The Ireland Inc column warned a few weeks ago about the inept mishandling of the European debt crisis and events of the last week showed that the Commission continues to play into the hands of speculators on sovereign debt markets who are betting big on nothing short of the break up of the eurozone.

The Commission has mis-read the developing market crisis over Greek and now Portuguese debt. In dealing with Athens and Lisbon, it used the same strategy in dealing with Ireland this time last year: keep up the political pressure on the governments to cut their annual budget deficits. It was joined by the international credit ratings agencies who, angered by Greece's hiding of the scale of its budget deficit, kept applying pressure. But the market jitters on Greece and Portugal debt have now hit the euro and worldwide stockmarkets, as shares of European banks, which hold devaluing euro bonds, took a hammering.

London media commentators now wonder whether the euromed debt crisis will later this year spread to Britain, whose annual budget deficit is, after all, as large as that of Greece or Portugal.

The numbers on the sovereign debt markets tell the story. Interest rates for Portugal to borrow money for 10 years soared by a third of a percent to 4.70% last week. But some good news for Greece – its key borrowing costs fell by 11 basis points last week to 6.73%, while Spain's borrowing rate was unchanged at 4.12%. When the dust settled, Ireland – at 4.85% – was still paying the second-highest debt-servicing costs in the eurozone.