It's time to stop the ring-kissing of Catholic bishops in Ireland

The picture of the Irish bishops gathered in conclave with the Pope in the Vatican just over a week ago summed up what is wrong with the Catholic Church, not just in Ireland but in Rome as well.

There they all were, a large group of elderly male celibates in white dresses smiling grimly for the cameras before they began their two-day discussion on sexuality and abuse.

What's wrong with the picture? Well, for a start there's not a woman in sight.

Nor are there any psychoanalysts or psychiatrists or psychologists or even an alternative therapist or two. Nor are there any ordinary adults who might be able to offer a real opinion on sexuality, speaking from the experience of a normal, well-adjusted person with an active sex life.

Nor are there any parents of abused children. Or even any victims -- adults who were abused by priests when they were kids (and let's face it, there's no shortage of those).

In fact there was no one at all in the room who might have been able to offer a worthwhile view on sexuality and how it emerged in such a perverted form among so many Catholic priests in Ireland, wreaking devastation on so many lives over decades.

Even more telling than the picture of the Irish bishops sitting down for their conference with the Pope was the TV news film we saw here the night before which showed the bishops shortly after they had arrived inside the Vatican.

All decked out in their expensive robes and crosses, they formed a long line and shuffled forward one by one like penitents to kiss the Pope's ring, sinking half way to their knees to do so.

The body language was all squirming embarrassment, mixed with a little preening pride. After all, this was the big time for them, like Oscar night, even if the circumstances were a little uncomfortable.

The Pope had a fixed smile on his face as he greeted them one by one, his cold eyes assessing the miserable creatures who had presided over a system which had brought him so much trouble. It looked like scenes from The Godfather and The Da Vinci Code somehow had got mixed up.

The Goodfellas were lined up to pay homage to the Don, all in their elaborate costumes inside the Vatican. The air was heavy with guilt and foreboding.

Kissing the Pope's ring? That self-abasing ritual sends out completely the wrong message when what these guys should be doing is trying to make the church more relevant in the modern world.

What this Pope needs is sound advice from a wide variety of people, clerical and lay, male and female. What he doesn't need is a roomful of Irish bishops going through the traditional motions.

It's time to dump this kissing of the Pope's ring. And it's way past time to dump the bit where ordinary people fall to their knees to kiss their bishop's ring.

What's all that about, anyway? I don't remember Jesus Christ having a ring and expecting everyone to fall down and kiss it.

As for what a roomful of aging celibates could possibly know about sexuality, your guess is as good as mine. It's worth remembering that most of Christ's 12apostles were married men, and that compulsory celibacy was an invention of the church that came over 1,000 years later, after centuries of married priests and even married Popes.

It was the worst decision the Catholic Church ever made, and the present problems about sexuality stem from that disastrous change.

Celibacy may work for some, but for many others it doesn't. If you take the Freudian view, repressed sexuality will always find a way out, frequently in undesirable ways. Add to that the system that sent young boys from all male schools into all male seminaries and you have a recipe for arrested sexual development and release that puts children at risk.

But the Catholic Church refuses to recognize this. Instead of accepting that the abuse is a consequence of the church's attitude to sexuality, the church sees it as wrongdoing by aberrant priests.

So in Ireland we have had denial, cover-up and abusing priests being moved by bishops from one parish to another when complaints were made. We have had decades of abuse by dozens of priests all over the country.

The appalling saga of abuse was revealed not because of anything the church did but because of the courage of the victims and the judicial inquiries set up by the state. The failure of the Irish bishops, past and some present, which was revealed in the report on the Dublin area, was the immediate reason they had all been summoned to Rome.

The victims -- who were not invited to the meeting -- were hoping for a full apology from the Pope, for an acceptance of some responsibility by the Pope and for a recognition of the trauma they had suffered. What they got was the same old waffle, relayed by the Irish bishops after the two-day meeting.

The Pope put what had happened in Ireland down to "a weakening of faith." If the priests involved had been stronger in their faith they would never have done such terrible things. He also said that "the lack of respect for the human person" in society was one of the causes.

This lame response and the failure to offer an adequate apology angered abuse victims here. They are also angry because the Pope failed to take any responsibility for what happened in the Dublin diocese even in recent decades.

This is significant because it was the Pope, then Cardinal Ratzinger, who as prefect of the all-powerful church committee the Congregation for the Doctrine of the Faith, had been Rome's top man for dealing with this stuff since 1981. All cases of abuse worldwide had to be referred to him.

To suggest that he did not know what was happening in Ireland and how the Irish bishops were dealing with it is nonsense. He was part of the culture of cover-up within the church for years.

So there is every reason to think that the Pope is as culpable as the Irish bishops who moved abusing priests around. If he didn't know, he should have known. That was his job.

But getting him to admit that either he or Rome was at fault was never going to happen, because that would open the Vatican to a legal challenge from Irish abuse victims. Any admission of the Vatican's culpability in its directives to bishops on the reporting of abuse complaints could open the floodgates to massive compensation claims.

One particularly nasty suggestion to emerge from Rome over the past week was that the abuse was a peculiarly Irish problem. Given the worrying number of Irish religious who have been involved in abuse in other countries, like the U.S. and Australia, that might seem to have some validity.

But the fundamental problem is not where the abusing clergy are from. It's the warped attitude to sexuality the church has given them.

