ECONOMIC CRISIS IN IRELAND

The Current Economic Crisis in Ireland was caused by national decisions

The Current Economic Crisis in Ireland was caused by National Decisions

Introduction

The financial crisis of 2008-2010 in Ireland is a serious financial crisis which includes ongoing fall in recession from which it was once one of Europe's economies having even faster growth compared to many other members of the European Union (Butler, 2009). The country announced officially entered in recession in September 2008, with a sharp increase in the rate of unemployment over the coming months, although this increase was already underway since the third quarter of the year. According to Dukelow, (2011) Ireland was the first country the euro zone into recession, according to the Central Statistics Office of Ireland.

Hard hit by a double crisis, financial and real estate, the dashing Celtic Tiger of the early 2000s is now a shadow of itself: its GDP plummeted by 7% in 2009, the deficit reached 32%, unemployment reached 14% of the population, and the recession does not seem complete (McDonough, Dundon, 2010). The EU fears that a bankruptcy would jeopardize the entire Euro zone.

According to European Commission report (2011), when things go wrong, the Irish hit the road: Ireland is once again a land of emigration. Publication in late September, a report of the Central Statistics Office (CSO), INSEE local cast a chill in the country (Kinsella, 2012). INSEE aims to provide the production and analysis of the official statistics in France and is known for the responsibilities that include organizing and publishing the census, producing different indices that are recognized as being excellent quality (Dukelow, 2011). INSEE carried out the analysis on the population statistics of Ireland and for the first time since the exceptional growth of the 1990s, the number of starters exceeds that of arrivals (Kinsella, 2012). In one year, from April 2009 to April 2010, 65,100 people left the island while only 30,800 people settled there. According to Dukelow, (2011), three years earlier, in 2007, there were 42 000 in from the country and 110,000 to do the opposite to try the Irish adventure. That year, immigrants accounted for 11% of the Irish population (Kinsella, 2012).

Discussion & Analyses

Bubble Economy and National Policies

According to Andreosso, Lenihan, (2011), Aater 2001, the manufacturing industry of the United States started to decline rapidly. This gave Irish economy a boom in property. 1/5th of the state revenues were driven from property taxes and a workforce of 15% were employed in building infrastructure (Butler, 2009). According to House, McGrath, (2004), this strategy portrayed a bubble economy just like the United States and heavy emphasis was laid on low taxation, total revenue for the forces of the market as well as light regulation (Wells,2010). The Irish bank had to borrow $594 billion from various European banks in order to sustain the boom at the time (Butler, 2009). This was a big step as the figure represented three times the economy of Ireland. Billions of dollars were given by British and European banks but ...