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Economic Response to Covid crisis cannot replicate the mistakes of the last recession

Social Democrats co-leader Roísín Shortall said that today’s economic update from Finance Minister Paschal Donohoe did little more than set out possible scenarios but failed to provide any real detail regarding the Government’s response to the economic fallout of the Covid crisis.

Speaking after the Minister’s press conference, Roísín Shortall said:

“Unsurprisingly it paints a very stark picture of challenges ahead and we know that the cost of responding will be substantial. However, the Minister fails to outline his approach to raising the necessary funding to enable the country to respond appropriately and to say how this will be financed

“The big question is who will pay for this. We cannot repeat the mistakes of the last recession. People in Ireland had no control over this pandemic & the cost of responding to it must not fall on their shoulders. This is a Europe wide problem and we need a Europe wide solution. It would be entirely unacceptable for the ECB to respond with costly loans and that is why the gov must vigorously pursue the issuing of Euro Bonds, so that Europe can mutualise this very substantial debt.

“The aim of economic strategy should be to provide an economic stimulus rather than retrenchment and austerity. This can only happen if the ECB provides funding at zero or negative interest rates.”

21st April 2020

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