2011

IRELAND 2011

“Nothing odd will do long” – Samuel Johnson

New hollow shells silhouette the landscape,

From houses half built to multi-storey frames.

The vista mirroring a decade’s progress.

Hope and hubris like weed and shrub commixed;

The mirage of easy wealth for most dispelled

As realism takes hold. Change comes but slowly

To reject, replace, beliefs found wanting,

The worship of property, the siren of cheap credit,

The trust in men who lead and men who lend.

Measured against our past, is now then bad?

There is no famine, hunger or disease,

No racking poverty, no emigrant ships

No quiet rural emptying out; no despair.

What can we place to balance in the scales?

Ephemeral prosperity? Folly and fancy?

Our ancestors would laugh could we commune,

And offer to change places if they could,

And bid us to face forward and not back,

And take to heart Doctor Johnson’s words

That nothing odd lasts.

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TO CLOSE AN EMBASSY

Ireland is to close three diplomatic missions, including the Embassy to the Vatican. The
announcement last week has been received with gung ho  enthusiasm by the Catholic –bashers and mixed
feelings by many others I have no mixed feelings. Closing two of the three is a
mistake.

Take the Vatican first. Whatever the faults and failings of the Vatican’s
reaction to the child abuse issue, which is a horizontal one affecting the
Catholic Church in a number of countries, and is something that  Rome will have to work out satisfactorily,
there are other issues. Nationally, the majority of the Irish population remain
Catholic, with all that that implies. Like it or not, they have views.  While all have been shocked by the clerical
sexual abuse saga (still very much a small part – though high profile – of
those accused and/or convicted of sexual abuse of children)  poking the Pope in the eye, metaphorically,
will  not necessarily sit well with them.

Internationally, the Vatican provides a focal point for the
world’s one billion plus Catholics, the second largest religious grouping in
the world, and one which  includes powerful and numerous communities across the globe. It can tap into
missionaries, locally based churches and lay communities. It appoints all
Catholic bishops worldwide, including the Irish ones. Internationally also the
Vatican’s diplomatic network is extensive and highly regarded. The net result
is that the Vatican is a storehouse of information and analysis and is regarded
as an important ”listening post” and  a very useful resource to tap into, something diplomats on the ground can avail
of. As a country with a small diplomatic service, and limited resources,
Ireland should be looking to foster links of this type, not walk away from
them.

Certainly the Irish Embassy to the Vatican “yields no
economic return”. It never did. This presumably applies also to the large
number of states which maintain resident embassies to the Holy See, but there
is no sign that they are rushing to close their missions. Yet the Vatican IS
important to Ireland, as witness the curious decision to seek to appoint the
Secretary General of the Department, i.e. Ireland’s most senior diplomat, as
non-resident Ambassador, with the implication that he/she will have the full
resources of the Department available should the need arise.

Normally a non-resident accreditation is of an existing, usually adjacent,  ambassador, whose
functions are confined to at most several visits per annum and who receives
little or no extra resources for the secondary accreditation. Since Rome, one
of our relatively large Embassies (i.e. more than one person and a dog) is not
acceptable to the Vatican, the judgement has been made that none of the other
diplomatic missions nearby, which are stretched in any event, would have the resources
– time or personnel – to handle the Vatican. Clearly the thinking is that
another brouhaha like the recent one would need to be handled seriously. Yet
that begs the question why close the Embassy. Surely a more subtle approach,
such as leaving the post of Ambassador vacant
for a year or two, could have been tried. The cost of keeping the
mission open would hardly break a broke nation.

Timor-Leste was never more than a development aid office in
any event and it appears that sufficient progress has taken place there to
judge than this office can be closed.

That leaves Iran. The decision to close our Embassy there is
mystifying. So, trade has not lived up to expectations. Surely the answer,
shouted from politicians and officialdom in respect of everything else, is to
try harder and work harder. And if Iran is indeed a tough nut from the trade
point of view, it will hardly prove easier without some local knowledge and
presence on the ground. Last year, incidentally, we exported €81 million plus
to Iran; it was the fifth year in a row in which exports increased and they are
now significantly higher than the lows of a decade ago. Our total exports to
eight of the twelve post-2004 EU accession states over the past three years
have averaged €300 million per year; do the maths.

