FollowBy: Dr. Samuel Brazys
Tomorrow’s referendum is an important vote for Ireland not only because of the immediate financial implications but also as a measure of the Irish commitment to the European project. As an article in this week’s Economist makes clear, the way in which the current crisis is resolved (or not) will likely decide the future of the Union. As commentators have been recognizing for some time the current crisis illustrates the difficulty in maintaining a monetary union without a corresponding fiscal, or “transfer,” union.
Transfer union implies two things – a redistribution of wealth and a loss of sovereignty. While the former would almost certainly break in Ireland’s favor, at least in the short and mid term, it is the latter that gives so many people pause, and perhaps rightly so. It is true that EU level decision making is largely insulated from public accountability. However, the implication of this democratic deficit need not be “reject the EU” – the implication could instead be to strengthen the Union – not just economically but also institutionally. A strengthened EU, with both direct fiscal powers and direct representation, would do much to alleviate the root causes of the current crisis. It is true that in such an incarnation of the EU the sovereign power of Ireland would decline. However, the monetary union, and probably the common market, are not likely to survive in the absence of these institutional changes. The question then is not the stark “Is Ireland ready to sell her sovereignty?” but rather, “are the Irish people willing to be paid to transfer (at least a part of) their social contract from an Irish to a European sovereign?” A significant indication of Ireland’s answer to this question will come at the polls tomorrow. As John F. Kennedy once said, the cost of freedom is always high.