The Department of Foreign Affairs recently released a report on the progress toward meeting some of the goals set out in last year’s Farmleigh summit. I have to confess to a degree of unease about a process that doesn’t permit people to debate and scrutinise ideas in full open view. I am pretty sure that the vast majority of the people who attended and spoke are big enough and bold enough to have withstood an IrishEconomy type treatment for their ideas and I don’t see why it wasn’t simply podcast. As it was, the event was mostly held in private for a group of selected invitees. The progress report for what was discussed is linked below. Some of the ideas include a National Diaspora bond and an overseas graduate programme. Other paragraphs suggest that Farmleigh may have been influential in shaping budgetary policy, which is something that doesn’t sound very plausible. In general, I can’t disguise a degree of scepticism about such approaches but, having said that, some very influential and succesful people attended and gave their views so debating this document seems a good use of a thread.
31 replies on “Farmleigh Progress Report”
Whilst not economic policy per se, wasn’t there much talk recently over the possibility that the ‘grade inflation’ scandel last week was brought up (not for the first time but maybe for the first time someone actually listened) at Farmleigh?
@ Liam Delaney,
In my mind, I do link up a lot of what corporate governance reports are trying to do at the moment, all over, in this country of Ireland – with the attempt at Farmleigh conference last year. What Farmleigh was trying to do was work on the positive aspects. The corporate governance reports try to deal with well known negative aspects of our little place. Have a look at the movie Australia, some night, starring Nicole Kidman etc. Australia is a big place, but back in 1939 was a very small place too, if you know what I mean. What do you know, the church were stuck in the middle too, dispensing with the wisdom. I wonder if movies will be made 80 years from now, depicting Ireland in the same way? BOH.
Also, on RTE radio Drive Time, this evening, Mary Wilson had a guest on, who had a sort of poem about Ireland and mothers. Going back to Padraig Pearse and his poem. Very interesting, you should check out that podcast on the RTE web site. BOH.
I attended the one public session and spoke to the some of the participants. I think privacy was important because it gave them the freedom to speak their minds without fear of public backlash or meeja hysteria. They did belong to organisations, public and private..and sure you know the way people get their terribly excited and angry when someone says something meaningful.
Good point on the grade inflation.
The solidarity bond as proposed seems reckless. It is proposed to take money away from the economy and from investment into private enterprise, and funnel it into state expenditure. This is not how it’s done in Singapore, an example discussed before. What you do is: give all resident adults (active in the social welfare or tax systems) the bond, free, gratis and for nothing. They then have the choice of either holding it for 5 or 10 years, or of cashing it immediately. The idea is that people who don’t absolutely need the money will hold it; people who for some reason need the money (because they are absolutely broke; need to invest it in a business or whatever) can draw it down.
Obviously the bond is not completely free. The reality is that everybody is facing some type of cut in their income these days.
As for a diaspora bond – we’d be better getting people to invest in private Irish companies, surely? This would take risk away from the taxpayer if nothing else.
Separately: the description of Dermot Desmond’s proposed project is quite wide of the mark, as I understand it.
The paper fails to note that NAMA is likely to find itself as a major backer of the London Olympics – http://www.irishelection.com/2009/07/ireland-now-shareholder-in-london-olympics/
The most useful contribution were the home truths from ex-Intel chief Craig Barratt who questioned the quality of education system and said while Intel had chosen Ireland as a key location for about 14 reasons, only one remained – – the tax rate.
He couldn’t be easily dismissed as a begrudger.
Generally, this is like so much else, a sideshow to the need for addressing issues of reform and emerging challenges.
The lost decade and a half won’t be easily made up and competitions for new ideas etc are part of the actionless action many of us mistake for reality.
Has anyone seen a list of Craig Barrett’s fourteen reasons ?
Really good article by Michael Hennigan (above) in the Times today, highlighting the constraints of relying upon foreign investment as a means for long term growth-sustainability and job creation.
