Kilkenomics kicked off on Wednesday evening with a preview of what’s to come over the five days of the second annual festival mixing comedy and economics.
A very well informed Colm O’Regan took on the role of comedian/host at the first session of the festival, ‘What You Really Need To Know’, with panellists David McWilliams (economist), Martín Lousteau (former finance minister of Argentina) and Peter Antonioni (author of Economics for Dummies).
The idea is to turn on their heads some of the economic policies currently being pursued, and it was clear from the start that convention was going out the window – where else would you find a comedian in a suit accompanied by three dressed-down economists?
We learned a few things on the night: among them that a national default could be quick and painful but possibly unavoidable. About the festival itself, we learned that its discussions and interviews are being streamed on Kilkenomics FM at www.soundcloud.com/kilkenomics and that the Marble local currency is back for this year’s festival – once again “the strongest currency in Europe”.
Because, funnily enough, the festival again comes at a time of turmoil and uncertainty. As was said on the night: “Last year we brought you the IMF. This year we’re helping bring down the Greek government.” And for next year, who knows, although there was a mention of “zombies”...
On a serious note, Martín Lousteau had particular insight to offer, having worked in top economic posts including the finance ministry in the wake of Argentina’s default in 2002.
Speaking of the pending Greek referendum on whether to accept the proposed new bailout and remain in the Eurozone, he said: “No matter which way it goes, this is going to end up very badly. The bad news is that we in Argentina are 10 years ahead of Greece, but Greece is only months or years ahead of Europe. It might be Italy, it might be Portugal. I hope it’s not Ireland” – to which David McWilliams summarised the mood of the audience by saying: “We do too.”
But what does a default feel like?
The good news is that 75% of Argentina’s public debt was written off, and the country has now experienced 98% growth since 2003.
The bad news is that it wasn’t a pretty sight getting there.
“In the beginning, everybody loses,” Mr Lousteau said. There was an immediate freeze on bank deposits and those who had invested in bonds largely lost their money. Argentina’s economy had also been in a depression from October 1998 to May 2002.
When the country defaulted, the poverty level jumped up to 50% of the population and 25% of people didn’t have enough money to feed themselves.
But he said that the country didn’t really have a choice at the time; it simply could not pay its debts. “I would never advise a country to go bankrupt, but sometimes it is unavoidable,” he said.
And he noted that for those who saw the value of their deposits plummet, if they waited another year and a half or two years for them to grow again, they found that the value returned.
Still, as Colm O’Regan joked to the UK’s Peter Antonioni, “you must be kicking yourselves that you didn’t join the euro.” – which prompted the economist to say of former prime minister Gordon Brown: “It’s the one thing he got right.”