After years of economic calm, Ireland could be facing a storm. Are we better prepared this time?
read
'Poor old unlucky
Bertie
'.
The Mahon tribunal had stampeded through Ahern's murky personal finances with a coach and four earlier that year, and Ahern had no choice but to fall on his sword.
His successor Brian Cowen had been
Fianna Fáil
's dauphin prince for a decade. In a for-once becalmed and benign Dáil, he listened as party leaders heaped praise on him and wished him well. In his own speech, he said he wanted to care for the less well-off in society and create 'caring and compassionate communities'.
That day was as good as it got for Cowen. A retrospective headline could have read: 'Poor old unlucky Biffo'. And as for Bertie? He dodged a bullet that day. The first slate clouds of the coming storm were massing just over the horizon.
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There were some small signs already evident. The State's revenues in the first four months of the year had fallen alarmingly. Yet, the Versailles levels of spending continued apace.
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That was only the beginning of the tragedy that was to unfold for Cowen and for the State. By June came the confirmation of a slump in house sales, and a significant downturn in bank profitability. The late Brian Lenihan mused that month it was just his luck to become minister for finance at the moment the building boom had come a 'shuddering halt'. The government began to batten down the hatches but the hurricane had already made landfall.
Those who write about politics love the phrase of George Santayana's that 'those who cannot remember the past are condemned to repeat it.'
Since the economic crash there have been several extraordinary events that might have presented credible threats to political stability across Ireland, Europe and the world: Brexit; the Covid-19 pandemic; the war in Ukraine; the energy crisis; the terrible events of October 7th and the unspeakable annihilation of Gaza by Israel. Now we have a bellicose Trump presidency, brimful with threats and tariffs.
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Corporate tax take tumbles 30% for May with €1.1bn less over same month last year
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The State has somehow managed to weather all those storms. That has been partly thanks to huge windfalls from corporation tax that have given Ireland a buffer from the worst impacts of Covid and the cost-of-living crisis. Annual once-off payments for households became the norm during the last Dáil term.
Seemingly, our economy still retains the knack of defying gravity. Two sets of figures, published on Thursday, suggest that all looks good for the public finances. The Department of Finance confirmed there has been an increase of 3.6 per cent in tax revenue so far this year. Economic growth also looks strong. According to CSO data, gross domestic product (GDP) grew by almost 10 per cent in the first quarter of 2025, driven by a surge in exports.
When President Trump started sabre-rattling about
tariffs
earlier this year, many people discovered for the first time the kind of astronomical figures associated with multinationals based here. Exports to the US from Ireland were worth €68 billion in 2024, two-thirds of which came from pharmaceuticals and medical devices.
Beneath that veneer lies a more complicated scenario. Since 2011 there have been two parallel Irish economies, a global one and a domestic one. During the best years, GDP figures have been spectacular. But the picture was distorted. That part of the economy that doesn't feature gleaming towers in the Docklands, space-age pharmaceutical companies or aircraft leasing was lagging behind dramatically. This economy is made up of PAYE employees, or people working in less glamorous sectors, and those in the gig economy. Their reality has been a constant struggle to pay bills as prices escalate, to meet childcare costs, to scrape together enough to pay the mortgage or rent and put petrol in their cars.
A new category, modified domestic demand (MDD), was created to better reflect that domestic economy. For example, when you strip out the multinationals, growth in MDD was less than 1 per cent in the first quarter of 2025. Not tanking by any means. But slowing.
Tax take also seems to be holding up overall in 2025. However, the picture is complicated by the Apple tax money. When that is excluded, corporation tax is no longer up 18 per cent, but is more than 9 per cent down on the same period last year. Is that a sign that that ATM is finally running out of cash?
It feels hard to escape from the sense that after years of generally smooth cruising, we are now facing turbulence. You can see signs of that wariness at institutional level. The Government has said categorically there will be no once-off payments this year. It has also revoked a plan to extend statutory sick-leave entitlements by two days. Sensibly, too, it has began an urgent all-hands-on-deck diplomatic and trade offensive to diversify away from the US and open up new markets elsewhere.
One thing that has been reminiscent of the Celtic Tiger over the past decade is the willingness of governments to spend a lot of money. The capital housing budget has had a fivefold increase from €1.2 billion in 2017 to €6 billion in 2025. The health budget has almost doubled in the same period, up from €14.6 billion in 2017 to €25.8 billion this year. Overall State expenditure topped €100 billion for the first time in 2024. That's all well and good, unless we encounter a 2008-style collapse in revenue.
