently rejected the prospect of their country having to give up any power or money to save the euro.

We can sit in here and talk in a vacuum, but things are moving very fast and attitudes are changing because they are being forced to change. We were told we saved these banks on foot of an ECB instruction. We saved them because we had to save the euro, and we were told that no European bank was going to fail. We have been compliant for the troika and we have been compliant with our fiscal adjustments, which I think will be soon unsustainable, but we also acted in the interests of keeping a sustainable euro, and we have not had any serious return on that.

The principle of the ESM is not a bad one. The idea of having a major amount of money that can be drawn down in a time of crisis and where each country contributes is a good idea in principle. However, the problem is that there is no democratic oversight and many of the rules and regulations for the ESM are unacceptable as far as I am concerned. This is obviously a fund for which there is a requirement to pay the money back. It is difficult to understand what fund will be used to save the Spanish banks if it is not the ESM. To be perfectly honest, people are making this up as they go along without any values that would give many of us a sense of inclusiveness. I would like to go back to a stage where we did share some of those values, which were very noble, in the full knowledge that there will be pain. I understand that we cannot avoid that pain, but in the debates this morning, this evening and tomorrow, which are all interrelated, we are not talking about the issues about which we should be talking. We are not solving the problems we should be solving, and we are discussing them in the absence of knowing what will be created. That is dangerous.

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