Given that Ireland has adopted this strategy for over 30 years, I sense its institutions and actors operating within them (IDA et al) are locked into a path dependence that makes it very hard to change strategy. And if they do – it is hard to know what it would look like. I mean – the IDA by definition is designed to source foreign investment as a means for wealth and job creation. Any thoughts on the possible alternatives Michael?
Also, if someone has a copy of the 14 reasons Craig Barratt gave for INTELs decision to locate in Ireland – can they post them up here – would be most useful.
@On the 14
Matt Cooper on the Last Word below ……… not sure if he mentioned them —– but Cooper has been on this one for a while …….. if anyone has his email??
This business of diaspora bonds, national solidarity bonds, national recovery bonds, man-in-the-street bonds or whatever you want to call them is pretty silly.
The country has serious fiscal problems. This stems from accumulating debt at too fast a rate and, at some point, professional investors may decide that we’ve accumulated more debt than we can pay back.
These “people that like us” bonds will count as debt just as much as bonds issued to mean nasty foreign professional investors. I’m guessing that the idea is the interest rate on these bonds are expected to be lower than those on normal sovereign bonds. However, given the likely amounts involved, the savings to the state would be tiny and there would be additional costs associated with administering a new program of this type.
There is a large element in the zeitgeist at the mo around here grasping at straws – the fairy gomother, the rich uncle in the States, the European saviour, the white knight, the magic wand, the job_projections (again) as a substitute for real jobs in the now, blind faith that something will turn up, the resort to prayer and divine providence, the shuffle in the executive, and so on ………..
Indicators of a state of shock/denial/anger ……… but suggestive of the fact that many are not facing ‘reality’ in ‘all’ its ‘ontological’ dimensions. And all this ‘spin’ from the top is certainly not helping ……
That said – I wouldn’t be totally dismissive on the bond idea – think some Universities could learn from the US in this regard re research funding, useful research chairs, and embedding certain industrial sectors here – then again, I’m no bond expert: Ask_Eoin.kom
@ Aidan R
Nestlé, the world’s biggest food and beverage company has over 5,000 working in R&D.
Our dairy companies generally produce commodity products compared with other European companies and Glanbia is talking about hiving off its low margin Irish operations!
The industry needs to be rationalised and instead of ploughing billions into university research hoping for a biotech brealthrough, some should be diverted to helping to build a world class food industry.
Germany became a net exporter of food and drink in 2008 for the first time in decades.
The Eurozone market is largely unexploited.
The countries Germany, France, Benelux, Italy and Spain collectively represent a GDP 3.9 times the size of the UK, yet the non-food exports by clients companies of Enterprise Ireland, for these countries is 40% of that of the UK.
Ireland: A “smart” economy in food better than pie-in-the-sky aspirations?
Looking at Germany – again – Remember Telesis/Culliton ……. both failed to address institutional linkages/complexity – I can’t believer I’m about all this stuff again (did they beat the drum slowly etc )
German industry is fully interlinked with its Vocational Education Training system – tech schools link to local industry and personnel move between them and industry is involved in curriculum design etc Not Here! This stuff has been discussed (and reports galore) for over 30 yrs now ……..
On Banking and Industry [agri or otherwise] Banks are ‘involved’ in financial and strategic decison making in Germany – take a medium to long term focus in a type of win-win (as distinct from exploit as in anglo-american model) partnership etc ………… here productive wealth creation and banking are – well , look around. We need new banking models [pls don’t even think about resurrecting u_no_hu as a business bank]
Rethink and re-structure institutions …………. [ what a job]
On R&D look at Kerry and additives/savvy chemicals – & global – can be done.
… will get to your IT piece later on.
In ‘Bertiespeak’ this is all “smoke and daggers” to deflect attention from the upcoming bank recap.
Beyond the diaspora bonds, I couldn’t help finding this list of “positive suggestions” pretty depressing.
