Ireland as a model for other European States?

Following on from Re-visiting his previous article, Tom Friedman in the NYTimes, has another go at the same point.. Follow the Leapin’ Leprechaun. He argues that Ireland [and the UK] have an social-economic model that German and France should adopt – “One of the first reforms Ireland instituted was to make it easier to fire people, without having to pay years of severance. Sounds brutal, I know. But the easier it is to fire people, the more willing companies are to hire people.” Update Crooked Timber takes issue with Friedman’s analysisInterestingly, the CEO he quotes lists his reasons for investing in Ireland in a somewhat different order than Friedman did, and misses the free education angle –

Harry Kraemer Jr., the former C.E.O. of Baxter International, a medical equipment maker that has made several investments in Ireland, explained that “the energy level, the work ethic, the tax optimization and the flexibility of the labor supply” all made Ireland infinitely more attractive to invest in than France or Germany, where it was enormously costly to let go even one worker.

But I can’t help questioning Friedman’s seeming reliance on quotes from current Irish Government Ministers –

The goal, added the minister for enterprise and trade, Micheal Martin, is to generate more homegrown Irish companies and not just work for others. His ministry recently set up an Enterprise Ireland fund to identify “high-potential Irish start-up companies and give them mentoring and support,” and to also nurture mid-size Irish companies into multinationals.

And by the way, because of all the tax revenue and employment the global companies are generating in Ireland, Dublin has been able to increase spending on health care, schools and infrastructure. “You can only do this if you have the income to do it,” Deputy Prime Minister Mary Harney said. “You can’t have social inclusion without economic success. … This is how you create the real social Europe.”

Perhaps he should include a comparison with the refusal to countenance a review of the Common Agricultural Policy at some point?

Update Henry, at Crooked Timber, has this to say on Friedman’s argument –

As already noted, Ireland isn’t necessarily the best example for big industrial economies to follow; but insofar as it does set an example, it isn’t the kind of example that Friedman thinks it is.

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