The truth is that abuse has emerged among priests and brothers in many countries. For example, this weekend the bishops in Germany -- home of the present Pope -- got together for a major press conference to make a public apology for abuse that happened there.

The Pope is due to issue a special message to Irish Catholics within a few weeks. But since he would not agree to allow any of the victims to attend the meeting in Rome, no one is expecting much.

Irish Catholics don't need any empty messages. Words are cheap.

What the Catholic Church needs to do urgently is end celibacy, start ordaining women, allow contraception and generally change its attitude to human sexuality.

Until the church starts treating human sexuality as something healthy and wonderful to be enjoyed and celebrated instead of something dirty and furtive to be denied and hidden, the problem is never going to go away. Either in Ireland or anywhere else.

It's time to get back to the message of Jesus and get rid of all the pomp and ceremony, particularly the ring kissing.

Only for Irish government spending cuts, it would be a Greek tragedy

If you were reading your world news last week you will know that the European Union leaders came to the rescue of Greece. The Greek economy is in crisis, it has a massive budget deficit, the country is at the limit of its borrowing ability, and without EU backing it would go belly-up.

Sound familiar? There but for the Grace of God and the spending cuts goes Ireland.

Taoiseach (Prime Minister) Brian Cowen said as much last week after the EU summit. Greece needs to follow Ireland's example in getting its state spending under control. They have to cut their deficit.

Tell that to the militant unions in Greece, which make the Irish trade unions look like sheep. They brought Greece to a standstill last week, shutting the airports and filling the streets with protests. They want higher taxes on the rich and even more state borrowing to protect their lifestyle, even though the country can't pay its way.

The reason the EU leaders intervened is because the big Greek economic mess is destabilizing the euro. The euro has sunk in value against the dollar in recent weeks, and the international money markets are becoming more nervous not just about Greece but about some of the weaker countries in Europe, including us.

In official European circles, the group of problem countries in question is called the PIGS -- Portugal, Ireland, Greece and Spain. And make no mistake about it, even though the sense of crisis in the Irish economy has abated in the media here in recent weeks, the fact is we are just as deep in the smelly stuff as we have been for the past two years.

The soft guarantee given by the EU leaders to the markets last week about Greece has given the Greeks some time and breathing space to get their act together. But there is a lot more belt-tightening to come over the next few years -- for them and for us -- before we will all come through this recession.

So Cowen's suggestion last week that Greece should follow the Irish example caused a few sniggers here. I'm not sure following Ireland's example is what anyone should do, given how we messed up our economy and our current snail's pace towards putting it right.

There is still no real sense of urgency here, either in government circles or in the media. For the past week, for example, Irish TV news and newspapers have been saturated with coverage of the resignation of George Lee from Fine Gael, the main opposition party.

Lee is a former RTE economics correspondent with a big profile who gave up his job to join Fine Gael and help save the country. Or so he thought.

Some of the senior Fine Gael people, while they were glad to have him as a vote getter, did not share his high opinion of himself as the national Messiah. He felt ignored and, in what looked like a fit of pique, he resigned from the party and the Dail (Parliament) last week after less than a year in politics.

This storm in a tea cup was interpreted as a failure on the part of Fine Gael leader Enda Kenny, and it became a huge national story which went on for days. The truth is that Lee's resignation is of little national significance.

What was of real significance here last week was the revelation that a senior International Monetary Fund (IMF) official, an American economics expert called Steven Seelig, had told the Irish Minister for Finance Brian Lenihan in April last year that the IMF did not believe that NAMA would result in a significant increase in bank lending in Ireland.

This was a real bombshell. You will remember that the National Asset Management Agency (NAMA) was set up by the government here to buy the bad property loans from the Irish banks to stop them going bust. It was going to cost billions, and it was justified on the basis that if we bought the bad loans and also put enough billions in new capital into the banks (so far we have put in ****11 billion) this would get the banks lending to businesses again and get the Irish economy going again.

Now we learn that the IMF representative who came to Dublin last year told the government that, while NAMA might save the Irish banks, the IMF did not believe it would get credit flowing here again. This revelation, which emerged under a Freedom of Information request, was really shocking, implying that the government's strategy was wrong then and is still wrong.

Even before this revelation, a lot of people here were getting very disenchanted with NAMA. It's way behind schedule -- the billions in loans from the top 10 developers were due to be transferred out of the banks in December but that is still a month or two away, at least.

NAMA is operational and the valuation work is proceeding. But there is still a lot of uncertainty about the value of the property involved in the loans and the discount that is to be applied when NAMA takes them on. The original estimate by Lenihan of an average 30% discount now seems to be too optimistic, and the valuations coming in from the experts are much lower than 70% of the original price.

This has major implications for Irish taxpayer. On the one hand it increases the chances that when NAMA eventually sells the properties back into the market in 10 or more years, it may not make a loss.

On the other hand, it means that there will be such a big hole in the books of the banks right now that the government will have to pump billions more in to recapitalize them. Already the Irish taxpayer has underwritten ****11 billion in funding and another ***15 or even ****20 billion might be needed to keep the banks here afloat.

Last week the ratings agency Standard & Poors estimated that the cost of Ireland's bailout would be as high as ***25 billion, and other estimates have been even higher. What this means is that the government will effectively be nationalizing the banks, which is something it has always said it wanted to avoid.

