Let’s not repeat Ireland’s mistakes

Written By: - Date published: 1:25 pm, March 29th, 2010 - 23 comments
Categories: capitalism, economy, Economy, poverty - Tags:

The eXileD has a piece on Ireland’s woes and how they got there. The 1980s neoliberal revolution and dodgy deals for the Right’s mates are familiar. Ireland became a tax haven for bludging international financiers. It’s all come crashing down but John Key wants to copy their mistake by creating an offshore financial centre here.

So it’s that time of the year again. That time of the year when you put on the stupid, oversized green hat, get outrageously drunk, approach a young man/woman/shaved-ape in a bleary haze and ramble on about how your third-cousin’s friend’s half-aunt was Irish in a desperate attempt to get laid. Maybe some cringing Irish ballad might come on (you know, one of those songs about prison ships and birds of freedom) and there’s no way in hell you’re going to resists that urge to sing along. For shame.

That’s right; it’s St. Patrick’s day!

Here in Ireland we have an expression for this type of behaviour (yes, we Fenian folk act in a similar manner so often that we’ve coined a phrase); it’s called ‘acting like a total fucking gobshite’. And yes, Paddy’s Day is a day of doing precisely that. It’s a day when people idolise the old country (even if it’s not old, or their country); a day when they call to mind images of leprechauns, Celtic warrior kings and Enya.

Well, as the Guinness induced intoxication begins to clear and those whimsical spirits fade away; when you wake up next to a stranger only to find that both of you have huge shamrocks tattooed on your arses; when you begin to survey the vaguely recalled chaos of the night before now you’re ready to read about the fair green isles.

You see Ireland isn’t in a good way. Ireland’s coming out of a bad bender and it fucking hurts!

‘Jesus! How did this happen?’ you ask yourself the morning after. Why is your novelty hat full of sick? Which drink was the ‘one too many’ that pushed you into that self-destructive spiral? Well, the Irish are asking themselves or, at least should be asking themselves the very same questions. Let’s start from the beginning.

Historically, Ireland has been a very poor place. Up until the mid-twentieth it was basically an agrarian economy an economy dominated by landlords, bailiffs and peasants. The landlords were prosperous class who laughed at the hungry poor; the bailiffs, a mean bunch of drunken bullies who liked nothing better than to batter some poor emaciated hut-dwellers with their shillelaghs (I believe your Bill O’ Reillys and your Sean Hannitys inherited the ‘bailiff gene’); and the peasants? They were a terrible bunch a personification of the smell of a rotten potato.

Sure there were a few built up cities Dublin was alright, Cork wasn’t too bad but even here the poverty was pretty disgusting. You know that Schopenhauerian idea that life is essentially embodied pain? Well, for most of their modern history, the Irish have been living evidence of this.

And the culture? It was crap. Completely saturated by a Catholicism spread by a well entrenched and highly organised Church (although in fairness to the Church, if it hadn’t been for their civilising influence, which only sort of half-worked, I’ll bet that the Irish would still be living in their own filth).

Anyway, then the revolts came. The big dates that you’ll be swigging to this Paddy’s Day: 1916, 1921 1923. They were okay. Well, to be fair 1916 was great; a bunch of poets, nationalists and an admirable Scottish Marxist called James Connolly basically signed a suicide pact and took over the GPO, one of Dublin’s main strategic buildings. Then the British came in and absolutely crushed them oh well.

Once the dreamers and the fools were out of the way a heavy and ignorant nationalism set in that can still be felt today. When the Civil War ended in 1923 no one really cared about anything except Catholicism and the tri-colour well a few did, but they were just ignored.For the next 60 or so years nothing really happened. The Church banned a few films; a load of people went to Latin mass and the new ruling-class that had taken power after the Civil War tried at some rather feeble attempts to industrialise the country. Pretty boring stuff oh, well there was the troubles, but they’re a bit of a fetish; if you want a discussion of them do a Google search, you’ll get plenty.

