“If you have ambition in Poland, you come to Ireland”

The old northern narrative that the Republic got rich purely on the consumption of large grants from the EU is long since busted, though sadly that is probably more true to Northern Ireland’s Peace Process™’s bias towards short term ‘keep the peace’ projects which by and large confer limited lasting value for the local communities invested in. Reuven Brenner with a breezy account of how they did it, and why being a favoured destination for ambitious immigrants is good for the country.

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  • seabhac siulach

    The jury, I would say, is still out on whether such a large influx of people (400,000 since 2004) is a good thing or a bad thing. We shall probably get our answer when the economy inevitably cools…GDP growth levels of 2% are predicted for 2008 (not the 5-6% of this year)…
    To talk of immigration purely in terms of economics (as most economists tend to do, naturally) is to ignore the other less benign aspects of such large population movements on many aspects of normal life: pressure on the health services, schools full of children with little or no english, pressures on houses prices, lowering of wages in the labouring/low-skilled sectors of the economy, etc. It is not all about cold GDP numbers and rates of growth…

    “…though sadly that is probably more true to Northern Ireland’s Peace Process™’s bias towards short term ‘keep the peace’ projects which by and large confer limited lasting value for the local communities invested in.”

    I have read through this sentence a number of times and it is still confusing me…

  • Little Eva

    Mick
    The Republic did get rich on large grants from the EU. It has been through the wise investment and management of those grants that they have managed to stay rich. They desrve all paludits on that score for good management and wise investment. Agree entirely with you on the NI thing regarding EU money being wasted on short-term value, keep-the-peace, community stuff.

  • Mick Fealty

    SS,

    May have been overstretching my syntax a bit, but LE covers it fairly well.

  • George

    Little Eva,
    over half of Ireland’s EU money went to the farmers. Ireland didn’t get rich on grants, large farmers did and others in the farming industry.

    Seabhac,
    They’ve been waiting 10 years for the Irish economy to slow down. There’s another line of thought out there (will try and fish it out later) that the boom (growth of 3-5%) will go on for the next 20 to 30 years.

    One of the reasons given is that Europe will continue to grow slowly (1-3%) so Ireland will continue to be the most vibrant economy and therefore will attract the best and brightest immigrants.

    If they are right, you ain’t seen nothing yet. Forget the Poles, we’ll be having German, French, Spanish and all kinds of quarters.

  • seabhac siulach

    “The Republic did get rich on large grants from the EU.”

    Yep, it was nothing at all to do with the low tax-rates, cutting public spending in the late 80s, providing free university education in 1995, etc., etc. All just a result of the 26 counties leeching EU money…it is so simple, when explained like that…those feckless paddies after all, surely couldn’t do it themselves, there must be another handy reason for how they did it…ah, yes, those famous’handouts’…the kneejerk, no thinking, simple (in all senses of that word) answer to how the 26 counties has become one of the richest countries in the EU (world). Truly, a lie repeated enough can become the ‘truth’…
    Unionists should keep repeating this ‘lie’ if it makes them feel better, at the same time, the 26 counties will continue on its own upward course, oblivious to the snide comments of Northern begrudgers who might be coming to realise that they have backed the wrong horse…

  • slug

    Speaking as a unionist, economic success in the Republic, and huge massive numbers of people moving in there from outside, are good things. May it last as long as possible sez I. The last thing NI needs is for the ROI to do what Germany and Japan did, namely go into 15 year depressions. We in NI now experience positive benefits and spillovers from having next door the wealthiest and most productive per capita nation on planet earth. It’s also very good in terms of having a challenging and relevant benchmark – raises our own expectations of what we should be aiming for.

  • Mick Fealty

    ss, there is plenty in that article with which bat the EU largesse ‘argument’ back, without getting hot under the collar about ‘northern begrudgers’…

  • Brian Boru

    “Ireland’s population increase is due largely to the influx of low- and high-skilled immigrants. Combined with a significant inflow of capital, this open-door policy has not led to any of the forecasted negative effects that are now at the center of the heated immigration debate in the United States. The unemployment rate in Ireland is now about 4.5 percent; it was in the 15 percent range in 1993. As noted, the country has become much richer, too.”

    I resent yet again being told that there are no disadvantages to immigration, and having the 4.5% figure repeated. The reality – as mentioned by Pat Kenny recently – is that unemployment has gone up around 5,800, but the rate has remained 4.5%. Contradictory? Not when you consider job-displacement of the Irish. The figures do not mean that 4.5% of the labour-force of Irish-origin are unemployed, but rather that 4.5% of the whole labour-force (Irish and non-national) are unemployed. I contend there is displacement going on, most notably in the hospitality and food-sectors, and an AIB report (I am pretty sure) some time ago focused on employment trends on a sectoral basis seems to confirm this.

    “The Republic did get rich on large grants from the EU.”