But it seems likely that the amount of capital that will have to be put into the big two banks here, AIB and Bank of Ireland, will mean that the taxpayer will end up owning as much as 80% of both banks.

Welcome to Communist Ireland, you may think. And it's true that nationalizing the Irish banks, however reluctantly, would cause all kinds of problems in the future. But as far as I'm concerned, it's still better that than paying way too much for the property assets coming into NAMA.

I don't mind being a taxpayer shareholder in the Irish banks. Maybe I will get some money out of it in the long run, or maybe my kids will. And maybe they will also get something back when NAMA sells all those properties after holding on to them for years.

There is another big plus in nationalizing our banks, one that could even please the IMF, an organization that is not a big fan of state ownership. If the government is in ultimate control, it can dictate bank policy and make lending to businesses happen again. Everybody wins!

Except the existing shareholders, of course. But then they have already lost almost everything.

It's a tough world these days, especially for the PIGS.

I don't buy the Ireland-is-out-of a recession talk

One or two of the more optimistic economists here have started to predict that Ireland will emerge from recession later this year or early next year. That view is founded mainly on the fact that some of the world's major economies have already edged out of recession and started to grow a little again, and that world trade will pick up a little in the coming year as a result.

As an open economy heavily dependent on exports, we will benefit from this upturn and Ireland will come out of recession. That's the theory, anyway.

Much as I would like to, though, I'm not buying it myself. I don't think we're going to see much, if any, growth in the Irish economy this year or next year, and we'll be lucky to see it in the year after that.

What will happen, I think, is that we will just about come out of recession, or in other words our economy will stop shrinking. But instead of showing much growth it will flatline, bumping along the bottom for a few years. And that's going to be bad news for all those out of work here and for school and college leavers over the next few years.

That's the reality. But it's a reality that a lot of people here just don't get.

They see a few headlines predicting that the recession is over and they think that we're just magically going to go back to the way things used to be here. I've got news for them -- we're never going back to the way it used to be in the Celtic Tiger years.

Towards the end of the Tiger years our growth was mostly driven by the construction sector, and our manufacturing sector had already started its sharp decline. We've had our property bubble and we're not going to have another, at least not for a very long time.

So if we are to recover the strong economic growth that made us well off, in the future it will have to come from the rest of the economy, from manufacturing and services. For that to work we have got to restore our international competitiveness; in other words, to start producing a whole lot more for a whole lot less. And what that really means is that we will have to work harder and longer for less money.

It's not going to be easy. Last week, in a major speech, the Taoiseach (Prime Minister) Brian Cowen seemed to suggest that the main thing we need is confidence.

The speech, to the Dublin Chamber of Commerce, has become an annual event in which the taoiseach talks freely and directly to the country's business elite. Last week he even invoked the spirit of 1916 as he urged the captains of industry to make the recovery happen.

But it's not that simple. In fact it's even more complex than sorting out our banking mess and getting credit flowing again.

It's not about a lack of confidence. It's about getting our costs down to the level where multi-national companies will want to come here again instead of lining up to get out of the place.

Because that's what they have been doing. Last year 130,000 people in Ireland lost their jobs, many in construction but many also in manufacturing.

The most recent figures, released a week ago, show that there are now 434,700 people here either out of work or working part time and claiming welfare. I remember predicting on this page about a year ago that unemployment would hit half a million, and we're now well on the way there.

In spite of this huge number of people out of work, however, there is also a whole section of the workforce here whose jobs are protected from the crisis because they are cocooned from reality in other ways. As far as they are concerned, they are carrying on as though nothing has changed.

So if you go to the doctor or the dentist, you find that it still costs you as much as before. The same is true of a wide range of professionals, from lawyers to accountants.

It's also true, of course, of all the people who are paid by the state. Yes, their pay has been trimmed a little over the past year, partly to pay more of their huge pension bill, but they are still very highly paid and they have job security, unlike workers in the real economy.

The problem is that too many of these people -- the professionals and those on the government payroll -- are still floating around on cloud nine, and they still don't get it. They talk about the recession and competitiveness, but it's always someone else's problem, not theirs. They oppose all efforts to get them to accept lower pay levels.

The difficulty for the rest of us is that their pay affects the cost of living and of doing business here. Our electricity power plant workers (semi-state workers with a virtual monopoly) are the highest paid in Europe. We also have the most expensive electricity in Europe. That's not a coincidence.

In a way we have become a divided nation. It's not about the border anymore.

These days there's a new border, between those who have secure jobs and those who are out of work. And so far the haves are showing very little consideration for the have-nots.

The professionals talk about the effects of the recession, but there's no sign of their organizations proposing a nationwide drop in fees. The state workers (the last bastion of old-fashioned union power in Ireland) have already begun a campaign of non-cooperation and disruption aimed at reversing the moderate pay cuts that have been imposed on them.

The government desperately needs to reduce the budget deficit by reducing its pay bill, yet the state workers refuse to accept it. They want the government to go on borrowing to pay them.

The result of all this is a growing rift in Ireland between the two sides. Those who are out of work and desperately trying to live on welfare and hold on to their homes look in disbelief at the behavior of the state workers and the professionals.

They read about people on state boards and in state organizations and quangos who are still living like they did before the recession, still taking big salaries, getting big expenses and charging all kinds of things from foreign trips to concert tickets to the taxpayer.

