Four and a half years ago, I watched a parade of Sinn Fein supporters march through Dublin's most opulent shopping precinct, a bedraggled band of hard-core republicans clad in track suits, berets and dark glasses. With pipes whistling and drums beating out a military tattoo, they shuffled past the temples of unaffordable fashion.
It was the alternative Easter parade of 2006, held on the Saturday before the official commemoration of the 1916 Easter Rising, at which then-prime minister Bertie Ahern was to welcome the British ambassador to the display of the Irish armed forces. This British presence at an Easter military parade was a diplomatic first, made possible with a rain of money that was pelting down on Ireland - a torrent of cash that was intended to wash away bitterness, cleanse and lubricate Irish society.
For some, the rains failed and they were marching with Sinn Fein that day as Ireland's wheeling and dealing became frenzied. I reckon many more will join Sinn Fein's Easter parade next year, among them Sinn Fein leader Gerry Adams. Last week, he announced he will step down from his positions in the Northern Ireland assembly to run for a seat in the Dail, the Irish parliament, in the next general election.
Sinn Fein is a nationalist movement, and campaigned hard against ratification of the European Union's Lisbon treaty (Europe's de facto constitution). If Mr. Adams plays his cards right, this fiscal crisis could be Sinn Fein's big opportunity to make significant political gains in the Republic of Ireland, at the expense of Fianna Fail and Fine Gael, the old-guard parties of the now-discredited Irish establishment.
Until now, Ireland's financial implosion has seemed like a wild fairground ride, with few signs of real injury. Politics could be the first casualty, before the raw pain of jobless distress begins to hit middle-class Irish people, who may find themselves sitting uncomfortably alongside the bedraggled Sinn Fein marchers.
The Celtic tiger boom didn't lift everyone. It was a boom for real estate agents, bankers and lawyers as well as engineers, middle managers and technicians for the plants built by foreign-owned electronics and drug manufacturers. There was no room in the Celtic tiger's business-class lounge for the unskilled or uneducated.
Research by economists at Trinity College Dublin into the impact of globalization on Ireland found that U.S. companies accounted for 77 per cent of Irish exports, while domestic enterprises made up only 10 per cent. In 2002, the researchers found, foreign multinationals accounted for more than half of Ireland's corporate tax revenues, and foreign firms were earning a stunning 17-per-cent yield on investment. The researchers concluded that this impressive profitability and boost to the Irish treasury was not because of superior Irish productivity, but tax planning. The multinationals were funnelling profits through Ireland, attracted not so much by high skills but low taxes.
The Irish tax haven is creating a stink in Brussels, where tax undercutting is seen as morally dubious and Germany is calling for a "severe reform program" for Ireland. During the 1916 Easter Rising, Germany supplied weapons to the Irish rebels, smuggling rifles into Ireland as the Kaiser's plotters sought to create mayhem in Britain's backyard. Today, Ireland's would-be rescuers in Germany are calling for an end to the country's fiscal jiggery-pokery.
Oddly, the country that has most to lose from Irish tax competition, Great Britain, is the least likely to demand fiscal backtracking in Dublin. Far from being an enemy, Britain's Tory-dominated government, with its euro-skeptic and anti-tax rank and file, may be Ireland's most supportive friend as Dublin strives to keep the Brussels tax police at bay. It is a curious twist of fate that Ireland's best hope of retaining its sovereignty may lie in friendship with Britain.
Carl Mortished is a Canadian financial journalist based in London.