Report by Rob Brown in Dublin
3 Oct 2010
In the Celtic Tiger era, Eamonn Blaney would have been the embodiment of Cool Hibernia.
With his dark-rimmed designer specs and sharp pin-striped jackets, you might still mistake him for a successful entrepreneur or corporate executive if you were to see him sipping an espresso in one of the cafés near his home in Howth, a traditionally prosperous peninsula jutting out from Dublin.
But the truth is this 46-year-old Dubliner is carefully counting the cost of every small indulgence these days.
Blaney is on the dole: one of the 455,000 citizens of the Irish Republic unemployed or under-employed. When he signs on, he is surrounded by traumatised Tiger Cubs, a hedonistic young generation foolishly reared to believe that their wise elders had somehow suddenly discovered a magical cure for the centuries-old scourges of economic misery and mass emigration.
Blaney’s own grand misfortune was to graduate with an MBA from Ireland’s top-rated university, Trinity College Dublin, in 2008 just as the international banking crisis erupted and the southern Irish property bubble spectacularly burst. The two start-up businesses he has founded since have both failed to pay the bills as Dublin has become trapped in a particularly fearsome downward financial spiral.
The epic housing bust has blown a €25 billion hole in the annual state budget and the Irish government is having to pump at least double that into a seemingly endless bank bail-out – equivalent to about one-third of Ireland’s economic output last year. Credit lines have almost completely dried up across the country’s zombified financial institutions for small and medium-sized enterprises.
“I refuse to lie down and let the bastards win,” is Blaney’s defiant mantra as he struggles to get another venture off the ground. He comes from a long line of fiery rebels, having been born into one of Ireland’s political dynasties. His grandfather was a member of the old IRA, fighting in the war of independence and serving in the national parliament (Dail Eireann) for several decades. His father, Niall Blaney, was a Cabinet minister and his cousin (also Niall Blaney) holds a seat in the Dail.
Yet, even with all these insider connections – and more than one-quarter of a century of self-employment on both sides of the Irish Sea, in everything from car dealership to the licensed trade – Blaney is struggling to raise the modest funding he needs to ignite his small internet-based venture.
He burns with anger about the state of the country his ancestors freed from British rule. “My forefathers sacrificed everything to turn a bogfield into a modern, vibrant democratic republic and we’ve ended up in a new form of slavery. We’ve become enslaved to international bond holders.”
Blaney became a bit of a national hero – drawing 5000 hits on his personal website – when he took part in a recent state-of-the-nation debate on television. To thunderous applause from the audience, he lambasted the member of another proud political dynasty, Conor Lenihan: “Listen, you’ve had more money than any government in the history of the state and you’ve blown the fecking lot.”
To date, such tensions have been largely confined to television studios. They have yet to spill out on to the streets, as in Greece. But the authorities here are bracing themselves for scenes in Dublin similar to those in Athens. The police force, the Garda Siochana, was reported to be secretly undergoing specialist training in riot control over the summer.
One factor which may be keeping a tight lid on popular anger for now is the strikingly generous social welfare benefits introduced in Tiger times. Although it has been cut back for the youngest claimants, the basic jobseeker’s allowance in Ireland is €196 a week, compared to just over £60 in Britain. The gap is so great that the Garda have had to mount checkpoints to try to stop the unemployed in Northern Ireland slipping across the border to claim benefits by giving false addresses in the Republic.
A vast edifice of other subsidies and credits (including a universally applied relief on mortgage payments) makes the Irish among the most cosseted and least taxed in Europe. More than half of those still in work in the Republic pay no income tax as the basic threshold is far higher than in Britain. There is no council tax.
It is hard to see how this can continue when the gap between what the Irish government spends annually (€55bn) and what it is now raising in revenue (barely €30bn) is so vast. Since the onset of the crisis, Dublin has borrowed €400 million per week to keep state benefits flowing and basic services such as schools and hospitals functioning – and it is borrowing at increasingly punitive interest rates as the country’s credit rating has been repeatedly lowered by international credit agencies.
Finance minister Brian Lenihan – who is wrestling with this nightmare scenario while undergoing treatment for a life-threatening form of pancreatic cancer – is publicly committed to slashing public expenditure by at least a further €3bn in his upcoming budget (following €4bn of cuts last year).
“Iron Brian” has also served warning that the tax net will be substantially widened to claw revenues in from the lower paid. Public sector employees have already had a pension levy slapped on them and their take-home pay effectively slashed by about 15% under the new austerity measures.
The prevailing mood among the citizenry has been most eloquently encapsulated by Declan Kiberd, Professor of Anglo-Irish Literature at University College, Dublin. “Nobody knows what will happen next – not even our leaders,” he has written. “We walk as a community in darkness down a strangely unfamiliar road, into a new landscape for which there are no maps. Except, possibly, newspapers.
“Their sales may be in decline, but you can bet your life that more people are reading a newspaper, and in greater detail, every day. If you call into an office still lucky enough to be in business, you are likely to find people reading the morning paper. Four or five years ago, these readers would have been rushed off their feet with work to do and would have managed to glance at headlines only at the end of a fantastic day.”
The unwelcome increase in “free time” is, Kiberd contends, just one reason for this heightened interest in current affairs. “Another is the fact that citizens, who for more than 15 years allowed politicians to get on with things, are now scrutinising their lords and masters more critically. And many don’t like what they see.”