    Actually a lot of Southerners believe that too, but they are wrong. Most of the cash went to farmers, and considering agriculture is now only responsible for 8% of our exports and around 4% of industry, I think it beggars belief to argue that current economic prosperity is a result of EU subsidies to the agriculture industry. Remember that 20 years after EU membership, we remained an economic backwater by Western standards. This only changed with economic-liberalisation in the late 80’s and 90’s, notably the 10% corporation-tax rate, privatisations, tax-cuts, greater trade-union restraint (with some notable exception), and national-wage agreements that helped get industrial peace. But to argue that we got here on the basis of handouts is something I find quite offensive, as it implies we are too stupid to make a success of our economy ourselves and need to be spoonfed – sortof like the theory from the imperialists that Irish people were ‘too stupid’ to run their own affairs. We got here through our own efforts and imagination, and a gradual move away from failed Socialist economic models.

  • seabhac siulach

    Mick:

    “ss, there is plenty in that article with which bat the EU largesse ‘argument’ back, without getting hot under the collar about ‘northern begrudgers’…”

    More than tired of hearing the same old line trotted out, that’s all…
    Ever so slightly bordering on racism, if you ask me, this continuing need to ‘explain’ the success of the 26 county’s economy in terms of outside agents, in particular EU money (a line frequently bandied about in the right-wing British press and, it would seem, from this site at least, among unionists)…at it seeks to deny to the 26 counties (and its people) the kudos it rightly deserves in developing its economy on its own, and on its own merits…

    Should we perhaps also attribute the German and Japanese economic miracles of the 1950s merely to US (Marshall plan in the case of Europe) money? That would be the ‘simple’ thing to do…

    In which case, why did not more countries show the same economic success, countries that also received this money, if not more? Note that both France and the UK received the largest amount of aid;
    http://en.wikipedia.org/wiki/Marshall_plan , perhaps something most people don’t realise.
    Obviously, there are always other factors at play (including the Unions, tax, education…) that influence an economy’s development and that merely throwing money into a bottomless hole, as the six counties should more than eloquently prove, is obviously not the way to create a strongly growing economy.

  • Brendan

    If you are asking about handouts : the occupied 6 counties receive more “donations” from England annually than are taken in tax from all the tobacco sales in Britain.
    Thats pretty unsustainable (especially if Europe ban tobacco altogether) and a bit 19th century colonial thinking in my opinion.
    A united Ireland will be more than capable economically of supporting the extra population, but with a massive reduction in the state quangos and jobs-for-the-boys that exist in that part of Ulster.
    This will be replaced by real jobs in private companies that will flood in for the relatively low wage and highly educated young people. As we have seen in the Republic since 1990.

  • Rafa Benitez

    “Not when you consider job-displacement of the Irish.”

    God I hate xenophobia. The only people I ever hear shouting about ‘for-in-neers, stealin’ our jobs’ is usually from people who don’t work anyway (present company excluded).
    If a person is not qualified enough to hold the job and a more qualified person, regardless of their nationallity, comes along, then they should get the job. If companies are going to continue to operate here, then they will require a pool of talented individuals to pick from. Nationality is irrelevent in this case. High skilled employers are more concerned with skill matrixes and experience than wages.
    In the case of low skilled jobs, if a company has a choice of cutting expenses and moving to Poland, or staying put and hiring Poles here, I’d rather the company stayed here.
    Low wages paid to foreigneers are helping to keep inflation from going off the wall, and keeping low skilled services cheap and affordable to all. Obviously there are cases of employers taking the mick (or Mikeal instead of the mick in these cases)and taking liberties with screwing everyone for a quick buck, but these cases are in the minority and proper use of the law will sort them out.

    George,

    The French are already coming here in their droves. I heard of one ‘Irish’ company which as set up by a Frenchman to provide support and services in France. Because of the unfriendly nature of French labour laws towards start-up businesses, he set up shop here, and advertised for employees in France. He gets over 200 C.V.’s a month from France from people who want to come here and work. I read this in an article a while back, so any specific details have long dissappeared from my head. Sorry.

  • DK

    Thought for Unionists and Republicans: The immigrants to ROI and NI are unlikely to have any interest in reunification, especially as they have chosen the country as is – why act to change it and potentially jepordise your future?

    Why then are Sinn Fein (apparently) in favour of immigration, while Unionists (generally) aren’t. Surely it should be the other way round!

  • PaddyReilly

    Why are Sinn Fein in favour of immigration and Unionists not?

    The majority of immigrants are Poles, and practising Catholics. While initially quite uninterested in Irish politics and intending to return when they’ve made their pile, in the long term such as stay on will intermarry with the locals of the same hue and be drawn into their political nexus.

  • Crataegus

    Mick

    I agree with much of that, but I think there were other factors such as the relatively competitive cost of labour in the late 80’s, English speaking and reasonably well educated, but also don’t underestimate the importance of dubious liberal planning criteria, which turned pieces of turf into substantial assets. I am convinced it played a major role in increasing locally owned wealth. You need wealth and assets to move forward. Grants did play a very small part but it would be impossible to show causation.