Iran has a proud history. It was and is a significant player
in the region. It is, moreover, the nineteenth largest economy in the world,
roughly the size, in GDP terms, of Australia and Poland and has an estimated
GDP per head of $13,000. It has a population close to 80 million, is
strategically and geopolitically important and, inter alia with its energy
reserves, is a potential regional superpower. It is also fast developing a nuclear
capability which could see it become the second Islamic nuclear power with
possible  profound  ramifications for the whole Middle East. From
what one can judge there is considerable social ferment within the country
which could presage change sooner rather than later. By closing the embassy
Ireland will be shutting herself off from monitoring developments there and
will certainly be unable to interact, influence or mediate, even to a limited
degree.

These closures have been justified by  the declared necessity
to implement cuts across the board in view of the current woeful financial situation.
The Department of Foreign Affairs, minus the development cooperation element, is one of the smaller government
departments. Most of its budget is spent on the upkeep of missions abroad,
rents salaries and allowances. Savings can only be made, therefore, by closing
overseas  missions. The McCarthy Report
actually recommended that Ireland should reduce the number of its overseas
missions from 76 to 55, without, as far as I can see, specifying which or why.
If three is the extent of the closures, we should be relieved. Ireland has a
relatively small, relatively inexpensive foreign service. Most of the missions
are tiny – one or two diplomats with limited clerical back-up – and are
expected to deliver on a varied range of duties, including helping Irish
citizens in distress. It should be noted that most criticisms of this
“consular” role either misrepresent what embassies can and should do in
situations or occur in countries where Ireland has no direct representation on
the ground – as was the case in Libya earlier this year.

It seems illogical to me to close any of Ireland’s  missions at a time when the message from the
politicians seems to be “Export or Perish”. Indeed look at where we are NOT
represented directly. In South and Central America we have three (3!) resident
embassies, Mexico, Brazil and Argentina; Mexico, with three diplomats, is
doubly accredited to Cuba, Colombia, El Salvador, Peru and Venezuela! We have
one embassy in North Africa (Egypt). We have no one on the ground in six of the
world’s 35 largest economies, including Indonesia (15), Thailand (25), Pakistan
(27), Colombia (28), the Philippines(32) and Venezuela (34). Strategically
placed embassies have multiple secondary accreditations (Saudi Arabia,
Singapore, Moscow), which they try to service with two or three diplomats. Canada, with three diplomats, also
covers Jamaica! And now we are to close Iran.

If we ARE to close missions how about a radical approach by thinking
outside the box a little? It has been argued that the Vatican embassy was a
sort of sacred cow (pun not intended), which has now been slain. In the context
of examining Ireland’s diplomatic representation, and in particular getting
more for the buck, another sacred cow might be looked at. This is the mantra
that Ireland should have an embassy in every EU member state. And we have. This
was ok when the EU was Twelve, or even Fifteen, but it is now Twenty Seven,
with Croatia poised to join and a queue from the Balkans round the corner. IF
yielding economic return is to be the criterion for an embassy on the ground,
take those trade figures I mentioned above. Do we need three embassies in the
Baltics? Do we need embassies in those of the Central European member states
included in the eight bracketed together in our trade statistics? Five or six
of these missions could be closed or consolidated freeing up the diplomatic
staff for redeployment elsewhere, either in new posts or to beef up missions
such as China, India or Russia, whereextra staff dedicated to commercial activity would not go amiss and
where we have some way to go before the law of diminishing returns kicks in.

Another avenue to be looked at might be to pursue the
Vatican option and cover certain posts from HQ. We already cover a number of
small states from our UN Mission in New York. In the era of Internet and emails,
and in view of the additional layers of frequent  meetings of officials across all areas of EU
competence and in areas of political and judicial cooperation, do we really
need Irish embassies on the ground in e.g. Scandinavia? Sweden closed its
embassy in Dublin several years ago, without any dire consequences. Why should
we not follow suit? An officer of appropriate rank sitting at H.Q. – where
there is already a regional desk system in operation – could surely function as
efficiently, and at far less cost, than an officer en poste. The Nordic posts
could be closed , with the exception of one, to provide consular assistance as required.
We can probably suppress one or two other EU missions, like Belgium and
Luxembourg since the our mission to the EU in Brussels can cover; ditto Switzerland
, with our UN mission in Geneva to cover. But No! Shock, Horror! Last year
Belgium was our second largest export market in the EU after Britain, and Switzerland
was our second largest non-EU market. If economic return is to be the criterion
then these missions, small as they are, definitely justify their existence.