Every week here the media uncovers more examples of this waste, more stories about state organizations which seem to do very little except keep their senior staff in the luxury they have come to expect.

One thing seems clear. The significant reduction in pay and living standards that will be necessary here to shift us back into a competitive position will have to be shared across Irish society.

If that does not happen -- and so far it is not happening --then there is a serious risk here of social breakdown, of those who have well-paid, protected jobs and the army of unemployed becoming openly antagonistic to each other.

That would be a disaster for us, and the government will have to show real leadership over the next couple of years to avoid it.

Apart from the manufacturing sector, the other area that is really suffering here at the moment is small business, including retail, as spending contracts in the recession. Small businesses are having a very tough time, and it's not helped by the triple whammy they face.

Sales are down, the banks won't give them credit to keep going, and the government red tape, enforced by well-paid state workers, continues to tie them up as though everything is normal. It is driving some small business people to despair.

Let me give you an example. My daughter lost her Saturday job in our local bookshop recently when it closed down. The owner explained to me that he could no longer afford to pay the high rent he was being charged.

It was over ****1,000 a week, a huge rent for a small unit in a suburban shocking mall. There were some weeks last year, as the downturn pushed spending down, when his turnover was not much more than that. So after 20 years in business he closed.

He had pleaded with the landlord to reduce the rent, but to no avail. That was a couple of months back and the place is still vacant.

And all over Dublin, in some of the main shopping malls, the same thing has happened. Even on Grafton Street there are a number of vacant units, dark and dirty gaps in the smile on the face of the most prestigious shopping street in Dublin.

Commercial rents are a real problem here now. Like wage levels, they soared during the Celtic Tiger years, making Grafton Street the fifth most expensive shopping street in the world.

The problem is that they have not come down, even though the recession has sharply reduced turnover, and this is destroying many long established businesses.

There was real shock here a couple of weeks ago when the Grafton Street jewelers West -- the Tiffany of Dublin -- said it would be closing. Iconic fashion and shoe stores are also closing, and the street that was once famous for its shopping experience is being reduced to a waste land of cell phone outlets and fast food joints.

Tough times in Ireland -- but not for all.

Back to the dour old past in Northern Ireland politics

So here we go again. Just when we thought it was all over and consigned to history, we're back to another crisis in Northern Ireland.

If they ever make a movie about it, it will be called Back to the Past instead of Back to the Future. This latest crisis which could sink the power-sharing administration and wreck stability up there has been going on for over a week now.

It may be resolved by the time you read this. But I'm not betting on it.

Watching the dour faces of British Prime Minister Gordon Brown and the Taoiseach (Prime Minister) Brian Cowen as they arrived in the North last week to deal with the crisis, I could not help thinking back to the famous remark made by the late Reggie Maudling.

When the Conservatives took power in Britain in 1970 the North had just exploded in violence, making it the number one problem for Maudling, the new British home secretary. He came over to the North for a look, and after the visit he gratefully boarded the plane back to London, settled into his seat, and called out, "For God's sake, bring me a large Scotch. What a bloody awful country."

Brown, a Scot, probably felt like doing the same in the middle of last week as he left the North after a couple of days of frustrating talks that failed to produce a result.

Cowen, a man who knows his history, was probably thinking of a pint rather than a Scotch as he headed back to Dublin. He may also have been thinking of the famous quote from Churchill.

Speaking about the North during the House of Commons debate on the Irish Free State Bill in 1922, Churchill referred to the way the First World War had changed everything:

“Then came the Great War -- every institution, almost, in the world was strained. Great Empires have been overturned. The whole map of Europe has been changed.

“The position of countries has been violently altered. The modes of thought of men, the whole outlook on affairs, the grouping of parties, all have encountered violent and tremendous changes in the deluge of the world.

"But as the deluge subsides and the waters fall short, we see the dreary steeples of Fermanagh and Tyrone emerging once again. The integrity of their quarrel is one of the few institutions that has been unaltered in the cataclysm which has swept the world.”

Yes indeed. Everything changes, but the North remains the pain in the behind it always was.

Churchill's words are as true today as they were 90 years ago. Despite disarmament, peace and power-sharing, the place is still a problem.

Despite enough years of normality to make even Belfast a tourist destination, the ancient quarrel bubbles away beneath the surface. Despite truckloads of money poured into the place and endless encouragement for the local politicians, the new beginning has been on the point of collapse for the past 10 days.

Once again, the political facade cracked and the backwoods men threatened to bring the house of cards down. That's the last thing we need, given the potential there would then be for a return to violence.

That is unthinkable. Which is why Cowen and Brown immediately put everything else on hold and hurried to Belfast early last week.

They left the talks after a couple of days, but the negotiations have continued now for over a week with the Irish foreign minister and the British secretary for the North keeping an eye.

By the time you read this, some compromise may have been cobbled together. Or maybe not.

One way or the other, enormous damage has been done to trust and confidence, to hopes of building a normal society in the North. The whole episode has left a very bad impression.

While the rest of us grapple with real problems and try to pay our way, the Northern politicians (on both sides) split hairs and spill out their old venom while Britain spends billions to keep the place going. They're not only different, they're on a different planet.

People down here in the south have watched in disbelief. Cowen has his hands full right now as the true extent of the banking black hole created by our property collapse becomes visible. The challenge we face to avoid national bankruptcy is immense.

