THE ECONOMIC crisis facing Ireland is so severe that there is “a very strong case” for the political parties to form a government of national unity, according to Niall FitzGerald, the Irish deputy chairman of media giant Thomson Reuters.
Speaking to The Irish Timesat the World Economic Forum, Mr FitzGerald said: "This is economic war, and when in war you cannot afford the normal political debate. There is a very strong case for the political parties to come together and form a government of political national unity for a period."
He said the parties should agree to “core actions and sustain them for a period of years – we cannot indulge ourselves with the normal political debate”.
Referring to Ireland’s likely second referendum on the Lisbon Treaty, Mr FitzGerald said the country needed “a healthy dose of reality when Ireland takes its view on Europe”.
“If Ireland was not in Europe or the euro zone it would have ended up in a worse position than Iceland.” This should be borne in mind in the coming referendum. “You have to understand the consequences of the choice – I am not sure Europe would be as patient with Ireland again.”
Mr FitzGerald, a former chairman of consumer goods firm Unilever, said that there was “no quick fix” to the Irish economic situation.
During the country’s decade-long boom there was “too much quick trading in money and not enough making of money and building for the long term”.
“When I left Ireland in 1971 the Irish per capita GDP was 60 per cent of the European average and before this crisis it was 120 to 125 per cent of Germany. That comes from excessive development and there has got to be a correction. We spent what we didn’t have at an unsustainable level.”
He said borrowing may have helped grow the economy rapidly but that the heavy leveraging of debt was now having a negative effect. “That is what leverage is about – leverage is good but it is a two-edged weapon. It gives you great benefit on the way up and great pain on the way down.”
