Emigration the only way out for young Irish in Ireland -- No future, no jobs, no hope if they stay behind

Children taking part in a Sinn Fein organized demonstration 
against emigration in Dublin earlier this year.

Behind the very occasional good news story about new jobs the economic situation here remains absolutely dire.  Not that you would think that watching the way Taoiseach (Prime Minister) Enda Kenny and his ministers turn up at every new job announcement to bask in the glory and suggest that we're emerging from the gloom.

There have been a couple of examples of this in the past two weeks, with the Kerry Group announcing 900 jobs at a new food product research facility to be built in Co. Kildare and the Paddy Power bookmaking business announcing 600 new jobs in their Dublin HQ in online gambling and the supporting technology and marketing.

Both of these are impressive developments in home grown businesses that are doing well, and of course new jobs are not only welcome but desperately needed.   But the way we are all supposed to accept news like this as the dawn of a bright new day and the way the Kenny and his ministers seize on these announcements and milk them to the last drop is worrying for several reasons. 

Firstly these are mainly high end jobs, some of which will require high skill sets and language abilities that will not be that easy to find among Irish school and college graduates.  As in similar job announcements recently, some of these jobs will go to foreign applicants who will come in here to fill the vacancies.   We will come back to this later. 

But the main issue in this week's talking points memo, as Bill O'Reilly would say, is that such announcements give a misleading view on the jobs situation here right now, because that remains extremely bleak. 

The fact is that Ireland is hemorrhaging people now, particularly young people, because they can't get jobs at home. 

The headlines and the statistics are soul destroying, and no doubt you will have seen some of them. 
Most of the figures come from information gleaned in the census last year, which led to the memorable headline that emigration was worse now than at any time since the famine. 

Another emotive headline said that one person was leaving every five minutes.  This was built on figures that showed that 87,100 people a year were emigrating – a daily average of 238, or one person every 303 seconds, which is just over five minutes. 

That was the situation over a year ago, and what level emigration is at now is anyone's guess, although no expert thinks it is coming down. 

Adding information from airline figures, from unemployment figures and other official statistics to the base of the census data allows the experts to estimate the current level of emigration.  But it's not an exact science, partly because there is no real effort to gather enough information.  Official Ireland does not really want to know.  

Read more on Irish immigration here.

The overall point is that we are losing a significant slice of the present generation of young people.  And many of them will never come back on a permanent basis. 

The return of emigration here on a scale that is now higher than in the eighties or in the fifties or probably any time since the famine has, of course, caused a great deal of discussion and comment here. 

But a lot of this is superficial. An in-depth analysis of emigration to identify its root causes would involve many sacred cows in Ireland, and official Ireland is not prepared to go there. 

Of course we know the immediate reason why so many people are leaving right now -- they can't find jobs at home.  The emigration figures are higher than ever before because our population is higher than at any time since the famine, and the economic  crisis we are going through now is deeper than any this century. 

Most of that is of our own making, but our situation is made even worse by the worldwide financial crisis and slowdown.    

That much is clear.  It's stating the obvious.

But what is not clear is why Ireland is so vulnerable and so prone to emigration.  Mass emigration is not unique to us, but we are probably the country in the world best known for it. 

There are historic reasons, of course.  We have a history of emigration that goes back to the famine and because we speak English, the U.K., the U.S., Canada and Australia are easy destinations for our escape.  
There are social reasons as well.  For decades, up to relatively recently, our Catholic belief in the evils of birth control meant that large families were common.

Families with eight or 10 children growing up on modest farms in areas with no industrial development were seen as something to be celebrated, even though the inevitable result was going to be emigration.

That has now changed drastically, with the high number of single parent or one child families bringing down the average number of children per family in Ireland to less than two.

But there are still large families, and the emigration option is deeply ingrained in us at this stage.  

Another critical factor is the failure of our culture and particularly our school system to develop a sense of entrepreneurship.   The idea of starting your own business is not a dream many young Irish have, at least not until they go abroad.  Too often here the aim is to get into one of the professions or the civil service.  