Are we better prepared for the coming storm than 17 years ago? The answer is probably yes but even that might not inure us.
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Photograph: William Keo/The New York Times Rita (50): 'You are held and detained for hours and they search our bags, going in both directions' 'I am single but I had siblings I was in charge of raising after my father and mother died. Four male siblings are married now, and two of my brothers were killed, assassinated by [Israeli] special forces in 2005 and 2003. I betrayed my brothers by working in the settlements, I only did it for one month. 'I received 90 shekels a day. The Israelis pay 150 shekelsbut the brokers take the rest of money. 'I began before October 7th [2023]. After, things became different. We had some really tough situations. For example, we were not allowed to go to the bathroom. So I protested and they were surprised that someone spoke out. 'When we went there we thought we'd be working in factories but it was grading dates, sorting through them outside on a plantation. They do the sorting in three stages: us women were the first stage. They would take the good stuff to go to the Israeli market or international market and the ruined ones go to the West Bank. 'One day I was at the checkpoint going home and I told the soldiers we were very tired, so I was detained for four hours. 'Even when we go inside the settlements, and they are looking at our IDs, you are held and detained for hours and they search our bags, going in both directions. I wish these settlements were shut down. I was once kicked out because of the inspection. They searched us on the way in and out because they wanted to make sure no one stole anything. I speak a little Hebrew and I heard them calling us 'thieves'. The Israeli guard said 'I don't want her to come back', and I said, 'I don't want to come back'.' 'I am totally against settlements and the expansion of the settlements. New settlements must stop. The settlers are becoming very violent because we are allowing them to become violent. We're not united and we don't stop them. 'I still feel guilty until this day that I worked in a settlement.' Palestinians in their cars waiting to cross a checkpoint near the West Bank city of Nablus. Photograph: EPA Esma (36): 'We have to be at the checkpoints at 2am. Sometimes we sleep in the car ...' 'I have four daughters and one boy. My brother was killed when I was 14. He was wanted by the Israelis and they hunted him with spies. 'I started working there in the Jordan Valley, seven or eight years ago. My husband was against it because he knows about the things that happen in the settlements, especially for young women ... it was shocking for me at the start. 'I went there and started sorting dates. I later went to work in another settlement in a dry cleaners, with much better conditions than working in plantations. I worked for one year and got paid 500 shekels a month. During Covid-19, they let some people go and kept only the good people, but they also started exploiting us, giving them extra hours without getting paid. There was a lot of work pressure. 'At some point they made us sleep in the dry cleaners. In the whole day you get half an hour break for lunch and then go back to work. We wanted to pray but couldn't even get the time to pray. 'In settlements, there's a humiliation in our treatment. There was a gate for Palestinian workers and a gate for Israelis. Once a broker took me to the wrong gate, they checked my ID and found out my brother was in prison and made me stand in the sun for an hour. They released me, but only after the guard asked the Israeli broker to go and get a weapon as the guard said it was dangerous to be around me. 'We have to be at the checkpoints at 2am. Sometimes we sleep in the car and sometimes we can't sleep. Sometimes there's conflict at the checkpoints, they'd shoot gas bombs and sound bombs for no reason. We don't have any alternatives. Our government is not creating the opportunities for us to work. 'The war has destroyed everything. Because of the war, Palestinian workers are unable to go to Israel so they had to shift to working in the settlements if they are allowed to. There used to be Palestinian brokers making 600 shekels a day but now they're making 90 . The business owners, the settlers, say if you don't like it there are a lot of other workers who want this. I am originally from Gaza and they can see that on the system; I was held for three hours at a checkpoint as a result. 'They've brought Chinese and Indian workers and they're paying them more than the Palestinians, but they're not doing a good job. 'There's harassment, humiliation, especially for young girls. One of my employers fired me because there was another lady willing to take the job and go out with him and things could get physical. It depends on the personality of the women and the conditions, some of them are divorced, some are tempted, some are forced. They are pressured into it, especially in the settlements.' A car park at the Barkan industrial estate beside the Israeli settlement of Ariel, in the occupied West Bank. Photograph: Sally Hayden Lama (52): 'My family and relatives ... would prefer me not to go work in Israel or in the settlements' 'I have one boy and one girl, and used to live in Jordan with my family before coming back in 2021. I was surprised to find out that women worked in Israel and in the settlements because before that it was only the men. 