Irish Remedy for Hard Times: Leaving Post author By John McHale Post date February 24, 2011 The Wall Street Journal carries an extensive article on Irish emigration. Categories In Migration Tags Emigration, Irish brain drain 76 Comments on Irish Remedy for Hard Times: Leaving ← Martin Wolf: Ireland Needs Help With Its Debt → Migration Estimates 76 replies on “Irish Remedy for Hard Times: Leaving” Massive failure cannot be rewarded. Let’s be clear on that: we’ve been driven back to the 1980s. At least we can speak tomorrow and make a clear message go forth that whatever about differences in the staging of bondholder restructuring this Monumentally Incompetent govt must not be rewarded for it’s failures. This isn’t politics, it’s political economy and they get a 20%, non compensatable, no appeal, exclude, no repeat grade from me. They get that high a grade for honesty, for turning up and completing the test, but that’s it. It’s by no means gratifying but it was inevitable that we’d finally arrive at a serious discussion of the last of the three points I gently suggested should be addressed before Christmas….emigration as an opportunity for Irish people to acquire the skills, experience, education and revenues that will be necessary in any event for Ireland to compete successfully in a truly globalised world. The debate was instigated by comments from Dominique Jean-Raymond accurately reflecting opinion in Europe and “Europe” (right or wrong, it doesn’t really matter) that Ireland’s CT rate constituted fiscal dumping. It was suggested that (again rightly or wrongly, for legitimate or illegitimate reasons, it doesn’t really matter) “Europe” would focus attention on this issue and that it would become a central factor in negotiations after a general election in Ireland aimed at convincing our EZ partners that, alone, we could not fulfill the requirements of the EU/ECB/IMF deal. And that our inability to do so was part of a Europe-wide inability to exit this ( essentially banking, but now existential) “European” crisis under current political and economic governance conditions. Mr. Sarkozy led the politically popular and populist charge – plus ça change!), followed by the floating by Berlin of the “Competitiveness Pact”. And recent European and global financial press coverage has firmly placed our CT rate on the negotiating table as part of the “European” CCCTB discussion that will take place at the March Summit. Incidentally, it ( CT rates) has also been put on the agenda in the US by President Obama as part of an effort to incentivise US MNCs to create more employment back home in the US where a “recovery” is also not creating jobs. The second of the three points concerned the ( apparently?) now accepted fact that even if Ireland is successful at preserving our CT rate in these negotiations, and even if Ireland continues to be successful in attracting US MNC FDI in very difficult circumstances, the resulting net employment-creation ( in Ireland) peaked nearly ten years ago. Some of you will remember that it was suggested that, while Irish “industrial” policy since TK Whitaker had served us well, it was now time, in new circumstances for a new policy, with a fully developed, new strategy to go with it. The third point was that continued high levels of unemployment in Ireland would lead to high(er) levels of emigration and that we needed to deal with this fact (preferably maturely, unemotionally, and even as an opportunity). So, let’s discuss it! Is this site now devoted exclusively to commenting on foreign newspaper articles rather than real economic data? It rather looks like it if you look down the recent list of threads. With regard to this particular article, I’m afraid that it is just the usual over-egging of the doom pudding. Firstly, with regard to the figures, these sorts of articles always use ESRI forecast figures and not CSO actual figures, and contain the usual statutory interview with Professor Alan Barrett of ESRI, who is responsible for the ESRI forecasts. Over the past few years, CSO actual figures have differed greatly from ESRI forecast figures. ESRI forecast figures, published before the period in question began, indicated net emigration of 120,000 between April 2008 and April 2010, the figure bandied about in the media and on this site at the time. However, CSO actual figures, published after the period in question was over, put it at 42,500 between April 2008 and April 2010 (of which 66.1 per cent was foreign nationals going home). I can’t think of any other field where the media and the ‘experts’ prefer to use forecast figures published before the event began, rather than actual figures published after the event was over. It certainly doesn’t happen in sport. Following the last thread on emigration on Irisheconomy.ie, I was in email communication with Professor Alan Barrett. He still maintains that the CSO actual figures for April 2008 to April 2010 are wrong (although they have never been wrong before) and that his own forecasts for that period were correct (although they have never been correct before). This is akin to my going to Paddy Power and claiming that my bet that Tyrone would beat Dublin last July was correct, and that the referee had merely counted the scores wrong. I may try that one later this morning. However, rather than repeat the same arguments endlessly on here, I agreed with him then to let the matter drop until the census results are published later this year, when we will know for sure, and when either ESRI or the CSO will be proved wrong. I have full confidence that it will be ESRI that will be proved wrong. Although I don’t believe that it is likely to happen, if the census shows that ESRI were correct and the CSO wrong, then that would be a major loss of brownie points to the historically-reliable CSO and they would have to review their inter-census population estimation methods. However, if the census shows that the CSO were correct and ESRI wrong, then Professor Alan Barrett’s credibility in this matter will be totally shot to pieces. I will predict that, assuming the electorate vote in a politically-correct and media-approved manner tomorrow, the divergence between ESRI forecast figures and CSO actual figures will narrow dramatically in coming years. Secondly, regarding the composition of the figures, of the 42,500 net emigration between April 2008 and April 2010 estimated by the CSO, fully 28,100 were foreign nationals going home. In what way is this emigration? Am I an American emigrant because I lived in California between February and June last year? If you read the papers in California, you will find that, since the recession began, lots of Mexicans have gone home. Are these American emigrants? The bottom line is that, according to historically-reliable CSO inter-census estimates (but which, as I say, ESRI are claiming are wrong this time round), net emigration of Irish nationals, the most relevant figure, amounted to 14,400 between April 2008 and April 2010, and not the 120,000 or so figure forecast by ESRI beforehand and repeatedly bandied about in the media as if it were fact. Thirdly, regarding the destination of those Irish nationals leaving (if the CSO figures are correct, a fraction of the number claimed in articles such as this to be leaving), it appears that they are nearly all going to Australia, Canada etc. Contrary to Professor Alan Barrett’s claims in a recent Irish Times interview, I can see very little evidence of any significant net outflow to the UK, at least up to 2010. In his Irish Times interview in December, Professor Alan Barrett made great play of the fact that approximately 11,000 new UK National Insurance numbers were granted to Irish nationals in 2010 (actually very little different to pre-recession). True, but 13,400 new Irish PPSN numbers were granted to UK nationals in 2010, which natuarlly he didn’t mention in his Irish Times interview. So, its a 2-way flow between Ireland and the UK, and there is very little evidence of much change in that flow since pre-recession. In passing, I note that it was announced last week that London’s Irish centre is to close (link below). This hardly indicates much replenishment with new blood. http://www.irishpost.ie/ Fourthly, with regard to future net migration. every time that there is a recession in Ireland (every 25 years on average), we are deluged with claims of mass net emigration stretching years ahead. I have brought up a few times on this site the Davy Kelleher (Colm?) McCarthy report on migration published in the late 80s. It forecast that the population would fall from 3.5m then to 3.3m in 2011. It forecast net emigration of 1m between then and now. There was much weeping and wailing about it in the media at the time. Lots of articles in the Irish Times, New York Times, Wall Street Journal et al bemoaning the terrible fate of the Irish that such a catastrophe should befall them. The FF (naturally) Taoiseach of the day was asked by assorted lefties to resign because of the grim picture it presented. I am sure that, if Irisheconomy.ie had been around then, it would have had a few threads devoted to it, each attracting a thousand angry posts. Turned out to be the biggest load of bullsh*t ever. The population rose from 3.5m to 4.5m in 2011 and there was net immigration of 0.5m. If current annual merchandise export growth of 28 per cent (from CSO figures published yesterday) is maintained, history is likely to repeat itself. @Brian Lucey If we want to change the results, we have to change the approach – to political economy. To what extent does recent (say post WWII) economic history suggest that political and institutional reform is a pre-condition of recovery from the kind of political failure we have here? Mancur Olson’s work suggests as much. To what extent will the results of tomorrow’s election deal with what the FTimes outlined as follows “In the long run, failing elites are discarded. That happened to the aristocracies and monarchies of old. In high-income countries, recent failures of elites have been too obvious to ignore. The advantage of democracy is that it discards failure more quickly and less violently than other systems. True, electorates may well make serious mistakes, by discarding what works for what turns out not to do so. Yet democracy imposes an invaluable discipline on elites: the latter must convince the public that they know what they are doing. Recent performance is making this quite a challenge. The people are complaining loudly. Elites must both listen and respond.”