web analytics

The luck of the Irish

Written By: - Date published: 12:30 pm, November 24th, 2010 - 11 comments
Categories: Economy - Tags: ,

In Question Time yesterday, Bill English said Ireland is an example of how bad the recession might have gone in New Zealand. That triggered a memory of John Key three years ago saying we should follow the Irish economic model. I guess we can just be thankful Key wasn’t in power at the time to put that crazy ‘aspiration’ in effect.

Here’s the ‘Key Notes’ from October 2007, where Key says we should adopt Ireland’s economic reforms:

Looking at Ireland

I’m always struck by the similarities between New Zealand and Ireland. We are the same size in terms of population, and we are both green, hilly, and have strong agricultural economies.

There are differences too. Ireland is also more prosperous than New Zealand. That hasn’t always been the case. Just fifteen years ago, the Irish and New Zealand economies were on a par. We were both poor performers compared to other developed countries.

Nothing much has changed in New Zealand. But Ireland has gone from being one of the poorest countries in Europe to being one of the wealthiest. It’s done this by adopting policies that encourage business growth, improve the skills of its young people, and entice Irish people all over the world to return home to live and work.

The lesson from Ireland is that countries can turn themselves around if they are determined enough. It’s a lesson New Zealand would do well to learn.

In case you’re wondering, the Irish model that Key is crediting with its apparent economic success is a strain of neoliberalism just as virulent as ours, if not more so, with an additional element of corruption.

Of course, the real reason for Ireland’s growing prosperity was, initially membership of the EU and the huge net payments it got from the EU infrastructure and agricultural budgets. After decades of poverty, the EU was helping Ireland to catch up.

Then, things went nuts. Among its neoliberal reforms, Ireland set up an ‘International Financial Services Centre’, basically a Wild West for financiers were Irish tax rules didn’t apply. The jobs and cash flowing in caused a huge property bubble. Everyone had jobs, everyone felt rich and could get even richer selling houses to each other. (sound familiar? Ireland was worse)

And then it all went to shit. The global financial system nearly collapsed, the finance jobs disappeared, the housing bubble burst, the economy went into steep decline. The recklessly over-extended Irish banks, which were riddled with corruption, went to the government for bail-outs. To pay for the bail-outs and constrain its own deficits, the government slashed spending sending many more on to the dole queue and gutting public services. Even that wasn’t enough to make investors confident enough to buy its debt and, now, it has had to go to the EU for its own bailout.

As Bill English said in the House yesterday “We have only to see the experience of Ireland, which has essentially gone broke, to see just how bad things could have been.”

Remember, that’s how bad things could have been if English, Key, and Brash had had time to put their extreme rightwing plans into effect before the crisis.

11 comments on “The luck of the Irish ”

  1. Colonial Viper 1

    China and Singapore have shown willing to limit and deflate property asset bubbles early on to prevent (or minimise) adverse effects on the real economy. But then those countries have politicians who think more than a year in advance.

    And in fact its not an asset bubble per se which is particularly toxic, it is when that asset bubble is being fueled by interest bearing debt.

    • Herodotus 1.1

      CV, yet a property bubble keeps the middle class ingorantly happy as there perceived wealth increases, and displays to the less well off that entering onto the conveyor belt to success is attainable.
      To the incumbent govt there is a no cost, no promise scenario to keep the middle class swinger on their side. Unfortunatelt the longer the bubble exists (held artificially) the bigger the BANG.
      But boy was it interesting of all the self congratulations at BBQ’s of how wise people were on entering the group of multi home ownership. Also how doumbfounded they were when in discussions to justify the price of a bach/crib or their new rental. It was all based on the house next doors value.

      • M 1.1.1

        ‘yet a property bubble keeps the middle class ingorantly happy as there perceived wealth increases, and displays to the less well off that entering onto the conveyor belt to success is attainable.’

        Herodotus, I still have friends boarding this supposed gravy train, doing it on a shoestring but it will only take a job loss for it to be a total train wreck. I’ve tried to caution them but they’re so wrapped up in the ‘wealth generation’ they think it can’t lose, all part of the something for nothing mantra – I think Lotto tickets would be better odds and you wouldn’t lose your shirt.

  2. tc 2

    We’ll always have an unaturally high property market when there’s no CGT to discourage those that can from making tax free gains…….Oz introduced one in the 80’s alongside compulsory super, FBT to level that one out.

    Let’s all hold our breath for the MSM to bring our money market PM to account over such statements…..that’s if you can pry them out of the corner they’re cowering in.

    • Colonial Viper 2.1

      And make it tougher to get credit. People who are not buying a property as a primary residence need to stump up a 50% deposit for instance.

