The Celtic Tiger is Badly Bruised
A self- conducted tour of Ireland on the ancient canal system proved to be an excellent venue to see the country from a different angle. The canal system was built in the 1700’s as part of the industrialization process at a time between the horse only and the rail roads. They remain a marvel of engineering and a testimony to very hard work.
Cruising the byways was predominately rural. The surrounding country gave the impression that nothing much had changed in over two hundred years. However the tranquility was interrupted from time to time as new starter castles appeared on the shoreline. Expansive housing, commercial and industrial complexes came into view, many awaiting occupancy. It was surreal but in keeping with the fable of the emergence of the Celtic Tiger.
Even to the vacationer’s eye, all seemed strange. Housing prices were way out of proportion to any reasonable wage scale. Apart from pharmaceutical and electronic manufacturing plants, no substantial economic activity was evident, tourism excepted. The big news was the emergence of Waterford Crystal out of bankruptcy protection.
In retrospect, it was the classic the ”Emperor Has No Clothes “ syndrome. There was too much European Union enthusiasm, a very unusual tax regime, and a fast influx of workers. Private, public, and government capital flowed, in the belief that a largely agrarian economy could be turned into a tiger without passing go.
A recent book by Michael Lewis called Boomerang, Travels in the New Third World tries valiantly to explain the mess. Still a worthwhile read.