An important election in the history of the Republic of Ireland has seemingly produced a new Government of the Fine Gael party and Labour, involved in advanced coalition talks.
The former Governing party, Fianna Fail, was completely decimated at the polls; its vote dropped from 40 per cent to 15 per cent in response to its disastrous handling of the economy which culminated last November in a humiliating bail out of the Irish economy from the EU and the IMF. There were major gains in the Dail Eireann (Irish parliament) for Fine Gael and Labour, which now have 76 and 37 seats respectively.
It was also a successful night for Sinn Fein, which trebled its amount of seats to 14. The party’s most prominent newcomer, Gerry Adams, vacated his Westminster seat of West Belfast to stand across the border in County Louth.
The scars of this economic collapse will run deep in this small country
Leader of Fine Gael and incoming Taoiseach (Prime minister), Enda Kenny, declared that Ireland “Now stands at a transformative moment in our history, on the brink of fundamental change…in how we regard ourselves, how we regard our economy and how we regard our society.”
Since entering office, Kenny’s in-tray has been overflowing, mostly with concerns relating to an economy that has contracted 14 per cent from its peak in the boom years. The main issues have been the unemployment rate of 13.4 per cent and the consequences of the punishing conditions attached to the €85bn bailout that Kenny describes as “bad for the Irish people, and bad for Europe.” He will get a chance to re-negotiate the deal straight away as he will be attending several Euro-zone Summits in the next fortnight.
Ireland’s economic rise and fall has been spectacular and in comparison, Britain’s budget deficit and spending cuts seem merely an inconvenience. Unprecedented economic growth that began in the early 1990’s and was nicknamed the ‘Celtic Tiger’ rocketed Ireland from one of the poor men of Europe to one of its richest per capita. This transition, in under twenty years was astounding. The former Taoiseach, Bertie Ahern, declared in 2007, “I don’t know why people who engage in that sort of thing [warning about the potential of a financial crash] don’t commit suicide.”
Ultimately, the Celtic tiger was built on the unstable foundation of a loose financial sector and a property bubble that were both allowed to spiral out of control through lax or non-existent regulation, elite cronyism and endemic corruption. The pressure is on for Enda Kenny and his new Government to start rebuilding the bond between the Irish people and their political and economic elites.
The scars of this economic collapse will run deep in this small country, but none are more visible and ironic than the dozens of ‘ghost estates’ full of half-built or vacated houses – a hangover from the madness of the property boom and the now dead Celtic Tiger.