Our school system is still a largely classical education, with rote learning to pass exams and a failure to teach children to think for themselves and to develop initiative.  In spite of recent efforts to get kids to do more math and science, Shakespeare and Irish still take up large chunks of school days. 

Very few schools have computer rooms, and computer skills and programming/information technology is still not a Leaving Cert (high school) subject.   

On top of this we have very poor language skills by European standards.  It's not unusual for a Dutch or French or German teenager to speak English and another foreign language as well as their own.  They study English and often another foreign language, starting in primary (junior) school. 

Here we don't study a "continental" language until secondary (high) school because Irish, the dead language to which we continue to pay lip service, is a compulsory part of every school day and eats up the time for language.

One consequence of this is that many call center and technical support center jobs here (like some of the new Paddy Power jobs mentioned above) end up being filled by immigrants from other parts of Europe. 
During times of strong economic growth these factors tend to masked by the number of jobs in construction and services.  But these weaknesses -- particularly the failure to develop an enterprise culture here and the failure to radically change our education system -- mean that in normal times emigration remains a constant factor in Irish life.  

Another factor that masks our failure is the success of foreign direct investment (FDI) here, the multinational companies (many American) who open plants here to supply product or services to Europe or the wider world. 

The fact that we are English speaking and that we have a young workforce that used to be cheap (and is now becoming cheap again) helps us to maintain this, although the truth is that it is mainly tax driven.  The trouble with FDI is that it is moveable, and we have seen the consequences of that in the past decade as we were undercut by well educated, young workforces in other countries and plants migrated from here.  

The bottom line is that our efforts to create and maintain enough jobs here for our population has never equaled the performance of, say, the Scandinavian countries.  Our society remains locked in attitudes and beliefs that prevent us from developing the way we need to and from tailoring our population level and our education in a way that will allow us to take control of our national destiny rather than forever being forced to accept the humiliation of forced emigration. 

Voluntary emigration will always be an option for our adventurous young people, and so it should be.  But forced emigration of people who do not want to leave is a scandal and a failure. 

The ridiculous amount of immigration to Ireland that happened during the boom -- the census last year showed that we now have half a million non-Irish people living here -- is another facet of our failure to plan and organize our society in a sustainable, sensible manner.   Around half of the emigration figures produced by the census last year related to some of these people going home again, mainly east Europeans. 

But many now regard Ireland as their permanent home, partly due to our higher standard of living, education, housing, health care, welfare and so on.  

Faced with an economy now in crisis and the necessity to make huge cutbacks in state spending, the wisdom of allowing such large scale immigration now seems doubtful, if it ever made sense. 

But what to do about the situation in this era of political correctness where everyone is expected to look on multi-culturalism as a blessing remains to be seen.

The immediate problem is, of course, our flat-lining economy, with little sign that our unemployment level (almost twice the level in the U.S.!) is going to come down anytime soon.  

Even the IMF last week was wondering aloud whether the austerity program here was depressing economic activity so much that jobs would not emerge and that the cure might be worse than the disease.  Thanks, guys.  We could have told you that. 

The answer, as if you didn't know, is to split our banking and our sovereign debt, get the ECB to take a hit on our bank debt and give us a chance. 

Beyond the present crisis we are in -- and it is difficult at the moment to look that far ahead -- we need to grow up as a country and start taking responsibility for ourselves, for how big our families are and for how we are going to provide enough jobs for our population, whatever sustainable level that is.

Only then might forced emigration be consigned to where it belongs -- the history books.  

Ireland will reluctantly vote "Yes" n the EU Fiscal Compact referendum

Labor Party launched their "Yes" campaign last month

Ireland is now just two weeks away from our referendum on the EU Fiscal Compact.  Even though the vote on May 31 is the most important one we have faced in years, you would not know it looking at the media here.  

Newspapers and TV are leading on other stories every day, clinging to any distraction they can find, because the fiscal issues and arguments are so boring.        

So instead of us having a searching national debate here, a resigned acceptance hangs in the air.  It's the last thing people want to talk about, or even think about. 

When pressed, most people seem to feel that a yes vote is the lesser of two evils.  And they are probably right. 

But they will be voting yes with a heavy heart and a feeling of resentment.   They know we've got a rotten deal from Europe. 