The last two paragraphs were tongue-in-cheek. I hope the
point is taken up.. Ireland’s diplomatic service has a job to do. One element
of this is trade promotion in the broadest sense. But this cannot be allowed to
degenerate into hucksterism. Our diplomats represent Ireland and are required
to maintain appropriate levels of dignity and behaviour. Few would have it any
other way. The immediate financial savings in closing Tehran and the Vatican are
miniscule and may cost us more in the longer run. Let us hope there will be a more
critical and public scrutiny of any proposals for further closures.

CRYSTAL BALL GAZING

A favourite story of mine occurs in various forms but is usually attributed to
a character in Islamic folklore, Nasruddin. The story concerns a man who has
offended or outraged a king and is ordered to be put to death. He pleads for
his life and tells the king that, if spared for a year he will teach the king’s
horse to talk. The king accepts the offer but promises a worse death one year
on if the man fails to deliver.

The man is upbraided by his friends for his foolishness. He responds: “I have
gained a year. In that year I might die. The king might die. The horse might
die. The king might change his mind. And who knows….I might even teach the
horse to talk.” The moral being that much can happen in a year. The corollary
is that forecasting what will happen can be difficult.

Take the Irish Presidential election. By the time you read this Ireland will
have a new President. With seven candidates and given our quirky electoral
system, the race at this stage is too close to call . It has been fascinating.
The last two Presidents have, with style and energy, transformed a role that is
largely ceremonial, raising the stakes for all candidates this time round. The
attempt by Sinn Fein to supplant Fianna Fail as the major opposition force by
running its strongest candidate , Martin McGuinness, has added to the contest.

Indeed who wins is just one of the interesting aspects of the campaign. The
results, including the voting transfers between the candidates, will be studied
closely to see whether the remarkable outcome of the general election last
February was a once-off or whether it marked a sea-change in Irish politics.
Together with the accompanying by-election – to fill the seat vacated by Brian
Lenihan’s death (what had been Fianna Fail’s only seat left in Dublin) – the
Presidential poll gives the first opportunity to stocktake.There are signs that
the Teflon coating on the new government is starting to crack with its room for
manoeuvre circumscribed by the IMF as the first painful budget approaches.

Certainly there is a new volatility among a large section of the Irish
electorate, a willingness to be ultra – critical and to “throw the bums out” if
they are perceived to have failed to deliver. In February this led to a
collapse in the Fianna Fail vote, with much of its traditional support seceding
along class lines, middle class to Fine Gael, working class to Labour,
republicans to Sinn Fein.

Since then Fianna Fail has signally failed to recover and has seen its support
decline further in the polls, culminating in its decision not to contest the
Presidential election. In vain has the party leadership pointed out that the
new government is doing little beyond following the Fianna Fail blueprint for
economic recovery. So far the electorate has seen through that one – the
programme for recovery, negotiated with EU and IMF guns to the head, would
never have been necessary in the first place had Fianna Fail not wrecked the
economy.

Fianna Fail now faces a challenge for its self-proclaimed Republican soul, this
time in a head to head with Sinn Fein, which is also stealing what is left of
its populist quasi left-wing appeal. It can do nothing about it as it still
tarred with the brush of economic mismanagement as well as the harsh programme
of recovery. The omens do not appear good. Already some analysts are drawing
analogies with what happened in Northern Ireland, where Sinn Fein has
shouldered aside the SDLP.

Sinn Fein has a formidable party machine and a hard –headed leadership. And, it
should not be forgotten, two decades ago a sizeable rump of the political wing
of the Official IRA began the odyssey that led to membership of a government
coalition (as the Democratic Left), before eventually merging with the Labour
Party, where it soon took over leadership. Could this process be about to be
repeated, ceteris paribus?

