Why Ireland’s economy may not be sc*wed but its newspapers may be…

On Wednesday night, I took part in an experiment the results of which may indicate that the Irish economy is not entirely screwed, but the Irish newspaper industry just might be. McConnells advertising company invited an irregular bunch of Irish bloggers (to declare an interest, in my case they paid for my flight) to the offices of the IDA to meet and be briefed by their polymath CEO, Barry O’Leary on the IDA Ireland’s new US ad campaign in the States.

The IDA in Dublin have been running smart campaigns for years now. Back in the 1980s they ran an ad across the US which ran “The Irish: Hire them, before they hire you…” Now the emphasis is on human capital, and innovation. Despite Mairtin’s understandable frustration at Northern Ireland being left out of the big Diaspora do at Farmleigh House on Friday and Saturday, one of the reasons the Republic can pull in such fire-power is the way organisations like the IDA continue to track down anyone in a senior corporate position that’s even remotely smells Irish, and keep in contact in a fairly relentless manner. Over the years a certain dynamic has grown around rounds of Foreign Direct Investment; with local talent rising through the ranks in Ireland, hitting senior management in the states and with some returning to set up their companies back home. On Thursday when they launched their latest €2 million ad campaign, it seemed the pre-occupation of the press with the wider distress of the country meant that Mary Coughlan’s Einstein gaffe the official press launch on the following day was all that got through to the papers…

Not terribly surprising since the only people in the audience who asked any questions, myself and the guy from PA, so I suspect Senan Moloney’s Coughlan riff (which made the Irish Independent’s front page splash) was written off the back of the PA reporter’s sharp-eared account of the proceedings. I stopped asking after my third question, since it was getting a little embarrassing.

The crisis, the Nama debate, the government deficit and the consequent McCarthy Committee Report, the Tax Commissioners, and the fear amongst political and media insiders that a comparatively impoverished No camp are going to run Lisbon very close this time is creating a bad news aura around Ireland in the States. Some IDA officials say that in some cases the first 20 to 25 minutes of any conversation with a senior industrial player in the US is taken up with ‘bad news from home type”.

It’s hardly surprising. An excellent report prepared by the Ireland Fund for the Farmleigh forum does not pull its punches:

* There has been a steep rise in unemployment rates: June 2008 – 5.9 per cent, June 2009 – 11.9 per cent. In 2008 youth unemployment increased by 87 per cent. The number of persons on the live register rose to 418,592 in June 2009

* Unemployment may exceed 17 per cent by the end of 2009 house prices are back to levels last seen five years ago with average national prices falling by 10.9 per cent in the year to May 2009
In 2009, our national deficit of €14.7 billion was the highest ever

* The national debt was €65 billion at end of the second quarter of 2009

* The Irish Government has taken €45 billion off its estimate for economic activity for the next 3 years Ireland has the fastest growth of personal debt in the industrialised world. In the mid-1990s the
average debt as a proportion of household disposable income was 48 per cent. This has risen to over 180 per cent

* Irish exports fell by €6 billion in 2008

* Overseas tourists were down 3 per cent in 2008 – the first drop in 7 years. Up to 25,000 tourism jobs were lost in 2008.

And, to boot, there has been a drop of 30% in FDI globally in the last year. Grim stuff.

But both the Ireland Funds’ report and the IDA argue that these are the primary conditioning factors for the short term. An IDA spokesman told Slugger that in the last two quarters of 08/09, no senior businessman was prepared to put his head above the parapet, but that in first quarter of this year they were starting to take calls and talk cautiously about development plans going forward. The glacier may be just be beginning to move.

FDI still accounts for 60% of Ireland’s total exports. There are 150,000 people employed by the companies that are on the agency’s books… And it provides a huge draw for overseas talent in companies like Facebook and Google, where there are estimated to be 48 native languages spoken by its employee.

And there is some evidence that incoming firms are starting to move up the food chain: or in the jargon from technology transfer to knowledge transfer. It’s understood Merck is currently spending €300 million on vaccines development facility in Carlow. That’s high end R&D, rather than manufacturing.

It strikes me that the IDA do simple things well. With just 34 employees in the US, much of what they do is look for Irish names in senior executive roles corporate America and cold call them, then set up communications channels and then crucially keep them open (76% of their business is with existing clients).

Time will tell if the Farmleigh event is a Diaspora world shaker, or a one off media stunt. Mairtin’s frustration is understandable. Not least since some of the good will shown by corporate America towards Ireland generally, has its basis in the success of Northern Ireland’s Peace Process.

But the success of that process has been replaced by the serial failure of the local political process, and more importantly the failure of Northern Ireland’s politicians to strategise with the instruments and resources they already have (think InvestNI and SIB).

So why do I think newspapers are screwed; especially since my colleague from PA spotted Coughlan’s gaffe when I didn’t?

Well, the gaffe was a good catch, but by no means all of the story. The bylined journalist from the front page story does not appear to have even been in the room. His ‘account’ was a good blog riff, on the basis of someone else’s (albeit paid for) legwork. Catching the Deputy PM blagging on a smart economy, is one thing, but informing citizen’s about that what’s actually being done is quite another.

I understand the economic reasons why newspapers adopt this ‘apparition strategy’ in such fuzzy, messy and difficult-to-manage world. But it seems to me that with the exception of some high end financial journalism, companies, political parties, and civil society organisations might be better off heading down the citizen journalism route, rather than taking a risk on trying to catch the attention of the pre-occupied, overworked, overstressed generalists of the mass media.

It will inevitably lead to some bumpy rides, but we already know that the ‘dodgy’ Wikipedia has developed a seemingly endless capacity to get into areas that the ‘respectable’ Encyclopaedia Britannica just can’t…

In a world where the Sun Newspaper has made its showbiz columnist it’s new editor, the newspaper is becoming so intent on entertaining it has no time (or space) to get serious about what actually affects a nation’s citizens… Fair play to the IDA for adopting an innovative comms strategy to launch an ad campaign about, er, innovation…