The problem is that the rotten deal we got which transferred billions in private bank debt into sovereign debt carried by the Irish taxpayer has nothing to do with this Fiscal Compact.  Voting no is not going to make that situation any better.

That is the basic reality and people here understand that.   They also understand that, tempting though it might be to vote no to "get our own back" on Europe, the consequences could be disastrous. 

So what's this Fiscal Compact all about?  It's a financial treaty agreed by 25 EU states in January this year, all of whom were able to ratify it by a vote in their parliaments -- all except Ireland, where our Constitution requires us to have a referendum.  

There's nothing revolutionary in the treaty. In fact it's basically a restatement of earlier EU agreements on fiscal discipline, with new mechanisms attached.  The aim is to prevent a repeat of the debt crisis in Greece and some other EU countries, and to avoid the potential collapse of the euro.

Under this new Fiscal Compact, or treaty, 25 of the 27 member states have agreed to keep their budget deficits below 3% of gross domestic product (GDP) in the future.  They also have agreed that in future they will not let their total state debt exceed 60% of GDP.  

This has been tried before and even Germany did not stick to the rules.  To enforce discipline this time the European Commission will monitor compliance, and countries which breach the agreed limits will face legal action in the European Court of Justice.

All of which sounds impressive.  The reality is, however, that all this is aspirational. 

Many countries in Europe are way beyond these targets at the moment and it will take considerable time, three or four years at least, to get budget deficits down to 3%, and far longer to get the debt-GDP ratio to the target 60%. 

In the meantime, countries will have to implement a program designed to bring them steadily into compliance over the coming years. 

This, of course, is exactly where Ireland is at right now under the terms of the EU-IMF bailout.  In fact ratifying and implementing this treaty won't make any difference to us here since the terms of our EU-IMF program are even more demanding. 

Why does Europe need this treaty?
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For years, in fact for decades, countries across Europe have been borrowing too much.  Governments have run budget deficits year after year to keep up state spending on services, state pay, pensions, welfare and so on in an effort to maintain a standard of living that their economies could no longer afford. 

Europe, its empire days long gone and its industrial competitiveness undermined by China and developing countries, has been in decline.  It's also been in denial. 

Accustomed to a standard of living far higher than in other parts of the world,  European populations wanted to preserve their privileged positions, but they did not want to work harder or longer or pay more taxes.  So politicians in Europe soon learned that the way to get power and stay in power was to borrow on a massive scale.  

Instead of cutting back or forcing through efficiencies, they ran huge budget deficits year after year, even when tax revenue was shrinking.

The problem is, of course, you can only do this for so long before the markets start to doubt your capability of ever paying back your debts.   Eventually the markets get spooked and the cost of state borrowing (the bond yields) soars to the point where borrowing becomes non-viable. 

In the doomsday scenario (like in Greece and Ireland) the markets won't lend to you at all, at any interest rate, so you become completely dependent on institutional sources of funds like the EU and the IMF. 
Preventing this kind of crisis in the future is what this Fiscal Compact is about.  It's about curtailing the freedom of EU countries to make eejits of themselves, like the Greeks and the Irish.   

But  you would not think that listening to Sinn Fein and the few loony lefties here who are the only ones advocating a no vote.  All the other political parties are calling for a yes vote, including Fianna Fail, to its credit, even though it is in opposition and could easily have tried to exploit the situation. 

The arguments being put forward by the no side include opposition to the introduction of water charges and a property tax, refusal to allow any cuts in welfare rates, demands for extra spending on health and education, demands for investment in job creation programs and so on. 

A lot of this is couched in language which talks about "growth promotion" as an alternative to the "downward austerity spiral" which is blamed for lowering domestic demand and shrinking the economy even further. 

The refusal of political parties in Greece to accept bailout terms, and the insistence of the French president-elect on new growth measures, as well as public anti-austerity demonstrations in countries like Spain, are all seen by the no side here as evidence that the tide is turning against the austerity regime and the Fiscal Compact. 

The problem is that all the solutions being advocated by the no side have one thing in common.  They all mean spending  more money, which means borrowing more money, which is the last thing Ireland, or any other European country, should be doing right now.  