And where was the taoiseach last week? Up in Belfast talking to the looney tunes.

Brown is also in a battle for survival. He's up to his neck in Iraq and Afghanistan and he faces similar economic problems to us, with the added problem of an election in a few months. Yet he was also stuck in the North.

Both of them are extremely busy men. Yet last week they had to drop everything to go to the North and babysit the toddlers who were throwing everything out of their buggies again.

This column has not been concerned with Northern Ireland for a long time, for the very good reason that the place no longer impinges on us in the south the way it used to do.

But this mini crisis up there dragged it back on to our agenda again, and people here are not happy about that. In fact it would be fair to say that people here are disgusted with the bickering, the intransigence, the sheer bloody-mindedness.

For a lot of people down here, if they ever hear another whining, self-righteous Northern accent again it will be too soon.

The crisis, as you probably know, was caused by Sinn Fein's warning that it was about to pull out of the power-sharing administration because of the failure to devolve responsibility for policing and justice from Westminster to the administration in the North. This is the final part of the transfer of power to the North's new administration, which already handles everything else.

It's way overdue but the Unionists have been dragging their feet, still suspicious of giving Sinn Fein a say in such a critical area.

In fairness to Sinn Fein, one can understand their frustration. It's nearly 12 years since the Belfast Agreement was signed. It's over three years since the St. Andrews Agreement, after which the transfer of policing powers was supposed to follow without further delay.

But here we are three years later, and the Democratic Unionist Party (DUP) which shares power with Sinn Fein are still not ready to play ball.

The frustrating thing is that -- apart from the Neanderthal wing of the DUP -- the people in the North don't care that much about who controls policing now. As long as it's fair and even-handed it's not an issue.

What they do care about now is the economy, jobs, health, education and all the other bread and butter issues.

The DUP’s extreme wing can't bear the thought of the former gunman Martin McGuinness and his colleagues having an influence on policing. So they are saying no and they could yet split the party and topple their unfortunate leader Peter Robinson. They want Sinn Fein to prove it is trustworthy for another few years.

This is all nonsense, of course. The main threat at the moment up there is from the Real IRA and the other dissident Republicans, and Sinn Fein is likely to show those boys little mercy if it has a hand in directing police policy.

The DUP hardmen's intransigence on this is not only stupid but dangerous, although after the 30 years of IRA mayhem and murder, you can see why they find it hard to listen to McGuinness discussing policing. Nevertheless, it's time for them to move on.

As for Sinn Fein, their threat to collapse the administration was not what the North needs right now. The power-sharing administration already has responsibility for finance, jobs, business and all the other areas that affect people's everyday lives like health and education.

Given the state of the North's economy, there is no shortage of work to be done. It may be irritating for Sinn Fein, but there is no real urgency about the transfer of policing responsibility.

Both sides are at fault in this latest crisis, but this time the Loyalist hardliners are by far the most culpable.

Flying blind in the Irish recession

We got the perfect example of what's wrong with the Irish economy last week when our air traffic controllers went on strike.

The four-hour stoppage last Wednesday shut down our three main airports, grounding 150 flights. Over 20,000 passengers were affected, with missed connections, screwed up holidays, appointments abroad that could not be kept and so on.

The disruption, irritation, even misery caused to so many people -- Irish and foreign -- was considerable. But the damage done to our international reputation, especially among the business community, was perhaps even more serious. Why would anyone come here to set up a business if the air link cannot be relied on?

Since we're an island nation we are more dependent than most countries on air transport. It's a vital link, essential for everyday life and for business. So it's not something that should be interrupted in a cavalier fashion by a small group of privileged workers.

Yet that's what happened last week. The level of disregard for ordinary people and for the economy, especially in our present circumstances, was shocking.

So if the air traffic controllers felt justified in taking such action they must have a very serious grievance, right?

Well, no actually. What is bothering them is their pay (even though they are already among the highest paid air traffic controllers in the world) and their pensions (even though they already have what is probably the best air traffic controllers’ pension scheme in the world).

They are due a 6% pay rise under their last pay agreement and they are insisting on getting that, even though most workers in the Irish economy have had to forget about agreed increases, and many have had to take pay cuts to save their jobs.

One might have some sympathy for our air traffic controllers if they were badly paid by international standards. But that is not the case. Irish controllers earn far more than their counterparts in the U.S., the U.K. and most European countries.

The top 10% of Irish controllers earn between €170,000 and €230,000 a year. The average Irish controller earns €160,000.

The average pay for controllers in the U.S. last year, excluding overtime, was $109,000 (€77,000) which is half what the tin pushers in Ireland get. In the U.K., the average pay for controllers is even lower, at £60,000 (€69,000).

So it's fair to say that the 300 Irish air traffic controllers are very well paid indeed, without the extra 6% they are demanding.

It gets even more ridiculous when you look at the generous, guaranteed pension scheme they have as semi-state workers. It's non-contributory, which means it doesn't cost them anything.
But it does cost the Irish Aviation Authority (the IAA, which runs the airports here for the state) plenty. In fact the IAA pays the equivalent of 30% of every controller's salary into their pension fund every year.

For most workers in the economy, guaranteed pensions have collapsed, even after paying heavy pensions dues over the years. Yet these guys (and gals) have guaranteed generous pensions for life, for free!

The IAA wants them to start making a contribution to the pension fund (even a modest one, like other state workers recently) but they are resisting.

