Fintan O’Toole: Ireland must be tough to avoid being sold out in Brexit deal

Lessons from bailout show State cannot take goodwill of our European allies for granted

Democratic Unionist Party (DUP) Leader Arlene Foster, alongside Deputy Leader Nigel Dodds and Chief Whip Jeffrey Donaldson, makes a statement on their deal with the conservatives before leaving 10 Downing Street, on June 26,

 

On Thursday, we will mark the fifth anniversary of one of the greatest diplomatic triumphs in Irish history with fireworks, street parties and a parade of ambassadors and politicians past the GPO in Dublin. Or at least we would do if the triumph hadn’t turned to dust. It is an embarrassment now filed under O for oblivion. But we ought to remember it because it contains a warning about Ireland’s place in the Brexit negotiations. Crudely, the warning is that we cannot take the apparent goodwill of our gallant allies in Europe for granted.

Five years ago, Ireland was in a dire state, partly because it had obeyed instructions from Brussels and Frankfurt to pour billions after billions into the banks, including, insanely, the black hole of Anglo Irish Bank. Irish citizens had “taken one for the team” by funding what was proportionately one of the most expensive bank bailouts in world history. This had been done to shore up the euro zone and the European banking system. And there was a general view that Europe wouldn’t see us stuck, that when the first wave of panic had subsided and the necessary mechanisms had been established, we would get at least some of the money back.

Sceptical

Some of us were sceptical about this 19th-century morality tale of virtue rewarded and meekness vindicated. But we were wrong – or so it seemed on June 29th, 2012. That was the moment of what both then taoiseach Enda Kenny and his tánaiste, Eamon Gilmore, called the “game-changer”. In the early hours of the morning, the eurogroup leaders agreed that banks would be recapitalised through the European Stability Mechanism (ESM). Ireland was to be dealt with first and recognised as a “special case”. The official declaration said that “the eurogroup will examine the situation of the Irish financial sector with the view of further improving the sustainability of the well-performing adjustment programme”. 

Kenny and Gilmore returned as conquering heroes. A big chunk of the bank debt was going to be lifted from our shoulders, meaning that the State’s finances could be stabilised and perhaps some of the most savage effects of austerity could be avoided. As Gilmore told RTÉ: “This lifts that burden from the Irish taxpayer and means that the European taxpayer, at a general level, through the ESM, is basically taking on responsibility for it. It does mean we now have help in bearing this burden and that will enable this country’s economy to recover much faster than otherwise would have been the case.” Europe had come through for us after all.

Future crises

What happened? Nothing at all. Not a cent of European taxpayers’ money went into recapitalising the Irish banks. Within four months, Angela Merkel, worried about her own electorate, imperiously announced that the June 29th deal had nothing to do with existing bank bailouts and was just about what would happen in future crises. Our leaders continued to insist that she didn’t really mean this – and anyway sure weren’t we a special case? But the great triumph gradually deflated like a cheap beachball. And establishment Ireland simply stopped talking about it. Like a Russian athlete’s world record, it was wiped from the books. It never happened.

Supine obedience is not rewarded in the world of realpolitik – it just means that you can be taken for granted

This unhappy anniversary is worth marking, though, because Ireland is again crucially dependent on the goodwill of our European friends. As the remaining EU country most affected by Brexit, we need unwavering support. We have vital national interests at stake, most obviously that the British not be allowed to reimpose a hard Border across our island. We need that support, not in declarations or rhetoric or generalised friendliness but in the hard, bitter moments when deals are finally done. To put it frankly, we need not to be sold out.

So far, admittedly, there is every reason to be reassured. The Government and the diplomatic service have done a superb job in getting the Irish question to the top of the agenda for the Brexit negotiations. The EU has seemed much more serious about Ireland than the British do, which is astonishing when you remember that the British actually govern part of the island. There is no reason to think that the lead EU negotiator, Michel Barnier, is less than entirely sincere in his determination to look out for Irish interests.

Brimming with goodwill

But euro zone leaders were perfectly sincere five years ago when they decided to help us out with our banks. I’m sure they were brimming with goodwill – until Merkel found that helping Ireland could mean more trouble with her domestic electorate than it was worth. So what if, in 2019, the pesky Irish problem is all that’s standing in the way of a Brexit deal? Will we again be more trouble than we’re worth?

Ireland was forgotten five years ago because we just did what we were told anyway. Supine obedience is not rewarded in the world of realpolitik – it just means that you can be taken for granted. This lesson must be learned. Europe must know that we are grateful for the support and solidarity. But it must also know we will never accept a hard Border under any circumstances. And if necessary we will be a bloody difficult country.  

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