Ireland's agonizing but steady reduction in our budget deficits, which aims to get down to a 3% deficit within two or three years, means that until then we have to go on borrowing to keep the show on the road.  We are still adding to our debt mountain even while the austerity measures bite. 

Those who advocate a growth agenda as the solution never discuss what it would take to make countries like Greece, Portugal, Spain, Italy, Ireland, even France, really grow.  Growth is always talked about in terms of extra spending, of investment, even though what that really means is extra borrowing. 

The trouble with that is that the money borrowed has a way of vanishing into extra pay or services rather than goods that can be sold at competitive prices on the world market.  

We're all in favor of growth.  But the real driver of growth is not borrowing.  It is keeping pay at competitive levels, increasing working hours and efficiency, maximizing output, cutting waste and overspend out of the system. 

It's all about making an economy a slim effective machine that can sell goods and services on global markets that people round the world want to buy. 

It sounds terribly simplistic.  But it really is that simple.   The rest is just a toxic mix of prevarication, self-interest and laziness. 

Because of the uncertainty across Europe, the no campaigners in the debate in Ireland are calling for a postponement in the referendum, at least until the growth element the French are calling for is agreed.

But there does not seem to be much sense in putting the vote off.  We can take any growth measures that come in the future as a bonus.  The most important thing now, however, is to show our support for a fiscal regime in Europe that will avoid this kind of mess in the future. 

One other point needs to be kept in mind.  Because we will need to keep on borrowing for another few years and are more than likely going to need a second bailout, we need to be able to access EU funds in the future, particularly the new ESM rescue fund.  Only countries that ratify the Fiscal Compact are going to have access to that fund, where money will be available at much cheaper rates than on the markets, assuming we can get the markets to start lending to us again. 

The no side have been making assumptions that the IMF or someone else will lend us money in the future instead.  There is no basis for such assumptions.

If it were to go wrong it would mean having to balance our budget immediately, in a single year, which would cause real suffering and possible chaos here. 

All of which means that the only sensible position for us to adopt is that of a reluctant yes voter.   It's a rotten deal, but it's the only one out there.

The Irish Government - teachers with no class control

Eamon Gilmore and Enda Kenny.

You will remember George Bernard Shaw's famous maxim beloved of students everywhere -- those who can do, those who can't teach.  Here in Ireland a third line is frequently added -- those who can't teach become government ministers.

The Taoiseach (Prime Minister) Enda Kenny, his Minister for Finance Michael Noonan and the Minister for Public Expenditure and Reform Brendan Howlin are all former school teachers.  Two of them (guess!) are former elementary school teachers.  That's worrying enough.

Possibly even more worrying is the CV of the Tanaiste (Deputy Prime Minister) Eamon Gilmore who did psychology in college, became a student leader and then got a job as a trade union organizer.

Having had some experience of the airheads who gravitated to psychology when I was in college, I'm inclined to think that anyone who went that route is probably even less clued into the world of high finance than teachers.   You can decide for yourself.

But these four buckos (two Fine Gael and two Labor) all have one thing in common.  None of them has ever worked a day in his life in the real economy, in a business that had to make a profit to survive.  

Something else they have in common is that together they make up the core of the government sub-committee in charge of getting us through the financial crisis, getting us out of the IMF bailout and getting back our economic sovereignty.  

Other ministers are called in to join this supreme committee as needed, but these four geniuses with their non-existent experience of the real economy are the main men in charge of saving Ireland.   Is it any wonder people here have such little confidence in our future?

What we have learned over the past year from this Fine Gael-Labor government is that they are very good at being sanctimonious about the mess that Fianna Fail made of our economy.  They get all high and mighty and holier than thou about it.  And in the first few months you could not blame them.

Fianna Fail destroyed the country and left the new government in an impossible situation, with the economy carrying an enormous financial burden that may take decades to remove.
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But despite the lousy hand they have been dealt, there comes a time when the new  government has to start taking resolute action.  Now, after more than a year in power, the new government has passed that point.

What we are getting, however, is confusion and weakness.   It turns out that the new government is not so good at actually taking the hard decisions that are necessary to put things right again.