? http://www.ft.com/cms/s/0/777441d0-183a-11e0-88c9-00144feab49a.html#axzz1EreSxyvQ The National Economic and Social Council (NESC) has clearly admitted how the political, administrative and financial elites failed over the past 10 years. “In the past decade, Ireland’s approach to fiscal policy, prices, costs and financial regulation were not sufficiently adapted to the disciplines of a single currency.“ http://www.nesc.ie/dynamic /docs/The%20euro%20MEDIA%20RELEASE%20from%20NESC.pdf IMO, regardless of the outcome of the election tomorrow, we need to design, implement and use a series of checks and balances to limit the scope for excess by the powerful, whether they be public or private, elected or appointed in order to ; · ensure competence and moderation in government and · overcome inertia at government level, both national and local; so that our constitution is a framework for a free government that limits, restrains and allows for the exercise of political power, which we as citizens of a Republic own. We need to ensure that our way of governing ourselves has both · the means to be successful for the common good with increased democratic accountability and · the capacity and of adapting to the changes that constantly descend upon it. We citizens need to ensure that the state’s decision making-processes are structured and disciplined. We need to copper fasten new ways of governing ourselves to avoid the kind of muddling through, inertia, lack of foresight, and reversal that marks previous efforts at reform. To ensure this, I am firmly convinced that we need to embed both · Swedish style Freedom of Information and · Swiss style direct democracy into our constitution. However, these two steps will take longer to research, consider and implement. For expediency we must take those steps which we can, just to get us started on political and institutional reform. Only thus can our skills and energies open the paths to sustainable standards of living and greater justice. For anyone interested in one citizen’s five points, see p.56ff of the Dublin City Business Association(DCBA) 10-point manifesto http://www.dcba.ie/static/doclib/Towards_a_Second_Republic.pdf for all who wish to live and work here. @ Richard Fedigan I have a concern that we may be entering into the third phase of a meltdown of the Irish economy. First the banks gamble themselves into insolvency, while leading politicians are surfing a wave of short term cash flow. Secondly the state is bankrupted by blinkered croneyist decisions to socialise the banking losses. Thirdly the shrinking sovereign loses its attraction as an MNC profit centre, as CT changes are imposed. What is your development strategy for this increasingly possible scenario ? @ JohnTheOptimist +1 The wallowing, particularly on emigration, is way over done! What was that quote ‘THe Irish are a series of stories that they tell themselves, none of which are true’ @John McHale, Many thanks for this thought-provoking piece. ( I see you get an honourable mention – and that Richard F has beaten me to the keyboard!) Previously, when the good times rolled, there was much debate as to whether Ireland could be viewed as a national conomy catching up with its peers or a regional economy within a defined economic space. My sense is that Ireland operates as a regional economy in two dimensions. We may continue to use the tired old language of emigration, but what we are seeing now is qualitatively different. Due to airline de-regulation, increased capacity and lower unit costs we are seeing Irish labour mobility within the globally dispersed developed Anglophone economies. This is one dimension. For a variety of reasons (language, culture, history) we are seeing much less mobility on the other dimension within the European economic space – despite its operating principles of freedom of movement of capital, labour and goods and services. We have proved adept at attracting FDI from the developed Anglophone economies – in particular from the biggest one – but we have not been good at attracting it from the European economic space. Nor have we been good at its counterpart Domestic Direct Investment (DDI) – apart from building properties to sell to each other. Germany is encountering labour shortages in a number of areas. This is the dimension we need to explore seriously. Unfortunately, for many Germany is being viewed as the enemy – imposing bank losses on us – but Germany could make good use of Irish productive resources to the benefit of us all. It has access to the global markets and insufficient resource to service them; we have valuable, but underemployed, resources. We need courage, imagination and vision before the developed Anglophone economies snatch the best of what we have – even if it is only on a temporary basis. @Brian Lucey Just to clarify, are you using The Irish Economy website to urge voters neither to vote Fianna Fáil nor Green? I doubt anyone really captures the figures accurately or forecasts them accurately. There will undoubtedly be even more people leaving as the personal debt crisis unfolds as well as younger people leaving to find opportunity/career openings. You can go on all you want about previous figures differing from some other figures but this is the here and now and this (link) is just the tip of the iceberg: http://www.rte.ie/news/2011/0224/ulster-business.html I personally know many people who have left in the past few months (mainly to Canada, USA, Australia, UK), who are planning to leave in the next few weeks or who are hoping to run away from debt as soon as they can find an exit. I have a phone interview for a role in Grand Cayman tomorrow. Wish me luck! Hopefully, my vote tomorrow will be my Parthian arrow. Anecdotal maybe ……. (and I know you hate that JtO) but I’ve spoken to at least 100 students in the past week (under 30’s) and only one of them had anything positive to say about the idea of staying in Ireland to pursue a career or any confidence that any new incoming government could sort out the mess left behind by the last lot. They all consider politicians to be a laughing stock and don’t believe a word that comes out of their mouths. I think that’s understandable. @JTO I hate to disagree with you since you tend to be far too kind to me in your comments. But I am concerned that the ESRI estimates might be a lower bound, at least for gross emigration. The forecast for gross emigration for the year to April of this year is 75,000. This follows gross emigration of circa 65,000 for the years to April 2009 and 2010. It is true that the stock of immigrants has decreased, so we can expect that the number of returning immigrants will decline. But a comparison of the gross emigration numbers for the year to April 2010 and the year to April 2009 already shows a shift from returning immigrants to outflows of the native born. (The number of native born that left rose from an estimated 18,400 to 27,700; the number leaving originally from the “EU12”, fell from an estimated 30100 to 19,100.) While it is mainly based on anecdote, there does appear to have been a significant pick up in the emigration of the native born over the course of the year since April. p.s. the one who expressed confidence in a new government sorting the mess out is the daughter of a TD. “An exodus could also reduce demand for housing, depressing already low prices and deepening the losses faced by Irish banks” Already low prices? What is this journalist talking about? Already low in comparison to what, the super bubble of 2006? Here’s some comparative data Sales price per square meter Berlin €1,800 UE: 12.5% Frankfurt €2,800 UE: 8.2% Strasbourg €2,750 UE: 9.7% Copenhagen €2,800 UE: 7.8% Dublin €3,000 UE: 13.5% WSJ: “It’s not just English-speaking countries that the Irish are heading for. After the U.K., the favorite destinations for Irish people last year were new European Union member states such as Poland and the Czech Republic, with older EU countries like France and Germany coming in third, according to figures from Ireland’s Central Statistics Office.” They seem to be unaware that many of our emigrants are economic migrants returning home. @ BL: “. . . we’ve been driven back to the 1980s.” Should I be grateful, in some perverse manner, for your endorsment of my many cited asssertion that we are not in an economic depression, but in backwards transition to an economic Regression. I had supposed it might be the mid-1990s. We’ll see. @ PQ: “What is your development strategy for this increasingly possible scenario ?” Paul, you did not address this to me, but there are several things that are fairly urgent. 