Ireland's Minister for Finance Brian Lenihan said Thursday that the state could handle the extra debt it incurred by recapitalizing Ireland's failed banks.
Acknowledging that it would drastically increase Ireland's national debt, he feels that the taxpayer can handle it.
Speaking to the Irish Times, Lenihan said, “We are in danger of viewing Ireland as having a problem we cannot surmount, but that is not the case. Those advocating default would put us in the position of Iceland or Argentina and that would leave us with insurmountable problems.
“People are perfectly entitled to be angry at the reckless lending of the bankers. I understand that, but Ireland is not Argentina and we can’t go around repudiating our debts."
Lenihan said that he was aware that the taxpayer was not happy that the banks and the state are being funded by the IMF and the EU, which makes the state dependent and malleable to their wishes.
Aware of the sensitivity of the international political economy, Lenihan said the crisis, "has been a huge pressure on me since 2008, knowing the fragility of the system."
The Minister also said that if the banks had their way they would put private interests ahead of the economies interest.
"If the banks were left to their own devices, they would have put their private interests ahead of the need to support the economy. If the banking system is not in a position to support economic recovery, it won’t happen."
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