NY Times editorial: Irish must be allowed renegotiate their debt

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Renegotiating the terms of Ireland’s bailout should be a top priority says an editorial in Wednesday’s “New York Times.” The piece said, “It is in no country’s interest to lock Ireland into long-term economic ruin.”

Ireland will have no chance of moving forward and rebuilding its economy unless it seeks a new deal from Europe, according to the editorial.

The editorial also stated that Irish citizens have the right to be angry at what they described as “the catastrophic mismanagement of their economy.”

The incoming government is now faced with the task of attempting to restore public faith by “fairly apportioning economic sacrifices,” regulating banks and ending the “cozy ties” between politicians and bankers.

Criticizing the multi-billion EU/IMF bailiout, the “New York Times” stated that Prime Minister elect-Enda Kenny is right to renegotiate the terms.

“European Union leaders demanded deflationary tax increases and spending cuts that make it impossible for Ireland to grow its way out of debt and ruinous interest rates that will deepen those arrears,” it said.

Ireland’s problem stems from the introduction of the euro, low interest rates and lax bank regulation which “ignited a speculative housing bubble.”

On Friday Kenny is due to meet German Chancellor Angela Merkel and French President Nicolas Sarkozy. Next week Kenny will attend a special euro-zone summit which will aim to develop a plan for restoring stability to the currency.