  3. ghostwhowalksnz 3

    Part of the Irish miracle was illusory , even without the real estate boom.
    The reason the large difference between GNP and GDP.

    their low tax rate meant that many companies were based in Ireland and didnt have any jobs in Ireland

    For example, Google does all its worldwide advertising through Ireland , worth billions but doesnt give jobs or services to the Irish, but Google gets 15% tax rate.

    The big Wall St banks , most of their deals are done in London, but the ‘back office’ is in Dublin. It only covers the paperwork but the high income traders are all in London and paying British taxes?

    As they say sup with the devil, and you have to pay his dues

  4. When it was originally coined, wasn’t the phrase “luck of the Irish” spoken ironically? If so, the title for this post is particularly apt.

  5. millsy 5

    What does it matter.

    The regular folks, along with those at the bottom of the heap, are the ones who are going to wear it the most. As they have all done during this whole recession.

    Maybe its time for the bankers to lose thier jobs, houses, etc.

    • Vicky32 5.1

      “Maybe its time for the bankers to lose thier jobs, houses, etc.”
      And then start leaping from windows… I remember a school teacher of ours back in the 60s telling a story about how he gave a boy a ‘saxpence’ because the boy had a Scots accent (back in the Depression – wow that teacher must have older than I realised at the time!)
      I remember feeling distant sympathy, never realising I’d be living through times that are almost as bad…
      Deb

