The opinion polls suggest that the Irish general election 2011 will fail to produce an outright winner. However, one thing seems certain: Fianna Fail, which has held office for the past 14 years, is heading for a crushing defeat, as it feels the full fury of an electorate stunned by the fallout from the financial crisis, and its country's swift and brutal reversal of fortune. In short it is time for the Bankers and Wankers to walk the short plank.
The political movement founded by Eamon de Valera has never polled less than 39 per cent of the vote; its meltdown means that, once the horse-trading is over, the new government will most probably be a coalition of two parties – Fine Gael from the centre-Right, led by the uncharismatic Enda Kenny, and Labour from the centre-Left. The two functioned successfully together under the premiership of John Bruton, as part of the "rainbow coalition" in the early 1990s. But those were far more benign times: the Celtic Tiger was still a manageable beast, and the plentiful availability of cheap credit had yet to lead Ireland into self-inflicted penury.
Doubtless, Ireland's voters will be pleased to get rid of the government that presided over both the boom and the bust. But doing so will not solve their economic woes. The final-quarter growth figures for last year suggest that Ireland has avoided a double-dip recession, but it has still suffered one of the most dramatic slumps in output of any of the eurozone countries. And therein lies the problem – Ireland's membership of the single currency.
To begin with, the low interest rates set by the European Central Bank fuelled an unsustainable boom. Now, the inability to devalue has rendered an export-led recovery harder to achieve. Moreover, the IMF and EU loans that prevented bankruptcy – which amount to 80 per cent of the country's GDP – could come at a high price. Other members of the eurozone have long disliked the generous corporation tax regime used to attract the hi-tech companies that were Ireland's principal source of prosperity, and may well insist that it is dismantled. With unemployment now close to 15 per cent, Ireland is also witnessing the emigration of its brightest citizens, a phenomenon it seems fated to suffer at periodic intervals.
This election is the first to be triggered directly by the tumult in the eurozone. Yet Ireland's new government will inherit a mess which – unlike its British counterpart – it does not have the freedom to deal with independently. Despite the shock they have endured, the Irish have preferred to vent their anger at the polls rather than on the streets. But while they remain in the euro, a new government will make little difference to their predicament.
