It’s not 27 national elections, as some in Brussels would have us believe. It’s one European election, and there’s just one issue: The economy, stupid. Which is where Iceland enters the picture — in Switzerland. Neither country is an EU member, but that’s what makes our continent so interesting, don’t you think? Anyway, European Commission president Jose Manuel Barroso is speaking in Davos and what does he do? He makes the comparison that makes Dublin cringe. According to the Irish Times: “It is interesting to compare Ireland with Iceland,” Mr Barroso told delegates. “They are two relatively small economies but the difference was — among others — that Ireland was a member of the euro area (and) so a country in a respected currency.”
Yes, but, how long will the currency remain respected? In case you didn’t read the weekend Financial Times, you mightn’t have heard that “Moody’s warns it may downgrade Ireland“. But that’s just the tip of the iceberg, as it were. “Ireland has already been given a warning that it could soon lose its triple A status by rival agency Standard & Poor’s, which has already downgraded Spain, Greece and Portugal in recent weeks.” Unlike Iceland, Spain, Greece and Portugal all use the same “respected currency” that Ireland does.
What does this mean for June’s election? Well, a lot, actually. Instability in the euro zone could pit member states against each other and voters in the EU’s struggling economies will either blame Brussels for their woes or turn on politicians nearer to home. Either way, something’s got to give and someone’s got to pay for the coming pain. It’s the economy, you see.
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Should we really be listening to financial analysts though? After all that’s happened in the last few years, haven’t they shown their utter inability to produce meaningful and reliable assessments?
Which is not to say Ireland isn’t doing poorly - I hear the Dell plant closure has been making itself felt…
Hi Eamonn,
The comparison with Iceland may sound a tad bit naive (it is also being used in Malta) but at the end of the day few could doubt that the EU and more particularly the eurozone has cushioned the impact of the crunch. Not many of the EU members (especially the small and medium sized states) could have weathered the storm so far in this manner.
Which is not to say that we have it good and that all is sunny. It is the economy (stupid) but again I think that people will vote on the 27 campaign issues for 27 different reasons times one hundred. We are still at the beginning of any proper campaign but the more I thinkaboutit (c) the more I see that there might be nothing rrong with electing our MEPs with regional priorities in mind - after all that too is the reason a constituency exists.
Maybe. But it is possible that one or more of the high borrowing Euro countries I mentioned will run out of money by summer if liquidity continues to dry up. Then, either one of the countries within the eurozone will default or the euro will break up. That’s a worst-case scenario, but it’s one that those looking for votes in June had better consider, because voters might want answers about the stability of the currency in their pockets.
Economic instability won’t necessarily impact negatively upon European cohesion. It may encourage, or even necessitate more cooperation amongst nations than ever before.
Europe may become the crucial institution in coordinating an economic response rather than a seemingly marginal one.