Today’s news from Ireland is grim. As my readers know, I have been teaching in Ireland for some years.
I’ve expected this day since I first set foot there in 2005.
Faced by the impending bankruptcy of its banks and the consequent destruction of its tottering financial system, the republic is seeking a bailout from the IMF and the European Union (more here). The result is that another European country winds up on the same road that developing nations did in the 1980s and decades of austerity are to come. But where the banana republics of old were undone by the ruling elite’s direct expropriation of funds for infrastructural schemes, the countries being forced into perpetual indebtedness now are suffering because of a more collective delusion. This time, instead of infrastructural schemes, it was the bourgeoisie’s faith that they had found a pot of gold that animated the mania, making them the most earnest cheerleaders of the same big banks that they have to bail out now, the same banks that have led the country to the brink of ruin.
The Celtic Tiger, if it ever existed, was created by the returns on productivity that external investment in a well-located, but underdeveloped, English-speaking nation brought. By the early 2000s, however, the Celtic Tiger was over and a new boom began around absurdly valued real estate. Even today, real estate in many parts of Dublin goes for more than comparable real estate in Manhattan. Since the latter is unquestionably overvalued by at least double (on a simple rent to price basis… seriously what other value can we give it besides rent multiplied by a degree of froth?), the former is thoroughly ludicrous. So even though I had seriously thought about moving to Ireland after George W. Bush’s reelection in 2004, and I dearly love the country, the economist in me panicked when I began looking into the real estate situation and I stayed put.
I repeatedly warned about the impending collapse of an economy based on froth upon froth. Now it’s finally happened and the price will have to be paid. Although Ireland would probably have done better to go it alone and refuse to bail out the banks, imposing heavy taxes on corporations and the mega-rich, they’ve decided to seek aid from the IMF. The "cure" will be akin to massive chemotherapy. It certainly won’t be pleasant.
Sadly, there’s little question that architects and architectural institutions as well played a role in this debacle. Schemes for housing millions of new residents expected to come to the country in the coming decades were eagerly drawn up even when there was no industrial or economic basis for such a massive increase in population. Such projects schemes validated the boom. Why weren’t plans drawn up for controlled shrinkage during impending contraction or for how to utilize the massively overbuilt housing? Alas, the answer is simple: such thoughts didn’t fit with the mantra that the boom would never end. Ireland was different, I was told time and time again, and unlike the tired old United States, it had discovered the secret for perpetual growth.
But such growth could only come from the fairy people and, as is their wont, they turned out to be a devious bunch, eager to lead the deluded, greedy, and overeager astray.
Now it’s time for the hard planning and thinking that should have been done a half decade ago or earlier. It’s time to reconsider what architecture means in a shrinking economy and with a shrinking population that seems likely to lose 10% of its population within a decade. As always, I’m ready to help by offering my input on the rebuilding process.
I hope this time somebody will want to listen.