So this stoppage was all about money, even though these privileged, highly-paid, semi-state workers already are doing extremely well.

The spark that caused the stoppage last Wednesday was the introduction of a new air traffic controller computer program to update the service for Irish airports and make the air traffic operation more efficient. Not without our 6% pay rise, said the controllers, and they refused to operate the system. The IAA suspended 14 of them, and the rest went on strike for four hours in sympathy.

Further stoppages were threatened, but these have new been put off following the start this week of Labor Court talks between the IAA and the controllers.

In the meantime, unnerved by the public outrage against them last week, the controllers are reluctantly operating the new system. Meanwhile, we all wait to see whether the talks will prevent further stoppages and how much the controllers will get.

In most businesses I know, particularly in these difficult times, workers are eager to get their hands on new technology, new processes and new computer programs which will make them more efficient and therefore protect their jobs. They don't demand extra payments for working the new stuff. They just get on with it.

But the air traffic controllers (and many other state or semi-state workers) are different. Efficiency doesn't matter because their factory does not close down if someone else is more efficient.

Not only that, but in the case of the controllers they are a monopoly. So they have the state -- and the rest of us on this island -- by the throat. That's why they get paid so much for work that, no matter how difficult John Cusack made it look in the movie Pushing Tin, is not nearly as complicated as they like to make out.

That kind of greedy, opportunistic, cynical attitude should have no place in Ireland today, given the challenges we face. But as I said at the start, this strike by our controllers is the perfect example of what's wrong here.

There is a disconnect between large groups of state workers here and the reality that workers in the private sector of the Irish economy now face every day. Private sector workers shape up and take pay cuts to survive.

Too many state workers in Ireland are overpaid, inefficient and ready to strike at the drop of a hat and screw up the country if anyone tries to upset their cozy arrangements.

Unfortunately, the air traffic controllers are not the only state workers who are getting ready to throw out the baby with the bath water. On Monday of this week workers across many areas of the state services -- civil servants in various government departments, nurses, teachers, prison staff etc. -- started a work-to-rule in protest against the modest cuts in their pay announced in the recent budget.

With reduced tax revenue due to the recession we can no longer pay state workers here the high salaries they negotiated during the boom. The government has to reduce the budget deficit or the country will go bust, and a large part of state spending is on pay for state workers. So there has to be cuts.

The pay cuts announced in the budget in December amounted to around one billion euro. In a desperate attempt to avoid these pay cuts, the unions offered to make up most of this by taking extra days off without pay.

This would be made possible by increased productivity, they said. They promised a "transformation program" for the way state services are delivered, aimed at big increases in efficiency saving huge amounts of money.

The government was skeptical, no deal was done and the pay cuts went ahead. And now the unions are saying that the "transformation" they offered, to improve efficiency, is off the table.
But what the rest of the workers in the economy want to know is why? In the private sector, increasing efficiency on a regular basis is accepted as essential in the battle to increase Ireland's competitiveness.

The state workers have admitted that they could be much more efficient, but now say they are not willing to co-operate with any transformation program. What part of WE CAN’T AFFORD IT do they not understand?

Before all this is over, we're going to be a very divided country, split between those on the state payroll and those in private industry. The airwaves were full of angry callers on Monday denouncing the public service workers and their work-to-rule.

The general view is that they are well paid, have cushy permanent jobs, with fantastic guaranteed pensions and that they should wake up to reality and share the pain being felt by everyone else.

Several commentators here remember what Ronald Reagan did some years back when he took on the air traffic controllers in the U.S., fired them and then rehired them at reasonable pay rates. A lot of people feel that the same strategy should be used here, if they strike again.

Apart from sorting out that particular problem, it would send a message to the rest of the state sector at the same time.

Ireland, the country of empty ghost houses

Time was in Ireland when we used to bring tourists to stay in haunted castles. These days we have haunted houses of a different kind, so-called ghost estates on the outskirts of many towns around Ireland. And they're not the kind of places that tourists would want to stay in.

The new ghost estates don't actually have ghosts. They're called ghost estates because they're empty.

They are the many developments of houses and apartments built during the construction boom here which now can't be sold. And they seem to be everywhere.

They vary in size from a few dozen houses to big estates with hundreds of units, but they all have the same look of abandonment, with unsold units, half finished units, estate roads that end suddenly in dirt tracks, and piles of rubble left behind when the builder went bust.

In many of them just a few units have been sold and the residents exist in a kind of zombie land, where they often have whole streets to themselves and the only life is the weeds growing up through the unfinished pavements.

At night they have an eerie atmosphere and little lighting. It's no wonder people call them ghost estates.

They're haunted all right -- haunted by the ghost of the Celtic Tiger.

I was at a funeral last week in Deansgrange Cemetery on the Southside of Dublin. We went slowly through Leopardstown Road and later on to Sandyford, areas that used to epitomize the affluence of the Celtic Tiger, full of new apartment blocks and swish office towers with modern architectural flourishes. These are the places where people thought nothing of paying half a million for a large apartment.

We passed blocks of apartments which were almost empty, and office blocks which were completely empty and had tattered. “To Let” signs across their facades.

It was clear these apartments and offices had been unoccupied since they were built a year or two ago. And this was on the fashionable Southside of Dublin, where property once seemed like a no-brainer for the investor.

