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Thanks, Keith. I'm beginning to wonder if
the EU, as it now exists, can really hold together. Diverse histories,
languages, ethnicities and ancient grievances - can they really be expected to
remain submerged under a sense of a common European
identity?
Ed
----- Original Message -----
Sent: Friday, May 27, 2005 7:11 AM
Subject: [Futurework] More on
Ireland
In a posting of yours which I didn't reply to you
raised the subject of Ireland* and its jobs. You might be interested in the
following which is by way of an insert in a larger article about the European
Union and the increasingly parlous state that three of its major countries --
Germany, France and Italy (the last particularly) -- are now in. Ireland is
the only exception to an overall state of quiet desperation in Europe as to
when its economies are going to pick up. (And England is an exception, of
course, at present. Although we're technically in the EU, we don't have the
euro and, psychologically, we don't really think we're an EU country
anyway.)
(*We're talking of the independent Irish Republic here, not
the six counties of Northern Ireland which is a UK province without a
government for the last few years, occupied by British troops and even without
a practising police force for half its [Catholic] population -- where the IRA
and Sinn Fein keep the peace and where the crime rate is almost nil compared
with the drug-gang ridden policed parts of Protestant Belfast.)
If (and
when) the EU explodes politically (I would give it no more than 5 years now)
then I reckon that Ireland will perhaps join us and the Scandinavian countries
in a new North European Free Trade Area. There are already great political
tensions. The older EU countries don't want to give up their farming subsidies
to the 10 new countries that have just joined. Germany is tieing itself
significantly to Russia in trade deals for preferential energy supplies.
Illegal immigration is increasing mainly through Italy and Spain which seem
incapable of stopping it. And France, from all accounts will be voting No on
Sunday to the new proposed European Union Constitution (283 pages of it, so
help us -- even one French politician who is urging voters to vote Yes
confessed the other day that he hadn't read it yet!). Talk about the Bush
administration being confused, it's just as bad over
here!
Keith
<<<<
HOW IRELAND FREED ITS
ECONOMY
John Murray Brown
When Digital closed its mainframe
computer factory in Galway in April 1994, it seemed like the end of the world
for this city in the west of Ireland.
Today, Galway is again a buzzing
commercial and industrial centre. It contains one of the world's largest
clusters of medical device manufacturers, and many of its companies are headed
by former Digital employees.
Galway's ability to reinvent itself
illustrates the way Ireland has been able to weather economic storms, moving
steadily up the value chain as low-cost manufacturers move to cheaper
locations overseas. According to the Industrial Development Agency, the
government body that promotes foreign investment in Ireland, there are now 28
medical device companies in the Galway area, 15 of them locally owned,
employing a total of 5,000 people.
What happened in Galway has been
replicated across the economy, as other foreign companies have set up,
attracted in large part by a young, well-educated workforce, many with
experience of working abroad. In the last decade, it has been the Irish
working overseas in the world's big high-technology companies who have been
persuaded to return home. More recently, Ireland has seen an influx of foreign
nationals taking up jobs that the Irish will no longer do.
John
Fitzgerald, professor at the Economic and Social Research Institute, says:
"Ireland has not avoided the phenomenon of companies closing but all the time
the people have been able to find other jobs." Unemployment is at 4.4 per
cent, half the European Union average. Net immigration is about 30,000 a year.
Growth has resumed its strong upward momentum, with gross national product
projected at around 5 per cent for this year and close to 4 per cent for 2006
and 2007, still well ahead of its European partners.
A key ingredient
in Ireland's success has been the low corporate tax rates, which have been
attractive to foreign companies. Keeping corporate taxes low has had
cross-party support. And you will rarely hear an Irish politician, left or
right, question the value of capitalism, as recently happened in
Germany.
The hands-on approach of the government has also been vital.
"There is none of the policy inertia that you might find in larger economies,"
says Eamon Cahill, an analyst with Forfas, the government's industrial policy
body. Some experts trace Ireland's economic success back to the introduction
of free secondary education in the 1960s. The fiscal reforms of the late 1980s
provided the platform for the recent growth surge.
The labour force
increased in line with the 1980s baby boom, along with net immigration. With
the arrival of multinational companies, and as agriculture has declined, there
have been huge productivity gains. High productivity has meant that, although
wages have risen, unit labour costs have been restrained. A series of
centralised wage agreements has allowed the government to introduce flexible
working practices. In exchange for wage moderation, income tax was
cut.
Moore McDowell, professor of economics at University College Dublin,
says the Irish labour market is probably not as liberal as that of the UK. But
he says Ireland's real advantage is the "absence of restrictions on doing
business".
Employers are relatively free to hire and fire. Social
security payments - a burden for employers - are much lower than in other EU
countries. Mr McDowell also cites the relative powerlessness of the trades
union movement. "In reality, the union movement is almost a public sector
phenomenon. Companies like Ryanair and Intel will have nothing to do with
unions."
Financial Times -- 26 May
2005
>>>>
Keith Hudson, Bath, England,
<www.evolutionary-economics.org>
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