The Princeton History of Modern Ireland

TWENTY-FIRST-CENTURY IRELAND

Diarmaid Ferriter

THE FIRST DECADE OF THE twenty-first century in Ireland witnessed significant economic, social, and political optimism, ultimately overtaken by a calamitous crash that by the end of 2010 left the Irish Republic bereft of meaningful sovereignty and reliant on bailout funds to finance the state. It was a decade of economic expansion, relative peace, and stability, but also of greed, revelations of historic misdeeds and abuses, severe incompetence in governance, and failures in financial regulation.

Prior to the economic crash, some historians tentatively sought to assess the impact of the transformations witnessed during the economic expansion (the “Celtic Tiger” period) of the mid-1990s to the mid-2000s in a state long accustomed to economic malaise. The big changes that had evolved from the 1970s, according to Roy Foster, were “perhaps decisively and forever … a question of attitude,” and he traced these shifts through economics, politics, the decline of religion, women’s liberation, the cementing of partition, and the impact of Irish literature. Whether the collective transformations represented Ireland’s Great Leap Forward or were the product of a series of interconnected crises, he decided, it was too early to conclude.1

Foster’s assessment is a reminder of the perils of contemporary history and the obvious caution that is necessary in drawing conclusions about recent events due to the lack of source material and perspective. This is an even more salient point now, as the convulsions since 2008 have added more complexity and layers for historians and analysts to sift through to grasp the essence of the Irish experience. But it can be fairly asserted that the following themes should loom large in any attempt to understand Ireland in the twenty-first century so far: politics, the Celtic Tiger economy, the Northern Ireland peace process, the fortunes of the Catholic Church, the Republic’s relationship with the European Union (EU), and the economic collapse and its consequences. This chapter deals with each of these themes in turn.

POLITICS

The last general election of the twentieth century was fought in the Republic in 1997, largely on the grounds that excessive taxation of middle-class incomes was an unacceptable form of persecution, and this issue was to dominate political thinking and strategy for the next ten years. In terms of party politics, no ideological reasons prevented all the main political parties from serving in a grand coalition; there was little debate concerning equality or redistribution of wealth, but rather a preoccupation with who could manage the wealth most effectively to benefit the middle classes. Fianna Fáil (FF) won the 1997 election, but to govern, it needed the support of a smaller party, the Progressive Democrats, which championed a deregulated economy, low personal taxation, and social liberalism. Five years later, campaigning during the 2002 general election, the leader of the Progressive Democrats, Mary Harney, suggested “the country cannot afford a lurch to the left,” which was a reaction to the Labour Party’s promise to improve public services.2

Two years previously, Harney had made a speech at the Law Association of Ireland in which she addressed the issue of fiscal restraints being imposed by the European Central Bank and concluded defiantly: “Our economic success owes more to American liberalism than to European leftism … geographically we are closer to Berlin than Boston. Spiritually we are probably a lot closer to Boston than Berlin.”³ These words entered the Irish political lexicon as a shorthand for a battle of ideas, but in truth their significance was more because the notion of addressing political philosophy was not part of mainstream Irish political discourse. Bertie Ahern, for example, leader of FF from 1994 to 2008, and electorally the most successful politician since Éamon de Valera in the 1930s and 1940s, made it clear in his autobiography that he was hostile to the notion of ideas in politics: “I kept my appeal very simple … I would turn up at Supermarkets, to flirt with the housewives and joke about football with the husbands.” For him, the oldest rule in politics was that “the other lot are the opposition but you actually find your enemies on your own side … from the moment I won in 1977 the only plotting I was doing was about how to hold on to the seat at the next election.”⁴ On such sophisticated foundations was built the career of a three-time prime minister (1997–2008). But it was also built on short-termism, accompanied by “an almost manic desire to cultivate … a myriad of constituencies,” and

for all the economic and political successes of the government, it never articulated a vision of what it was all for…. Showtime politics was ruled by the electoral cycle … everything—policy, economics, government personnel and coalition choices—was subjected to the overwhelming importance of maintaining power. It was the retention of political power above all else to which Bertie Ahern’s Fianna Fáil was dedicated.5

This did not mean that the opposition parties, including the largest, Fine Gael (FG), were offering much that was different; the opposition did not propose “anything of substance or distinctive appeal. The outstanding performance of the Irish economy was not matched by a politics of equal calibre.”⁶ Nor was the Labour Party urging radical new departures; by 2005, it was insisting it would not increase income or corporation taxes.⁷

Although it was clear in the 1990s that the era of single-party government had come to an end—FF, it seemed, went from a position where it had all of the power most of the time to having most of the power all the time after 1997—the continued domination of FF meant that there was much reference to the notion of crisis within FG.⁸ Notwithstanding this dominance, FF’s position was clearly not impregnable; in 2004 its share of the vote fell to 32% in the European and local elections, the lowest since 1927. There was a justifiable skepticism in 2009 that the result of the local elections, when FF again polled poorly, could be labeled revolutionary, as the continuing battle between two large conservative parties that date from the Civil War era of the 1920s took a new, albeit dramatic, turn. But the result did raise questions: Just what did FF now stand for? Was it in danger of losing its self-proclaimed status as a national movement rather than just a political party? In 1985 it polled 47% of the vote in the local elections; in June 2009 it polled 25%.

