Paul Kearns
Forget the Celtic Tiger, Ireland is now a freeloading Celtic Cuckoo
Like the bird, it has become remarkably adept at prospering in the nests of others
You know you are skating on thin geopolitical ice when the Guardian, no less, criticises you for your derisory national defence spending, implicitly suggesting that, as a nation state, you are piggybacking on others’ efforts.
Welcome to Ireland’s Cuckoo Economy.
In recent years, Ireland Inc has found the economic sweet spot – as evident in its impressive GDP figures; Ireland, according to the World Bank, is apparently now wealthier than Norway or Switzerland.
The growing criticism, however – outside Ireland at least – is that Irish wealth is built on the backs of, or at the expense of, others.
Its security is, in effect, supplied by Nato. Ireland’s defence spending is the lowest in the European Union at just 0.2 per cent of GDP, less than one-tenth of that of its Nato neighbours.
Ireland’s very low and controversial corporate tax policy has attracted also growing criticism from its erstwhile friends and allies. Accusations of being an offshore tax haven or complicit in grand US corporate tax avoidance are not uncommon.
The underspending on defence alone, relative to the rest of its European Nato allies, amounts to a staggering €150bn (£130bn) over the past 10 years. Studies suggest Ireland attracts an additional €100bn (£85bn) annually in shifted multinational profits.
Someone else is clearly paying the price.
Some economists argue that Ireland has simply carved out a bespoke post-Celtic Tiger model that specialises in importing public goods and exporting taxable profits. A niche economy that serves its population well. It is, after all, a net contributor to the EU – some €1bn (£850m) annually.
Others might be less generous and argue that Ireland has constructed a free-rider economy par excellence. Like the cuckoo bird, it has become remarkably adept at prospering in the nests of others.
Fair enough. But a small country, especially a relatively geographically isolated and historically poor one, has to do what it has to do to generate wealth and, if it can, piggyback on the goodwill or public spending of others, as the case may be, so be it.
There is an obvious long-term risk to this geopolitical and economic strategy. It depends on the goodwill – arguably the indifference – of others.
With soaring wealth – on paper, at least – GDP per capita in the Republic of Ireland is now estimated at a staggering €113,000 (£96,000), more than twice that of the UK, at €49,000 (£42,000); that indifference is unlikely to last much longer.
Before people dismiss this as akin to what the New York Times once called Ireland’s “Leprechaun Economics”, it is worth noting that Irish public-sector salaries and welfare payments are generally higher than those in the UK. Whatever the creative accounting, Ireland is wealthy.
But the real risk in the transformation from the Celtic Tiger to a Celtic Cuckoo is when that successful arbitrage political economy – others might call it a beggar-thy-neighbour strategy – becomes wrapped in moralising hubris and sanctimonious sentiment. Bluntly, it’s harder for European allies to sustain a look-the-other-way attitude towards a nation which never stops lecturing everyone else about their moral failings.
The problem is not the moralising; it is the widening gap between Ireland’s increasingly elevated moral language and the messy realities of putting those principles into practice.
In the face of three years of Russian threats and aggression in Europe, Ireland’s president, Catherine Connolly, raised eyebrows during her election campaign when she compared a German desire to increase defence spending in the face of Russian aggression to Nazi Germany’s militarism, saying: “They’re absolutely championing the cause of the military-industrial complex in Germany, as a booster for the economy. Seems to me, there are some parallels with the 1930s.”
Connolly has since doubled down. In her inaugural speech, she summed up Irish hubris: “Our experience of colonisation and resistance, of a catastrophic man-made Famine and forced emigration gives us a lived understanding of dispossession, hunger and war, and a mandate for Ireland to lead.”
The president’s broad – and, it must be said, flattering – reading of Irish history, in which Ireland is cast almost exclusively as a victim of others, overlooks the country’s record of social oppression, institutional child abuse, censorship, political violence, sectarianism, and growing anti-Semitism.
To be fair, the Irish Prime Minister, Taoiseach Micheál Martin, has been quick to criticise Connolly in the past, accusing her of taking positions that risked damaging Ireland’s international relationships, warning that her comments on German rearmament would cause “serious damage”. Martin also rebuked Connolly’s comments on Hamas after she described the terror group as “part of the fabric” of Palestinian society.
Yet amid Russian threats and growing criticism from European allies, Foreign Minister Helen McEntee chose on her first day in office last November to prioritise, not the security of Ireland’s vast territorial waters, but the so-called Occupied Territories Bill, which proposed criminalising imports from Israeli settlements in the West Bank. The value of those settlement imports has recently been valued at €189,000 (£160,000). The bill passed this summer.
At times, Ireland seems a kind of theatre of moral absurdity.
The Football Association of Ireland (FAI), under threat of Uefa sanctions, refused to boycott Ireland’s upcoming Nations League fixtures against Israel but recently announced it will instead refuse to sell tickets to Irish supporters for the match. An Irish performative solution to an Irish moral problem.
But perhaps nothing better captures Ireland’s performative cuckoo moralising in its foreign policy than the recent viral story that, when purchasing a new €53m (£45m) Falcon aircraft to replace the government jet, Ireland requested that a piece of Israeli tech be removed from the plane, apparently compromising the plane’s navigation performance and its ability to land in dense fog.
Ireland may yet one day rue its decade-long habit of selective blinkers.