1. The bank deposit guarantee has to be foregone and no additional taxpayer euros shall be paid. This is non-negotiable. Ergo, a swift Referendum on the matter. If the citizens say NO – thats it. I’ve skikked the necessary detail on this one, but you get the idea. You cannot pay what you do not have. 2. Forget the CT thing, its a dreadful distraction. Depress, cut, slash or whatever euphanism comes to mind, all wages, salaries, earnings, etc. above the av ind wage level. All new hirings in any public service position shall lie between min wage (which should be restored) and av ind wage. Take it or leave. Hold a second Referendum:Increase taxes or reduce incomes or reduce employments. Its truth time. We have to live within the limits of our after-tax incomes, without resorting to personal or state credit cards to enhance our consumptions. 3. Massacre the HSE. Universal health provision for all. No exceptions on income, etc. 4. Reform Local Gov fast. Other political reforms will follow. 5. On educ: full third-level fees, except in Institutes of Technology which DO NOT offer degree programmes. Private, fee charging second level schools have three years to transition to no state salaries for any teacher. Any savings are transferred into Primary and Secondary especially Primary, which should have an age limit at 14, not 12. Jettison the existing Leaving Cert syllabii. They are anti-knowledge (as in Knowledge Economy). 6. Cram our existing banks: set up three new entities. Domestic, Commercial and Savings and Loans. BpW ps: I shall not respond to any comments however complimentary or abrasive. If you do not like them, then please propose your own. Lets see if we can come up with some consensus – say three essential, and immediate reforms. @Bork +1 Incredible they didn’t make that connection! off topic: I know Krugman does bang on on this theme but I liked this post http://krugman.blogs.nytimes.com/2011/02/21/misguided-narratives/ @Sarah Carey http://www.ballotbox.ie @All Irish Emigrants, Migrants, & the Fun Loving simply Footloose … To vote is your RIGHT – see upcoming in European Court of Human Rights – be ready to VOTE in the Next General Election – which is not that far off …. smart political economics an all dat …. @X_minister William O’Dea Must be those 20 million bullets that are scaring so many away … p.s. may we have that Sherman Tank back now please? Or do we have to send in the sheriff … or the rubber bandits? Blind Biddy needs it for her final push in the hustings in Kingstown … @ JtO, Sarah Carey, etc. A 22-year old person born in Ireland, who has had a good eduction and a degree from TCD, decides to make her way in the world by going to New York, where she secures a good job with a good wage. Good thing? Bad thing? A Polish electrician comes to Ireland in 2000, gets works finds a partner, and his children are at school. In spite of the tremendous pressure of the cost of accommodation he does well until the collapse in construction sector. Severely fancially reduced, and uprooting himself from his community he makes his way back to Poland. Good thing? Bad thing? I’m not comfortable with guessing at the inner hearts of people going either way. @ Joseph i personally know of only 1 person currently leaving (2 wks ago) this country, and that is a relatively young cousin of mine who’s headed down to Oz to do some building work for the year. Another lives in the US and was considering coming home this year, but has decided to put it off for a year or two, as much from a great new job opportunity for her husband there (for an Irish company) as much as the lack of opportunities here. I’m sure there are plenty of friends of friends etc who are looking at the UK or Ozzieland, but i can’t think of a single person “emmigrating” as opposed to heading off for the year. Of the 25 or so of my cousins in their early 20’s to late 30’s, i think all are employed or in full time education/study. While my own viewpoint may be an outlier, and while i obviously wouldn’t envy the choices available to the graduates of 2010 or 2011, and heading off for the year may be the simplest option available, I suppose there’s two sides to every story, and its not always as clean cut or as simple as the media would often portray. @ Gavin “A Polish electrician comes to Ireland in 2000, gets works finds a partner, and his children are at school. In spite of the tremendous pressure of the cost of accommodation he does well until the collapse in construction sector. Severely fancially reduced, and uprooting himself from his community he makes his way back to Poland. Good thing? Bad thing?” lets go back to 2001: “A Irish electrician comes to the US in 1992, gets works finds a partner, and his children are at school. In spite of a decent job and a good life, he longs to eventually return to his homeland, so uproots his family and life and returns to a booming Ireland in 2001. Good thing? Bad thing?” I think we all viewed, and still view, the latter story as a very “good news” story, why should it be different for our Polish friends? http://incomeproperty.buyorsellinlosangeles.com/surge-in-emigration/ @John Mchale The stats are quite clear in the WSJ. They refer to NET emigration. A summary of the facts in the dispute would be as follows: (a) Before the period in question began, ESRI forecast NET emigration of 120,000 between April 2008 and April 2010. Note: not GROSS emigration of 120,000, but NET emigration of 120,000. (b) After the period in question ended, the CSO estimated NET emigration of 42,400 between April 2008 and April 2010, one third the ESRI forecast. (c) For months after the CSO estimates were published, JTO banged on and on and on about the ESRI forecasts being shown to be inaccurate by the CSO estimates. (d) Following email communication with ESRI, ESRI then said that the CSO estimates were wrong and that their own forecasts were correct after all, but that it wouldn’t be known for sure one way or the other until the census results were out. In response, JTO said that he will let the matter drop for now, and instead await those census results. These will show whether or not it was ESRI or the CSO that got it wrong. (e) If it was the CSO that got it wrong for the period 2008 to 2010, so be it. It would not be good for the reputation of the CSO. However, I think that unlikely. (f) If it was ESRI that got it wrong for the period 2008 to 2010, then clearly their forecasts for the years beyond 2010, on which the WSJ article is largely based, lack all credibility. We will know for certain later this year. @Sarah Carey, Maybe not too far off-topic. What the esteemed Nobel Laureate is missing (similar to many of his equally esteemed peers) is that Chancellor Merkel recognises that, because her predecessors implemented it technically, but not actually, with voters’ direct consent, the required repair of the EMU will require the input of voters’ tax Euros. She is keen to create the fiscal space to allow this fiscal support to be provided while at the same time providing assurance to the sovereign bond market. It is a delicate balancing act between vengeful voters on one side (angry at what has been done in their names, but without their direct consent) and a sovereign bond market on the other side keen to minimise future uncertainty. Prof. Krugman is correct though in the sense that the Neocons (and their useful idiot supporters) are seizing on this to push back the boundaries of the state in every developed economy and to minimise any constraint that might be imposed on the forces of capitalism. Chancellor Merkel is no Neocon. She appears determined to bring the forces of financial capitalism to heel and will resist (and be encouraged by her voters to resist) any pushback of the boundaries of the state. @Gavin I didn’t guess inner hearts – the point is – the article is factually incorrect. It says “It’s not just English-speaking countries that the Irish are heading for. After the U.K., the favorite destinations for Irish people last year were new European Union member states such as Poland and the Czech Republic…..” Clearly the “Irish” are not leaving for Poland. The Poles are going home – for good or bad. @Gavin K Im urging people to vote. Full stop. Im also urging people to not reqward sequential massive failure. That failure is, I am 1000% certain, neither retro nor prospectively confided to, initiated by, or caused by FF/Gp. But, we are where we are. @JTO I understand that the debate — and the figures from this article — are in terms of net immigration. But it is useful to break it down into the gross flows, not least in considering the plausibility of the net figures. So I was trying to broaden it out a bit. The ESRI forecasts for gross emigration are 75,000 for the year to this April and 60,000 for the year to April 2012. The average forecasted outflows is then a bit less for these two years than for the previous two years. Is this consistent