I keep hearing on RTE and other mainstream Irish outlets that we're going to export our way out of this 600 billion euro banking crisis. Now that seemed to me like quite some undertaking after all we're only a small economy caught up in a global depression.
So I thought I'd look into the matter a little. The research material that I came across failed to reveal any cases where this had happened. In fact what I found was the complete opposite.
The research covered in great detail banking crisis from the 19th & 20th centuries, but stretched all the way back over 800yrs. Through all that time, which saw many boom times, never has a country managed to export their way out of a banking crisis. Now here we are being ask to deal with a monstrous banking debt during the largest financial crisis the world has ever experienced. Know I know we Irish are deadly an' all, but don't ye think that just maybe we may be slightly over-reaching on this one, in fact save for discovering a time machine I would hazard that it is nigh fuckin' impossible. So, I thought I'd clear up this "confusion", and get it straight from the horses flute.
I wrote to Fine Gael on the matter, what follows next is the resulting correspondence:
Hello, I'm an economics student and I have a query. Time and again I have heard our Taoiseach and other ministers from your party make the claim that our recovery will be export driven, in effect we will export our way out of this banking crisis. I would be very grateful if you could direct me towards the data supporting these claims as to date I am having great difficulty locating supporting documentation. Yours sincerely
The reply: The Central Statistics Office mid year released figures showing that Ireland's exports increased by 10% in August. Exports in August were up 10% on July, according to seasonally adjusted figure while Ireland’s trade surplus rose 15% compared with July, to €3.7bn. The figures also show that exports in August 2011 were up 5% compared with August 2010, according to unadjusted figures. The figures for the first nine months of 2011 compared with the same period of 2010 show Exports increased by 4% to €69,425m. Exports of Medical and pharmaceutical products increased by 11% or €1,936m, Organic chemicals by 10% or €1,342m and Petroleum by 51% or €325m. Exports of Computer equipment fell by 9% or €287m. Goods to the USA increased by 4% or €682m, to France by 14% or €470m and to Switzerland by 13% or €318m.
I wrote: Thank you very much for your quick reply. The figures you gave me clearly demonstrate that exports have gone up in 2011. However, I must have been unclear when formulating my question. What I wanted to know: are there any examples in history of a country overcoming a banking crisis by strong exports? Could you point me towards the theoretical economic approach that explains how a country can export their way out of a banking crisis?
They wrote: I understand that the point the Taoiseach was making was that Ireland is a uniquely open economy with a high dependence on exports, it is in a better position than most to gain from export growth. Economic growth is crucial to the economy's ability when faced with such debt to survive. In no sense did he mean that Ireland would overcome the banking crisis by strong exports, simply that strong export growth would enable the economy to work its way through the crisis by generating wealth in the economy. The government behind the scenes is working on arrangements to lower the cost of the bank bailout to more sustainable levels. Obviously in the midst of negotiations the details cannot be made public. A restructured debt plus economic growth from exports could ease some of the pressures on Ireland. In no way however is it on its own the solution. The potential for export growth in Ireland is greater in Ireland than in some of the other so-called PIIGS countries, so it gives us greater potential to survive the crisis. Other PIIGs countries have far less potential. None of that is to minimise the banking crisis in any way - the issue is being able to survive it. I hope that clarifies things.
It certainly did, perhaps that unique position that he mentions is that one which involves bending over and sticking one's head right up their arse.
So there ye have our gov. is embarked on a course of action, founded on nothing. And the press regurgitates this unquestionably, and RTE regurgitates it as if it's gospel, and you swallow it all up hook, line, and sinker. Not only that you pay for the lies. You buy these shitty newspapers and pay a TV license, tut, tut, tut.
By the way I sent the same questions to the Labour party, who have yet to reply, and to the Dept. of Finance, but their all f**kwits, so I won't be expecting much there. I mean these are the people who when asked how much does the use of the euro cost the Irish gov. were unaware that we paid of it's use, but that's another story for another day.
