Sir, – Simon Carswell (The Bottom Line, Business, September 5th) in reporting that two Swedes have been added to the regulatory stew, goes on to say that the 20 per cent devaluation option available to Sweden is not available to us. It is available. We must leave the euro; reissue a new currency, and we know we can cope with that because it has been done three times in the lifetime of many of us; let our own currency float at its own level, and move forward strongly. The Swedes will admit that that is the way.
We can stay loyal members of the EU, and rejoin the currency whenever we get full political union.
The present alternative is leading to further unemployment, cuts, lack of spending and tax generation and a continuing downward spiral. – Yours, etc,
Sir, – Simon Carswell highlights the important role being played by Swedish economists and Swedish economic history in repairing the Irish banking system. It also represents the second time since independence that Ireland has sought to use Swedish economic expertise to chart a path to banking reform.
In 1934, with Éamon de Valera anxious to pursue a more independent monetary path, the Swedish economist Per Jacobsson, who later became managing director of the International Monetary Fund, was appointed as an outside expert on the grandly sounding Commission of Enquiry into Banking, Currency and Credit.
In typical Irish fashion, the commission did not report until 1938. To de Valera’s annoyance, the final report warned against excessive government spending and debt financing. The commission did, however, after a further bout of internal Fianna Fáil wrangling, eventually pave the way for the establishment of the Central Bank of Ireland in 1943.
Jacobsson played a direct role in increasing the quality of Irish economic debate. He helped widen the Irish understanding of economic policy which, up to this time, focused solely on the Merrion Street-British treasury axis. Unfortunately, his views on the broader requirements of sustainable economic policy were largely ignored by Irish policymakers.
Jacobsson admitted he never fully understood the intricacies of the Irish personality; he viewed us as “cool customers” in financial matters.
We can only hope that the expertise of our current Swedes – Lars Frisell and Stefan Gerlach – will play a more central role in the reorientation of our banking system in the years ahead. Although I am sure they realise by now that our cool customer days in the financial stakes are well and truly over. – Yours, etc,