So, then the early 80s hit. While Maggie Thatcher’s own version of the Cheka were murdering people in the North, the Fianna Fail Party a bunch of corrupt right-wingers formed after the Civil War who refer to themselves as the ‘Republican Party’ got their hands on the doctrines of Milton Friedman and his cronies in watered-down form, I’m sure (these people are cretins, real troglodyte types, in both brain and body). Neo-liberalism had come to Ireland.

The effects were slow to pick up, but the cuts in public services were quick, sharp and deep. The free-market warrior who implemented them was a man called Ray MacSharry. He quickly became known as ‘Mac the Knife’, after the seedy character in Brecht’s ‘Threepenny Opera’. He finished his career, like many of the characters we will meet along the way and also like many Friedmanesque reformers, in public disgrace he was involved in a Watergate-style scandal, using police equipment to tape some of his colleagues. But no worries, even if an Irish politician ends his career in the proverbial stocks he’ll always be able to make himself a small fortune in the business world where moral vice turns into practical virtue.

The cuts of the 1980s were to be felt for the ensuing decades. It might be expected that during the boom years the funding would be restored. To expect that would be to misunderstand the nature of the ‘boom’. One of the main policy measures which allowed the boom to take place was an extremely low corporation tax rate. Ireland was never able to fund its public services because it was, and still is, a tax haven for international corporations an international money-launderer. We launder so much corporate money that economists don’t measure our economic growth in terms of GDP (the standard international measure), but instead measure it in terms of GNP, so that we don’t take into account all the money the corporations are washing through Ireland to avoid paying taxes in the countries where they set up shop. Somehow I doubt that magazines like the Economist took nuggets like these into account when they were championing Ireland as an economic paradise some years back.

In the mid-1990s economic growth was starting to pick up and by the late-90s it was accelerating at a rapid pace. The right-wingers were patting themselves on the back for their infinite cleverness. The stupidly named ‘Celtic Tiger’ was here (the term is cut-and-pasted from the ‘Asian Tiger’ phenomenon further evidence that the international business press is full of drooling idiots and lobotomised hacks especially since the Asian Tigers imploded in 1997-98).

To anyone who maintained their sobriety during this period it was remarkably obvious that the boom was dangerously unsustainable.

Actually, I won’t say ‘maintained their sobriety’ because anyone who was remotely realistic throughout this period would have found it hard not to reach for the bottle. You see the Irish came up with a stupid colloquial phrase to describe critical reasoning: doom and gloom.

‘Ah, Johnny’, Mary would say with a moronic smile plastered on her face, ‘sure he’s always talking doom and gloom’. The RTE’s (our national broadcasting service) economics editor who warned of the disaster that was coming? Doom and gloom. People who pointed out that spending your pension fund on a second home in order to turn around a quick bit of cash was a bad idea? Doom and gloom.

Throughout the so-called Celtic Tiger period the unquestioning subservience the Irish people had learnt under the rule of the Catholic Church fused with the facile optimism of the consumerist age to create a chemical compound of mass-stupefaction. Why vote out the corrupt bastards that were fleecing the country when a new Tommy Hilfiger shop had opened in the city centre (this one has jeans that come pre-faded!)?

Oh, and the corruption no, I won’t move on to the corruption quite yet, we’ll stick with the culture of the era for the moment. You see, Ireland modernised remarkably fast culturally speaking. Don’t get me wrong, I’m truly thankful for this it really isn’t a bad thing when large swaths of the population stop believing that the immaculate Virgin has appeared in Bally-nowhere to tell some sexually abused girl that God loves her.

The Irish culturally modernised by leaps and bounds. Most people of my generation sneer at the mention of organised religion or at the very least are fairly flippant about the whole thing. But if history has taught us nothing it is that one superstition will inevitably be replaced by another. China got Maoism; we got consumerism.

