WSWSThe €85 billion bailout agreed on Sunday evening between the European Union, International Monetary Fund and the Irish government will enforce the demands of the financial elite through the further impoverishment of the working class. It will ensure that those responsible for the current crisis are protected from any losses, while state finances will be raided once again to bail out insolvent financial institutions.
Negotiations were held throughout the weekend, with fears that failure to secure a deal by the opening of trading on Monday would precipitate a market collapse—driven in particular by concerns over bondholders being made partially liable for bank debt. This was explicitly ruled out, although a vague commitment was made by EU member states to consider imposing sanctions on bondholders after 2013.
Even such a limited proposal was too much for financiers. As European Central Bank policy-maker Christian Noyer warned, “As far as I’m concerned, I exclude that there will be haircuts [for bondholders] in the future. It will be a major objective of all members of the EU to do everything necessary to be in a position to fully honour their debts in the future. I exclude this as an eventuality even if it’s legally possible.”
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