Meet the New Owners - Part 3: The IMF

They only come out at night - they fear the sun. With their pale, tiny eyes, bloodless pallor and eerily glowing calculators, they strike fear into the hearts of small countries everywhere. Over the centuries they have gone by many names - dragula ... nosferatu ... the accounting dead. Today, however, they have a new name, hideous to behold and only whispered by the good people of Ireland...

The International Monetary Fund!

IMF Headquarters in Washington, D.C.

Like its closest relation, the vampyr, the IMF must be invited in by its victim. Having tricked its prey into lowering their defences, the IMF then attacks the softest, weakest part of its work force - the public sector. In an exclusive for this blog, I can secretly reveal the IMF's plan for Ireland should it ever be given access to our economy:

1. Public transport in Dublin will be replaced entirely by donkeys for hire. For commuters outside Dublin, Park and Ass facilities will be provided.
2. The Gardai will be fired, to be replaced entirely by a new force of leather-clad Germans, all called Gunther.
3. All teachers will be shot, to save on costs. The largest, most prematurely mature student in each class will be designated "Educational Operative 1" and will be charged with the teaching of their classmates, using as much violence and petty bullying as possible. Should they fail, "Educational Operative 1" will be shot, and "Educational Operative 2" will be selected, and so on, until the class is dead, thereby providing further savings for the Irish economy.
4. Hospitals will double as abbatoirs. No reason.
5. In an entirely unrelated note, Soylent Green will be the only foodstuff available in Irish shops.
6. 45% of the Irish population will be conscripted for work in the Wateford Crystal mines. That's right, Waterford Crystal comes from mines.
7. The shortest, stockiest, most ginger section of the Irish population will be selected for genetic experiments to produce an actual race of Leprechauns, thereby encouraging more American tourists to visit the country.
8. In an effort to boost the flagging economy around Shannon airport, half the facility will be sold to the US military for troop transport/ rendition flights. However, in an effort to be fair, and in a rare IMF concession to Ireland's politically self-righteous credentials, the other half of the airfield will be sold to Iran, so that they can strike back at the imperialist pig-dogs in the US with their mighty drone! 

The IMF's Overlord for Ireland - Willem Dafoe

The above will be the result of the current path we are on. Fianna Fail's economic plan is to keep kicking the economic ball into touch every few months, hoping that by the time that it is widely recognised that our economy is FUBARed, they will be out of office. By doing so, they are only increasing the likelihood that the IMF will be brought in, or at the very least, the ECB will take over the running of the country. While the IMF may not engage in all (or indeed, any) of the steps outlined above, we can't rule any of them out! More importantly, however, is the shame we should feel that this Republic, which for so long struggled for independence, is now faced with the prospect of becoming an economic colony yet again - not through the greed or hunger of an external power, but rather through our own incompetence in running our economy. Will the Republican Party ensure the end of Irish independence? Man up, Fianna Fail; cut if you need to cut, tax if you need to tax. Don't leave it to foreigners - if you screwed up, take the political implications on the chin. But whatever happens, don't let this Republic, tiny though it may be, fade from the pages of history.

Vader used to be with the IMF - but he couldn't stomach the cruelty

Meet the New Owners - Part 2: The Chinese

The dragon awakens. All under heaven - tian xia. A Communist state with a capitalist economy. To get rich is glorious. Whether a cat is black or white doesn't matter, so long as it catches mice it's a good cat. The future superpower. The Middle Kingdom. The mountains are high and the emperor is far away.

The above are just some of the many tired clichés about China that I will diligently avoid in this post. The simple fact is this: the United States, the richest nation on earth, has given its wallet to China in exchange for the fleeting pleasure of cheaper consumer goods. China now has America's cash - bags of it (estimated between US$1.75 -1.87 trillion in June 2010). And while Rome's will was enforced by the legions, and Britannia's through the might of the Royal Navy, China will buy your compliance.

Both images property of Bank of China

As a strategy, it is superb in its subtlety and simplicity. Despite the massive expansion in its military budget, China has almost exclusively focussed on the defensive, militarily speaking. Even the much feared DF-21 is, in essence, a defensive weapon - China does not want to take on the US Navy globally with massive carrier battle groups of its own,  it simply wants to keep the US out of what Beijing perceives as its maritime patch, using a (admittedly game-changing) land-launched anti-ship missile. It is with economic force, rather than its military, that Beijing will go on the offensive - and economic offensives tend to be more profitable than military ones.

Seriously, America, it's defensive!

China's involvement in Africa is well-documented (interesting documentary on the topic by Al Jazeera's Witness programme here) and while some would argue this push into the continent is commercially driven rather than politically or diplomatically led, the latter will inevitably follow the former. China is in Africa, in a nutshell, to buy up resources in exchange for hard cash and investment in local infrastructure. I'm fairly certain that, if you were the leader of Zambia, you would listen to the country that was building your roads.