A strange sort of consumerism it was too. The Irish writer Brendan Behan once said ‘Other people have a nationality. The Irish and the Jews have a psychosis’. How right he was. When both these peoples tried to forge their own national identities they were horrified to find a big, dark void where their nationality was supposed to be. The Zionists went mental existential threat this and holocaust that. The Irish weren’t quite so unfortunate. They hung onto the whole Catholic thing for a while; but ditched that whole miserable affair at the first chance they got. When the imported American cultural goods started to arrive by the shipload, the shopping malls began to fill up Dawn of the Dead style.

Then something weird started happening young people started mimicking the characters they saw on inane MTV-style shows like ‘The OC’ and ‘One Tree Hill’. Why is this weird? Well, it’s a matter of geography, really. You see, we’re not L.A. we’re REALLY not L.A. Ireland has shit weather really, really shit weather (the Irish burn significant amounts of carbohydrates just complaining about it). So when you see the guys (yes, we say ‘guys’ now) wearing beach shorts in the pouring rain, or the girls doing the oompa-loompa through the application of fake tan, it’s just that a little weird.

Anyway, let’s move away from the cultural pathologies and get back to the political pathologies. Corruption got pretty bad no, scratch that corruption got really bad. One of the major figures of the 1980s reforms was on-again off-again Taoiseach (translation: Prime Minister) Charles Haughey. Haughey was a crooked bastard and everyone knew it. A total pisshead (translation: regular consumer of alcoholic beverage) and a notorious womaniser; he was also embroiled in an IRA arms deal in 1970. ‘Cool’, you say? Don’t let this fool you as I said earlier Irish nationalism is a murky ideology; where greed mixes with social responsibility and venture capitalist drug-dealers form alliances with committed socialists.Through the eighties Haughey amassed a small fortune by accepting bribes from scumbag businessmen. He even bought himself an island yes, that’s right, the Irish Taoiseach had his own island-lair! But it wasn’t your typical lair. It didn’t have sharks and scuba-men swimming around it or a skull-cave housing a biological warhead. Instead of playing the Bond villain, Haughey used to take helicopter trips to the island with his buddies on the weekends (his son owned Ireland’s biggest helicopter firm) and they all used to get so thrashed on whisky that many claimed Haughey couldn’t work properly come Monday. Corruption Irish style.

Haughey pretty much got away with it too. Everyone thought he was a scumbag well apart from his elite buddies, and that’s all that matters. Unfortunately corrupt bastards don’t pay for their crimes in Ireland; they merely step down from public office, go in front of some bullshit tribunal that goes nowhere and end up in a cushy business job or live out the rest of their days on their private islands drinking their brains out.

For the rich boozing isn’t the escape it is for the poor. Instead it’s a Bacchic dance of transgression. The elites in Ireland don expensive clothes, go to the trendy spots and get absolutely trashed. Enter one of these hip clubs and you’ll encounter the décor of a Parisian restaurant, the dress of an awards ceremony and the stagnant stench of an alley bar. Approach one of the sneering patrons they’ll tell you, in their stressed, pretentious accent, all about their wealth, about their loathing for the poor then they’ll stumble, try to steady themselves and fall on their ass. Coke is popular too the perfect drug for Ireland’s verbose, yet vapid elite. What these people seek is a chemical to accentuate their vulgar arrogance and vulgar it is. There’s no class about this arrogance. There’s no ironic distance toward it it’s fully felt, fully embraced. Many Irish elites would get-off on telling you just how brilliant they are. There’s no need for culture of any kind say, talking about Renoir or Joyce as a point of prestige the arrogance sells itself. This is an attitude of pure brilliance, esteem and privilege and it feeds the corruption like cancerous tumour feeds off its host body why would you have any responsibilities for a society and a country which you are so far above?

