To coin a phrase, is Estonia right to pocket euros?
Plucky little Estonia. Having escaped the Soviet Union, and faced the wrath of the Russian bear on several occasions since, this tiny country of 1.3 million people has now joined the euro. These people are brave, but are they right in the head?
Actually, the entry of Estonia is a timely reminder of what the euro is supposed to be, and what it is not. It is timely because, in Ireland, these arguments were forgotten the minute those strange new notes appeared in the ATM machines.
We are paying a terrible price for that amnesia and are having trouble engaging with the kind of rational analysis which preceded entry — even though almost everyone was in favour of membership.
There are those who say we should leave the single currency, but you will search hard for detail on how such an event could be organised, and what would happen afterwards.
Those in charge of affairs say we must never contemplate any such thing.
Estonia also offers some hard lessons for those who hanker for life without the constraints of the euro.
It, too, had a borrowing splurge and horrible crash. The 14% fall in output was almost on an Irish scale — and this is the poorest country in the EU. Even though it was not a member, the very existence of the euro exerted a baleful influence. One does not have to be in the euro in order to borrow in euro. Estonians, like other eastern Europeans, were able to get cheap mortgages by borrowing in euro.
But they ran the risk that their national currencies would fall and the cost of the loans would rise.
This is precisely what happened in some cases, especially Hungary — as many Irish property investors are all too well aware.
These people are brave, but are they right in the head?
Estonian debt will still be foreign debt, but it is now in their own currency. Having seen the calamities of the past year, they will not be celebrating entry like earlier members.
But the prospect of keeping your loans in the currency in which they were borrowed is a powerful incentive to join.
Any country leaving the euro under pressure would find itself up to the ears in foreign currency debt. Those with long memories will know that excessive foreign debt is an even more severe constraint than government deficits.
As for those, after a crash austerity programme, Estonia's public finances are well within the rules for euro membership. Which illustrates one of the fundamental flaws in the rules — that they do not count private debt.
Estonia's case also brings to mind the fundamental questions facing Ireland in 1999.
The Baltic states have the theoretical defence of the Nato military machine against the giant neighbour who in the past absorbed them. But many there think the “soft power” of EU and euro membership may actually be a better protection. It often seems that Moscow feels the same.
Ireland's strategic choices are less stark, but they are real. So long as there is a European currency, what would be the position of an Ireland which did not belong to it? Would it be a smart Atlantic Hong Kong or Singapore or an impotent, unsuccessful outsider — probably an unofficial member of the sterling zone, by decree of the markets? Opinions may vary, but the choice is as fundamental as ever it was.