In contrast to Bertie Ahern and his predecessors, Brian Cowen, who took over the leadership of FF in 2008, inspired no cult of leadership, meaning that the party, for the first time, had a serious leadership dilemma on its hands.⁹ The main problem for FG remained its lack of experience in government and policies that were indistinguishable from FF, and even though in November 2007 the leader of the Labour Party, Eamon Gilmore, made a declaration of his socialism, it was deliberately cautiously defined: “I believe that every person is equal. It is as simple as that. That’s what makes me a democrat. That’s why I am a socialist. And why I belong to a social democratic party.”¹⁰ When Gilmore elaborated on what motivated him, the result was an overtly careful balancing act, offering little depth or candor.¹¹

One of the most dramatic political events of this era was the general election of February 2011 that led to what the victors, FG and Labour, suggested was a democratic revolution.¹² Since its foundation in 1926, FF had not only dominated Irish politics, being in power for almost sixty of the next eighty years, but it had also been one of the most successful political parties in the world. Over the course of all general elections that it contested from 1927 to 2007, it secured an average of almost 45% of first-preference votes. To lose to the extent it did in 2011—its vote went down to 17.4%, and it lost fifty-one of its seventy-one seats in parliament—represented defeat on a historic scale, with echoes of the seminal December 1918 general election, when Sinn Féin routed the Irish Parliamentary Party, winning seventy-three seats to the Irish Parliamentary Party’s six, down from sixty-nine at the dissolution of parliament. But in a sense, the 2011 general election result was about revenge rather than revolution. Irish political culture—involving an excessively centralized state, weak local government, and national parliamentarians focused on local constituency work to secure their reelection—was not at all transformed by the 2011 election, and it is also questionable if it really represented a “revolution in mood.”13 The main beneficiary of the collapse in the FF vote was FG, hardly a radical alternative.

In the context of economic convulsions, loss of sovereignty, and the demise of FF from 2008 to 2011, there was no shortage of assessments of the cumulative failures of Irish political culture. Fintan O’Toole, for example, suggested Ireland “needs to lose every last vestige of hope in our governing culture” in the sense of a state that was conducted for the public interest, as opposed to a state that was a separate entity from the people.¹⁴ The state was depicted as a failed entity and a parody of democracy: local government did not in any meaningful sense exist; 94% of decisions on public expenditure were made at the national level; no link existed between local taxation and local services; and the national parliament passed already-decided-on legislation rather than initiating it, with no transparency provided for the benefit of its citizens.¹⁵ In relation to these failings, there also seemed to be much food for thought in the observations of historian Tony Judt on the international financial meltdown in his final collection of essays: “we have substituted endless commerce for public purpose and expect no higher aspirations from our leaders.”¹⁶

Although Irish culture had developed a sense of the permanence and robustness of the nation, it tended to see the Republic and nation as coterminous as opposed to seeing a republican citizenship that was conscious, active, and needed to be watched over with the vigilance of civic virtue.¹⁷ There also developed a certain nostalgia for the Civil War generation and its idealism and sense of public service that had been seemingly abandoned by the subsequent generation. Journalist John Waters, for example, reflected on the failure to question the moral basis of the Celtic Tiger version of modern Ireland, which was rooted in the inadequacies of those who sought to modernize the country “on exclusively materialist principles since the 1960s.” The result was a country never sustained by its own resources. Added to this, he maintained, was an Irish self-hatred, preventing the imagining of a new beginning and regret at the absence of “a national father figure to show us the way.” Waters framed his argument by pointing to the loss of an idealism and honesty associated with the Irish revolutionaries who fought the war of independence from 1919 to 1921.¹⁸ Some of this criticism was unduly simplistic and ignored many historic ambiguities in relation to Irish political culture, but Waters was accurate in his conclusion about contemporary Irish politics: “politics today is not politics at all, but something more like management of a minor company with an uninteresting product.”19

ECONOMIC EXPANSION

As was observed in a special feature in The Economist magazine in October 2004, “surely no other country in the rich world has seen its image change so fast.” Various explanations were offered as to the reasons for the economic expansion. The Industrial Development Authority had been successful in attracting foreign investment, and the education system had supplied a corpus of skilled workers who made a significant contribution to the information technology sector (more than one-third of all personal computers sold in Europe were manufactured in Ireland, and it was the world’s biggest software exporter, highlighting its globalization). Pharmaceutical and health-care companies also found Ireland an attractive base; for these foreign companies, a well-educated English-speaking workforce combined with low corporation and capital gains taxes made Ireland highly desirable. By 2004 the more than 1,100 multinationals in the Republic were exporting goods worth $60 billion a year.

Low taxes were a boost to home-grown enterprise, while women’s participation in the workforce increased dramatically, and with the European single currency, lower interest rates became the norm. But The Economist also identified problems in 2004, principally the lamentable state of some public services “and a dangerous obsession with property”; average house prices in Dublin had quadrupled over the previous decade. Nonetheless, it concluded that “Ireland has grown up.”²⁰ Economic historian Cormac Ó Gráda argued that Ireland’s low tax, low public debt economy, and development of social partnership were the result of the Celtic Tiger rather than its cause, while Roy Foster observed in the midst of the economic boom “a sometimes spectacularly unequal prosperity.”²¹

For its champions, social partnership was a crucial factor in creating the stability and industrial peace needed to sustain economic expansion, but to its critics it was about a smothering protectionism between privileged groups.²² At the end of the 1980s, social partnership had been seen as a necessary response to despair about the Irish financial crisis, resulting in the Programme for National Recovery (1987–1990), an accepted strategy to escape the cycle of stagnation, rising taxes, and unmanageable debt. Partnership was continually widened, and the benefits of industrial peace were much touted; it created an interesting interdependence but also complacency and aspirations that could not always be delivered on as well as problems of monitoring. The titles of the agreements in the early twenty-first century give an indication of how the partnership mission was officially viewed: Prosperity and Fairness (2003–2005) and Sustaining Progress (2003–2005). The program Towards 2016, agreed on in 2006, was effectively abandoned because of the economic crisis after 2008 and the imposition of pay cuts in 2009.