    With regards

    The harder part is to attract and retain talent. Ireland succeeded not only because of its fiscal changes, but because the country embodies the Western tradition of openness to many tribes.

    timely reminder given current political debate.

    You mention NIs dismal peace dividend expenditure, any fool could see that the projects were generally poor value and of dubious long term benefit. At the time I complained about many, and few wanted to hear because there were many vested interestes.I think the Flax Centre about typifies it. I have no idea how many millions were poured in there theatres and all, and if my information is correct it has now been purchased by a property developer for apartment development. What long term gain?

    There was an obscene industry built around acquiring grants whose purpose seemed to be next year’s salaries for staff. I can remember being invited to some of the proposals to show private sector interest and noting how many well educated people were milking the gravy train and importantly how many people were employed directly by the funders. I often wondered what percentage of the grants went on administration and what was the cost of the time put into all the projects that did not fit into whatever criteria or did not receive match funding and failed along the way. An obscene waste of time and money and we still haven’t learnt.

  • Greenflag

    Brian Boru,

    ‘as it implies we are too stupid to make a success of our economy ourselves and need to be spoonfed – sortof like the theory from the imperialists that Irish people were ‘too stupid’ to run their own affairs. ‘

    Indeed BB . We have seen a reversal in the last 60 years all over the world in the outdated imperialist based beliefs that you had to be either white , protestant and european or american to be able to a) rule your own country and b) enjoy sustainable economic growth .

    Taiwan and Ghana had the same GDP per person in 1960 -Today Taiwan’s is 20 times that of Ghana

    Zimbabwe (Rhodesia ) had a GDP per person figure 5 times that of Botswana in 1980 . Today Botswana’s GDP per person is 12 times that of Zimbabwes if not more .

    Other comparisons such as West Germany v East Germany , South Korea v North Korea , Dominican Republic v Haiti , Costa Rica v Nicaragua all show the pervasive effect on economic development of having either the right kind of politics or the wrong kind . What works as opposed to what does’nt .

    In 1970 the Irish Republic had a GDP per person approx 70% of that of Northern Ireland . Today that situation has reversed so that GDP per person in the Republic is approx 180% (almost double )that of NI .

    Surely this has to be because the Irish Republic is predominantly Catholic right 🙂 ? Well based on the ‘imperial’ mindset anyway . Doesn’t explain China or India mind you . Maybe it’s because they’re not Protestant either ? But then there are the Danes who are predominantly the latter ? Could it be that the imperialist thought mode got it wrong ?

    The truth is that that there are as many factors which impell economic growth as there are factors which cause a reverse in economic growth .

    It seems to me from looking around the world that each country /region /state has to work with what it has in terms of resources (natural , capital and human) and then devise the correct mix of practical economic policies which impells development and also chooses the type of politics which can sustain that development .

    In addition this has to be done in world which is now going through an ‘information’ revolution which IMO will have a far greater impact on the world (politically and economic) than the Industrial Revolution did .

    Re NI – Hanging on to the present economic and political status quo is just a recipe for remaining stuck in the same mess.

  • Greenflag

    Crat,

    ‘An obscene waste of time and money and we still haven’t learnt. ‘

    I can believe it . Economies which are largely public sector dependent are prone to the ‘obscenity and waste ‘ you mention . Just to assure you that NI is not alone in this -Puerto Rico is another example .

  • Greenflag

    Forget the Poles,

    I would’nt . They have personal experience of what it’s like to live in a communist paradise .
    In addition recent Polish history from 1790 has many parallels with Ireland’s experience . They also have a sense of humour .

    Poland 1987

    A Pole goes into a Warsaw bank .

    ‘I have 100 zlotys and I don’t know where would be the safest place to put them ‘?

    ‘Put them in our Bank ‘ says the bank clerk.

    ‘But what if the Bank crashes ?’ says the Pole .

    ‘If the bank crashes then the bank administration guarantees to refund your money’ says the clerk

    ‘What if the Administration goes bust?’

    ‘Then the Polish Ministry of Finance guarantees to return your money’ says the bank clerk.

    ‘What if the Finance Ministry goes bust ?

    ‘Then the Polish Government guarantees to efund your money ‘ says the bank clerk now getting irritated .

    ‘But what if the Polish Government goes bankrupt?’ says the Pole ”

    ‘Well , in that case the friendly Soviet Union guarantees the return of your money ‘ says the bank clerk

    ‘And what if the Soviet Union goes bust?’

    ‘You don’t mean to say that you’d begrudge 100 zlotys for that ‘ says the bank clerk !

    Update 2006-

    The Soviet Union did go bust and the Polish Zloty has been appreciating in value. And the Pole is now earning Euros in Dublin . What a difference 20 years can make . Except of course in NI 🙁