THE Irish Government’s guaranteeing 100 per cent of all banking deposits has resulted in the Irish state drowning in a bottomless pit of bail-outs. Bailing out the Anglo-Irish Bank added 40bn euros to the bill that is to be delivered to the Irish working class and middle class for payment.
The total of the current bailouts is expected to reach 50bn euros adding 25,000 euros per taxpayer to the debt.
Last Thursday, the Irish government announced its 2010 deficit was now 32 per cent of gross domestic product (GDP), more than double what was previously projected, and ten times over the EU limit.
The total collapse of the Irish capitalism is now in sight, setting the financial buzzards circling overhead, awaiting an opportunity to move in for the kill. Hedge funds are now threatening to destroy the Irish state if the price of their bankrupt assets in the Anglo-Irish Bank are even marginally marked down.
Demands are being made that the Irish state immediately sells off its gas and electricity industries, and as well shut down entire departments of state, such as Defence, the Environment, and Community Affairs.
Such is the depth of the crisis, and the panic in the ranks of the bourgeoisie, the Irish government is being told that it must stop trying to rescue the banks, and throw to the wolves the sections of the working class and the middle class that have kept what cash they have in these banks under the illusion that it would be permanently guaranteed.
Ireland’s ruling class would not be affected since its wealth is offshore, and its tax bills equal zero.
The demand is also being made that Ireland quit the euro, and resume its old position as a dependency of the UK stock exchange.
Such is the hostility and the fear that the world crisis is creating in the circles of financial predators, a recent call link between Irish Finance Minister, Lenihan, and hundreds of investors had to be abandoned, as it spun put of control into an orgy of denunciations and vilifications of the Irish government.
Lenihan has now announced that the government will present a new four-year budget plan in November.
Meanwhile, while Irish capitalism is being torn asunder, Spain, Greece, Italy, and the new Eastern Europe EU arrivals remain in desperate crisis.
Joseph Stiglitz, one of the capitalist world’s leading economists, has warned that since the future of the euro is now in question, speculators will shortly be targeting Spain.
He states: ‘Under the rules of the game, Spain must now cut its spending, which will almost surely increase its unemployment rate still further.
He adds: ‘As its economy slows, Spain may be entering the kind of death spiral that afflicted Argentina just a decade ago.’
For good measure, he points to the conflict between Germany, with its high surpluses, and Ireland, Portugal and Greece, with their massive deficits, and concludes that the break-up of the eurozone may well be not just on hand, but could be a good thing.
He suggests that one way to save the euro would be for Germany to leave the eurozone.
The Germans, on the contrary, are considering that saving the euro may well require evicting Ireland, Greece and Spain!
There is however no structural cure for the world crisis of capitalism as it affects the European Union.
There is no way out of the crisis for the workers and the middle class of Ireland, Greece and Spain other than a socialist revolution.
Equally, the workers of the UK, France and Germany are being driven along the same road in the defence of their jobs, pensions and wages.
Indeed, what is required throughout Europe is the building of sections of the Fourth International to lead the European socialist revolution to its victory.