During the boom social mobility increased, as did disposable income; average gross weekly household income in the state in 2004–2005 was €989.53, 48.4% higher than the €666.72 recorded in 1998–1989, and disposable income (after tax and social insurance) increased by almost 53%.23 Higher earners had a variety of opportunities to avoid paying substantial tax; in 2003, the statistical branch of the Irish Revenue Commissioners listed the incomes of the top four hundred earners in Ireland without naming the individuals. Fifty-one of them had an effective tax rate of less than 5%, while of the 117 highest earning, twenty-nine had no tax liability at all, suggesting that tax shelters were protecting the wealthiest to an extraordinary degree.²⁴ Figures in relation to public spending as a proportion of the country’s national wealth were also revealing of Irish priorities: in 2000 the proportion for Ireland was 32% compared to the United Kingdom’s 40.2%, Belgium’s 49.9%, and Germany’s 45.9%; the average across the EU was 47%.²⁵ Three years later, Ireland was twenty-seventh out of thirty Organisation for Economic Co-operation and Development countries for social transfers, meaning the redistribution of wealth through welfare payments or pensions.²⁶ In the midst of extraordinary economic growth (which witnessed, for example, the Irish economy growing by 11% in 2000) came observations from a UN Human Development Report suggesting, in light of social spending falling as a share of gross domestic product (GDP) from 1997 to 2001, that the Republic had the second-highest level of poverty in the developed world.²⁷ Another interesting aspect of the boom was the proportion of new jobs that were being filled by migrant workers; of the 90,000 jobs created between September 2004 and September 2005, for example, 40,000 of these went to such workers.²⁸ The following year, there were 420,000 foreign nationals in the Republic, up from 200,000 in 2002, out of a total population of 4.2 million, the highest Irish population since 1861.

But it was the reliance on the construction sector that was truly alarming. By 2006 construction amounted to nearly one-quarter of Irish GDP, compared to less than 10% “in a normal economy, and Ireland was building half as many new houses a year as the UK which had 15 times as many people to house.”²⁹ There is no doubting the importance of land and property ownership as a driving force in post-Famine Irish history; the land war of the late nineteenth century was a defining campaign that was ultimately to result in the breaking of the power of the landlord class, the transfer of property to former tenants, and legislation that enabled ownership to be entrusted to a new class. Perhaps what was ironic was that one hundred years after that revolution in land ownership had been largely completed, it was replaced by a native class of landowners and speculators who, with external speculators, were to exercise their domination of land and the Irish economy in an even more invidious way than some of the most wretched of the nineteenth-century landlords.30 Ireland in the twenty-first century was consumed by a property boom and bubble that was ultimately to be its undoing.

NORTHERN IRELAND PEACE PROCESS

Despite the broad welcome for the Belfast Agreement in 1998 that did much to bring thirty years of the Northern Ireland Troubles to an end, its allowing for a power-sharing executive and assembly has resulted in negative assessments of the Agreement. For example, Henry Patterson has argued that it was “an elite brokered settlement that balanced precariously on deep reserves of communal distrust and antagonism.” Much attention was also focused on the resentment that unionists felt about nationalists benefiting much more from the Agreement, such sentiment rising on the unionist side from 31% of those polled in 1998 to 55% in 2002.³¹ In addition, Eamon McCann and others consistently argued that the 1998 solution institutionalized sectarianism.³²

During the long path to a relative peace in Northern Ireland, there was much desire for and talk of the normalization of politics and society, and many wished for the days when economics rather than violence would dominate discussion. Though the Democratic Unionist Party and Sinn Féin found a way to work together as part of a power-sharing executive and assembly, a great deal of division and sectarian hatred was still apparent in Northern Ireland in the first decade of the twenty-first century, while dissident republicans showed no sign of disappearing and remained a serious threat to peace. Historically, given the cyclical nature of violence, there was no reason to expect it would disappear completely as a result of the 1998 Agreement, and it did not, but it was massively reduced.

In 2009, George Quigley of the Institute of British Irish Studies suggested that some of the stridency had gone out of the tone of debate in Northern Ireland and that “there is mutual civility there never was before.”³³ But it was quite fragile: a frosty tolerance that was easily unhinged. Many physical barriers dividing communities remained, as did the segregated housing estates and the education divide. After the sheer horror of the Real Irish Republican Army’s (IRA) Omagh bomb that killed twenty-eight people in 1998, the number of killings dramatically declined, which was cited as a vindication for the choice of politics over violence. The years after 1998 also witnessed the eclipse of the Social Democratic and Labour Party and the Ulster Unionist Party, and the end of the era of the respective leaders of those parties, John Hume and David Trimble (who won the Nobel Peace Prize for their efforts in laying the groundwork for the Belfast Agreement). In 1997 the Ulster Unionist Party had ten members of parliament; by 2005 it had just one. The Social Democratic and Labour Party went from being the largest party in terms of votes in Northern Ireland to the fourth-largest party. Sinn Féin secured a strong presence in the Dáil as well as in the North; Ian Paisley and his successor, Peter Robinson, leaders of a resurgent Democratic Unionist Party, were converted to power sharing.