Links to post

Recent Comments

Recent Posts

  • Deed of Settlement signed with Ngāti Rangitihi
    I pānuitia i te rangi nei e te Minita mō ngā Whiriwhiringa Tiriti o Waitangi, e Andrew Little, kua tāmokohia tētahi Whakaaetanga Whakataunga i waenga i te Karauna me Ngāti Rangitihi, e whakatau ana i ngā kerēme hītori Tiriti o Waitangi a taua iwi. Ko Ngāti Rangitihi tētahi o ngā ...
    BeehiveBy beehive.govt.nz
    20 hours ago
  • World Soil Day: valuing our soils key to a better world
    Agriculture Minister Damien O’Connor has marked World Soil Day (5 December) with a $6.25 million investment in mapping New Zealand’s most valuable soils which are vital to our economic, environmental and social wellbeing. “The more we know about our natural resources, including soils, the better we can make good sustainable ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Government receives interim report from the Royal Commission of Inquiry into Historical Abuse
    The Government has received an interim report from the Royal Commission into Historical Abuse in State Care and in the Care of Faith-Based Institutions. The terms of reference for the Royal Commission required a progress report on the inquiry‘s work to date to be delivered to the Government by the ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Minister of Foreign Affairs announces diplomatic appointments to Malaysia and Austria
    Foreign Minister Hon Nanaia Mahuta has announced Pam Dunn as New Zealand’s next High Commissioner to Malaysia and Brian Hewson as New Zealand’s next Ambassador to Austria and UN Permanent Representative, Vienna. Malaysia “New Zealand and Malaysia enjoy a warm bilateral relationship. We have had diplomatic relations for more than 60 years, ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Intention to appoint a Commission for Tauranga City Council
    Minister of Local Government, Hon Nanaia Mahuta, has confirmed the Tauranga City Council has been advised of her intention to appoint a Commission in response to significant governance problems among the Council’s elected representatives and the findings of an independent review. “I have been closely watching the conduct of the ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Pacific Health Scholarships 2021 about improving access to healthcare for Pacific communities
    Associate Minister of Health, Aupito William Sio is calling on any Pacific students studying health or disability-related courses to apply now for a Ministry of Health Pacific Health Scholarship. “These scholarships acknowledge the vital role Pacific people play in our health workforce. This was most visible through our Pacific workforce's ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Speech to Auckland Trade and Economic Policy School
    CHECK AGAINST DELIVERY   Thank you for the opportunity to speak today. I want to recognise the hard work of the University of Auckland’s Public Policy Institute in putting on this event. Bringing together internationally recognised leaders and thinkers on trade and economic policy, with exporters, business leaders, diplomats, economists, ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • NCEA Level 1 changes give students a broader foundation
    The Government is making changes to NCEA Level 1 to ensure it remains a strong, credible qualification that supports young people into employment and further education, Education Minister Chris Hipkins said today. “Last term, the Government initiated a wide-scale review of the National Certificates of Educational Achievement (NCEA), involving consultation ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Crown accounts reflect positive economic trend
    The Government’s books were again better than expected as the economy continued to recover post COVID lockdown, the Finance Minister Grant Robertson says. The Crown Accounts for the four months to the end of October were far more favourable than what was forecast in the Pre-election Economic and Fiscal Update ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Increase to supplier diversity through new procurement target for Maori Business
    Māori enterprises are in line for greater opportunities to do business with government agencies under an initiative to spread the benefits of the economic recovery.  The Ministers for Māori Development and Economic and Regional Development have announced a new target to encourage public service agencies to cast the net ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Climate emergency declaration will be matched with long-term action
    Today’s climate emergency declaration will be backed with ambitious plans to reduce emissions, the Minister for Climate Change, James Shaw today. “Our Government has put New Zealand at the forefront of climate action over the last three years. Declaring a climate emergency and backing this with long-term action to reduce ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Celebrating the success of Prime Minister’s Oranga Tamariki Award winners
    28 young achievers who have been in the care of Oranga Tamariki or involved with the youth justice system have received Oranga Tamariki Prime Minister Awards in recognition of their success and potential, Children’s Minister Kelvin Davis announced today. At the awards ceremony in Parliament, Kelvin Davis congratulated the rangatahi ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Public sector to be carbon neutral by 2025
    Public sector to be carbon neutral by 2025 Immediate focus on phasing out largest and most active coal boilers Government agencies required to purchase electric vehicles and reduce the size of their car fleet Green standard required for public sector buildings The Government has launched a major new initiative to ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Government fulfils election undertaking on new top tax rate
    The Government will today keep its election promise to put in place a new top tax rate of 39 per cent on income earned over $180,000. “This will only affect the top two per cent of earners. It is a balanced measure that is about sharing the load so everyone ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Sir Robert Martin re-elected to UN Committee
    New Zealand welcomes the news that Sir Robert Martin has been re-elected to the Committee on the Rights of Persons with Disabilities, says Foreign Minister Nanaia Mahuta and Minister for Disability Issues Carmel Sepuloni. “Sir Robert has been a lifetime advocate for persons with disabilities and his experience brings a ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • New rules to protect Kiwis from unaffordable loans
    The Government is making sure all consumers who borrow money get the same protections, regardless of where they get their loans.   “Building on the work to crack down on loan sharks last year, we’re now making the rules clearer for all lenders to help protect borrowers from unaffordable loans” ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • New visitor attraction to boost tourism
    The opening of the first major new tourism attraction since the global outbreak of COVID-19 closed borders to international travellers will provide a welcome boost to visitor numbers in our largest city, says Tourism Minister Stuart Nash. Mr Nash has this afternoon taken part in the official opening ceremony of ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Govt moves on drug checking to keep young New Zealanders safer this summer
    The Government will pass time limited legislation to give legal certainty to drug checking services, so they can carry out their work to keep New Zealanders safer this summer at festivals without fear of prosecution, Health Minister Andrew Little says. Next year the Government will develop and consult on regulations ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Public Service Commissioner reappointed
    Minister for the Public Service Chris Hipkins announced today that Public Service Commissioner Peter Hughes CNZM has been reappointed for three years. The Public Service Commissioner is appointed by the Governor-General on the recommendation of the Prime Minister. “Mr Hughes’ reappointment reflects the need for strong leadership and continuity to ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Pōwhiri marks the start of a critical year for APEC
