Friday, September 30, 2011

Please try the fish

The Wall Street Journal's agenda column takes another run at Iceland vs Ireland comparisons.  The gist of it is that the comparisons don't look as good for Iceland as they did earlier in the year because Ireland has had a few quarters of export-led growth, but it's still the case that telling the banksters to go to hell, as Iceland did, is not obviously a worse strategy as the banksters would have you believe.

The different sources of exports in each country need to borne in mind: Ireland relies heavily on multinational tech and pharma, while Iceland has energy-related and fish.  Fish might have worked for Ireland, except that the once-permanent party of government, Fianna Fail, gave them all away to the EU in 1972 as part of the membership negotiations, much as they would later give away the national pension fund to the aforementioned banksters.  So one of the lessons of the comparison might be that the voters shouldn't elect parties with a track record of sacrificing national assets, which the Irish electorate appears to have taken on board as of 2011.

What all this has to do with Greece -- the ostensible subject of the WSJ article -- is not clear. One less obvious lesson may be that a political cleansing -- which Iceland had when the crisis broke and Ireland had at the start of 2011 -- can have strong economic effects.

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