with what we are seeing the ground? I do think that the media can sometimes overreact to the more acedotal evidence, but I sense a real shift in how the emigration option is being viewed, which might be partly explained by the re-establishment of emigrant networks. @Brian Lucey Im urging people to vote. JTO again: Excellent advice! I endorse your plea. Unfortunately, thanks to the RIC, Auxilliaries, Black and Tans, RUC, B’ Specials etc, I don’t have a vote in this election. Touch wood, this will be the second last election in which such is the case, depending on whether or not the FG government lasts until 2021. As the economy is clearly recovering, there must be a good chance that it will, although obviously if all the oil-producing countries were to go up in flames, that would knock the recovery off track for a bit. After the election, I wonder if all the trendy left-wing media commentators will be regretting demonising FF so much. As there is no left-wing majority in Ireland, or even close to it, the left can only be in government when there is a fairly equal split between FF and FG. As they saw FF as all-powerful, and FG in long-term decline, the trendy left-wing commentators went overboard in demonising FF for the past decade, hoping that that would reduce their vote sufficiently to allow an FG-Lab or a Lab-FG government in, one in which FG and Lab would have roughly equal numbers of TDs, and Gilmore might even be Ireland’s first ex-marxist Taoiseach. It must have seemed an excellent strategy at the time. Alas, it looks like they overegged the FF-demonisation pudding, and the FF vote has slumped to the point where only truly evil people (like myself if I had the vote) could contemplate voting for them, so much so that FG might now get in on their own, resulting in Ireland’s most right-wing government ever. I bet the trendy left-wing media commentators never thought of that. Although, for historical reasons relating to the factors mentioned in my first paragraph, I wouldn’t be inclined to vote FG, were they to get an overall majority, there is a serious risk that I could die from excessive laughing over the weekend, knowing the despair and grief that such a result would induce among those trendy left-wing commentators, a despair and grief that was made one hundred times worse for them by the knowledge that they had contributed so much to it. Net emigration over a two or three year period gives a better picture of the real impact of the recession than the gross flows. The 1 year visa emigrant is the best illustration, where a person is an emigrant one year and an immigrant the next – there were thousands of young Irish people in this situation even at the height of the boom. Also, the CT debate seems to be heading more towards a consolidated base rather than harmonised rates, so the incentive, GDP generating, etc impacts of the low CT rate on the MNC sector would probably still be available. We would then need a good cost benefit analysis of how much of our existing and future CT we’d have to hand over to the Germans, etc. vs. the long term benefits of renegotiating the bailout @ALL “There are no circumstances in which Ireland as a sovereign nation should default.” Michael Noonan, FINE Gael, right now, on RTE Radio 1 hosted by Patronising Pat, the arch in-sider. @Eoin Bond An industrious lot – the Bonds. Blind Biddy is sending her cousins into the French Foreign Legion, to certain parts of Waziristan, certain regiments of the British Army, the US Marines, & other sundry spots where the english language is rarely spoken – and they are ALL coming back after a while – must be something heavy coming down the line ….. but Biddy is staying mum at the mo … little matter of ousting A. N. Other X-Minister_Mary tmro top of her agenda at the mo ….. are all her cousins are voting of course before they go … early and often … @John the Optimist ‘… the RIC, Auxilliaries, Black and Tans, RUC, B’ Specials etc, I don’t have a vote in this election.’ Shudda phoned Blind Biddy John – she wudda got you sorted (-; @brian lucey “They get that high a grade for honesty, for turning up and completing the test, but that’s it.” Are you going soft? They all got tax free enhancements to salary for turning up. Why would you give them marks also? Paul Hunt makes the important point that the Irish economy operates more like a regional economy that a “classic” national economy. The defining characteristic of a regional economy is factor mobility. This can make the population of a regional economy quite indeterminate, especially where feedback effects (e.g., lower scale reduces productivity or the type of fiscal feedback loops mentioned in the article) are in operation. One of the most striking graphs from Irish economic history is a comparison of the Irish and English populations over the last few centuries. See here for a pair of graphs (especially the second) from Timothy Guinnane’s book, The Vanishing Irish. The wide-range of possible Irish populations came back to bite us during the property boom. Although we now all have 20-20 hindsight in identifying the property bubble, there was a range of plausible fundamental equilibria, causing the basic fundamentals of the housing market to become unanchored. Marc Coleman comes in for a lot of mocking, some brought on himself by his combative approach, but he did make an important point about the range of possible Irish population futures. Of course, the feedback loops can operate to reinforce the reductions in population as well as reinforce increases. There are also other forces that can turn things around despite the population loss. This happened after the 1980s wave, and I think that on balance that emigration wave turned out to be a significant net positive for the Irish economy. People returned with enhanced skills — and especially international experience and connections. There is a decent chance that this will happen again, but we shouldn’t take it for granted. While in many cases modern emigration is far from an individual disaster, my sense is that it is better to have our young people here — not least to drive institutional change — rather than somewhere else. @John the Optimist Blind Biddy (via Twitter): How many votes you want John? Paul Quigley ( et al.) Let me be very clear on my view on the subject of this thread. There is ( and there has not been) ENOUGH “emigration” from Ireland, and, as a result, Ireland is a failed economy and state. You, Paul Quigley, have summarised our situation this very well in your three points: 1.) Irish banks gambled ( themselves) into insolvency 2.) Irish state bankrupted by decisions of ( democratically-elected) Irish politicians to socialise these banking losses 3.) Irish “shrinking sovereign” loses attractiveness as an MNC profit centre as CT changes are imposed. ( In substantive/arithmetical/economic terms, CT rates may, indeed be a “distraction”, but the reality is that it PERCEIVED to be a negotiation point and therefore, quite simply, it IS. ( We don’t have a lot to negotiate with). May I add a fourth point, the subject of this thread, “emigration”. People leaving one geography to move to another geography because the other geography is where the jobs are is not a PROBLEM. It’s reality. It has ALWAYS happened. And it ALWAYS will. I would contend that Ireland has reached the state described in Paul Quigley’s 3 points because not enough Irish people seriously looked elsewhere for alternatives to the way we have done things in Ireland since “independence”. ( I do NOT want to be sidetracked into discussions about “fact-finding missions”, Erasmus programmes, ‘gap’ years, back-packing around Thailand, doing a “stage” in Brussels, getting a degree at Harvard, working for a semi-state organisation in Prague or 5 years ” experience” as an MEP ( see vomit-inducing interview with Dick Roche on BBC World last night!) Quite simply, an economy as open and trade/export dependent as ours needs people with VASTLY more international WORK/private sector EXPERIENCE at all levels of our society. And the ONLY way to get this experience is by “EMIGRATING”, or at the very least spending a CONSIDERABLE amount of time WORKING (and absorbing ideas) elsewhere. We are, and have been for too long, almost completely focused on OURSELVES, our past, our successes, our houses and, right now, the problems we have that were all caused by SOMEBODY ELSE! Let me be clear, once again, for balance, that this is by no means true only of Ireland. In France, where I have lived for almost 30 years ( but always working” internationally from here, real experience of and knowledge of the outside world is ABYSMAL, particularly among young people. In addition, everything here is filtered through a language that is no longer a global language, particularly as far as business is concerned. In Ireland, we do NOT have this excuse! Finally ( for now) and in full awareness of your very pertinent question “what is your development strategy for this increasingly possible scenario?”, I have already suggested in a guest post ” Taoiseach from Mars” that we need a NEW mechanism to consider precisely this question. I believe that there is an urgent need to bring a number of truly INTERNATIONAL “creativity” ( NOT “innovation”) facilitators to Ireland to work with selected ” Irish” professionals, both resident and not resident in Ireland to