Along the way, there were postponed assembly elections and numerous claims that the Belfast Agreement was dead, as well as the firm IRA statement of July 2005 (“All volunteers have been instructed to assist the development of purely political and democratic programmes through exclusively peaceful means”).34 These steps were followed by verifiable arms decommissioning and numerous twists and turns before acceptance of a new police force and a power-sharing government in 2007. John Hume’s replacement as Social Democratic and Labour Party leader, Mark Durcan, had asked: “what hope is there that those who delivered the worst of Northern Ireland’s past will deliver the best of its future?”³⁵ The short-term answer came in the form of the “chuckle brothers”—the Democratic Unionist Party’s Ian Paisley as first minister and Sinn Féin’s Martin McGuinness as deputy first minister. Paisley was on the losing side in 1998 but was the long-term winner. It seemed in 1998 that the Belfast Agreement had vindicated the moderates, but in the long run the so-called “extremes” were the beneficiaries. There was an element of history repeating itself in this regard, as a similar transformation happened in the south during 1922–1932, when the anti-Treaty republicans lost the vote over the Treaty agreed with Britain following the War of Independence and were crushed in the Civil War, only to win power less than ten years later.

After the Belfast Agreement, Sinn Féin and the IRA profited from internal discipline and ruthless centralization, in contrast to the loyalist paramilitaries, who imploded, the irony being that it was the republicans’ opponents who got more out of the Agreement by securing the Union, the principle of consent, and the eradication of the Republic’s territorial claim to Northern Ireland in its constitution. The republicans obtained a share of power, cross-border bodies, the disbandment of the Royal Ulster Constabulary, and acceptance that they had fought a war and prisoners could be released. The path to power sharing was long and winding, precisely because both sides needed to make it so, unionists because of divisions in their ranks, and republicans because, in the words of historian and Trimble adviser Paul Bew, “how could a revolutionary movement settle for such a prosaic, even dull outcome, which fell so drastically short of its stated objectives? Perhaps this helps to explain the IRA’s consistent compensating adventurism in this period” (including controversies about an alleged republican spy ring at Stormont and the Northern Bank robbery in 2004, a massive heist that suggested “the IRA was still committed to running a criminal empire”).³⁶

The British interest in Northern Ireland was not as deep as unionists would have liked, which was also the case during the War of Independence era. Historically, there have always been pragmatic reasons for British politicians wanting to get the Irish question off the table at Downing Street, reasons that could take precedence over ideological commitment. For example, during the War of Independence, despite what was said in public, British policy, while initially focused on defeating the IRA’s military campaign, ultimately became about engineering a deal with Irish republicans. While this aim was complicated at various stages by surges in violence from 1920 to 1921, as it has been in more recent times, it remained the central goal in both eras.37

In relation to the contemporary Irish republican project, while Gerry Adams moved south and won a seat in the Dáil, Sinn Féin’s bold move to have Martin McGuinness elected president of Ireland in 2011 did not go as well as it wished (he received 13.7% of first-preference votes). The voting results revealed that the legacy of the Troubles was still raw, partitionist mind-sets were still entrenched, and republicans were worried about lack of interest in Irish unity.³⁸

Ultimately, the most obvious thaw was in Anglo-Irish relations. This was encapsulated in Bertie Ahern’s words at the Palace of Westminster in 2007, when he addressed a joint session of parliament: “We are now in an era of agreement—of new politics and new realities … reconciliation has brought us closer.”³⁹ The visit of Queen Elizabeth II to the Republic in May 2011 was also an indication of confidence on the British and Irish sides that both were ready for a gesture of this significance. The British government took this development very seriously; the presence of Prime Minister David Cameron and Foreign Secretary William Hague was testament to that. At the outset of her speech in Dublin Castle during that visit, President Mary McAleese declared: “this visit is a culmination of the success of the peace process.”⁴⁰ That was certainly underlined by the warmth of Anglo-Irish relations, but those sharing power in Northern Ireland were less effusive about what held them together and their capacity to overcome what still divided them.

THE CATHOLIC CHURCH

The collapse of the authority, credibility, and influence of the Catholic Church—a process that had begun in the 1960s and 1970s and was given added momentum by the revelation of scandals in the 1990s—continued unabated in the first decade of the twenty-first century. In November 2009 the Report of the Commission of Investigation, Catholic Archdiocese of Dublin, chaired by Justice Yvonne Murphy, was published (the Murphy Report). It had its origins in the 2002 broadcast by Radio Telefís Éireann (RTÉ, the national public-service broadcaster) of a television series produced by the acclaimed Irish documentary maker Mary Raftery, Cardinal Secrets, which investigated the handling of child sex abuse allegations in the Dublin Catholic archdiocese. Following the broadcast, the government pledged to establish a full independent judicial inquiry into the archdiocese’s handling of abuse allegations, which led to the setting up in 2006 of an investigation into the handling of those allegations by church and state authorities from 1975 until 2004. It found that four successive archbishops of the Catholic Archdiocese of Dublin handled allegations of child sexual abuse badly, with “denial, arrogance and cover-up,” and did not report their knowledge of abuse to the Irish police over a period of three decades. The structures and rules of the Catholic Church facilitated the cover-up of abuse. Auxiliary bishops of Dublin were also aware of complaints of child sex abuse, yet assignments of priests to parishes were often made without any reference to child sex abuse issues. The report detailed cases involving forty-six priests and more than 320 children, most of them boys. Senior members of the Irish police force regarded the actions of priests as being outside their remit, and some of them reported complaints to the archdiocese instead of investigating them. Although some priests did bring allegations of abuse to their superiors, there was, it was found, a “don’t ask, don’t tell” policy.41

