Trinity academics Brian Lucey, Sean Barrett and Constantin Gurdgiev have lent their support to calls for a European debt conference to be held in Ireland. The move comes a week after a private members’ motion supporting a debt conference, which was proposed by Independent TD Catherine Murphy, was defeated in the Dáil after government parties opposed the motion.
Professor Brian Lucey from the School of Business told Trinity News that a “large chunk” of the debts should not have been placed on “just Irish taxpayers”. While there is “no magic bullet … an optimal solution” would involve a combination of “a degree of fiscal retrenchment”, “debt monetisation” by the European Central Bank and debt write-off. “Debt monetisation” refers to the creation of new money by the ECB to buy government debt. Given the level of “political capital” invested by political leaders in monetary union, Lucey said that a Eurozone breakup would be an “astonishing” but not an “improbable” possibility. While he would be approaching some of his colleagues about supporting a debt conference, Lucey added that most of the “big wigs” in College are “loth to get involved in letters to the paper.”
Also supporting calls for a European debt conference, Senator Sean Barrett, who is hoping to raise the issue in the Seanad, laid the blame for the crisis squarely on Europe, especially Germany. “The mistakes were made in Brussels and Frankfurt before they were made in Ireland,” the fellow emeritus at the Department of Economics said. “Germany is unwilling to make sufficient transfers to make the euro work. Instead we get remarks that the Greeks are lazy tax avoiders, Ireland must try harder but is best boy in class, Iberians take too long over lunch, etc.”
Barrett said that “a poorly designed currency brought huge capital flows from Germany to Ireland, [and] then a property bubble and bank collapse. Every man, woman, and child is paying €64 a week for the mistakes of bankers and bureaucrats.” He added that Greece and several other “peripheral states” should exit the Eurozone. “It is ironic that a country may legally exit the EU, a successful free trade area, but cannot leave the euro, an unsuccessful, badly-designed currency area.”
Dr Constantin Gurdgiev, adjunct lecturer in finance at TCD, also voiced his support for a debt conference but warned that, without the “direct democratic participation of the people of Europe,” there was a danger that a debt conference would only “replicate the status quo”.
Professor Philip Lane, head of the Department of Economics, had not responded to requests for comment at the time of writing.