Aaron McDaid

Recently, I had become a fan of David McWilliam's writing, but not any more. In "Fight for our right to prosperity" he vaguely argues that the Republic of Ireland's economic salvation will lie in increased exporting. He seems to even hint, in the final paragraphs, that the Republic of Ireland should leave the eurozone.

We can't just wave a magic wand and become exporters again. Our trading partners, such as the UK and US, will be trying to do the same. We can't expect that Germany and Japan and China will suddenly decide to import trillions of dollars of stuff every year instead of exporting.

The only way to increase our exports in the current international climate is to pimp ourselves out at a really low rate, which'll mean cuts in standards of living. Unless David wants us to "export" by making computers out of turf and push them into the sea.

Much of our economy, especially those directly or indirectly involved in trade, will need to be replaced or reconfigured. That'll mean massive layoffs. There'll be less of an industry importing electronics and clothes as nobody can afford them any more, and there'll be no exporting for some time as there'll be no buyers.

Slowly but surely, whether we like it or not, our trade deficit will be corrected for us. We deserve the downward pressure on our collective standards of living - we need pay for the hedonism of the last decade. The only real option we have is whether to accept mass unemployment; or instead to spread the pain more evenly by using government borrowing to employ everyone.

Mass unemployment may sound appealing to some, but we'd be even less productive having 10% of people scratching their ass at home than if they were working on some government-funded public works. Enslaving 10% in order to keep 90% at their high standard of living requires, at a minimum, that the new slaves are actually working on something. Realistically, we all have to accept a cut in our standard of living.

So the only way to keep unemployment under 10% (even 10% might be difficult!), and avoid the inevitable rioting (rioting fueled by racial tensions), is for the state to borrow heavily and spend.

This'll crowd out the lazier importing, by making it more expensive, and any importing will be caused by the government's works which can be turned off as the economy improves. And exporting will make more sense again as the state will be glad to get any euros into the country which can be used to pay off the debt. Basically, we don't want any more BMWs from the Germans or Wiis from Japan, but if they can give us something useful instead we'll consider buying it. (Just don't try to take my Wii off me!)

I never thought I'd be saying this, but government borrowing and spending is the only option now. David McWilliams vaguely hints that he doesn't like this but he isn't clear and he has no alternative.