The Murphy Report was the third devastating report—following the Ferns Report of 2005 in relation to the abuse of children in a Wexford Diocese and the Ryan Report of 2009 into child abuse in institutions run by religious orders and funded by the state—that vindicated the abused child and revealed much about how power was used and abused in the past. In providing such an overwhelming body of evidence about an “obsessive concern with secrecy and the avoidance of scandal” and “little or no concern for the welfare of the abused child,” these reports provided a corrective to the atmosphere of secrecy and shame that surrounded these experiences for so many years. The Murphy Report also made it clear that the extent of the sexual assaults on children could not be explained by maintaining that the country was too poor and ignorant; there were calculated cover-ups by the church and a deliberate abdication of state responsibility. The documentation available and the decision in 1986 to protect church assets from abuse victims by taking out an insurance policy gave lie to the claims that there was not enough knowledge of what was going on and that the church hierarchy “was on a learning curve,” as it maintained.⁴²

The abuse scandals were just one indication of a church in crisis; many other factors were relevant, including the decline in Marianism (devotion to Mary, mother of God), a loss of credibility in relation to contraception, and a decline in mass attendance and religious vocations. Between 1990 and 1998, ordinations to the priesthood fell by 66% and by 1998 deaths and departures from the priesthood outnumbered ordinations by a factor of almost five to one. In 2000 the historian James Donnelly suggested the need for an “effective repositioning of the institutional Catholic Church in Ireland.”⁴³ The decline of its authority also raised questions as to the church’s continuing ability to staff the schools and hospitals it had controlled for so long.

There were also calls for the cutting of historic links between church and state. When the Ferns Report was published, its contents prompted some of the most explicit denunciations of the church from Irish politicians regarding its role and status in Irish society. In November of that year, Progressive Democrat Teachta Dála (a member of the Irish parliament) Liz O’Donnell went further than most by asserting that the church was incapable of self-regulation and unworthy of consultation on any issue affecting reproduction, relationships, sexuality, or family planning. It was time, she insisted, for a clear division between church and state, the implication being it was time to assert that Ireland should be a secular state in practice.44 Politicians gradually came to reject, in the words of Barry Desmond, former minister for health, the idea that “the common good” was the same as “the Catholic good.”⁴⁵ But others also wondered about the gap left; in 2003 former taosieach Garret FitzGerald wrote about the decline of the influence of religion in the Republic and the “inadequacy of any alternative lay or civic ethic, especially in the face of the double hazard of the siren call of individualist liberalism on the one hand and the off-putting face of fundamentalist Catholicism on the other.”⁴⁶

During this period other indicators of change were also evident; a referendum on abortion to prevent suicide being grounds for a termination of pregnancy was defeated in 2002, and Dick Walsh suggested this was the first occasion “in which the alliance of Fianna Fáil, the Catholic bishops and lay activists were defeated, largely by social democrats.” Brian Girvin concluded that “those in a minority in the 1970s now represented a majority.”⁴⁷ Girvin also pointed to another shift in the church/state equilibrium, when the Minister for Children Brian Lenihan insisted it was his responsibility to ensure that the church’s guidelines with respect to children were compatible with the state’s.⁴⁸ But the state made some strange decisions in this regard also; despite the assertion in the Ryan Report that “it is impossible to determine the full extent of sexual abuse committed in boys’ schools,” an indemnity deal between some religious orders and the state was patently inadequate and was agreed on without enough external scrutiny. In 2011 Taoiseach Enda Kenny excoriated the Vatican for its alleged lack of cooperation with Irish inquiries into child abuse, while the Irish embassy at the Vatican was closed down, supposedly on grounds of cost.

In terms of the practice of religion and mass attendance, an opinion poll in April 2005 revealed average weekly mass attendance was 44% among Irish adults (and only 28% in Dublin); the figures were 78% in 1992 and 65% in 1997.⁴⁹ It was also clear that a laissez-faire approach to Catholicism was now firmly and irreversibly established: three-quarters of Irish adults agreed in 2005 that the Catholic Church should allow women priests; support in vitro fertilization treatment for couples; and relax its views on sex before marriage, divorce, and having a child outside marriage. An even higher proportion—83% and 87%, respectively—did not accept the church’s view on the use of artificial contraception and believed it should change its stance on the prohibition of condoms in Africa to prevent the spread of AIDS. Quite simply, many Irish adults decided to be Catholics on their own terms.

RELATIONSHIP WITH THE EUROPEAN UNION

It has been estimated that over the course of the forty years of Irish membership in the EU, GDP per capita in Ireland rose from 53% of the EU average to 140% in 2008. During the same period, €67 billion worth of transfers from the EU to Ireland took place, at one point amounting to 5% of gross national product.50 Overall, it has been estimated that Irish farmers benefited from Common Agricultural Policy funds to the value of €44 billion between 1973 and 2008, while structural funds amounted to €17 billion up to 2012.⁵¹

Given the size of these figures, it is hardly surprising that membership of the EU was largely seen as positive during the years of Irish economic underdevelopment. What changed significantly in the first decade of the twenty-first century was the extent to which the euro-skepticism apparent for so long in Britain resonated with many in Ireland. In the first twenty years of membership, this factor was not significant. The early Eurobarometers, taken twice a year to monitor feelings about the Community in the member states, suggested that it was economics rather than politics that was foremost in the minds of the Irish.⁵²

There was rarely any evidence that Irish enthusiasm for European integration could be taken at face value as an expression of a European identity; Irish attitudes were essentially pragmatic and related to how much money Ireland could get out of membership. In 1997 political scientist Tom Garvin had argued that “Ireland has become a rather well plugged-in periphery of Europe and America rather than a periphery of Britain. She probably prefers it that way.”⁵³ A Eurobarometer in 1994 revealed that 79% of the Irish surveyed responded positively to the question of whether they viewed membership as a good thing, compared to 58% in the community as a whole. That same year, Dermot Scott, an official in the EU parliament, suggested that in Ireland,

for want of information, public opinion has not understood the EU and has therefore not genuinely taken the EU to its heart, having a somewhat semidetached attitude, willing to go along, but having little knowledge or conviction about the goals of integration, little vision of what a European Union might become. The corollary is also true: that there seems to be little enough genuine opposition and that each dose of integration, however balefully received, is swallowed and ingested, though the patient may scowl at the next spoonful.⁵⁴

