John Halligan (Waterford, Independent) | Oireachtas source

I thank my colleague for tabling this timely motion, on which I welcome the opportunity to speak. The most recent figures show that approximately 26 million people are unemployed across Europe, while 150 million are at risk of poverty and social exclusion. This is the European Union as we know it today - a union which is not working. So-called experts on both sides of the fence are beginning to reach a consensus that eurozone policies are pushing countries into a black hole from which there will be no escape. People in Ireland, Greece, Portugal and other countries are suffering the terrible consequences of austerity policies which are designed primarily on the basis of a consideration of their impact on speculative markets rather than by reference to sufficient compassion and empathy with the predicament in which we find millions of European citizens, yet, while eurozone authorities continue to seek stability on the backs of the people mentioned, all indications are that we are sinking deeper and deeper into recession and stagnation. Peripheral countries such as Ireland are being confronted with stark choices because of the crisis and structural weakness of the eurozone.

The solution being pushed on us by the European Union is dramatically unfair and unjust. It imposes huge costs on working people who we all accept are not to blame for the crisis in the first place and all this to save the euro. We have committed ourselves to decades of austerity, despite a growing consensus among economists, including prominent economists in America, and politicians right across the world that it is not working. A review of Ireland's bailout programme by a Brussels-based think tank last week concluded that the deepening of the eurozone recession could be a central problem in Ireland's full return to the financial markets. The evidence is there that the economies of a growing number of countries, our own included, are being impoverished, while countries at the centre remain in recession. It is interesting that the latest statistics confirm that France is now deep in a second recession, while the economy in Germany grew by just 0.1% in the first quarter of the year, following a 0.7% fall in late 2012. The Italian economy recently receded for the seventh quarter in a row. The outlook for the entire eurozone must be admitted to be grim. Youth unemployment stands at 25% generally and almost 60% in some peripheral countries, yet the European Union continues to adhere to a version of a logistical economic theory, the assumptions of which have little or no regard for social consequences. Unless desperate calls for reform from the ECB are listened to and a dual strategy of price stability and growth is adopted, this will, according to experts all over the world, continue.

Eurozone policies are deeply flawed on a number of fronts, none more so than the fixation with debt reduction, while, effectively, ignoring GDP growth and the need for structural reform. It does not make sense to many of us. As it was, the eurozone was incapable of maintaining one currency, interest rate policy and exchange rate policy for economies with different levels of productivity, different implicit economic competitiveness levels, different resource endowments and different degrees of exposure to economic shocks. The powers that be in the eurozone made a sweeping decision that countries with very different economies and burdens conformed to the same stability growth criteria; a maximum 3% budget deficit and a 60% debt-to-GDP ratio. This one-size-fits-all approach makes no sense. If people think Ireland will come out of the recession in the next few years, they should think again. It is not going to happen on the basis of the policies being generated throughout Europe and forced through by Germany and France. CSO statistics show that, in Ireland, 700,000 people are in poverty, while an estimated 5,000 people are homeless. As I stated, 26 million people are unemployed across Europe, while 150 million are at risk of poverty. How can the eurozone be considered to be working, given these statistics?

It would be interesting to hear the Government's views on whether it would consider bringing forward a European Union referendum Bill as is currently being discussed in the United Kingdom. The draft UK Bill promises that by the end of 2017 the British public will be asked whether the United Kingdom should remain a member of the European Union. It is an indictment of our political system that there is no rational debate about this possible scenario, notwithstanding the fact that arguments for a managed exit from the eurozone are becoming more credible by the day. Again, I refer the Government to economists across the world who say the make-up of the eurozone and the policies of austerity within it are failing. The American policy of job creation and growth is not based on austerity; it is based on internal spending and the assumption that if one gets people to spend rather than force austerity on them, the economy will grow. The two mechanisms for growth are external investment and internal spending. We are not generating internal spending. I am not an economist by any means, but I listen to what many of them say. Unless we can generate internal spending, we are not going anywhere.

In recent months the European authorities have started to make statements on rebalancing austerity, which is very much akin to shutting the stable door after the horse has bolted. At least some of these authorities are now grudgingly accepting the evidence that their short-term austerity doctrine has been enormously damaging to the eurozone and global stability. There is a real and valid argument for a managed exit by Ireland from the eurozone and, while I am not too sure about it either, the Government has a duty, at the very least, to open a debate on it.

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