    New Zealand kicked off its APEC host year today, with a pōwhiri taking place on Wellington’s waterfront with local iwi Te Atiawa, and a number of Government ministers welcoming representatives from the other 20 APEC economies. “APEC is a hugely important international event, and New Zealand is hosting amidst the ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Speech at APEC 21 Opening Pōwhiri
    9am, Tuesday 1 DecemberTe Whare Waka o Pōneke, Wellington Central He Mihi Kei aku rangatira no ngātapito e whā o te ao huri noa, tātou e huihui mai nei. Tēnā rā kōutou katoa. He tangiapakura ki ngā tini aituā kei waenganui i a tātou, ka tangi tonu te ngākau ki ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Government extends business debt relief to October 2021
    To assist with the ongoing economic recovery from COVID-19, rules allowing affected businesses to put their debt on hold have been extended by 10 months. “New Zealand’s economy is recovering better than we expected, but the impacts of the pandemic are far-reaching and some businesses need continued support to keep ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Bill introduced to support workers with 10 days sick leave
    The Government is delivering on a key commitment by introducing a Bill to Parliament to expand sick leave entitlements from five days to ten days a year, Workplace Relations and Safety Minister Michael Wood announced today. “COVID-19 has shown how important it is to stay at home when people are ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Progress on pay equity for DHB staff
    Today’s initial agreement between DHBs and the PSA on pay equity for clerical and administration staff is an important step toward better, fairer pay for this crucial and largely female workforce, Health Minister Andrew Little says. If ratified, the agreement between the Public Service Association and the country’s 20 District ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Iconic Milford Track officially reopens
    One of New Zealand’s premier hikes and a cornerstone of the Te Anau community, the Milford Track has officially reopened, “From today, hikers booked on the popular Great Walk will be able to complete the walk end-to-end for the first time since early February,” Minister of Conservation Kiri Allan says. ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Support for farmers beefed up ahead of La Niña
    Further funding for feed support services and new animal welfare coordinators will help farmers who continue to feel the effects of an extended drought, says Rural Communities Minister Damien O’Connor. “In March this year, I classified the drought in the North Island, parts of the South Island and the Chathams ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Next steps for Christchurch Hospital campus redevelopment
    Canterbury DHB will be better placed to respond to future demand for services and continue to deliver high quality care, with the next stage of the campus redevelopment programme confirmed, Health Minister Andrew Little says. The Government has approved $154 million in funding for the construction of a third tower ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Five Power Defence Arrangements Defence Ministers’ Joint Statement
    The Defence Ministers from Australia, Malaysia, New Zealand, Singapore and United Kingdom reaffirmed their nations’ continued commitment to the Five Power Defence Arrangements (FPDA), and commended the achievements over the past 49 years as the FPDA moves towards its 50th Anniversary in 2021.  The Ministers recognised the FPDA’s significant role ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Jobs for Nature funding protects health of Hawke’s Bay waterways
    A joint Government and Hawke’s Bay Regional Council project will invest $4.2 million to protect local waterways, enhance biodiversity and employ local people, Environment Minister David Parker announced today.   Over two years, the Hāpara Takatū Jobs for Nature project will fence 195km of private land to exclude stock from vulnerable ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Year border exception for seasonal workers in the horticulture and wine industries
    2000 additional RSE workers to enter New Zealand early next year employers must pay these workers at least $22.10 an hour employers will cover costs of managed isolation for the RSE workers RSE workers will be paid the equivalent of 30 hours work a week while in isolation From January ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government increases support for New Zealanders to work in seasonal jobs
    The Government is offering further financial support for unemployed New Zealanders to take on seasonal work. These new incentives include: Up to $200 per week for accommodation costs $1000 incentive payment for workers who complete jobs of six weeks or longer increasing wet weather payments when people can’t work to ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government receives Royal Commission of Inquiry report into the Terrorist Attack on Christchurch Mos...
    Minister for Internal Affairs Jan Tinetti has today received the Royal Commission of Inquiry report into the Terrorist Attack on Christchurch Mosques, and will table it in Parliament on Tuesday December 8. “I know this will have been a challenging process for whānau, survivors and witnesses of the terrorist attack ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Zealand Government to declare a climate emergency
    The Government will declare a climate emergency next week, Climate Change Minister James Shaw said today.                                       “We are in the midst of a climate crisis that will impact on nearly every ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Call for urgent action on Pacific conservation
    A declaration on the urgency of the global biodiversity crisis and the need for immediate, transformative action in the Pacific was agreed at a pan-Pacific conference today. The 10th Pacific Islands Conference on Nature Conservation and Protected Areas is taking place this week across the Pacific.  Minister of Conservation Kiritapu ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Speech from the throne
    E aku hoa i te ara o te whai, Kia kotahi tā tātou takahi i te kō, ko tōku whiwhi kei tō koutou tautoko mai. Ko tāku ki a koutou, hei whakapiki manawa mōku. He horomata rangatira te mahi, e rite ai te whiwhinga a te ringatuku, me te ringakape ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Keynote address to Chartered Accountants Australia and New Zealand conference
    Speech to the CAANZ conference - November 19, 2020 Thank you, Greg, (Greg Haddon, MC) for the welcome. I’d like to acknowledge John Cuthbertson from CAANZ, the Commissioner of Inland Revenue Naomi Ferguson, former fellow MP and former Minister of Revenue, Peter Dunne, other guest speakers and CAANZ members. I ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Expert independent advisory group appointed to strengthen the future of Māori broadcasting
    A panel of seven experts are adding their support to help shape the future of Māori broadcasting, Minister for Māori Development Willie Jackson has announced today. “Today I will meet with some of the most experienced Māori broadcasters, commentators and practitioners in the field. They have practical insights on the ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Government to review housing settings
    New Zealand’s stronger-than-expected economic performance has flowed through to housing demand, so the Government will review housing settings to improve access to the market, the Finance Minister Grant Robertson announced today. “Our focus is on improving access to the housing market for first home buyers and ensuring house price growth ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Crown accounts reflect Govt’s careful economic management
    The better-than-expected Crown accounts released today show the Government’s careful management of the COVID-19 health crisis was the right approach to support the economy. As expected, the Crown accounts for the year to June 2020 show the operating balance before gains and losses, or OBEGAL, was in deficit. However that ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community launch marks next step in addressing racism in education
    The launch of Te Hurihanganui in Porirua today is another important milestone in the work needed to address racism in the education system and improve outcomes for Māori learners and their whānau, Associate Education Minister Kelvin Davis says. Budget 2019 included $42 million over three years to put Te Hurihanganui ...
    BeehiveBy beehive.govt.nz
    2 weeks ago