But that was to change, and by 2001, turnout for the Nice referendum was only 35%, which resulted in the rejection of that treaty, which had been designed to reform the institutional structure of the EU to cope with expansion of its membership. In reacting to this, political commentator Dick Walsh suggested “It has taken us 30 years to hold our most thorough debate on Ireland’s role in the EU and what Europe means to us.”55 The rerun of that referendum in October 2002 resulted in the passing of the treaty after many pro-Europe heavyweights were called on to hammer home the message that Ireland was doomed if it was rejected again. Some on the No side had been consistently drawing attention to the undermining of Irish autonomy due to accelerating European integration. Anthony Coughlan argued in 1999 that with the embrace of the euro and “by ceding to Brussels and Frankfurt the power to control credit in the economy, decide interest rates and the currency exchange rate, the politicians of our main parties are abandoning fundamental interests for advancing the Irish people’s welfare.”⁵⁶

Certain trends and sentiments were made clear from the Nice campaigns and subsequently the referendums on the Lisbon Treaty, the stated aim of which was to enhance the efficiency, legitimacy, and coherence of the EU, which was rejected in the first referendum in 2008 but passed in another referendum in 2009. Accusations of a “democratic deficit”—deliberate marginalization of smaller states by arrogant EU officials—and an alleged undermining of Irish neutrality resulted in the assertion in 2008 by those campaigning against the Lisbon Treaty that “The New EU Won’t See You, Won’t Hear You, Won’t Speak for You.”⁵⁷ The main political parties struggled to confront these sentiments effectively, while the “No” campaigners, though they made exaggerated and sometimes disingenuous claims, marketed their message much more effectively.

The longer Ireland was a member of the EU, the more questionable it became as to whether membership was a foreign policy issue at all; Irish interaction with the EU fell “into a new intermediate area where foreign and internal policy-making blend into one another,” a development further underlined by the acceptance of a severe austerity program in return for EU/European Central Bank (ECB) and International Monetary Fund (IMF) support.⁵⁸ In 2010 Irish dependence on the EU was clear in terms of financing the state, but there was much confusion and uncertainty about Ireland’s status in the midst of domestic bankruptcy and international credit fears. In 2011 a leading historian of Irish foreign policy, Patrick Keatinge, suggested that

among the major political and bureaucratic actors in this drama is an exotic mix of Finance Ministers and their officials, bankers both public and private, external institutions (the European Central Bank and the International Monetary Fund), as well as more remote and menacing entities, such as markets and investors…. It is necessary to get to grips with the story of negotiations of a highly technical nature, conducted in terms of a grotesque mix of euphemism, denial and apocalyptic threat…. It is a sobering realisation that in such an environment the European Union itself is on the defensive; this is a crisis for the euro as well as for Ireland’s financial and economic credibility. Amidst this confusion, positive attitudes towards EU membership—arguably the most significant Irish policy strategy of the past fifty years or so—can no longer be taken for granted. Adaptation to this situation in the short term has already involved negotiating from a position of great weakness, in the context of a formal suspension of full economic sovereignty. Beyond that, there will be a need at the very least to restore a severely damaged international reputation…. There are many imponderables in all of this.59

THE ECONOMIC COLLAPSE AND CRISIS

How had all this come to pass? Or as economist Morgan Kelly put it in 2011: “What happened to Ireland?” It was, he said, a “natural question,” given “the meteoric trajectory of the Irish economy over the past 25 years from basket case to superstar and back to basket case.”⁶⁰ He looked at the long-term factors relevant to the economic boom—including free secondary education and expansion in the numbers at third level in the 1970s, more competitive costs, and currency devaluations—but by 2000, while Irish incomes had risen to average European levels, competitiveness was affected as wages rose faster than increased productivity: “at this stage it might have been expected that Irish growth rates would fall back to ordinary European levels. Instead, growth continued at the rapid rates of the 1990s with one difference, that it was now driven by a credit-fuelled building boom rather than by competitiveness.”⁶¹

In the 1990s 5% of the Republic’s national income came from building—“the usual level for an industrialised economy”—but by 2006 this had reached 15%, with bigger mortgages and rising bank lending. Kelly then summarized the origins of the collapse:

While most banks abroad lent about 80% of national income, Irish banks in 2000 lent only 60%. Between 2000 and 2008, during what economists used to call the “Great Moderation”, banks found that they could borrow almost any amount on international markets without security, at rates only slightly above central bank rates. This led to an international lending boom where bank lending in most European economies rose to around 100% of national income. In Ireland, lending rose from 60 to nearly 200% and most of this was funded by borrowing from overseas banks. Everything that happened in Ireland between 2000 and 2008 stems from this simple fact.⁶²

Of the €1.8 billion of taxes collected in excess of expectation in the first nine months of 2006, €1 billion of this was tax from property transactions.⁶³ But for all the focus on revenue generated, there was not enough concern expressed about the borrowing underpinning it: personal debt as a percentage of disposable income increased from 89% to 140% between 1996 and 2006.⁶⁴ One of the failures of the era was the determination not to act on the Kenny Report of 1974 on the price of building land; it had recommended that development land should be compulsorily acquired by local authorities at a 25% premium above its existing use value and that a register of property sale prices be established. The report’s recommendations were essentially ignored, because restrictions on land speculation threatened powerful pressure groups and vested interests.65 The Kenny Report, a reaction to the housing shortages, land prices, and land rezoning practices of the 1960s and early 1970s, was frequently invoked in the decades after its publication; it had highlighted that the demand for housing would continue to grow, and that if nothing was done about it, prices would rise “at an even more rapid rate than previously.” But as was observed twenty-five years after the report, “one administration after another failed to meet the challenges of profiteering.”⁶⁶

