Dublin taps on capital markets

Other periphery countries witnessed a sharp drop in their premium risk, as the markets bet on better prospects for lame ducks around Europe. Markets expect Portugal to follow a similar virtuous path. Even Greece shows a much better shape than some months ago. On face value, the outlook seems brighter but the toil induced by real adjustment weighs heavily on ordinary people. The dole queues are longer than warranted and the product gap portrays a blatant waste of resources.
Ireland has escaped from hell without scrapping its social cohesion.

The crisis forced many inhabitants to flee the island searching for jobs in the UK and other Anglo-Saxon areas. But it did not feed into major cuts on wages or benefits for the less well off. Contrary to other periphery countries, it has managed to preserve the bulk of its welfare safety net. It proves you can avoid utter ruin without imposing undue burden on workers, pensioners or unemployed people. By following this common sense policy, Ireland is better poised to invigorate its internal demand, thus running a better chance of recovery.

Europe as a whole still faces grim prospects in months to come. The December inflation rate stands at 0.8%, far below the ECB medium term target. Unless Germany and other surplus countries propel their home demand, the central bank will have to take tough action for making sure 2014 lives up to expectations.

Fortunately, France is bound to become the yardstick for gauging the European economy health, as Italy and Spain move little by little into safer territory. Germany may eventually find itself confronted with the option of fostering internal expansion or dumping, once more, the Euro into unmitigated destitution. Let’s hope this time it will not hesitate in making the right choice.