The corruption theme is a tired one in Irish political discourse as drawn out and tedious as an Al Gore speech. To give a recent example take our last Taoiseach, Bertie Ahern (another Fianna Fail-er). You’ve probably seen him before. He’s the stammering, dithery monkey-man in the shabby suit you often see standing next to world leaders, complete with shit-eating grin. Ahern was also disgraced for taking bribes from dodgy businessmen and stepped down from his government office. As the financial crisis unravelled and the activities of some of the bankers came to light Ahern commented that ‘he’d only taken a few bribes’ a perfect example of the sense of arrogance and untouchability that pervades Ireland’s elite. Interestingly, Ahern’s autobiography went on to be a best-seller.

This is another thing people need to understand about Ireland. Ask the average Irish person what they think of the politicians. ‘Feckin’ corrupt eejits’, you’ll be told but in reality what Shaun O’ Shaughnassy really wants is to cultivate that drive to fuck over other people himself. This is what a large portion of the Irish population looks for in Ahern’s autobiography but they find themselves only able to apply it in the most petty manner; say, by hiring a builder off-the-books, or by ripping their customers off by selling overpriced crap through their shit businesses. These people, who sneer at the arrogance and corruption of the elites, really just want in on the game.In Ireland we have a term for the attitude of the corrupt (yes, another): ‘cuteness’. Cuteness is a strange one; it’s a sort of mix between criticism and praise. ‘Ah he’s a cute bastard’ means at once ‘He’s a corrupt dickhead’ and at the same time something like ‘He’s very clever’. In reality these people aren’t in any way clever they’re simply ruthless. They’re the type of people you wouldn’t leave your wallet around and the Irish people have an intense love-hate relationship with them. The average Irishman’s conscience says ‘no, what these people do is wrong’, but the little Bertie Ahern-shaped devil on their shoulder says ‘ah, go on no one will notice, you’ll get away with it!’.

In following these supposedly lovable rogues and again I stress there’s nothing lovable about these rogues, they’re just crooks Ireland has walked blindly into an economic catastrophe. As mentioned earlier an enormous property bubble inflated during the so-called Tiger. Who would have thought that a sty of corruption would be fertile ground for a speculative bubble to emerge? Well, emerge it did. Property prices went wild prices tripled between 2000 and 2006.

People were fed the illusion of wealth. Their bank accounts were empty, as part of our economic policy was to artificially stifle wages, but people thought that because their house was worth €500k they were in the big leagues. Like a punter at a street-corner playing three-card monte, the Irish people bought what they were sold in a dizzy state of unquestioning optimism.

Then it all crashed. What a bang it was! The floors fell out of these houses; their value dropped into the netherworlds. Then the banks started going under. One after another they imploded. Property developer after property developer was discovered to have been bribing corrupt government officials. As in most developed countries, for most people the ‘boom’ was never a boom at all it was merely the using of the public purse to generate a speculation induced bourgeois orgasm. There was public outcry. Things really started to heat up. And then silence.

As things quietened down, the government began setting up NAMA (National Asset Management Agency). NAMA makes the US bailouts look as transparent as a Spielberg film. The scheme pumped money into some of the worst banks; institutions that should have died a death, but instead were kept on life-support. Joseph Stiglitz, speaking at Ireland’s main university, commented ‘Countries which allow banks to go under by following the ordinary rules of capitalism have done fine. The US has let 100 banks go this year alone, as did Sweden and Norway in their crises this bank bailout is a simple transfer from taxpayers to bondholders, and it will saddle generations to come. The only thing that might give you solace is that, as chief economist of the World Bank, we see this type of thing happening in banana republics all over the world. Whenever a banking crisis happens, the financial sector uses the turmoil as a mechanism to transfer wealth from the general population to themselves.’

Stiglitz’s comparison to a banana republic is apt. In those countries the ruling elite is so tightly knit, so closely interlinked that one of them couldn’t roll over in bed without getting a hand job from another. Here we see another of Ireland’s political diseases: localism. We’re a small community, with good social ties. ‘How lovely’, you might think, ‘I might go there on holiday’ but throw unregulated capitalism in the mix; then what you get is a tightly knit oligopoly whose members literally all know each other.

