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For a small economy like Ireland to go back to its own currency would be an invitation to global capital to basically take over the country as no Government/Central bank would be in a position to control the speculators...
Index of Frank's Diaries
Any attempt to solve the euro crisis has to keep that in mind.
She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
To your specific points:
That all implies a level of confidence and competence and an appetite for risk which we have never had in this country at official level.
Confidence, yes. Competence, I hope. Risk? No, the whole point of this operation is to make sure you run no risk of getting into a fight with the markets that you can't win decisively. If Soros and his friends even have a sporting chance then You're Doing It Wrong.
The very problem with pledging to unilaterally defend a fixed exchange rate (which is effectively what you're doing when you're entering a fixed-rate regime with the D-Mark, since the BuBa is completely unwilling to live up to its end of the deal) is that you commit yourself to fights where the other guy has a fair chance of winning. Fights with speculators should be totally unfair in your favour. You print the money, and you decide how much of your money they get to borrow. If you can't win with that sort of home-field advantage, you really deserve to lose.
Friends come and go. Enemies accumulate.
Most of the peripherals have no business, economically speaking, being in a currency union (or any other sort of fixed-rate regime) with Germany, Austria and the Netherlands. Ireland is different, because it has a structural internal current accounts surplus. But for various reasons of historical accident, Ireland is getting shafted. And there comes a point when one must weigh the cost of leaving the Eurozone against the cost of getting shafted for the benefit of Societé Generel and Joseph Ackerman's Christmas bonus.
My gut feeling is that Ireland is approaching the point where it might make sense to just say "fuck it" and issue scrip. But where you fall on that trade-off depends on how you value the future relative to the present, and that is fundamentally a political decision that I, as a foreigner, have no business making for Ireland.
And of course that's only the economics. It is possible to attach political value to the continued existence of the Euro, and be willing to pay an economic price for keeping this political value. Again, that's a political decision that I can't make for the Irish electorate. Though I do note in passing that aforementioned economic price is, under current institutional arrangements, borne disproportionally by the less well off.
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