Slight but important clarification

Tom McDonnell10/05/2011

Tom McDonnell: I believe I was slightly taken out of context in the Irish Times today.

I was quoted as saying

“...austerity measures would not restore growth”, which is fine,


“He urged the Government to ramp up public investment in a manner that should “echo Roosevelt’s New Deal policies . . . and the Marshall Plan policies which engendered the recovery of Western Europe in the wake of the Second World War”.

Just to clarify that the Marshall Plan comments were meant in the context of a European wide programme of investment as a countervailing force to the austerity measures being undertaken domestically in the periphery. I was not claiming the Irish Government had access to the resources to “ramp up” investment.

Centralising monetary policy, while keeping the other instruments of economic policy in member hands, is incoherent.

In the longer-term the Euro zone members (principally Germany) will have to decide between fiscal federalism and Euro zone break-up.

The status quo cannot hold.

Posted in: InequalityInvestment

Tagged with: austerityinvestment

Dr Tom McDonnell

McDonnell, Tom

Tom McDonnell is senior economist at the NERI and is responsible for among other things, NERI's analysis of the Republic of Ireland economy including risks, trends and forecasts. He specialises in economic growth theory, the economics of innovation, the Irish and European economies, and fiscal policy. He previously worked as an economist at TASC and before that was a lecturer in economics at NUI Galway and at DCU. He has also taught at Maynooth University.

Tom obtained his PhD in economics from NUI Galway.



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