In 1997 Irish banks were funded entirely by Irish deposits, but by 2005 most of their funding came from abroad and could be easily withdrawn.⁶⁷ From 2000 to the collapse, lending to construction and real estate rose from 8% to 28%, and banks loaned in the region of $100 billion to speculators to gamble with. The acclaimed American financial journalist Michael Lewis characterized what was going on as in effect a Ponzi scheme. Much that was built was simply not needed; between 2000 and 2004, for example, an extra 987 hotels were built with a tax subsidy of €196 million. Nonresident companies in the Irish Financial Services Centre found that they would be facilitated in what was in effect a low tax enclave. In April 2005 The New York Times remarked on the “light hand” of corporate regulation that made Dublin “the wild west of European finance.” The Office of Director of Corporate Enforcement set up in 2001 was not staffed properly (it had only thirty-six employees in 2006) and was not taken seriously enough.⁶⁸ Gene Kerrigan concluded, accurately, that those in government “just wanted something that would pass for a regulatory system if you didn’t look too closely at it,” and the ECB looked the other way.⁶⁹

Lehman Brothers collapsed and filed for bankruptcy in the United States in September 2008 with debts of €440 billion, and the first stage of the Irish crisis also came to a head that month when Anglo Irish Bank suffered a run in wholesale funding markets. Although it is true that Lehman’s collapse precipitated the Irish crisis, it did not cause it; the reckless loans by Irish banks had been made well before the collapse. Anglo had used lending to developers to dramatically transform its market share and was left woefully exposed. Minister for Finance Brian Lenihan was put under considerable pressure to guarantee the Irish banks and their bondholders. The bank guarantee that was then agreed on “sank Ireland,” as bondholders were protected. From November 2007 to October 2010, Irish banks borrowed €97 billion from the ECB to repay private creditors, many of whom had not even expected to get back all their money. All public deposits in banks were guaranteed, as well as most existing bonds issued to other financial institutions. Private debts became public debts, with devastating consequences.⁷⁰

The role of the ECB in all this was controversial. In one of the many books on the onset of the crisis and the reaction to it, this role was summed up by one of Ireland’s leading journalists: “It was the ECB that had put a loaded gun to the Irish government’s head” with an implied threat that it would withdraw liquidity support for the banks if the Irish government did not move to calm market fears. The ECB, of course, had a bigger concern with the stability of the wider eurozone, but according to journalist Matt Cooper, the ECB subsequently “conveniently forgot its own enormous failings in dealing with the crisis, as well as its responsibilities.”71 This was the same ECB whose president, Jean Claude Trichet, in Dublin in May 2004 heralded Ireland as a “model for the millions of new citizens of the European Union.”⁷² But by 2008 Trichet’s main concern regarding Ireland was that no European bank would be seen to collapse and subsequently, in 2011 he put undue pressure on the Irish government to abandon its plan to enforce burden-sharing on senior bondholders in Anglo Irish Bank by threatening to withdraw ECB emergency funding from Irish banks.⁷³

Morgan Kelly described the bank guarantee as “an astonishingly stupid move: these bonds had been bought by sophisticated investors who knew that they stood to lose if the banks did badly.”⁷⁴ There was a determination to continue to honor this guarantee even after it became clear that the bank losses were beyond the resources of the state. Some have argued it should have been revoked, though others have challenged this narrative and warned against the simplification of the blame-game narrative. The absence of regulation dominated the world’s financial markets and was not just an Irish issue—the Lehman Brothers’ implosion involved the largest financial default in world history—and there was no alternative to the bank guarantee beyond a run on the banks and the complete implosion of the banking system.⁷⁵ Nonetheless, the idea that bondholders did not have to take any of the pain remained one of the striking and controversial aspects of the Irish crisis.

International lenders stopped lending to Ireland, and the country was forced to accept an EU/ECB/IMF bailout at the end of 2010. The program provided for up to €50 billion in fiscal needs and up to €35 billion in banking support measures from 2011 to the end of 2013, contingent on action to clean up the financial sector, put the public finances on a sustainable path, and implement a structural reform package. Forecasts of bank losses of €40 billion were shown to be ridiculously underestimated; Morgan Kelly suggested in 2012 that the bank losses would eventually cost the state in the region of €100 billion and that along with capital invested in worthless banks, “Irish national debt is likely to rise closer to €240–250 billion. There would also be the need for new capital for the banks and there was the danger of widespread defaulting on personal mortgages: the chance that such sums can be repaid by a nation with 1.8 million employed people is zero.”⁷⁶

By 2009 the National Asset Management Agency, a state-funded “bad bank” was in place, and unemployment, which had been 4.8% in 2007 rose to 13.1%.⁷⁷ By 2013 the unemployment rate had trebled since 2008 to more than 14% and the annual rate of emigration increased by more than 350% in the same period; 68,000 emigrated from April 2009 to April 2011, while 46,500 Irish people left the state between April 2011 and April 2012.⁷⁸ In early 2011, estimates put the drop in house prices at 55–60%, and it was difficult to avoid the conclusion that “the performance of the Irish political and economic system during the property price crash, the banking crisis and the deficit debacle revealed many unsavoury truths about Ireland that the unregulated growth and wealth of the Celtic Tiger obscured.”79 Three reports commissioned by the government on the collapse of the economy suggested the burden of responsibility was broad, with insufficient surveillance, warnings not heeded, and a “national speculative mania,” which was another misdirected exaggeration and exacerbated the tendency toward what Conor McCabe dubbed “pseudo-historical analysis.”⁸⁰ Crucially, no comprehensive official inquiry into the failings of the banks had been conducted up to the time of the writing of this chapter (2014), and there was no accountability with regard to their practices, meaning that “the public narrative about what actually happened remains vague and incomplete.”⁸¹

