by Michael Kirke | posted on MercatorNet.com on Monday, 22 November 2010
How much the current Irish banking and public finances debacle is going to contribute to a pan-European or even global conflagration remains to be seen. Whether or not the Irish troubles are going to engulf Portugal, Spain and God knows who else in a financial tsunami is a matter for the prophets of doom – and there are plenty of them around – to work out.
The worry is that this crisis may end up being a much greater catastrophe on a global level that it is for Ireland itself. We can only hope that the measures which have now been put in place, the funding from the IMF and the oversight that goes with it, will be sufficient to dampen the shockwaves.
The scale of what has happened is greater than any single event since Ireland secured her political separation from Great Britain nearly 100 years ago. The consequences of these events may change the political landscape of the Irish Republic in a way which many have longed for for decades while the historically burdened system has remained as doggedly in place as her beautiful mountain ranges in Connemara or Killarney. As Dermot Desmond, one of Ireland’s leading financiers, one who has come through this debacle with his reputation unscathed and his wealth intact, said recently, “The era of Civil War politics, passed on as a family business across generations, must be laid to rest.”
But while we may describe the events of the past three years as a debacle, it is wrong to describe them as a catastrophe. Real catastrophes cause permanent and irreparable damage and destruction. There is no doubt but that fortunes have been lost – for the most part by the foolish. There is no doubt there will be a degree of hardship for innocent bystanders. But in the longer term these are all things from which we can recover.
In the lead-up to the final capitulation of the Irish Government to the inevitable on Sunday night – its request for international assistance, with strings attached – a great deal of attention has been paid to the so-called shame and humiliation of a proud nation which won its independence at such a high cost.
There has been something of a grand delusion about Ireland’s vaunted sovereignty. Cries of woe uttered by Brendan O’Neill or Mick Hume in Spiked over the past few days — bewailing the arrival of the men in black from the IMF and the ECB — was media romanticism. For most Irish, talk about the nameless, faceless and unaccountable bureaucrats taking control of a freedom-loving little island on the western European seaboard is nonsense.
The plain people of Ireland saw the matter in a much more practical light. A group of incompetent politicians who had been badly served by their own nameless, faceless and unaccountable bureaucrats have had to surrender a measure of their control to a (hopefully) competent team of bureaucrats who will be no more nameless or faceless than those they will now have reporting to them.
Pride has been hurt but the Irish will “get over it and get on with it.” They are a resilient people. They are not afraid of emigration. They have been doing it for two centuries and are used to it. There are 80 million of them around the world. This reality is part of what gained Ireland its second place after Singapore in the globalisation world rankings a handful of years ago. Independence is a delusion. Mutual dependence is what has come clearly into focus as a result of all these events.
An illustration of Ireland’s and Britain’s mutual dependence was brought into focus in the Westminster Parliament last week when Chancellor George Osborne revealed that Ireland is the biggest market for British exports. Ann Marie Hourihane pointed out in The Irish Times: “[I]n 2009 Ireland bought a total of £23,767 million in British goods and services. That was £15,918 million in goods and £7,849 million in services. More than Brazil, Russia, India and China. However, if you add Hong Kong’s figures to those of mainland China you get a total £24,370 million British goods imported there, so Ireland’s figure is marginally below that.”
British embassy statistics revealed details last summer about the extent of Irish participation and investment in the British economy – the number of Irish directors of British companies, for example – which reveal a very different picture from one of proud and splendid isolation. As Hourihane commented, “They provide George Osborne with a good reason for offering us a big loan and they provide us with a very good reason for grabbing George Osborne and holding on tight.”
“It is not just true,” she added, “that Ireland consumes Britain’s food, its fashion, its football and the fun and rudeness of its tabloid culture, its golf, its opera productions, its West End shows, its Formula One, Downton Abbey and Masterchef – we are part of it.”
Dermot Desmond has remarked that Ireland’s success since the foundation of the State is often best observed from outside rather than from within. In an address in Dublin he pointed out that “We are an island nation with real spirit which has time and again fought against and dealt with enormous economic challenges. Today is no different and to appreciate those challenges we should examine the facts of the current situation and not the emotion. Today Ireland exports total €84 billion compared to 1990 when our exports were €18 billion. The growth in technology and other knowledge-based sectors has driven the success of Ireland.”
He recognised that the boom we have just experienced created an unsustainable bubble in property but holds that “the fundamentals of our position in 20 years have been undeniably transformed. Debt to GNP in 1987 was almost 125 per cent and it took almost one-third of the tax take to pay for the interest alone. Mistakes may be painful to bear witness to, but they are incredibly valuable if learned from.”
Another pundit, Agnes Aylward, recalled something from history which she saw as very pertinent to the situation facing Ireland today. Over 150 years ago, Thomas Francis Meagher first publicly unveiled the flag which would subsequently become the Irish Tricolour. Within a year of doing so he was tried and sentenced to death for his part in the failed Young Ireland rising of July 1848. That sentence was subsequently commuted to penal servitude for life in Van Diemen’s Land, modern-day Tasmania.
Before his deportation, he wrote to a friend about the future. It was the darkest of times in Ireland, which was just emerging from a famine which had taken the lives of millions. But he wrote: “Yet I do not, could not despair of her regeneration. Nations do not die in a day. Their lives are reckoned by generations, and they encompass centuries. Their vitality is inextinguishable… Greece has so outlived her ruins and her woes. Italy has so outlived her degeneracy and her despotisms. Thus too, shall Ireland survive all her sufferings, her errors and disasters, and rear one day an ‘Arch of Triumph’ high above the wreck and wilderness of the past. This is my sincere faith.”
Ireland did so and the Irish have no doubt but that the darkness they are experiencing now will give way to a much brighter future.
2 thoughts on “Ireland: from the bottom, everything is up”
IF Ireland falls and starts a domino effect in Europe, it will prove what a flimsy and flawed system the whole EU economic apparatus is. It will also show how poorly (although over-) regulated the system is aswell.
So are the Eurocrats really much better? Time will tell.
Thoroughly enjoyed this article, a great antedote to the perpetual gloom of recent media coverage.