I’m going to say something now that I’m going to get lambasted for but here goes: I never cease to be amazed by the vacuous nature of most of the economic policy ideas put forward by individual successful businessmen. Very often, they are either straightforward special interest pleading for tax breaks (represented as stuff that pays for itself but in fact doesn’t) or else stuff that’s incoherent.
I know what folks will say to this. These are successful businessmen, so surely they know how an economy should be run. However, there’s a big difference between, on the one hand, understanding how one unit in a big system works and, on the other hand, understanding how the whole system works.
The word ‘diaspora’ made its debut in Irish popular discourse when, subsequent to the 1990 World Cup in It’ly, President Mary Robinson welcomed the Irish football team to Arus an Uachtaran.
Several players were second-generation Irish born in the UK (plastic Paddies in the crude popular argot), delicately described by the President as members of the ‘diaspora’.
The camera focussed on, I think, Andy Townsend as the President uttered the d-word. His expression was an unfeigned mixture of puzzlement and amusement. His example should be followed by all.
The ‘D’ word is to a large extent irrelevant in the debate. The question is what relationship does Ireland want to have with those abroad who would express themselves as having an Irish connection.
Putting it simply:
– No engagement,
– Some engagement, or
– Full engagement
Having determined that it is then possible to decide on a mutually respectful strategy.
@KW: Yep. Those ‘business men’ are like that arrogant Oliver as he approached the Top Table with his ‘begging-bowl’ – “Please legislators, may we have some more of the taxpayers incomes”. That’s what ‘success’ actually is. Stiff the taxpayer. What will they do when the taxpayer is unable to ‘pay-up’ ’cause their incomes have been cut, and the Magic Multipliers go into reverse?
@ All: WRT Grade Inflation. This WAS a problem in 1980! Do some digging into the third-level education literature of the time. Nothing changes – just rhymes.
@ MH: Nifty article in IT to-day! I keep insisting that our Pemagrowth economic Model-in-Use is past its sell-by-date. Need to trash the conventional wisdom and start from scratch. Won’t be done. I wonder how many will really appreciate the predicament which those 1 billon job-seekers pose for us? We have plenty of ‘shovel-ready’ positions available in Ireland. It known as manual labour, down on the farm! But who wants to go there?
Karl: I basically agree with what you are saying re businessmen and public policy, but in fairness, it was not their idea to come and tell the government how it should be done – the government invited them to give their views.
The thing I notice about this document is not so much the content as the tone. The tone is basically defensive, that we have all these things underway to make Ireland more accessible and palatable, and that everything is basically alright. But everything is not alright, there are deep (but soluble) problems, and radical change is needed.
Dalymount Park: the 70s [six pints to the £] – Standing to attention as the Irish National Anthem blasts out over North Dublin – Soccer International.
Terry Mancini to Ray Treacey ‘God, that’s awful Ray! Hope ours is better than that?’ – Ray to Terry ‘Eh Terry, that is ours!’
Now can we have Eoin Morgan back for the Twenty20 world cup please? I’m all for the Diaspora – just so long as they can play (-; (as distinct from ‘pay’)
minor point: still waiting on that justification re the raid on nprf for the zombies?
Its really a shame as we enter this most important St. Patrick’s day period that the naysayers are out in force today. But I suppose there’s a good reason why economics is called the ‘dismal science’.
Its now over 50 years since Norman Vincent Peale published his great book, The Power of Positive Thinking, and its as relevant today as it was then, especially in respect to economics. Investment, as John Maynard Keynes stressed, depends on confidence.
Lets hope that as Taoiseach Cowen, and his ministers address the Irish Diaspora during the coming week that they indulge in no nattering negativity but stress the power of the positive: the future of the economy depends on it.
Hadn’t we enough of the grá mo chroí malarkey during the Celtic Tiger years when too many were fooled into believing the permanent free lunch was invented?
The same people who believed that the construction boom would last forever, are now selling what is termed the ‘smart economy’ as the magic formula but I guess there will always be a market for snake oil.
