Paddy Murphy on The Celtic Tiger and Irish Economy and Society

Paddy Murphy is the pick of the Irish News columnists, and over the last few years has been hitting the nail on the head time and again with his expositions of the petty sectarian politics at Stormont and the incompetence of the regime there, and of the attitude of the British and Irish governments. He mixes a scepticism about the squalid sectarian carve up with a sense of social justice, and witty and acerbic writing. So it is with great interest that I read his take (subs may be required after about a week) on the death of the Celtic Tiger. The article discusses both the madnesses of economic behaviour in the south, and the effects of the boom on attitudes down there.

The article opens with an obituary

Tiger, Celtic (nee Cathleen Ní Houlihan) Suddenly, but not totally unexpectedly, at her residence off the coast of Europe. Mother of an estimated 33,000 millionaires, 75,000 cocaine-users and 170,000 people who paid more for their houses than they are worth. Deeply regretted by property developers, politicians and lawyers at public inquiries into alleged corruption. Her funeral service was conducted by Brian Lenihan in his budget speech on Tuesday.

Murphy asks where the Celtic Tiger came from, why it ended, and what its lasting impact is liable to be. “The answers are simple – its causes are unclear, its demise was inevitable and its impact is debatable.” On where the Tiger came from, he says “economic growth appears to have been a combination of chance and the ability to grasp that chance when it came” (When Roy Foster said the same thing in his Luck and The Irish, the reviewer for the Irish Times amongst others accused him of failing to accept that Irish people were capable of manufacturing their own prosperity. I wonder how people will think about that after recent events).

On the Tiger’s demise, Murphy comments

Its demise is easier to explain. It was caused by uncontrolled property speculation. About 88,000 new homes were built in the Republic last year, roughly half the number built in the UK for a population 12 times larger. Workers from across the world built houses at prices which few could afford and at a rate which only speculators could understand.
Fianna Fail believed the country could live on borrowed money. In reality it was living on borrowed time.

That is an amazing statistic on housebuilding, and a demonstration of two things. Firstly, that the speculation and unchecked housebuilding in the south has gone mad, and secondly that not enough housing is being built in the UK, despite there being apartments springing up everywhere you look. And yet the price of housing kept rising, and the demand remained there. This level of house building is both financially and environmentally unsustainable, and tighter regulation is needed on the use of land in future (I’m sure we all know people with horror stories about drainage, subsidence etc in poorly constructed homes built where they shouldn’t have been, never mind the transport issues etc). It also demonstrates the extent to which the boom of recent years sprang from an act of collective delusion – apparently no-one in the south (or much of the north for that matter) was looking at Britain in the early 1990s.

Murphy then turns his attention to the consequences of the Tiger.

So now that the tiger economy is dead, who gained the wealth, what was it used for and what type of society did it produce? Much of the new money went to an exclusive few. One per cent of the Irish population now owns a third of the wealth. They probably spent it on big houses and helicopters, which would explain the 1,200 helicopter flights in and out of the Punchestown race meeting last year.
More modest earners appear to have splashed out on alcohol, foreign holidays and wooden floors. The 7 per cent who remained in poverty had nothing additional to spend.

One percent of the southern population owns a third of the wealth. That is a frightening statistic, and an eloquent condemnation of the inequality generated by the boom. It might be a little more palatable at least had the government put the increased tax take to good use. Yet, as Murphy pointed out, it was used to cut taxation and build roads, including through Tara, which

symbolised the government’s problem with wealth. It forgot Ireland’s past and thus had no conceptual grasp of its future. Heritage and environment gave way to business. Yet in this week’s budget, Brian Lenihan ensured that the economy’s coffin was carried by the poor, the elderly and children. He called it a rallying cry to patriotic duty.
It included an end to free medical care for all those over 70, an increase in VAT and a �100 fee for emergency visits to hospital. That certainly sounds patriotic.

The figures Murphy provides certainly demonstrate what a sick joke the levies of 1% on income up to 100,000 Euro and 2% on everything over it on the population are. It is hard to imagine a more unfair tax. And the stark reality of the budget becomes clear. To be honest, I had somehow missed the 100 Euro fee for emergency visits to the hospital. Had I noticed it, my initial reaction to the budget would have been peppered with a lot more swear words. It’s hard to express the outrage I -and most people – feel at the idea of having to fork over money because you are having a heart attack.

As if this isn’t a telling enough indictment of society and government in the south,

What became known as rip-off Ireland pushed food prices to New York levels, while unemployment stayed at about 5 per cent. Meanwhile, Dublin airport became Ireland’s Ellis Island and many Irish people, so recently removed from the tyranny of landlordism, adapted remarkably quickly to being landlords themselves.
The new society is reflected in the levels of crime. The US did not have to teach us about guns and corruption. History shows that we taught them. But the new culture of individualism, the demise of organised religion and the introduction of illegal drugs all combined to create Chicago-style gangsterism in Dublin and Limerick. Dublin has the fastest growing murder rate of any European capital.
Meanwhile, as the Morris Tribunal showed, gardai persecuted the innocent rather than pursue the guilty.
While Ireland plc became a corporate brand name abroad, internally it neglected its cultural identity. Can anyone claim that the national sport of hurling or the Irish language benefited from 20 years of the Celtic tiger? Instead, Ireland became Europe’s favourite pub. The lasting impact, north and south, is that the tiger ate much of what was Celtic.

