Two weeks after the most brutal budget in living memory, the mood in Ireland is miserable. Everyone has been caught by a combination of harsh tax rises and spending cuts as the government struggles to cope with a collapse in revenues and contain a soaring budget deficit.
The mood is also very angry. Unemployment has hit 11 per cent and is still rising. One Sunday newspaper says a majority of Irish people expect “civil unrest” this summer.
There is a blame game under way about who was responsible for allowing the golden years of the Celtic Tiger to evaporate in an unsustainable property bubble.
Developers, who bought up swaths of Irish countryside to build faceless shopping malls and soulless housing estates, come top of the hate list. The sleazy politicians that they helped to finance come second. The bankers who advanced too much easy money come a close third.
The political consequences of the credit crunch in a country that prided itself as one of the great economic success stories of the European Union are certain to be severe.
Fianna Fáil, the ruling party, used to be described as the most successful political machine in postwar Europe. In government for the past 12 years, it has been the largest party at every election for almost three decades. Now its popularity has collapsed and few expect the government to last until the next election in 2012.
Fine Gael, the eternal opposition, is well in front with ratings between 28 per cent and 32 per cent. Fianna Fáil is back on 22-25 per cent. The Labour party has about 18 per cent support, although for one brief moment back in February it overtook Fianna Fáil on 24 per cent – the ultimate humiliation for the party of Eamon de Valera.
Yet outside Ireland, in the meeting halls of Brussels and the chancelleries of the European Union, they are looking for a silver lining from the Irish economic plight. For the opinion polls also suggest that, precisely because of the downturn, a majority of Irish voters may vote Yes to the Lisbon reform treaty in a second referendum. That would finally clear the way for the long-delayed streamlining of EU institutions under negotiation since 2001.
Irish voters no longer want to be seen to be the last redoubt resisting the reforms, when they may need all the economic help they can get from Brussels. They rejected the treaty in June by a clear 53.4 per cent to 46.6 per cent margin. Recent polls now put the Yes vote at between 51 per cent and 55 per cent, and the No vote below 30. The rest are still undecided.
The Irish government agreed in December to hold a second referendum by November, in exchange for assurances from its 26 EU partners on the preservation of Irish neutrality, no interference with Irish taxation and no threats to the Irish ban on abortion. They also got a promise that all member states would be allowed to keep a full member of the European Commission. Those assurances are supposed to be attached to a future EU treaty in the form of protocols, although negotiations are still under way.
Three other governments have yet to complete ratification. In the Czech republic, the Senate is due to vote on May 6 or 7. In Germany, the president is awaiting a ruling from the constitutional court in Karlsruhe. In Poland, the president is simply waiting for the others to finish first.
Yet even if the opinion polls look more positive, the Irish vote cannot be taken for granted. Voters may be scared of the recession but they are also angry with the political class that wants them to vote Yes.
“It seems to be better for a Yes vote but that is before we have had a campaign and a question,” says Brigid Laffan, professor of European integration at University College Dublin.
It is also unclear what will be the effect of European and local elections on June 6 in the current political climate. Fianna Fáil will get a drubbing but will it be enough to allow a leading No campaigner to win a seat in the European Parliament?
Declan Ganley, the businessman who financed the No campaign last year, has turned Libertas, his campaign group, into a political party and hopes to win a seat from his base in Galway. Given the anti-establishment mood, he has a chance, particularly after the withdrawal of the sitting Fianna Fáil MEP. If he wins, it will give the No campaign a lift. If he loses, then an Irish Yes vote is much more likely.
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