Irish Meltdown Lights Fire Under Fellow Debtors: Vanessa Rossi

Ireland had little choice but to accept European Union help to avoid a breakdown in the financial system. There was no other way to rescue the banks without placing the burden on Ireland’s 4.5 million people.

At the peak of the financial crisis, the U.K. and U.S. were able to provide guarantees worth trillions of dollars to support their banks, though the actual costs turned out to be much lower as confidence was quickly restored. The full extent of the guarantee was largely hypothetical. They succeeded because they could make a credible promise of support -- Ireland could not.