There is not one mention of the C word. Confidence is what this country needs to get back in spades. I have been over 25 years in business and I have never seen the business community so shattered by the uselessness of it’s Political Leaders on all sides, a lazy Civil Service and a media besotted with their own importance to the point that most entrepeneurs dont see any future in this country. Farmleigh does nothing to change that view even if you dress it up as the Diaspora want to help. Calan is right !!!!
At the time of the Farleigh gig, I was struck by the fact the great and the powerful were being provided the security by the State of the Chatham House rules to say what they wanted without being reported while the organisations that represent poor and excluded are required to refrain from comment that is critical of the government if they want to receive state funding.
These are successful businessmen, so surely they know how an economy should be run. However, there’s a big difference between, on the one hand, understanding how one unit in a big system works and, on the other hand, understanding how the whole system works.
I became addicted to watching House M.D. TV series, starring Hugh Laurie and Lisa Edelstein. It is one of the few things in the past 18 months, that has caused many a smile to crack open on my face. There is one couple of episodes in the earlier seasons where a successful self-made business man comes into Gregory House’s hospital. Dr. House is interested only in cases, which no one else can fathom. Dr. House must be a pain in the butt, for someone to manage. A political war breaks out between these two forces. Dr. House wins in the end, (sort of) but takes a lot of collateral damage in the process. The self-made businessman walks out the door with $100 million. Originally he had arrived into the hospital to invest $100 million, on condition he was made chairman of the board of directors. The directors couldn’t turn down the money. The business man enjoyed having a toy to play with. Running things the way he wanted to, and the $100 million was simply a bargaining chip to buy those positions of control. He knew nothing about medicine, patients or hospitals. He had a vague notion that a hospital should run ‘like any other business’. He wanted to fire Dr. House (who had tenure) because it appeared House did nothing of great value. I saw a lot of the same thing at work in the construction industry. Many of the so called developers, knew nothing about the business they had ventured into. That is why we have NAMA, and so much went pear shaped. But certain individuals, because they had access to several lines of credit from banks, believed they were invisible when it came to property. The Dr. Gregory House types were marginalised (because they seemed to know a thing or two) and often sent to Siberia, during the Celtic Tiger. Their value to the system wasn’t understood. BOH.
Dr. House in the wars.
@ Michael Hennigan
I agree with you. Its not the first time my sarcasm was taken literally.
It seemed that the government was looking for some answers and some brainstorming, so a good idea.
But it will take confidence which means increasing or static asset values, which NAMA will prevent. It will also take effort which will only begin in earnest when people are told the truth. Now many may say they do not know for sure how bad it is going to get and that talking about it, if they think they know, will damage confidence, it will also get motors running. Then we shall see PROGRESS.
Until then it will be lots of shapes and folks will try to defend their corner, not realizing that the longer they wait the worse it will be for all and that fairness has gone out of the window. Soon it will be dog eat dog. That will be real funny. Just remember: start now!
DUMP NAMA just after the guarantee runs out…..
It appears that a lot of people here do not understand what Confidence to a business person means. It is not related to Property values/NAMA blah blah etc. Business people have moved on from those issues more than 18 months ago. It relates to management issues most of which will not cost a single Euro to the State. Properly dealt with they usually save the State Billions of Euros. What has being going on at the Publicly Funded Hospital Tallaght Hospital is typical of what I am referring to. Nobody in Government, Civil Service, HSE or at the Hospital itself be they on the Board, the Management Team, Medical Consultants, Administrators, Trade Unions etc will take any responsibility for this mess. The Worst part of all this is that one can see no end in sight to this behaviour by State Funded Entities which is so damaging to Confidence and Morale of not only their own staff but the wider business community.
Excellent points. Tom O’Dowd wrote a very good opinion article for the IT today:
@Seán Ó Riain & All
So – has anyone got a list of those Fourteen(14) – if so, pls pass it on.