Douglas Carswell's Blog

Eurozone must learn from Argentina

Irish debt today has a lower credit rating than Argentina's - despite the fact that Argentina went spectacularly bankrupt a decade ago.   

Having pegged her currency artificially to that of another, Argentina was where much of Euroland finds itself today. 

The red arrow shows what happened when Argentina was locked into a monetary union.

The blue arrow shows what happened when Argentina decoupled her currency and defaulted on her debts.

The lesson for Ireland, Portugal, Italy, Spain, Greece and any other Eurozone members is to follow the example of Argentina; Default on the debt, Decouple from the Euro, Downsize on the public sector.  You might call it, the three D policy - simple enough for even politicians to remember ....

It is now more than six months since I showed this graph to two top Treasury officials.  They looked bemused then.  I hope they understand now. 

Back to all posts