The financial crisis did not lead to civil unrest as it did in Greece, and Irish politics in 2010 had, according to Michael Lewis, a “frozen-in-time quality.”⁸² A country that fought a war of independence in the early twentieth century became, it seemed, compliant and docile in the face of the exposure of systemic corruption and the destruction of that independence nearly a century later; those responsible were not made accountable and punished for their misdeeds. Many answers and theories were offered as to why this was the case, including the post-colonial mind-set, the underlying political stability of Ireland over an extended period with an accompanying lack of ideological debate, the dominance of the Catholic Church, and the resultant absence of a strong civic culture and dissent.⁸³ But the crisis led to considerable reflection on the nature of Irish decision making, political leadership, the lack of distribution of power, and links between business and politics. Morgan Kelly argued that FF had become “the political clients of property developers … the building boom suited everyone that mattered.”⁸⁴

In the last few years of his life, Garret FitzGerald occasionally broached the issue of corruption in Irish politics, suggesting in 2010 that the Civil War generation through its “unselfish patriotism” provided a barrier “to the spread to politics of the socially inadequate value system that we, as a people, had inherited from our colonial past.”⁸⁵ This assertion may be too sweeping, but there is some truth in it. In 2012 the Mahon Report, which examined allegations of corrupt payments to politicians, concluded that such corruption was systemic and endemic.⁸⁶ The network of alliances, powerful vested interests, and pressure groups that was built up and facilitated corruption did not just emerge in recent decades. The network thrived initially in a small, protected economy and in a society that was snobbish and hierarchical.

The existence of such groups is a reminder that because of the way in which political culture evolved after independence, it bred a cynicism and selfishness about how to do business and make money in Ireland and the hierarchy of influence. Alongside attachment to the tradition of parliamentary democracy was a parallel devotion to a culture of self-advancement, which was about whom you knew and what you could pay. Many venal people were willing to buy Irish politicians, and politicians who were exposed as corrupt or untruthful continued to be elected and endorsed; those who called for accountability in this culture experienced fear, menace, and intimidation.87

In relation to the decision-making processes in the state since its foundation, Conor McCabe argued that the economic crisis was not just the result of unregulated, reckless bankers or because Irish people were obsessed with home ownership but was the consequence of the rottenness of the governing culture and vested interests over many decades, which allowed public money to be funneled into profits for private shareholders along with the surrender of rights to minerals, gas, and oil for a pittance. The privileging of Irish banks to influence the state’s finances was also something that had been building over decades.⁸⁸ In addition, some politicians seemed determined to discourage a robust questioning of the past in this regard—a popular phrase became “we are where we are.”⁸⁹ The notion of collective responsibility was also used when convenient to distract from the failures of leadership. For example, Brian Lenihan asserted that “we decided as a people collectively to have this property boom. That was a collective decision we took as a people.”⁹⁰ This statement is a simplification to the point of distortion of reality; people did not collectively decide to “have” a property boom; a relatively small number were able to skew the market through speculation, reckless lending, and a refusal to reduce the inflation of the property market, and many were encouraged to borrow beyond their means or were panicked into buying through warnings that if they did not move with speed they would fail to get a foot on the much-vaunted property ladder.

What did the journey from boom to bust in the first decade of the twenty-first century mean for Irish identity? Was there a sense that materialism had come at the expense of a traditional Irish value system? It may have been the case, as argued by a sociologist in 2007, that “the issue of identity … crystallizes around the issue of whether Irishness, as we understand it today, is fundamentally determined by an oppressed past or a privileged present.”⁹¹ The challenge after the crash was not just to get to the truth of what had happened and why but also to respond to it with some new vision; in that regard, those running the country were found wanting. Crucial themes—fairness, public service, and the nature of society—were undoubtedly neglected during the boom; it became commonplace for cultural commentators to assert that it had never been more fashionable to be Irish but for the more skeptical, what this amounted to was “the baleful influence that modernization theory has exercised over Irish cultural commentary.”⁹²

In 2007 Gearóid Ó Tuathaigh, while lauding the positive changes witnessed in Celtic Tiger Ireland, also suggested that “what is striking is the almost total absence of any clearly articulated or elaborated coherent social vision by political leaders in recent decades…. The general run of statements of social policy have rarely ventured too far from the safe zone of economic managerialism which has become the general zone of political discourse.” While Ó Tuathaigh acknowledged the progress politicians made in overseeing economic expansion and bedding down the peace process in Northern Ireland, he made the fair point that

the failure to articulate, still less to systematically take steps of achieving a coherent and persuasive vision of social solidarity, based on a set of values and principles that would enjoy wide public endorsement, has resulted in a series of confused, inconsistent or contradictory strategies being announced and pursued—in regional planning, health and housing, integrated planning of infrastructure, crime and the causes of crime—an incoherence which continues to cause widespread frustration, confusion, disappointment and anger among different sections of the community.93

Six years after these observations, in the midst of austerity, high unemployment, and mass emigration, and as the centenary of the events that composed the revolution of the early twentieth century was fast approaching, the stark reality was that the Irish Republic was bereft of meaningful sovereignty due to its bankruptcy, and its governing culture over the previous few decades had been exposed as rotten.