answer this question. ( I am NOT suggesting another Farmleigh “Diaspora” propaganda exercise!). Our existing structures simply CANNOT answer your very good question, Paul. I’m jumping the gun, but one conclusion of such a process might be that the Taoiseach announce that, while he will run the government, he is appointing someone else to run the economy! @John McHale The most important factor of production in a smart/knowing_intensive, increasingly services/intangible oriented economy is Human Capital. Short/medium term human capital mobility is a positive – if it returns here – if not, it is simply DUMB economic policy to gift such a gift to other economies/societies – double-negative feedback loops. & I know that you do know all this already – you are far superior on human capital mobility/flows than you appear to be on dodgy financial capital flows ….. @All Polish To all my Polish friends: Don’t go – the gene pool here is a touch inbred at the mo – enhance it (-; This article is written with the traditional “American Wake” view of emigration. The US itself has a broad unemployment rate above 16% and its housing crisis is impacting its famed traditional mobility. In the US today, there is a growing realisation that the expectation of each generation doing better in terms of standard of living no longer applies. Ireland is also not immune from the emerging trends of globalisation and Ireland as mainly a base for foreign firms is well-located for Europe but not for other areas of the world. Emigration if there is an opportunity for a reasonable type job overseas is preferable to being unemployed at home and depending on the individual, there are better places than Ireland to live. The Irish tend to gravitate to English speaking countries because of poor language skills but the 2 principal such countries have employment challenges themselves. An example of the changing world is the emigration in recent years of 100,000 Portuguese to Angola, Portugal’s former colonial subject. The Irish Indo has an article today quoting Angela Merkel as saying “Ireland’s 12.5pc rate had distorted the tax system here, leading to what she called “misallocations”. http://www.independent.ie/business/irish/irelands-low-corporate-tax-helped-fuel-banking-crisis-claims-merkel-2554023.html Now I accept that Ireland is a small farty economy which shouldn’t merit too much attention from the German Chancellor, but we can’t have her thinking this is true. Corporation tax has held up well during Ireland’s meltdown. The unsustainable taxes came from a massive asset bubble. There is greater truth in arguing that German reunification had a greater distortion on Ireland’s tax system than Ireland’s corporation tax rate. Ahura Quite a few contributors here tried to point out the EZ perceptions of the Corporation Tax rate and how it would be targetted. The usual reaction here was defensive sneering. If you want it defended you have to understand how the other side’s “man in the street” sees it – and try to work out a counter argument that will work on him (not one that will do among a group of Irish economists). @John McHale, Thank you for trying to get the debate back on track. I think the thrust of your comment is valid: labour mobility – both in and out – has becoming a defining feature of the Irish economy. Just get used to it. And let’s not get tied up in knots analysing the statistical minutiae of these flows of people. It does, however, have major implications in terms of uncertainty in the provision of physical and social infrastructure – in particular, housing. The owner occupier model doesn’t fit this reality very well. And it raises questions about the recovery of investment in specific, long-lived assets. But my main point remains unaddressed. Given that it might be socially and economically desirable (for a number of reasons) to seek to dampen the volatility of these flows, how do we ensure that some of the equally mobile productive capital spends enough time in Ireland to absorb some of this surplus labour supply that would otherwise move elsewhere? The number of graduates leaving the country due to unemployment is truly depressing and wasteful. Taxpayer investment in higher education is not reward when so many have to leave. My main criticism of the article is that it fails to join the dots explicitly between the lack of success of knowledge economy policies and the huge public levels of R&D subsidy. @ Paul/John as MH notes, this is aimed at a US audience. If we took emmigration figures from large parts of Mexico, or even from certain particular US states at times of economic downturn, how bad would the figures look? Worse than Ireland in some instances? Its the same basic principle of labour mobility. @Paul Hunt, John McH The volatility of the Irish economy over many decades, combined with labour mobility goes a long way towards accounting for the entrenched mediocrity in much of its public sector. It tends over time towards population by people with either less initiative or less marketable skills and attitudes. Think back to who was around, in what positions in the early ’90s – and how those incumbents rode the incoming tidal flow. Explains a lot in my view. Just typed the above when advised Donal Forde just appointed to Chair Red Cross. Now there is an example (not personal ho him obviously) of a guy who is connected not having to sell his skills and record to foreigners. He will be kept in the greater public system. What a set up. speaking to my father last night he was telling me about the liveline discussion on emigration. it would seem many people have skills that ireland won’t need any time soon, the m.a. is the new b.a. and ff have a rendezvous with reality this weekend. @John McHale https://docs.google.com/present/view?id=0ATPiIoPVJ2alZGYzcDJmY18xZjJ6NHFyZ2Y&hl=en&authkey=CMyE5-MG I have not read the book ‘The Vanishing Irish’. Nor do I know when it was written, nor in what context in the book the graph you link to is given. So, I am not criticising it. However, it only gives the population graph for Ireland up to around 1970. As a result, it only captures the beginning of Ireland’s population boom and, therefore, doesn’t give the full picture. If the graph extended up to 2011, it would show a dramatic upswing in Ireland’s population in the past half-century. Between 1961 and 2011, the population of R. of Ireland increased from 2.8m to 4.5m, an increase of 60 per cent. This was by far the largest population increase of any European country in that time and not far short of that recorded by the U. States. Notwithstanding the conflict that was raging for most of that time, the population of N. Ireland also increased from 1.4m to 1.8m, so the term ‘The Vanishing Irish’ certainly doesn’t apply to recent history. I see no reason to think that these rates of growth will change in the next half-century. Ireland (both sides of the border) starts this half-century far richer, far more developed, far more peaceful than it was in 1961. @Grumpy @Paul Hunt @Paul Quigley @Alchemist Grumpy’s “entrenched mediocrity” ( not fair to link it only to “much of the (Irish) public sector” surely!) is a very useful description in two words of what has caused our problems. The outside perception is that this was leavened with a truly irritating dose of arrogance that European voter-taxpayers in particular find hard to stomach when, as they see it, they are finding the going tougher and tougher for their ageing populations and their increasingly unemployed young people while being asked to bail out Greece, Ireland and more to come. This means that their perceptions continue to be derived from sound bites. And the “Irish” sound bites are all bad news competing with much more interesting bad news, from Libya for example. The bad news that impinges on European voter-taxpayers from Libya, for example, is about perceived higher energy prices and inflation. Against this back-drop, you may be interested to know that that there is absolutely NOTHING on the main French TV news channels about an election taking place in Ireland tomorrow. Nothing, good OR bad! To come back to this “Leaving/”emigration” thread, and at the same time address Paul Quigley’s “what development strategy?” question, I believe a top flight international strategy facilitator ( I know and have worked with a few) could make real progress with a challenge framed as Paul Hunt framed his question: “How to ensure that some of the mobile productive capital spends enough time in Ireland to absorb some of the surplus labour that would otherwise go elsewhere? A corollary question, as part of the same brief, could be a question about how to keep the more skilled, entrpreneurial “labour” that does leave Ireland “invested” in the answer to Paul’s question. This sort of strategic questioning ( within an appropriate mechanism) is what needs to be done. Why is it not being done? Indeed, if it is being done, or was to be done, it would be the kind of “message” that taxpayer-voters, in Ireland and abroad, just might pay attention to instead of the fantasising that passes for “policy” right now. By the way, Alchemist, “the number of graduates leaving the country due to unemployment is truly depressing and wasteful” is a statement that, in MANY cases is SIMPLY NOT true. My nephew will graduate in Ireland in a couple of months, will leave Ireland