Lest we forget, however, these events in Ireland have a slightly “phoney war”
feel to them They are taking place against the background of on-going
uncertainty in the international economy We have our own problems, and we are grappling
with them. Indeed we’ve earned brownie points for being the good guys and
taking our medicine within the EU, unlike the Greeks. The current popular line
is that Ireland will be well placed to take advantage of the world economic
recovery, when it comes. In one form or another all the political parties buy
into this line.

Whether we can deal with the debt mountain tends to be glossed over, or, in a
classic example of doublethink, our debt is dismissed as being something that
will be subsumed in the new arrangements to follow a realignment of the world
financial situation.This may well be, but there seems little or no appreciation
of, and certainly no informed debate on, the collateral damage for Ireland that
any such realignment would entail or, indeed of the type of catastrophic global
economic situation which would necessitate such a realignment.

The Left, with Sinn Fein as cheerleader in chief, has embraced with enthusiasm
the localised alternative of a national debt default. This tends to be viewed
through Micawberish spectacles, an approach reinforced, up to now, by the
perceived pussyfooting approach of the EU heavy hitters to the struggles of
Greece actually to implement a rolling programme of austerity. The grim reality
of what was involved for ordinary people when Argentina defaulted, or when the
Russian economy collapsed, has had little airing here. What happened in a
remote country far away could never happen to Ireland! Sadly, it could.

Here again crystal ball gazing can prove difficult. The international economy
may well go into meltdown. As the cliché would have it we are now in uncharted
waters.And if the world economy does collapse the next generation of economic
commentators and pundits will point to the events of the last three years-
since Lehman collapsed – and will conclude that the signs were there for all to
see, that there was a sequence of events almost teleological in nature which
brought about the collapse.Frankly the only things clear at the moment are that
the future is a hidden book and that the major political leaders worldwide are
agreed only on their fear of the unknown and what the future may bring.

Much can happen in a year. Greece may well default over the next twelve months,
in a process that began earlier and with consequences that will long persist.
Ireland seems to have bottomed out economically in some respects but the when
and how of recovery is contingent on many factors. We may get a helping hand –
Eurobonds or a common Eurozone debt have been talked about. So has a
fundamental restructuring of the Euro and the EU constitution itself.There are
even references to how the young USA launched the Dollar in 1790. What will
happen? Who can tell? The political obstacles to surmount seem almost as
formidable as teaching a horse to talk.”

SOMEBODY OUT THERE LIKES US

SOMEBODY OUT THERE
LIKES US

Despite our economic woes somebody out there likes us and
wants to come here to live! The very first results of the 2011 census have
appeared – the headcount. They show that the population of the republic has
risen to 4,581,269, an increase of 340,000, or 8.1%, since 2006. The size of
the increase came as a surprise to officialdom, exceeding estimates by 100,000.
It would appear that, in addition to a high birth rate, more people arrived and
stayed and fewer left than had been thought. Given that even now living
standards here (and the social welfare system) compare favourably with those in
Central Europe and the Baltics, let alone the third world, should anyone have
been surprised?

The 2011 figures suggest at the very least that one of the
common official assumptions concerning inward migration needs revisiting, i.e.
that many of those who came “for work” during the Tiger Years would leave when
the economy imploded. Certainly some have, and the number arriving has
diminished, yet many more have stayed. The actual figures will not become clear
until more detailed data from the census becomes available next year, but
recent contacts and exchanges I have had with just three embassies in Dublin
paint a very interesting picture. The myth of the mobile transient Polish
building worker needs to be put to rest.

There are now probably 200,000 Poles living in Ireland,
anything up to 100,000 Lithuanians and 30,000 Latvians. These three
nationalities alone now comprise 7% of the country’s population. Anyone who has
been an emigrant, or is familiar with the pattern of Irish emigration over the
years will not be surprised, given the numbers who came to Ireland from 2004
on. Once the emigration pain barrier of several years has been reached,
experience suggests that a good proportion of immigrants will stay, put down
roots, develop relationships and start families. These people are not going
anywhere.