The big challenge, of course, is shifting the portion of the debt burden that is directly attributable to the banking collapse away from the ordinary Irish taxpayer who had little or nothing to do with it.

For the first time a week ago a very senior official of the European Central Bank admitted (perhaps inadvertently) that the reason Ireland has been prevented from burning unguaranteed senior bondholders was not just to protect the reputation of Irish banks, but also the stability of the European banking system.

The ECB is well aware that the European banks that lent money into the Irish boom to get a share of the action are partly to blame for what happened here.  Yet instead of sharing in the cost of the property crash, they are getting all their money back.  And the Irish taxpayer is being forced to carry the enormous bill, with the bailout provided so we can make the payments.

The new government, in spite of all the huffing and puffing, has failed to do anything about this gross injustice.  They have managed to get a portion of the debt pushed down the road, but there is no debt forgiveness or burden sharing involved.

On the biggest issue we face, they have failed.   They are still trying to be the best boys in the European class in the hope that the head teacher in Europe will reward us for good behavior.
Sadly, the real world does not work like that.

Because of the billions being sucked out of the economy each year, taking away from much needed spending on services like health, education and welfare, the debt burden is our number one issue, dwarfing everything else.

But the government has caved in and swallowed the ECB line -- everything must be paid back.
The banking debt is only one half of the problem, however.  The other half of the problem, for which we are entirely to blame ourselves, is the overspending by the state.

We need to get our spending back in line with our revenue.  That's far from easy, since revenue has contracted so much since our property boom turned into bust.  But there is no alternative.

Since they are the ones funding our budget deficit, the IMF, the ECB and the EU (the troika) not only have laid down the schedule for us to cut spending and raise taxes but have suggested ways we should go about it.

Some of this is pretty obvious stuff.  Ireland is one of the few countries in the world which don't have a property tax.  We got rid of local property taxes (called rates) back in the 1970s, and since then local services have been funded from central government, a bill that is now enormous and which the government can't afford.

So the troika told us to introduce a property tax.  If you've read an Irish paper in recent weeks you will know what a mess the government made trying to do this.
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To get the ball rolling, a flat "household charge" was introduced at a modest €100 for all houses.  In future, the charge (or tax) will be progressive so that those living in big houses will pay more.  But the government could not wait until all houses were valued, because the IMF had said to start immediately.

This caused huge resentment, and even though the deadline for payment has passed half the country has still to pay, with a sizable section swearing they will never pay.

This chaos was made worse because the government looked for payment via the internet and failed to make arrangements for all those people who like to pay in cash at the post office (like they pay their TV or dog license). The explanatory publicity campaign about the new tax also was confusing and unconvincing.

This debacle followed another one a few weeks previously that had thousands of people in rural Ireland up in arms.  This happened when the government tried to implement an EU instruction that all septic tanks (unconnected sewage systems) must be inspected to protect ground water quality.

The cost was to be €50.  There was such a revolt on this that the government subsequently dropped the charge to €5.

This week the row is about water charging.  Unlike in most other countries where local councils charge for water, the provision of water here has always been free.

This is counter to EU policy and our EU masters have told us to introduce a charge.  This means that every home in the country has to be fitted with a water meter.

At first we were told that this was going to cost a few hundred euro, to include fitting.  Again there was uproar.

Now we are told the fitting will be free and the payment for the meter may be spread out over a few years. But no one knows.

None of this sounds like a government in control, does it?  If they can't get to grips with the relatively small items like these, how are they ever going to tackle the big issues like the overall debt burden?

The bottom line on all this is that people here, like everywhere else, don't like paying tax.  And we've got bad habits.  To buy votes, politicians here failed to implement property taxes and water charges and now we are out of line with everywhere else.

I don't have to tell you guys in the U.S. about such taxes.  But we don't have to look that far to see what others are doing.  In Britain, for example, local taxes pay for local services and an average size house pays over £200 or £300 a year for water.

The trouble is that so many people here are struggling to pay their bills already that they say they have nothing left to pay these new charges.   A new survey has shown that more than half a million adults here have no money left at the end of the month after paying their essential bills. That's a tough place to be in.