The Fianna Fail government, for example, used to have a tent at the country’s major horse-racing event where they would drink with the biggest property developers and cut deals. No one else was allowed in. No citizens; no press. You didn’t need a cool password or a complicated handshake to get in you just needed your face to be recognised. ‘Jimmy, come on in, boy. Wait’ll I tell ye about this luvely piece-a land the Dublin council has and can’t afford to develop because we fucked them in the budget ‘.

So when the property developers’ banks went under the government drove the tax-payers money in by the truckload without thinking twice about it.Then the debt crisis hit. The politicians realised that they’d been haemorrhaging cash on utter shit such as electronic voting machines that didn’t work and now the government budget was fucked. Last January the budget was announced two words: bad medicine. And people’s attitude? Those involved in running the country political types, legal peeps, businessmen etc have a weird masochistic attitude toward the whole thing. They take this weird pleasure in implementing the cuts. It’s a binge and purge mentality and these people seem eager to administer the enema. The average worker, on the other hand, just feels powerless and finds solace in typical Irish cynicism and drink, lots and lots of overpriced drink (we tax drink loads ostensibly to stop people drinking so much, but really because it’s such an easy target).

So when you’re out drinkin’, singin’ and reminiscin’ remember that the ol’ Emerald Isles aren’t the paradise many purport them to be. There ain’t no rainbow folks. No pot of gold either. Just a rather backward country that failed to modernise its institutions properly; that is now being run by an almost nihilistic group of cynics who know they can get away with almost anything and which is now paying the price, big time.Ireland followed the route that so many countries have since the late-1970s (Russia, the United States, Chile, Indonesia etc): neo-liberalism. They used economic policy to float the wealth to the top of the pond where it collected, like scum, until it smothered all those that lived beneath. In Ireland this was undertaken in a cultural atmosphere that many will be celebrating today.

To end on a more positive note: [raises glass] Here’s to the death of neo-liberalism, Reaganism, Thatcherism and monetarism!!! [swigs].

Happy St. Patrick’s Day eXiled readers!!! Have a fucking mad one!!!

23 comments on “Let’s not repeat Ireland’s mistakes”

  1. Peter Johns 1

    i suppose you will suggest to British voters to vote Brown in after all he has done.

  2. ghostwhowalksnz 2

    Good to see they arent blaming the English for their troubles- yet

  3. tc 3

    Nice piece in granny today by an experienced funds manager whose worked in HK till recently who very diplomatically pours scorn over sideshows john’s financial hub fanasty and why it’s highly unlikely to ever work here……does the location sydney ring any bells johnny ?

    • Draco T Bastard 3.1

      This one?

    • Irascible 3.2

      Making NZ a finance house hub was a favourite Roger Mosferatu Douglas mantra during his time as finance minister. The scheme came to nothing as the abstract of “an advantage of time zone” was as much of an illusion as his economics were and are.

  4. BLiP 4

    Actually, I won’t say “maintained their sobriety’ because anyone who was remotely realistic throughout this period would have found it hard not to reach for the bottle. You see the Irish came up with a stupid colloquial phrase to describe critical reasoning: doom and gloom.

    In Aotearoa its called “hysteria”.

  5. prism 5

    Well- made quote from above –
    “the business world where moral vice turns into practical virtue.”

  6. Bored 6

    “speculation induced bourgeois orgasm”…..truly splendid, the language in this article is to die for.

  7. bobo 7

    Just shows the whole “lower taxes and they will come” argument for what it is, Ireland was a totally artificial economy built on hype, massive EU grants and a property bubble. In the mid to late 90s the right wing said “Look at Ireland !!, Look at Ireland!!” now the left wing say “Look at Ireland !!!” Look at Ireland !!!” for the opposite reasons..

