Irish Push EU For Debt Relief

Ambrose Evans-Pritchard, via nc links:

The Irish government has suddenly complicated the picture by requesting debt relief from as a reward for upholding the integrity of the EU financial system after the Lehman crisis, though there is no explicit linkage between the two issues.

"We carried an undue burden for protecting the European banking system from contagion," said finance minister Michael Noonan.

"We are looking at ways to reduce the debt. We would like to see our European colleagues address this in a positive manner. Wherever there is a reckless borrower, there is also a reckless lender," he said, alluding to German, French, British and Dutch banks.

Mr Noonan hinted that Dublin is asking for some of interested relief on a €31bn EU promissory noted linked to the Anglo Irish fiasco, among other matters.

Mr Noonan said Ireland's public mood has turned very sour.
"We have indicated to Europe's authorities that it will be difficult to get the Irish public to pass a referendum on treaty change," he said.
The EU's new fiscal rules would be legally binding and "justiciable" before the European Court, he said. This raises the likelihood that Ireland's top court would insist on a referendum.
The Irish voted `No' to both the Nice and Lisbon Treaties, before being pressured into repeat ballots, and would certainly some form of quid pro quo in this case.

Interesting.  Europe will be the dominant economic issue for the foreseeable future.  In the end, creditors will accept some losses, or they'll see even worse losses when bonds crater.  Things are going to get worse before they get noticably better.