Wednesday, April 22, 2009

"You Can Hear the Angels Sing"

Heard again recently on the streets of Boston: an Irish brogue.

And why is that 'news'?

For much of the past 150 years, America was the 'Great Escape' for those in Ireland. They came to escape oppressive laws(*), primogeniture, and a marginal agricultural economy. They came in large numbers in the 1840s (during the Great (Potato) Famine, when almost a quarter of the Irish population departed), and again at the end of the 19th century. And with almost one-in-ten Americans claiming ancestry, Irish-ness has gone from political pariah to political punchline. (Even the current President of the United States spells his last name "O'Bama" on March 17th.)

In more recent years, many young Irish would come over for a few years in their early 20s (usually on temporary visas), make some money, and return home to raise their family.

But in recent years, the pace of this latter emigration, temporary as it was, had slowed. The growth of the "Celtic Tiger" began in the 1990s, suffered a brief set back around the turn of the century, and then took off with a vengeance in the new millennium. And the rise of the Celtic Tiger meant that 'good jobs at good wages' for young Irish could be found in Dublin and Galway, and not just Boston and New York.

But while the growth may have been initiated thanks to low tax rates and an educated workforce attracting global businesses, it also deregulated banking and financial services. The growth also quickly spread to real estate and housing development. (An interesting parallel can be drawn to another country that de-regulated quickly: Iceland. Michael Lewis' take on the 'kreppa' is here; Ian Parker's (New Yorker) is here.)

And the overheated Celtic economy boiled over. As Paul Krugman described earlier this week, Ireland faces a technical depression: a contraction of the real economy of more than 10% this year. And as the Irish banks crumbled, the government stepped in -- think: Celtic TARP. But the world markets are not as forgiving to little Ireland as they have been to the U.S. (so far.) According to Krugman, unless the government gets its deficit under control by slashing spending and/or raising taxes, lenders won't buy Irish bonds. And thus, the crisis (at least on the Emerald Isle) will get much worse before it gets better.

Which brings us back to the happenstance of hearing the brogue on the streets of Boston. With the Irish economy heading downhill, young Irish again will be likely showing up here in Boston, in New York, and Chicago, looking for work and a better chance.

It's Back to the Future. Celtic Style.

(*) - For example, in the eighteenth century, thanks to British-based laws: "A Catholic couldn't sit in the Parliament, or be a solicitor, a gamekeeper, or a constable. They weren't allowed to attend university, either in Ireland or abroad, nor could they keep a school. Instead they relied on "hedge schools," where itinerant teachers lectured students in the open air. Priests said Mass in secret, too, at rocks and sites known only to the faithful. A Catholic orphan had to be raised as a Protestant, while no Catholic could own property or receive it as a gift." Barich, A Pint of Plain, p. 153-54 (2009).

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