Similar considerations apply to the 75,000 immigrants from
three other Central European EU states -the Czech Republic, Slovakia and
Hungary, who arrived here  during the
boom ( to end 2008). It’s fair to assume that they have stayed on in much the
same proportion as the others, i.e. anything up to 50,000. Moreover, though the
numbers arriving from these six EU states have declined sharply since 2008, PPS
registrations for the six (our equivalent of social security numbers) in 2009
totalled 26,000, in 2010 18,500 and, in the first five months of 2011, 6000.
Poles continue to register at over 100 per week. Again, it is reasonable to
assume that most of these late comers, who came with their eyes open,
post-boom, are still here.

These EU migrants had one other thing in common – no
restriction on the right to work in Ireland. People from non-EU countries, and
Romania and Bulgaria after 2007, require work permits, and, in terms of
receiving  welfare benefits, must meet
the criteria for “habitual residence”
regulations introduced by Ireland and others of the “richer” EU states
after 2004 to combat welfare shopping by immigrants ( and, incidentally,
applied to incoming Irish citizens and returned emigrants). The total number of
new work permits issued to all nationalities in 2008 was 8481, declining to
4024 in 2009 and 3394 in 2010. Romanians received just under 1100 of
these.

Nevertheless, 22,000 Romanians received PPS numbers in 2007
and 2008 and a further 5,500 in 2009 and 2010; around 1500 have done so this year.
The figures for Brazilians (who received slightly over 500 new work permits
since 2008) are even more startling. This is a non – EU state with which
Ireland has few historical or trading links (unlike Argentina, where there is a
large population of Irish descent). Between 2006 and 2008 almost 14,000
Brazilians received PPS numbers, in 2009 2741, while the figure for 2010 was
4257 (as against 143 Argentinians). To date in 2011 2553 PPS numbers have
issued to Brazilians, almost as many as to Poles. Again, presumably most of the
latest arrivals plus a good proportion of those who have arrived since 2007
have stayed. Ditto with regard to those coming from third world countries,
roughly 8000 in 2010. The message is clear. Despite our current economic difficulties,
Ireland continues to be attractive to those coming from poorer societies.

To complete the picture there is more affluent immigration
also and, all told, in 2010, around 70,000 PPS numbers were issued to non-Irish
people (the 85,130 issued to Irish people were, with a few exceptions, to
babies), a rate being maintained this year, despite the economic situation.
While emigration has picked up the net inflow continues and, as the census has
revealed, its extent has been underestimated.

The consequences of continued strong inward migration have
received little public attention. While there was considerable coverage and
hand-wringing over estimates of up to 50,000 young Irish people emigrating last
year, there has been little or no focus on the fact that 35,000 plus arrived
here last year as economic migrants. Clearly should this trend continue, on top
of the current situation, it will add considerably to the problem of tackling
unemployment, still stubbornly high at 450,000.

The recovery of the
90s took place initially with no inward migration, a static or declining
population and a work force in which women were underrepresented. This has now
changed utterly, and, while there are almost daily announcements of new jobs in
the multinational sector, they are not impacting on the total out of work. Like
Spain, Ireland may be entering a period with chronic high levels of
unemployment compounded by immigration and, in Ireland’s case, a demographic  structure which promises a continued high
birth rate.

The detailed breakdown of the population by age, nationality
or ethnic origin etc. will become clear as more of the census results become
available, but, generally, more people means more pressure on resources. At a
time of financial stringency this will cause the state some headaches but there
is  one potential silver lining. More
people also means more demand, including for accommodation, so an economic
recovery should see a surge in demand for housing, helping to solve the
overhang of excess housing units and correct the current imbalance.

Having a sizeable percentage of the population non Irish
raises other issues, which were pointed to in the 2006 Census, but which are
likely to become more pressing. Not least of these relates to democratic
representation. Only citizens can vote, but any review of the Constitution
(which is being mooted) can hardly ignore the issue of the vote for non-nationals.
The issue of multiculturalism also needs addressing in a more coherent way than
up to now. The data from the Census will be critical in this regard.

Some historical perspective. The current population figure
of almost 4.6 million is still far short of the 1841 total of 6.5 million for
the 26 county area, and, while the population of Leinster is now one third
higher, the population of Munster is a little over half the pre-Famine level,
while those of Connacht and Ulster are 60% less. It will take a lot more inward
migration to dent that shortfall.