It's as bad on the unfashionable Northside of the city. A few miles in from the coast where I live is one development that typifies how crazy it got here during the boom.

A vast billion euro development of hundreds of houses and apartments, it's called Belmayne. It was launched a few years ago at the height of the property boom and attracted a lot of attention because of the sexy advertising used to suggest it was offering a sophisticated new lifestyle, in which leggy models would be draped all over your furniture.

What it actually offered was a home in a bleak area close to the M50 beltway around Dublin beside some of the most deprived housing estates on the tough Northside of the city (where there was another murder last weekend). They did sell some units -- and then the property crash kicked in.

Today just 40% of the planned 2,650 houses and apartments are occupied, even though parts of the estate were completed more than two years ago. The builder is bust and the bizarrely named Belmayne may never be finished properly.

Families who bought there have few of the facilities they were promised. Investors are letting to out of work immigrants at minimal rent.

Prices have almost halved, and everyone is deep in negative equity. It's only half finished and it's a sad, lonely place to visit.

There are smaller but similar new estates not just in Dublin, but in all the cities and many of the bigger towns around the country. The problem is particularly bad in towns within a couple of hours commuting distance from Dublin. There you find forlorn, empty estates of houses in what was farmland around these towns.

Even worse -- a real sign we went crazy -- apartment blocks were built on the edges of these sleepy towns and villages even though there was plenty of land around to build houses. Why? Because the developers could make more money from apartments, and there were enough Celtic Tiger cubs commuting from Dublin to buy them at a quarter of a million each.

Until the crash, that is. Now they are all ghost estates haunted by the ghosts of the construction bubble.

How many houses in Ireland are lying vacant? The latest figures show that there's nobody living in 18% of all the houses in the country -- almost one in five. And the problem is getting worse, as about 500 new homes per week are still being added as developers complete some estates in better areas.

These new homes in mature areas with good facilities will eventually sell. But the vast backlog of unsold units in unwanted areas in cities or remote country towns will never sell, or at least not in the foreseeable future. In some places they are thinking of knocking them and returning the land to farming.

In many commuter towns there are other problems because the local councils won't take over the estates to provide street lighting, sewage connections and other public services, until the estates have been completed in accordance with the planning permission. In many cases the builders have gone bust and residents are left in half finished estates with no services.

In some apartment developments in Dublin and other cities where a lot of the units are unsold, residents find that they are being loaded with management charges for the whole building, or that maintenance is not provided at all and their development soon starts to deteriorate.

It's a mess. And it's a mess with no solution in sight because in spite of some efforts to talk the market back into life, the reality is that the overhang of unsold units will last for four or five years, and in the meantime property prices will fall even further before they start to stabilize.

For most of us who bought our houses 10 years ago or more it's not a problem. It simply means that our pile of bricks is now worth quarter of a million instead of half a million, which is still a lot more than we paid for it.

The people who are really screwed are the younger ones who bought over the past two to four years when the bubble was at its biggest, and they paid half a million (with a mortgage) for a home that's now worth quarter of a million. These young couples work around the clock to pay their negative equity mortgages and pray they don't lose their jobs in the recession.

What all of this means is that the property market is unlikely to recover any time soon. And it's not just domestic property that has collapsed.

The commercial property market -- office blocks, shopping malls, industrial estates, hotels and so on -- has fallen just as much and has a similar overhang of unwanted and unoccupied buildings. The recession has hit commercial property hard.

It's worse here than elsewhere because during the Celtic Tiger madness we built far too much of it. Some estimates are that we have around 40% more office space than we need -- a recent survey revealed that Dublin has the highest percentage of vacant office space of 22 European cities.

And the tax driven incentives to build hotels mean that we now have an estimated 12,000 hotel rooms more than we will need even if tourism grows strongly. That's a lot of hotels we need to close down. One high profile hotel on Dublin's Southside closed a week ago, and others will go the same way.

The collapsing property market has, of course, almost wiped out the Irish banks, which had to be saved by the Irish government. It's also wiped out some of the country's biggest developers, the billionaire boys who got unimaginably rich through the construction boom, thanks to the easy credit the banks gave them.

Some of them were foolish -- or crazy -- enough to have given personal guarantees, and they now face losing everything as their former buddies in the banks turn nasty.

One of them was on the TV news here last week, a broken man admitting that he had misjudged the market and that he was now broke. He's not the only one. About half a dozen of these tycoons are in the same boat, having paid hundreds of millions at the top of the market to buy sites and build apartment blocks and housing estates that now cannot be sold.

The banks are likely to pursue them for their personal assets where they can, even though that will recoup only a fraction of the billion or so that some of them owe. Some of them could even lose their homes as well as their limos. How the mighty have fallen.

News / 300,000 houses lying empty in Ireland, including 200 'ghost estates' / Click here

News / House prices at record low in Ireland / Click here

The boom to bust decade

Greetings from the North Pole. Well, not exactly, but that's what it feels like.

For the past two weeks Ireland has been in the grip of a weather system from Siberia that has seen temperatures sink as low as minus-14 Celsius. For the past few nights, for example, it's been minus 9 or 10 across most of the country, with sleet and snow adding to the misery. And it's forecast to continue for another week at least.

We're not used to this so we don't know how to cope with it. In fact we've not really had much snow -- there's only an inch or two on the ground in most places. Yet the country has ground to a halt.