Irish have no time for Fine Gael annual convention

Enda Kenny speaks at the Fine Gael ard fheis last weekend 

The main party in the government here, Fine Gael, had its ard fheis (annual convention) last weekend. It was a jubilant, celebratory affair, as though we were still in the middle of the boom.  

Nobody seemed to find it strange that it was being held in our new National Convention Center, built by one of the biggest developers here who is now bust and owes at least a billion.  Another monument to the boom now owned by all of us.

It was Enda Kenny's first ard fheis as taoiseach (prime minister).  Despite him saying that the convention was not going to be a celebration or a party, the delegates could not help themselves.  

They were grinning from ear to ear, cheering every good line in the speeches.  There was a lot of self-congratulatory backslapping.  The country may be down the toilet, but this is Fine Gael's time to shine and boy, are they enjoying it.

It's hard to blame them.  Fine Gael are in power after decades in the wilderness.  And thanks to the disintegration of Fianna Fail, they look like being there for a long time to come.

That's what is different this time. Yes, Fine Gael have held power in the past but it always seemed to be a blip, a few odd years here and there which were temporary interruptions of the decades of Fianna Fail rule.  The last time Fine Gael was in power was when John Bruton was taoiseach from 1994 to '97.

But now it's their turn to contemplate decades in power. The tables are turned and the roles are reversed.
Fianna Fail, the party that dominated Irish politics for generations, has destroyed itself to such an extent that it could vanish altogether.   Fine Gael is the new Fianna Fail.

That's what underlies the supreme confidence that Kenny exudes these days.

The trouble is that it's completely out of sync with the wasteland he is presiding over.  

Outside the Convention Center hundreds of angry protestors were venting their rage at the new household charge (the start of a property tax system) that is being imposed on every home here.  By the March 31 deadline only half the country had paid up, which shows the level of revolt there is on the issue.  

It's not so much the tax itself, because people here recognize that almost all countries have property taxes.  It's being started as a flat tax at a low level, applied to all houses, although it will be progressive in future and clearly the rates will go up very rapidly in the coming years.  

What's bothering people here is that the money being raised, like so much of the rest of our taxes, is going to pay off the billions in debts of our bust banks.

Of course the government is saying that the money is being ringfenced for local services, but no one believes them. At the end of the day it will go into the same revenue pot, and the payments we have to make on our zombie bank debt and bailout interest come out of that pot, leaving much less for everything else, like local services, schools, hospitals and so on.  

The injustice of what is happening to Ireland is the weak underbelly of the Fine Gael position.  Kenny's relentless positivity is all very well, but people here are not fools.  

They know they are being bled dry to pay for something that was not their fault in the first place.  And the resentment on that is growing all the time.

This resentment will not be lessened by strokes like the carefully timed deal on the Anglo Irish Bank promissory note which was announced last week, just before the Fine Gael convention.

It was presented as some kind of breakthrough.  In fact it's more of the same, loading more debt on to taxpayers.

The situation is that the former Anglo Irish Bank, now a zombie bank being wound up, owes around €30 billion, which is supposed to be paid off over 10 years in annual payments of over €3 billion euro.   The deadline for the first payment was last Saturday, March 31.

The deal the government has done with our European "partners" is a highly complicated one which effectively means we won't have to pay until 2025.

But it does mean that the debt has now been converted into a government bond, which means that the bank debt has been transformed into a state debt which taxpayers here will have to pay back in the future, along with interest charges.

Of course the Anglo debt, like all bank debt here, is state debt, since it was taken on board by the state under the infamous blanket guarantee issued by the last government.   So it could be argued that this new deal does not change the playing field.

But it does because it makes it explicit that this is now state debt, and it undermines the argument that much of this debt should have been written off instead of being loaded on to taxpayers.  

And the former Anglo Irish bank is only part of the problem.  During the boom here Irish banks were unable to raise enough cash from depositors here to fund the lending demand.  So they started borrowing from other banks, mostly in Germany and France.  

I pointed out the statistics in this column recently.  In 2003 foreign borrowing by Irish banks was below €15 billion.  By the time the boom peaked in 2007/08 it was €110 billion, most of it used to fund property speculation here.  

