Irish GDP Drops, A Warning For Other Austerity Experiments
Ireland announced that it Q3 GDP dropped 1.9% quarter compared to previous quarter. That puts it in a class with Greece which has suffered a similar contraction, but not by much. Ireland is a canary in the coal mine for…
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Ireland is a canary in the coal mine for many of the other troubled economies in the region. It was troubled early, along with Greece and before Spain and Italy. It, therefore, had to make tax increase and austerity decisions early. It now appears that this combination has become as deadly as many economists feared.
Reuters reports that
Held up as a role model for other indebted euro zone nations, Ireland is now in danger of losing the battle to repair its precarious debt position and return to bond markets in 2013.
And, so, Ireland begins anew the race to decrease its deficit enough to regain the confidence of capital markets which it lost just over a year ago. It would be nearly impossible for an economy which is Ireland’s stage of contraction to right itself into a growth mode until well into 2012, if any normal economic pattern prevails. This would leave Ireland with only a few quarters to reach a 2% or 3% growth rate
If Ireland cannot reverse its slide, there is a reasonable case that other economies in a like position, which have decided to take on the austerity and higher tax experiment, will find that the effort is doomed.
Douglas A. McIntyre
Contact [email protected] for any questions or corrections.
Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.