Has Ireland been culturally enriched by its new wealth? To return to Roy Foster’s Luck and the Irish, his chapter on culture certainly suggests so. The flourishing of Irish novelists, symbolised by numerous Booker prize wins, the popularity of Irish bands, and even Irish dancing (suitably jazzed up by Michael Flatley et al) suggests yes. The self-confidence of the place does the same. Yet Murphy is partly right too. Certainly he is correct on the criminal culture, and the explosion in drug use among the middle classes that fuels much of it. The cultural life of the ordinary person has probably been expanded by easier travel and wealth, but the Irish language certainly has not benefited, and the sense of community and solidarity has in many places been destroyed by individualism and shallow materialism reflected best in the Sunday Independent. Murphy’s critique then is a patriotic one, but it should not be mistaken for narrow nationalism of the type found in Desmond Fennell’s writings or that fuels anti-immigration hysteria elsewhere in Europe, and has the potential to raise its head in Ireland, and which may well have had a significant part to play in the very welcome rejection of the Lisbon Treaty.

The environmental and cultural questions Murphy raised should be at the centre of the debate of where we go from here. And yet, while it is easy to produce critiques of what is wrong, it is much harder to find solutions. Of course, we shouldn’t expect them in 750 words from a columnist, but we can and should expect them from the left, which must now mount a sustained attack on the greed, corruption, crass materialism, arrogance, recklessness, and short-term profiteering that has wasted such a glorious opportunity, and done so much damage to the fabric and culture of Irish society. We don’t have to agree with everything Murphy says to agree with his final sentence, a lament: “It all could have been managed so much better.”

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11 Responses to “Paddy Murphy on The Celtic Tiger and Irish Economy and Society”

  1. jonolan Says:

    Celtic, not Cletic. 🙂

  2. Garibaldy Says:

    Cheers Jo. I just spotted that and had hoped nobody else had noticed. Oh well. Would be a shame not to use the ability to edit 🙂

  3. jonolan Says:

    No worries. I was on WordPress Tag Surfer and notice the typo. I figured I’d pop over and let you know.

  4. Garibaldy Says:

    Appreciate it.

  5. Omar Little Says:

    I agree with most of paddy Murphy’s comments. But theres no comparison with Roy Fosters in Luck and the Irish. Foster writes as if he is genuinely pissed off that nationalist Ireland survives without the Brits and Olivia O’Leary, a fine journalist simply made a few obvious points. Like Foster spends fuck-all time here and couldn’t be bothered checking his facts.

  6. Garibaldy Says:

    The tone is different, and they certainly are coming at things from different angles but the analysis of the origins of the Celtic Tiger do bear some comparison – which is basically that we’re not really sure how it came about, and that the insufferable smugness of those who have benefitted from it, especially among the political elite, is far from warranted because luck played a good part. I find it hard to disagree. If it was all the corporation tax, or the education system or whatever, i.e. factors that were controllable by the south, then it could be easily sustained and replicated. There is no doubt that southern decisions facilitated its emergence (the surrender of a great deal of policy to the interest of multinationals) but it was undoubtedly a case of right place, right time as well.

    As for O’Leary’s review, I though myself it was a bit cheeky for her to complain about Foster spending time outside Ireland when she had done the same for so long. I don’t think as a rule of thumb that historians must live in the countries they study, and in fairness to Foster he pointed out somewhere (possibly on the RTÉ One to One show or whatever it was called) that he spent a lot of time in Ireland. I don’t think he is pissed off with the south’s success.

    In fact, I think he is pleased with it, especially its secularisation and cultural flowering. But I also think he was right to puncture some of the arrogance and to point out that the Tiger was not a story of uncomplicated success. In fact, the sensitivity to those left behind was one of the more pleasing aspects of what was a book which I have many disagreements with.

  7. Justin Says:

    “But I also think he was right to puncture some of the arrogance and to point out that the Tiger was not a story of uncomplicated success.”

    Absolutely. FEASTA a green-leftish Irish think-tank produces an occasional journal and in the second issue Dr Elizabeth Cullen (a medical doctor), by careful analysis of the statistics, shows that while the Celtic Tiger Ireland produced a lot of wealth, it also spawned a deeply unhappy, divided, untrusting and unhealthy society. At the root of this, in Dr Cullen’s view is the massive relative inequality in the country. Online in its entirety at
    http://www.feasta.org/documents/review2/cullen.htm

    This, and the sustained critique of the Celtic Tiger by the Justice section of Council of Religious in Irleand (CORI), back up P. Murphy’s view of things.
    http://www.cori.ie/Justice/Publications/50-AnnualSocioEconomicReview/59-annualsocio-economicreview-2008

    BTW, really enjoying the blog.

  8. Garibaldy Says:

    Thanks Justin. Shame CORI doesn’t know what an executive summary is, but it looks like interesting stuff.

  9. Abdul-Rahim Says:

    I read «Luck and the Irish», it was quite a bourgeois perspective, if not somewhat informative. Also is Dublin really the European murder capital?

  10. Garibaldy Says:

    I don’t know Abdul if Dublin is really the murder capital, though it may well be in percentage terms given the high number of gangland murders. I agree that Luck and the Irish is written from quite a bourgeois perspective – one problem for example being the lauding of Garret Gitzgerald for advocating things that had been part of the left’s agenda long before – though I think the economic chapter does deal with the downside a lot more than many other commentators.

  11. hoho Says:

    Clearly, the Celtic Tiger was the same neo-liberal clap trap that has fueled the rest of the world: smash wages and benefits to increase profits. Once the demand falls off for goods, flood the market with cheap credit and deregulated financial markets. Well, now the gig’s up. Ireland fell harder then the rest of the Western world because it has traditionally been a third world country and has less “real”, productive economy to cushion it when the neo-liberal model when it fell.

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