We're running out of salt and grit to make the roads passable, schools have closed for the first three days of this week, and the airports have been forced to shut several times over the past week for a few hours. And all this because of a few snow showers that would hardly be noticed in New York or Chicago.

As I said, we're not used to it (the last time we had a cold spell this bad was decades ago). So local councils here are never prepared. And the furious public have been blaming the government.

If Taoiseach (Prime Minister) Brian Cowen is feeling paranoid who could blame him? Even the weather is against him!

There was further bad news over Christmas -- on a much more serious note -- with the shocking news that the Minister for Finance Brian Lenihan has been diagnosed with cancer of the pancreas, one of the worst cancers you can get. He began chemotherapy a few days ago and has the good wishes and prayers of the whole country behind him.

Obviously this is a terrible blow for his family, but it is also a serious blow for the country since he is seen as the only politician with the requisite ability and courage to get us through the catastrophic economic mess we are in. He says he intends to continue working while undergoing treatment, but it's not going to be easy for him.

Added to all that has been the relentless recession, deeper here than in any other European country, with retail sales way down over the holiday period and unemployment numbers again rising. The very latest figures here show that one in every three males under 25 is now on welfare.

So it's been a miserable Christmas. But this being the first issue of the Irish Voice of 2010, it's time to look back beyond Christmas to review the past year and add up the national scorecard for 2009.

And yes, it's a big F -- F for Fail or Flunk or whatever you guys call it over there. It's been a year when not only the Irish economy but the Irish state came very close to total failure, to complete collapse.

This is also the start of a new decade, so it's appropriate to look back over the last decade in Ireland. In fact it's necessary to do so to see how we got ourselves into the mess that reached crisis point over the past year.

By any measure, 2009 was an extraordinary year here, and the 2000s (the noughties) were an extraordinary decade. The decade saw monumental changes, more than in any other recent decade.

I don't say that lightly. I've been working as a journalist since 1970, which is four decades ago now, and the changes we have seen in the past decade are on a different scale.

The noughties saw Ireland emerge as a place where everyone seemed to have a second home, or an apartment in Bulgaria, an SUV, a massive flat screen TV, kids in fee paying schools and a few hundred euro to spend on an average night out.

The Irish economy, once the poor man of Europe, heated up so much we were growing at 9% or 10% a year when even Germany and the U.S. could only manage 2% or 3%.

It was mad, of course, but it was a divine madness. Two or three foreign holidays a year, so what was not to like?

And as we lay in the sun we calculated how much our houses were increasing in value every year. Perfectly ordinary family homes in mature areas around Dublin were suddenly worth a million. We were all millionaires!

Everyone was swept along, from the CEOs on their million-plus salaries to the blocklayers and plumbers who would not take a job for less than a thousand a week. After tax.

It was crazy, but we did not call it that. We called it the Celtic Tiger.

I do remember writing here a couple of years back that it seemed strange that the economy was still booming even though we were losing all our manufacturing jobs to cheaper countries. I particularly remember commenting in this page about the absurdity of a property boom in which we were building thousands of new homes to sell to immigrants who were coming in here to work in construction. It was a bubble and most people knew it, yet we clung to the hope that we could keep blowing it up without it bursting.

It was a decade of greed and stupidity, and looking back now it's extremely embarrassing. We can blame the U.S. for letting Lehmans go under, we can blame the global financial collapse, we can blame the Man Above, or right now we can blame even the weather.

But there's only one place the blame needs to go, and that's right here. The reason the collapse is worse here -- much worse -- is because Ireland was more stupid and more greedy than anywhere else. And over the past year we have started to pay the price.

We will go on paying the price in 2010 and for at least another two or three years into the future because that's how far things have got out of line here and how long it will take us to readjust. There are big two problems, our lack of competitiveness and our budget deficit.

Government spending here soared during the Celtic Tiger as the boom brought in massive tax revenue. Now that our property bubble has burst and our economy has tanked, tax revenue has collapsed so that it covers just over half of government spending.

Getting that back under control meant huge cutbacks in state spending in the recent budget, and there will be similar cutbacks in the next two budgets. That impacts on state services and will be felt by everyone here as a noticeable reduction in our standard of living.

One of the problems in getting state spending back under control is the huge jump in unemployment (now up to 14% and still rising) which is putting so many people on welfare. And that is related to something else that happened here during the Celtic Tiger years -- our serious loss of competitiveness.

Pay rates and salaries soared during the boom and that fed into the cost of everything else here, from the coffee you bought on the way to work to the electricity used to power your computer or your cement mixer. We went from being a hugely attractive country for multinational companies to set up in, to one where everything was ridiculously expensive. Manufacturing, transport, the general costs of doing business here all went haywire and multinational -- and Irish -- companies reacted by shifting their plants abroad. Many of the high profile cases -- like the loss of the huge Dell plant in Limerick or the decision to manufacture "Waterford" glass in Eastern Europe -- were covered in this page.

But it wasn't just the high profile cases -- it was the ordinary manufacturing plants which closed down week after week, month after month as Ireland's manufacturing industries died. In the end we were left with a huge property bubble, which eventually burst.

Getting that competitiveness back is the biggest challenge that now faces us, both in 2010 and in the years ahead. If we can get that right, we have a chance.

If we don't, or won't, then expect to see many more young Irish where you are in the days to come. Happy New Year ... we hope.