on my advice, because he has already found the job he wants, that he could NOT have found in Ireland ( DEFINITELY an international job), is totally fired up and excited about it, and MAY come back to Ireland ( he loves it) depending on what we do in Ireland in the next year or so! He’s not depressed at all. Au contraire. Whether it’s “wasteful” for Ireland ( it’s certainly not for him) surely depends on whether we get our act together. Or not! @ALL 14.00 [Communication from Patricia the Irish Sovereign_in_Exile (via Twitter; Facebook; Reuters; AP; AlJazeera; CNN; and across the known universe) I urge all sane Irish citizens to only vote for those parties and individuals deemed to be SOUND ON THE BANKING QUESTION. We have to get rid of Toxic Banking System Dept which in no way whatsoever [morally, economically, socially, psychologically, spiritually] can be justified as conflated with Genuine Irish Sovereign Dept. Those who continue with The Conflationist Fallacy are guilty of Economic Treason, which leads inevitably to my death – the death of Patricia the Irish Sovereign, and the devastation of my people. @JTO My reference to the graph was not meant to be predictive in any way. The purpose was just to show range of possibilities for the population path, especially for a “regional” economy (i.e. one exhibiting significant factor mobility). The comparision with England provides a useful if obviously imperfect counterfactual. The very rapid growth in the population in more recent years is actually another good example of striking population change in a regional economy. Because of the feedback loops, population dynamics in such an economy can develop momentum over a period of time. But it is important to remember that those feedback loops can work both ways. Hi, Trying to start a repository of links urls to our unfolding crash here at links, http://www.bankpoll.net that show how our response is being measured/seen from abroad There’s accompanying forum http://www.bankpoll.net/phpBB3/ anyone can drop a link into at any time as well. You can use contact form on the website to send a link or use the forum. The more links I get to articles/docs/books/videos the more use the site is for all interested in such matters. Colm I suspect that the vast majority of contributors and readers to this site, like myself are over 35 years old. The figures from ESRI show that job loss is felt harder in the under 25 bracket. These are also the most mobile people due to lack of family ties in terms of kids. It is hardly suprising that these people feel most annoyed with the current political system and will secure a future elsewhere. It is also not suprising that many here comment that they do not know many that are leaving or feel that only the polish are leaving. This is due to your age and the age of your circle of friends. There are 2 differnent job markets at play in ireland. The over 35 where some have lost jobs and the under 25 where huge numbers have lost jobs. I could add the public service where none have lost a job but I suspect that would open a can of worms. I partly blame ESRI (among others) for this ridiculous nugget from the article (pointed out earlier by Sarah Carey above) “It’s not just English-speaking countries that the Irish are heading for. After the U.K., the favorite destinations for Irish people last year were new European Union member states such as Poland and the Czech Republic, with older EU countries like France and Germany coming in third, according to figures from Ireland’s Central Statistics Office.” ESRI, CSO and other commentators need to explain about the difference between Irish out-migration and eastern European returning emigrants. One can blame the WSJ if one wishes for the misinterpretation of the data, but our own commentators are doing an extremely poor job of differentiating between these different types of migrant flows. Many Polish young people, just like Irish young people, only planned to stay away from home a few years, did so, and the returned home when the foreign economy turned bad. That is to be applauded in the sense that it is a move to improved labour mobility within the EU. The Irish CT rate is a sub-plot within a sub-plot in the EU context. And the more Ireland bleats about and makes declarations along the lines of “over our dead bodies” the more it will be elevated into choice sound-bites for the more taloidish media organs and become part of the popular narrative. Chancellor Merkel is being forced to take a circuitous route, and to indulge in some low politics, to secure her objective of shoring up the EZ financial system and reforming the EMU. Key preliminary parts of this are to delay the effort for as long as possible to provide the more solvent banks to begin to trade their way out of difficulty and to establish the fiscal space to support the recap of banks that might need it. (On the latter she has been forced to beat back her FDP coalition partners who secured 15% of the vote in 2009 on promises to cut back the state and to reduce taxes.) But before she can ask her voters to cough up to shore up the financial system she must be able to demonstrate to them that voters in other countries are paying and will pay a fair share of the cost of repairing the damage. Rightly or wrongly there is a popular perception in the core EZ countries that Ireland did not pay its fair share to the EU while it was booming, was prepared to lecture all and sundry about the glories of its economic model, that its low CT taxation is part of this and that this, in turn, was facilitating the stealing of investment and jobs from the core economies. And to top it all they had the effrontery to vote against the Lisbon Treaty 3 months before the wheels came off. This doesn’t mean it shouldn’t be defended, but some sense about EU taxation policy should be conveyed in quiet, firm words in the corridors of power in Brussels and elsewhere. Let Chancellor Merkel play her low politics to soothe her angry voters. We need them to consent to some burden-sharing. This game will proceed at its own pace and in its own way. It makes sense for Irish politicians to demonstrate domestically their resolve to defend it – and to present the future challenges for Ireland’s economic and industrial strategy, but defiant sound-bites gaining currency in the international media would be counter-productive. It has diminished the democratic process that politicians were unwilling to present to voters their proposals on the structural reforms that will be pursued as part of the EU/IMF deal this year – even though much of the analysis has been completed. It has also diminished the process that voters have not been confronted with the reality of Ireland’s position as a regional economy with much diminished sovereignty. I think most voters have some realisation, but politicians continue to attempt to suspend disbelief. We are all worse off as a result. @John McHale I agree with you that a small globalised country, especially one speaking a language, like English, that is widely spoken elsewhere, is likely to have much greater population fluctuation than a large country, speaking a language that is not widely spoken elsewhere. However, I would not use the term ‘regional’ economy for Ireland pre-1922, which is when the big population decline shown in the chart occurred. For pre-1922, I would use the term ‘colonial’ economy. This may be of interest to you. By sheer coincidence the UK annual migration report was published today. I had no idea of this when I posted earlier this morning and disputed claims of there being significant net emigration from Ireland to the UK up to last year (although I agreed that there was some net emigration from Ireland to countries like Australia, Canada etc). I discovered it by chance on the BBC website at lunchtime. The report gives the UK ONS population and migration estimates for June 2010. So, I googled and found the corresponding report published this time last year, giving the UK ONS population and migration estimates for June 2009. Links to both are given below. http://www.statistics.gov.uk/pdfdir/mig0210.pdf (Irish figures page 13) http://www.statistics.gov.uk/pdfdir/mig0211.pdf (Irish figures page 18) The figures the UK ONS give for the number of Irish-born (ie Rep Ireland-born) persons living in the UK backs up what I said. The figures are: June 2009: 408,000 June 2010, 398,000 If I recall correctly, the figure quoted in the media back in the 60s, 70s and 80s was ‘1 million’ Irish-born persons living in the UK. It has been in continuous fall since then. The latest figures show that it fell by 10,000 between June 2009 and June 2010, which helps explain why the London Irish Centre is closing. Even though the 10,000 fall between June 2009 and June 2010 may be largely explained by deaths, it hardly bears out Professor Alan Barrett’s claims of a mass exodus from Ireland to the UK. @ The Alchemist, “The number of graduates leaving the country due to unemployment is truly depressing and wasteful” I don’t mean to be picky, but I would have thought that it would be a greater waste if graduates put their life / career on hold for 3 or more years while the Irish economy gets back on track. As the world becomes more complex and demands higher level skills then going abroad to obtain the necessary skills / experience / knowledge in other countries