Catherine Murphy (Kildare North, Independent) | Oireachtas source

If we look back at the last two big recessions in the 1980s and the 1950s, they displayed the same characteristics as the current one, with large-scale emigration, widespread unemployment, higher levels of taxation and cutbacks in services. Both recessions passed, as this one will. On this occasion we know that our recovery is highly dependent on the European Union and what form that Union will ultimately take. For me, it is essential that the Union is democratic and have equality and solidarity at its heart. I welcome the speech to the European Parliament made by the President, Michael D Higgins. What is regrettable is that this is not the mainstream discourse among European leaders. The President referred to the influential German sociologist and social philosopher Jürgen Habermas. In April Mr. Habermas delivered a lecture at Leuven University entitled, Democracy, Solidarity and the European Crisis. At the end of his thought-provoking lecture he stated:

If one wants to preserve the monetary union, it is no longer enough, given the structural imbalances between the national economies, to provide loans to over-indebted states so that each should improve its competitiveness by its own efforts. What is required is solidarity instead, a co-operative effort from a shared political perspective to promote growth and competitiveness in the eurozone as a whole.


Such an effort would require Germany and several other countries to accept short and medium-term negative redistribution effects in its own longer term self-interest -- a classic example of solidarity, at least on the conceptual analysis I have presented.

The concluding comments in his wide-ranging paper were:

The leadership role that falls to Germany today for demographic and economic reasons is not only awakening historical ghosts all around us but also tempts us to choose a unilateral national course, or even to succumb to power fantasies of a “German Europe” instead of a “Germany in Europe”. Germany not only has an interest in a policy of solidarity; I would propose that it has even a corresponding normative obligation.

If we are to look to the future of Europe, it is helpful to look at the conditions that allowed post-war co-operation, part of which required debt resolution. UCD professor of social policy, Mr. Tony Fahey, delivered a paper to the Social Justice Ireland conference in 2012 on the future of the European social model. In it he stated:

There were many reasons why the economic aftermath of the Second World War became so positive within such a short period. By 1945, government debt in Britain and France approached 250% of GDP. Germany's debts outstanding from the 1920s and 1930s devolved largely onto the new West German Government - they have been estimated at 300% of Germany's GDP in 1938.


In France, a burst of inflation peaking at 74% post war reduced government debt to just 40% of GDP by 1950. Britain, keen to protect the status of sterling as a reserve currency, struggled to avoid either direct default or indirect default through high inflation. As a result, its national debt declined much more slowly than that of other European states.


The exceptional case was that of West Germany. Uniquely in Western Europe in this period, it obtained the benefit of generous debt forgiveness, largely brought about through the intervention of the United States. Through the London Debt Agreement of 1953, it secured a write-off of over half of its foreign debt and easy repayment terms of the balance.

We are constantly told of the German memory of hyperinflation and there is no doubt that it occurred following the First World War. However, what occurred in the Marshall Plan was an extraordinary act of solidarity in much more difficult circumstances than those of today. It was an act that laid the path not just to the construction of the European Union, but it also enabled the reunification of Germany. If we are to have a strong Europe, if small countries are to pool more of their sovereignty, we need this to be a European Union of equal member states.

I am concerned that we are moving blindly forwards without seriously considering the implications of having Europe dominated by a handful of very powerful states. We are not setting the ground rules. There are no common values. We are making decisions with short-term interests in mind only. I echo the call for the Government to set out its vision of the kind of Europe we want to see and to which we want to aspire.

This morning at Arbour Hill we commemorated those who had given their lives in 1916 in the cause of Irish independence. If we decide to share more of our sovereignty, we must decide collectively to do this with full knowledge of both the positive and negative consequences.

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