  8. prism 8

    Another quote from eXileD (link at top of post) –

    Class War Alert: 70% of American Corporations Paid No Income Taxes Between 1998 and 2005. Let’s Repeat That Again: Majority Of Corporations Do Not Pay Any Taxes!

  9. prism 9

    Another good quote from the end of the piece.
    ” neo-liberalism. They used economic policy to float the wealth to the top of the pond where it collected, like scum, until it smothered all those that lived beneath.”

  10. vto 10

    So was it the lower taxes that caused the current crisis, or the massive EU grants, or the world-wide debt feast combined with real corruption, or the property boom? Or just … I dunno … what did he say again?

    • Draco T Bastard 10.1

      It was all of them vto and is exactly what Jkeyll is proposing that we do.

      • vto 10.1.1

        I don’t think that’s right Draco. I would suggest that had the tax system not been adjusted the same problem would have arisen due to the other factors. For instance.

        Many years ago while in Ireland a large scale property person known to us said such was the corruption that it was common for the glaziers to turn up to a building for repairs before it even got damaged by bombs etc.

        The piece above makes an entertaining read but it is just a rant and offers no decent analysis of Ireland.

  11. prism 11

    Listening to Nat Radio. Discussion on post financial muck-up. Ireland having trouble borrowing enough money to keep going. NZ not so bad our debt 60% of GDP, but China 22%, Japan about 190%. Britain will be about 100% by 2014, so much money will round the world will be going to pay interest with some reduction, there will hardly be enough to facilitate private company ventures.
    I feel that financiers deserve blame. Perhaps we can set up stocks and put the financiers in them and throw tomatoes at them.

    The item about Ireland said they haven’t tried to get tough with their financiers and banks. Sounds a real crony based greasy economy which has an echo of what happened in New York in the 1840s as Irish fleeing from the potato famine found berths to Ellis Island and the USA.. Wikipedia from google – “About 1842 Irish “gangs,” which used physical violence at election time, … The power of Tammany Hall is the natural result of…” There is interesting background as to how the Irish immigrants formed a system which organised large rorts under Tammany Hall influence that took US hundreds of millions in dollars in about a decade starting mid 1850s.

    • mcflock 11.1

      “Perhaps we can set up stocks and put the financiers in them and throw tomatoes at them. ”

      I’m not going to invest in tomato futures simply on the basis of stock market speculation…

  12. lessonfromhistory 12

    Ireland is indeed a salutary lesson – not just for its recent history but its past history as a island owned by overseas landlords who were quite happy to export the harvests while the local population starved.

    Time for the left to start fighting the sale of our farms to foreign buyers. The rules need tightening and soon. The elite of the right or the left are not going to protect us- we need some grassroots action here.

  13. mcflock 13

    One of the lessons I tend to get from history in general is that many of the “wealthy pillars of society” in most periods got to that position by doing things that were subsequently made illegal – capture in battle (middle ages), piracy (16th/17thC), monopolistic and anti-competitive behaviour and insider trading (19th century), marketing poisons to children and toxic waste dumping (20thC). With unique variations on the practices of previous centuries that were technically still legal, such as making money from information in accidentally received faxes or routing waste to less functional nations.

  14. Rob M 14

    I’ve never met an Irishman I trusted. This article goes someway to explaining why. Fair few lessons for NZ in here too. Much of this exiled Paddy’s description of Ireland brings to mind the free-market shakedown shenanigans we’ve been subjected to here. Of course our bubble isn’t going to burst because of a series of unique factors yet to be determined by the appropriate subject-matter experts.

    • john 14.1

      I have to agree that this is a fantastic rant, but a pretty poor analysis of the situation.
      It reminds me of the rubbish I spoke after spending my first day burning in the harsh NZ sun.

      I quite like the irony of Rob M “not trusting an Irishman” while swallowing whole of the rant above. I must remember that one…

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