Bono Hasn't Been Minding Ireland's Economy

American Monetary AssociationWe can’t fault U2 lead singer, Bono, for his relentlessly public mission, over the decades, to improve living conditions in some of Africa’s poorest countries. The man wears his heart and politics on his sleeve and there is certainly nothing wrong with that but, as a born and raised Dubliner, we wonder if he’s noticed the economic shamble that his home nation of Ireland has fallen into? The unvarnished truth is that Ireland’s economy is a mess and has never really recovered from a deep recession it fell into in 2007.

Public finances are a disaster and we’ll get to them in a minute but first let’s look at what the average Irish citizen wakes up to in the morning. House prices have tumbled 36% from a high in 2006, job prospects are terrible, and unemployment sits at around 14%. The GNP (Gross Net Product – which excludes money sent offshore to parent companies of the many foreign-owned firms) has fallen for 9 quarters in a row. But as bad as it looks at that level, an examination of the government’s work is even worse.

The Irish government is on track to spend 12% of GDP more than it receives in taxes this year. And if that wasn’t bad enough, the situation is such that the European Union is inevitably going to step in with offers (demands might be a better word) that Ireland accept bailout cash before the whole country disappears in a poof of insolvency. Once these cash injections to fix broken banks are factored in, we’re looking at a cost to the government and taxpayers of 30% of its GDP.

This isn’t the first time Ireland’s economy has tanked. It was positively anemic in the 1980’s but recovered. That was before the European Union came into existence though, and this time around Irish troubles have the capacity to take that organization’s currency down with them. From across the pond here in America, we certainly don’t wish Ireland’s economy any ill will but a weakening euro isn’t bad news for an American dollar that’s having its own trouble finding traction.

Which raises the question, as perhaps the most famous Irishman in history, who’s been minding the store while Bono’s been out saving Africa?

The American Monetary Association

American Monetary Association

Flickr / World Economic Forum

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