Having already developed a sphere of influence in Africa, both commercial interests and growing diplomatic stature are ensuring that China now looks for new horizons. Its involvement in South America is well underway - a growing presence in Europe is surely inevitable. Only this time, China will be the cash rich  senior member in an investment partnership, rather than merely the hawker of cheap OEM goods to European customers. How can money-savvy China pass up the opportunities that flagging economies in Europe like Spain, Portugal and Greece offer in terms of depreciated assets and the ability to acquire political capital and prestige at bargain basement prices? And if a flagging economy is a big draw for Chinese investors, well, no one flags better than Ireland!

What's more, the usual Irish gombeen approach to business won't work with the People's Republic of China - they know how to play us. Witness the recent promise by Chinese investors to create 1000 jobs in Athlone in a Euro-China business hub. Only catch- those 1000 jobs would be for Chinese immigrants, not the local Irish. The Chinese recognise that Ireland, for the last few years, has focussed almost exclusively on property to the detriment of all other sectors of the economy. And until we can offer them greater incentives than our over-stocked landbanks, the Chinese will only invest in one thing here - land.

Check your wallet, Wen.

That's why, in a rare note of seriousness, this blog is advocating that Ireland proctively grab China's future economic expansion into the EU as the opportunity we need to kick-start our economy, by offering China unique skills that set Ireland apart from our fellow EU members. We have one massive advantage over the rest of the EU for attracting Chinese investment - a little-known fact is that China is an English speaking country, or at least, it is fast on the road to becoming one. As the only English-speaking member of the Eurozone, and as a small, non-threatening nation with no history of imperialism, Ireland is ideally positioned to act as China's partner in Europe. Rather than seeking masses of manufacturing jobs, we need to offer China our knowledge of the EU regulatory environment, our experience of dealing with Brussels, and our ability to network throughout the community, to grow Ireland as the ideal destination for Chinese companies to locate logistics, sales and compliance hubs for their European operations.

Let's see you invade the pitch at Croker now.

 As a solution to our economic woes, its not perfect, and  much work needs to be done - such as beefing up Ireland's paltry representation in China, and introducing Chinese as at least an optional foreign language in schools would be a good start. But as a plan for the future, aiming to be China's gateway to Europe  beats waiting for Ireland's property market to rebound.

Meet the New Owners - Part 1: The Germans

With Irish bond yields having shot through the roof this morning, jumping from  5.744% to 6.046% and still climbing (BTW - I used a Bloomberg link; I feel so grown up!), I thought now would be a good time to look at Ireland's  various and many new potential owners. Today we start with the leading candidates to reposses this misty land, the Germans:

The Germans

Your debts are how big?

First, let me say that I will resist all the obvious puns and jokes- no talk of Reichs, or panzers, or blitzkriegs; not even as metaphors. In truth, the Germans today are frankly the polar opposite of the taciturn, expansionist, martial image much mocked by 1960's British sit-coms. The 21st century German is highly reluctant to engage in armed foreign adventures, and when they do; well let's just say they no longer display that hard Prussian backbone - they are, after all, the only army whose soldiers have actually gained weight in Afghanistan.

No, today's German is more interested in saving than in sallying forth - and that's where their power lies. While we in Ireland were splurging the cash, using Lamborghinis as garden sheds, burning Manolo Blahniks as a cheap energy source, or occasionally filling our pools, Scrooge McDuck style, with gold coins, Angela was saving - like the cold, calculating monster she is!

What sort of people are these Germans, I wonder, who save in times of plenty rather than engaging in perfectly healthy cash bathing? What sort of inhuman automatons display such disturbing levels of responsibility and forward planning? Look at you there, smug and secure with your steins of beer and low bond-yields:

Who's laughing now, Ireland?

Well we, the proud people of Ireland will accept your help, Germany, but I hope you realise how lucky you are, being given a very important part in the Irish economic miracle. I hope you realise that you're the ones who will benefit in the long run, being able to tap into such dynamic sectors of the Irish economy as building and property development. I bet your Siemens and your Kuehne & Nagel and your Puma's look pretty pathetic now, right, next to the might of heroes like Bernard McNamara and Sean Dunne.

Eh, sorry, what was that Angela? You might not actually give us any money?

Ah, well now, Angela, let's not be hasty! I'm sure Ireland has a lot to offer Germany, em, you know, economically like - the billions of Euro you give us, and the political fall-out for you among the German voters: I'm sure it will be well worth it!

No?

Ok, Angela you want to play hardball? Fine! - if Ireland goes down, we bring the Euro with us, possibly fatally wounding European integration - and that will mean you Germans have wasted the last 50 years on a European project that went nowhere. So you have no choice, Angela, you have to help us!

That's right Germans - your savings are going to be paying my pension!

Woo-hoo! The weakest link - sweetest spot on the chain!

But yes, we know Germany - you told us so!