When Ireland made the decision to protect all of its banks from losses and cover those losses by imposing austerity measures in 2008, Paul Krugman made hash of the conservatives' argument for adopting that policy. As it turns out, he was right.

Ireland relented on Sunday and formally applied for a rescue package worth tens of billions of dollars, after months of trying to survive its financial crisis with austerity measures and strict budgetary planning.

European Union officials, who had been pushing Ireland to accept help, quickly agreed to the request, committing a staggering amount of funds to an ailing member for the second time in six months.

Ireland's fiscal crisis, like ours, has a mortgage meltdown as its root cause. However, the decision to impose severe austerity measures, including a big tax hike on Irish workers while insisting that the corporate tax rate remain one of the lowest in the world has not proven itself to be effective.

An Irish bailout would mean humiliation for the government ahead of possible national elections early next year. Ireland would lose some control over its finances in return for loans, which could mean being forced to give up the country's rock-bottom corporate tax rate – a key attraction to businesses that annoys other EU countries that have much higher rates.

Because of the concern over panic and contagion, Ireland will request the bailout, and receive it. They should also raise those corporate tax rates sooner rather than later. Enough is enough. It's proven time and again that low corporate tax rates will not sustain economic growth. Ireland's austerity failure stands as a solid argument against conservative austerity nonsense here, there, and elsewhere.