is required for specialist areas. I don’t see that as wasteful. Depends on one’s perspective I suppose! But there is a lesson for the Irish political class, continue on with wasteful practices, crippling taxation, shoddy public services and zero accountability then there will be no future for this country. Those people who can get out, quite rightly will. @ Joesph, Best of luck with the interview! @VOTING RIGHTS FOR IRISH EMIGRANTS, MIGRANTS, FUN_LOVIN FOOT_LOOSE ETC http://globalirishvote.com/ @JtO Look at the confidence intervals on those estimates of Rep. of Ireland origin population in UK. Far bigger than the annual change and entirely consistent with the claim of thousands of extra Irish in UK since last year. On the basis the thread title deoes not specifically refer to people, more market familiar readers might like to note the Irish sov 10 – 2 yr spread is also leaving familiar teritory as of today. Given the recent peak in Eu bank stocks I wouuld suggest FG get ready to hit the ground running and try not to say anything stupid. Looks like the state’s Anglo business has given its deposit liabilities to the state’s Allied which has taken bonds guaranteed by the state, plus a few extra bonds in exchange or some actual money that Anglo apparently has a more urgent need for. Looks like only one week of voluntary use of MLF prolly at an extra cost of, what 3 or 400k? On the eve of the election. @Paul Hunt I entirely agree with your comments about Merkel and the ICT (although I am too sure to see its relation with emigration ). I would merely add two comments on minor points: Merkel certainly knows that the Irish crisis is a financial crisis and not a fiscal crisis ,same with Spain. Greece and Portugal ,however have more of a fiscal crisis .Their banks are in better shape than the Irish banks but their budgets deficits where out of control before 2008 .From a German perspective Italy and France are not the most virtuous partners either .So, when she proposes structural reforms she does not mainly address the Irish crisis but problems that are less urgent but real nonetheless. Attacking the Irish ICT rate and tax base is not only a way to make the sacrifices that the German taxpayers will have to incur more acceptable for them , it is also addressing a real problem .Ten years ago, when a small country, with a very small export base, adopted a predatory tax system, nobody really cared (nobody cares what the Baltic states are doing now).Ten years later the rest of Europe realized that Microsoft, Google and others paid practically no taxes on their European businesses . This was a different story altogether . The present administration in the US is not too happy either . “Favourite destinations for Irish people…” after the UK are apparently Poland and Czech Republic. So if a well educated Pole or Czech is lucky enough to return home, after gaining 2 or 3 years work experience, to employment (or improved job prospects) s/he can be classified as an Irish emigrant? Thank heavens for JTO! I was recently on a “red eye” to an East European country which has a lot of itś citizens working and living in Ireland. Out of 200 passengers on board I may not have been the only Irish citizen (there were quite a few children on the flight) I was certainly only one of approximately three people who spoke with a distinct Irish accent. While I do not deny emigration is taking place, among young Irish job seekers we need to be realistic about what we describe as “Irish emigration” . IMHO any senior academics who believe (or encourage) unsubstantiated notions that there is a mass exodus on a biblical scale of “Irish people” would benefit from being part of the “brain drain” and diaspora for 2 or 3 years. @ JTO I hazard a guess that a few hundred years ago your forefathers immigrated to Ireland. They stayed. If they had returned – well you wouldn’t be here and we would be the poorer for it. I know where you’re coming from with the returning migrant stuff but they would have been a real addition to our land had those who wanted to stay been able to stay. I know a few immigrants and many (not all) liked Ireland and would have liked to have made it their home – just as your forefathers did (and mine too at some stage). @ Livonian This question can only be properly answered by the census. No point in denouncing anybody til we get the definitive stats. @ Bond, Eoin Bond The crisis affects different people and professions to different extents. I think those most at risk are the precarious professionals – those expensive to employ and without sufficient connections to grasp the dwindling resources. It’s strange – the cake has gotten smaller but those closest to it are still getting a nice mouthful. @Eureka I agree many of these returning migrants would have been ” a real addition to our land”. However we have to remember that many returning migrants from other parts of the EU formed part of a “brain drain” in a number of their own countries which spent money educating them. IMHO those countries are also entitled to “a real addition” as well. Now that returning migrants have experience “under their belt” they can contribute to growth in their own countries just as experienced Irish people did when they returned home in the 90`s. @Eureka “…can only be properly answered by the census”. Agree 100%. No conclusions should be drawn (or encouraged) in the absence of “definitive stats”. Apparently the only “definitive stats” which currently exist paint a different picture. The photograph of the 62 (I will be lucky if I can retire at 68) year old retiree in Carlow should have a chance of winning a prize or two for lighting and tone though. @ Livonian It’s a competitive world. We benefit from the talents of those around us. We shouldn’t lose the talents There was only a slight fall in the number of non-Irish nationals on the Live register in 2010. In December Irish Nationals accounted for 82.5% (360,434) of the number of persons on the Live Register. There was a monthly increase of 10,214 (+2.9%) in Irish nationals and an increase of 1,863 (+2.5%) in non-Irish nationals. Of the 76,645 non-Irish nationals, the largest constituent group on the Live Register were nationals from the EU15 to EU27 States (42,198), followed by the UK (17,855). In the year to December 2010 the number of Irish nationals on the Live Register increased by 14,358 (+4.1%), while the number of non-Irish nationals decreased by 874 (-1.1%). We’re still talking about WHETHER there is “mass emigration” or not. And we seem to be fixated on whether the “emigration”, whatever its extent, is of “Irish” people or non-Irish people. And we don’t seem to be able to form a view on “emigration” until we know the exact figures. And we won’t know the exact figures until after the census, the formation of the new government, the “European summit” in March, the new “European” institutional architecture and probably the resolution of the European ( and global) financial crises. The presumption seems to be that emigration by “Irish” people is a “bad thing” while emigration by people who are not ” Irish” is, if not a “good thing”, then at least understandable, nothing to do with “us”, not a depressing thing, a waste, or a “national disaster”. As a former ( non-Ireland based) employer of European, American ( north and south) and Asian ( and African) workers, I am coming at this discussion from a different, ( real, globalised world) angle. At executive level, my executive staff would never have proposed to me the recruitment and employment of ANYONE who did not have a minimum of two years work experience outside their country of birth. And, for lower levels, a prospective employee with substantive “o/seas” work experience would ALWAYS go to the top of any shortlist. ( this applied to the maintenance men!) I am suggesting that, whether or not there is “mass emigration” from Ireland, and whether or not companies “exporting” from Ireland have most of their employees physically in Ireland, an economy like ours must behave at least like its competitors in recruiting human capital ( from whereever) that have experience of working in the real, globalised world. I would contend that this also applies to the so-called “domestic” economy. The lack of this experience in the Irish political, economic ( private and public) and social spheres is the single factor which I would contend gave rise to the “entrenched mediocrity” ( and much worse… incompetence, venality, myopia, naïveté, gullibility and finally, arrogance), that got us into this mess in the first place. So, John McHale, thanks for launching this debate. However, it would be a great pity if the conclusion of the debate about “emigration” were as facile as, “let’s wait to see if it’s really happening, we all agree that “emigration” is a “bad thing”, particularly for “Irish” people, and all our problems will be solved when all this disruption is over and we we get back to full employment ( for “Irish” people) just like it was during the………. credit, property and construction booms! @ Richard F: You may be correct in your assertions, but you have our context to consider. Ireland is a moated state. We have a pretty small population. We are endowed with land and a long coastline. Hence you work your most abundant factor intensively – I think that’s the logic anyway. We do have skilled labour (academically) but the experience bit is indeed a tad low. Now if we wished to correct that then I propose the following: (I wish I could insert a really sarcastic smiley here): Irish becomes the only language on this Island. Then we have to learn some alternates if we wish to get that ‘furren’ experience! Right? Oh, that won’t work. So, what to do? You know what? Lets shift to Right-hand driving. That should be good for a few jobs (insert appropriate smiley) – but I am actually serious about this. Its our context. We are fluent English speakers with relatively poor other european language skills and the political incentive is to make us semi-illiterate in Irish. Maths skills – mediocre. Read+’rite – patchy. Analysis skills – what be dem? Engineering and technical skills – very good actually. There’s your other abundant factor. Now all we need to do is to export them so they can remit. Trouble? Yep, Chindia are on the same wavelength. Bigger world supply, price of wages down. Prognosis poor. Only hope for social, political and economic changes are for the educated young to remain at home and kick up a stink. But that will not happen as long as they are fluent English speakers and can be readily assimilated into English-speaking economies. In economic terms, shortages are developing (fast) in food and fresh water – particularly in eastern Mediterranean. If we clean up our major freshwater sources we will have a product which is more essential that oil. That means stamping hard on you-know-whose toes. BpW @BpW Many thanks for that. All of which I agree with. I like your “abundant factor” slant, particularly as you veer towards “shortages in food and fresh water”. And I know that Edgar Morgenroth has ideas in this direction too. As it happens ( in my “treads” confusion as I slowly get used to your site!), I just responded to a ” Guinness” comment from Michal Hennigan over on “Migration “Estimates” on a topic he (sort of) raised directly related to “Irish” food and drinks and so-called branding of so-called “Irish” abundant factors in what Bord Bia very hopefully calls “The Food Island”. I’m interested in your “shortages” point and have 20 years’ international experience of the global food & drinks sector. Follow me over there and let’s talk about it? I know Michael has strong views also, many of which I agree with. Richard, I doubt if many would disagree that an experience-rich shortish stint abroad is typically a significant benefit to the individual and the economy. There is no doubt that the effects of emigration on the home economy are varied and complex. I know this all too well given the somewhat frustrating experience of working on this topic. A useful dynamic framework for studying the development implications of emigration is to recognise that two human capital stocks that are valuable to an economy: the domestic stock and the “diaspora” stock. There are then a host of interesting dynamic relationships — the effect of expectations of emigration on human capital investment decisions; the nature of diaspora links when people do emigrate; the effects on human capital investments in anticipation of return; the actual incidence and value of return given enhanced human, financial and social (network) capital. Like yourself, the modern literature has moved to taking quite a positive view of international labour mobility, as opposed to the pessimistic brain drain literature of old. However, my reading of the literature is that the effects of “absence” are underappreciated — especially when that absence is prolonged or permanent. Moreover, the regional economics literature actually does a better job than the international migration literature at understanding various forms of increasing returns (or more simply advantages) to scale. Ireland’s economy is unusual in that it performs more like a regional economy in certain dimensions, making this literature especially relevant. The new industrial strategy you write of — based, one supposes, on competitive advantage in innovation intensive industries — requires scale, enterprise and a drive for institutional improvement. I believe a significant and persistent emigration of our young people is something to worry about from a national development perspective. Of course, this does not mean we should do anything that would put barriers in their way, but policy should focus as far as possible on giving them decent options — including options for additional educational and skills development — at home. Many thanks, John. Before coming to your main point as far as this thread is concerned, the economic returns explored in the regional migration literature ( I know nothing about this and am most interested) I need to clear up a point about my hobbyhorse, a new “industrial” strategy. Far from this being based ( as you might have legitimately supposed) on “competitive advantage in innovation intensive industries” that require, as you say, scale, enterprise, and SUCCESSFUL institutional improvement, I have been so unconvinced by the “Smart/Knowledge Economy” slogans that all I can say with any certainty is that they’re NOT real strategies. From long years of strategic marketing, I know both how difficult it is to come up with and communicate a real strategy AND how copnterproductive it is to soldier on with a strategy that is not sustainable. We don’t have to anandon a strategy of attracting US FDI while working on a strategy to replace it. I don’t know what the new strategy should be because I haven’t worked on it. But neither are we, apparently…. seriously working on it. From the beginning of this debate I’ve believed that, somehow, our human capital is central to a new strategy. And this would and will involve a completely new way of looking at “emigration” as part of the calculus of giving our people decent educational and skills options at home AND abroad. We’ve got to look at this challenge with a language and methodology sheared of our emotional “emigration” baggage. So, what’s in the “regional migration literature? @ Brian Woods I know this is off topic but Ive often wondered about our freshwater as a resource. Has anybodo done any analysis on it that you know of. We’d have to make cost of import less than desalinization. Wonder if there’s a way! This is the kind of thing we will have to wait for a foreigner to lead us on!!! A foreign national leaving Ireland can be seen different ways. One way could be: A foreign national pays tax in Ireland, has no vote and therefore no representation. Taxation without representation has been equated with tyranny. Leaving a tyranny is a good thing 🙂 Labour mobility is both good & bad. Ireland benefited by an influx of a workforce that had been paid for in another country: Adults in their prime is a net benefit, children cost money to raise to their adulthood. My parents taxes in Sweden paid for my education, Ireland got the benefit. When I return to Sweden then Sweden will benefit from my experience in Ireland (&Germany). As Ireland has a relatively high unemployment the biggest loser from emigration in the short term will be landlords in Ireland. Some claim that NAMA controls a significant amount of property in Ireland and since the Irish state get the profit/loss from NAMA then it might be possible to argue that Ireland will lose out on all that leave regardless of nationality. Richard, Regional/urban economics is a big area. A major focus of the modern literature is the importance of increasing returns at the city level, in part inspired by the work of Jane Jacobs. On the empirical side, Ed Glaeser’s work on city growth is especially relevant. A robust finding is that initial skill levels is positively related to subsequent growth. This suggests the down side of letting your skills support the growth of city economies elsewhere. See here for a reasonably accessible review paper (unfortunately for some reason it is in Word form): http://www.economics.harvard.edu/faculty/glaeser/files/Glaeser_Gottlieb_jelpaperfornber.doc @Other movers, emigrants, migrants, footlosse fun-lovin FG tops poll in virtual ballot Fine Gael is on course to lead the next Government, according to the first count of a poll conducted among Irish emigrants. The poll was carried out over ten days on [www.ballotbox.ie] 5,580 Irish emigrants in 124 different countries voted in the poll. IP technology was used to block voters in Ireland, and passport information was used to discourage non-Irish people from voting. This is the first time such a poll has been attempted. The aim was to highlight that Irish emigrants are immediately disenfranchised upon leaving the country. This is in stark contrast to many other democracies, including the United States, the UK, Australia, Canada, and most EU countries. In the poll, Enda Kenny’s party won 30 per cent of first preference votes, with the Labour party on 25 per cent. Independents form the next largest group with 18 per cent of first preference votes. Sinn Féin is on 13 per cent, with Fianna Fáil and the Greens tied in last position at 8 per cent. http://www.irishtimes.com/newspaper/breaking/2011/0225/breaking56.html @all – on other ‘movers’ Blind Biddy (via Twitter from Kingstown): The X-Minister’s methods were strange – they caused us real surprise – to make us see the light – she threw bleed1n dust in all our eyes. 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