The Irish economy was the toast of Europe at the time and foreign banks wanted a slice of the action. So they shoveled the money into the Irish banks and, even though some economists were already warning that the boom was a bubble, the European Central Bank (ECB) which was supposed to be regulating banking in Europe did not intervene.

It was a gamble by the foreign banks involved, in search of higher profits.  It was incompetence on the part of the ECB.  

When the bubble burst and the Irish government stepped in with the state guarantee to stop our banks going bust the Irish taxpayer was saddled with the debt.

As we now know, the Irish banks claimed at the time that it was just a temporary liquidity problem and that they were solvent.  To be fair to the last government, no one at the time realized the situation was so disastrous.  

No one realized that converting the bank debt into state debt was going to bankrupt the country within a couple of years, drive us into the IMF bailout and rob us of our economic sovereignty. But that is what has happened.

It turned out that the Irish banks were completely insolvent and they owed well over €100 billion which by then had been transferred into a debt carried by the Irish taxpayer.  

Under the normal rules of free enterprise, if you make a poor investment you lose some or even all of your money.  That's what should have happened to the German and French banks and the other financial institutions who pumped money in here during the boom.  But that's not what happened.

To get the bailout money, the IMF and the ECB insisted that Ireland must honor all its debts, including its banking debts.  There could be no default, no debt reduction.   Everything must be paid back in full.
To get the bailout money, the last government agreed with this -- in fact since the IMF/ECB had them over a barrel they had little choice -- and the present government has continued on the same policy path.   Kenny repeated it in his ard fheis address last weekend.

"Let me be clear. I will not throw away the progress we have made in the last year by reneging on our international commitments. Ireland will NOT default."

The progress he was referring to was the interest rate reduction (which we got courtesy of Greece) and the promissory note deal.   Neither do anything to reduce the overall debt burden we face.  They do not affect the big picture.  

The huge debt burden is strangling our national finances because billions have to be diverted every year from services and from productive investment into simply repaying our debt and the interest on it.
That the ordinary Irish taxpayer has to carry this burden is both outrageous and unjust.   Most of the foreign banks that speculated on the Irish property boom sold the debt at a discount to hedge funds and speculators some time ago.  

These funds and speculators have now made a fortune because the bonds involved have been paid back at full face value by the Irish state.  To do so the government here used tens of billions of euro we borrowed from the ECB, via the bailout we got.

And who pays?  The Irish taxpayer, of course, the mug at the end of the line with no power and no voice.  
Our voice is Kenny, who is still trying to justify this arrangement, still trying to convince us all that there is something noble in paying back every last cent in full.

The reason this has been imposed on us by our European "partners" is that they didn't want to undermine other banks in Europe who lent us the money.   That would have destabilized the euro even further.

So Ireland, the willing sacrificial lamb which never protests, was led to the slaughter.   For the sake of the euro and EU stability, Ireland (the Irish taxpayer) was nailed to cross and will bleed there for years until all the debt is paid back.

What should be happening, of course, is that the EU and particularly the ECB should be acknowledging that their failure to control bank lending into the Irish boom was a major factor in what went wrong.

They should be acknowledging that they -- and the European financial institutions which poured money into the Irish boom -- should be sharing in the loss.

The only way this can be done is by a serious level of debt forgiveness or write down.  Kicking the can down the road, like lengthening the deal on the Anglo money, is not sufficient.

Instead of saying repeatedly that Ireland will never default, what our political leaders should be saying is that Ireland will never default as long as we get a get a debt write down that will ease the huge burden on the Irish taxpayer.

After all, the ordinary Irish taxpayer had very little to do with the massive burden of debt that now hangs around the neck of the Irish state like a millstone.

Nor is it convincing for Kenny to say that because the last government signed the Irish state up to the deal, we have to abide by it now.  The last government did so because they did not get the full picture from the Irish banks who either lied about the true position or did not know.  

And who was ultimately responsible for regulating the Irish Central Bank and through it the Irish banks?  The European Central Bank, that's who.

We may be a Catholic country. But it's time we stopped being martyrs.