'I needed income and had to find a job. There was a Palestinian clothes store near home that paid 20 shekels a day. I consulted my brothers and my sister-in-law who said there's an opportunity in the settlements where they heard you could make 220 shekels a day. 'Actually, it should have been 150 shekels, but the broker takes 60 ). I worked in a factory inside Israel too and got 280 shekels a day, with the broker still taking 60. We would use illegal crossings next to a checkpoint where they cut the fence and smuggled us in. We used to leave at 2am or 3am to get to the crossing. 'The first thing is the challenge of getting there ... We would get to the settlement and wait for the broker to pick us up from a very crowded area with no clean bathrooms. Go to the factory and be standing the whole time. We couldn't sit on chairs on the production line, couldn't talk, couldn't joke, you have to be moving the whole time. Your hands have to keep working. 'Some – especially old women – used to get diseases, like liquid in their feet, and they would go home sick. The buses were crowded because the more women, the more money for the brokers. We worked from 6am-10.30am, then the first and only break. Sometimes it's only 20 minutes. Then you go back to work until 3.30pm. Sometimes they say 'who wants to do some extra work?' and two out of the whole bus would want to stay, and the whole group will be forced to wait for them or work too. They were promised extra money but it wasn't given to them. 'The Israelis were not dealing with us directly, it's definitely a Palestinian operation. I didn't see any Israelis doing the same jobs for the same money. They wouldn't. We hear news from the workers being smuggled now into Israel after the war and they say the Israelis are complaining, they want the Palestinian workers to come back. 'There was a debate the whole time from my family and relatives. They would prefer me not to go work in Israel or in the settlements.' A car park in a settlement in the occupied West Bank. Photograph: Sally Hayden Maha (55): 'I would encourage banning trade with settlements if there's alternatives for Palestinian women' 'I am a mother of two boys and two girls, and I started working in settlements in 2015. I also went inside Israel, where they have industrial zones and big factories. 'Sometimes we'd organise dates and grapes, packing and sorting, avocados, mango, grapefruit, corn. It's exhausting, it's not an easy job. We had to leave at 1am to get to work because of the checkpoints. 'I then worked as a broker, because I was exploited as a worker before. I didn't want women to experience the same thing. I paid them in full. The women were very appreciative of that. I had a group of 45 women and I would get paid a commission just for bringing them. 'I wouldn't encourage working in Israeli settlements if we had the alternatives, our own businesses, our own projects, but this is our only choice. 'This is not something that we like, having these settlements, this is something that we were forced into. I would encourage banning trade with these settlements if there's alternatives for Palestinian women. 'We could invest in our local market, in our local agriculture. For example there are some Palestinian packing houses for grapes. What we really need are exporting opportunities for our products. If we can find these, then people will turn to these sectors. 'If the international community can support us to open channels to export our products then this would be good for us. Then we could control our life and our time. Our lives would become easier.' Nawal (59): 'I witnessed this exploitation of young women in most settlements' 'I started working in the settlements eight years ago. There was a bad economy, no work opportunities, nothing else to do. 'It was the worst kind of circumstances. No bathrooms: sometimes you just do it on the land. No privacy. The main cause of me leaving the job was the bad treatment. The harassment that took place was disgusting. 'There's a lot of harassment. Sometimes the girls are forced to agree to go with the men. They would go to their houses with them. If she wants to keep her job, if she wants more money, she has to ... it's really heartbreaking to talk about. They are 17, 20, they go to college and they come to work because they need to earn some money to pay for their education. The women themselves said this is the only option they have. I witnessed this exploitation of young women in most settlements. 'I got blacklisted when I advised one of the girls not to go out with the Israeli business owner. I said: 'Why are you doing this, you are destroying these young women's lives and future?'. And the settler responded saying: 'I have a lot of bastards in [the Palestinian city of] Tulkarem'. He has the power, he has the money, he has the work opportunity that these young ladies need. 'If a woman got pregnant he would give her nothing. Sometimes they do abortions. If she's a widow, if she's divorced, she would definitely need to do an abortion because she would not survive the community. If their communities found out they could be killed, they would take it out on her because they can't do anything to the Israelis. 'Now, during this war, it has increased because there are no other options. I wouldn't do it, I would die out of hunger not to allow anyone to touch me because of my principles and my religion. 'We need protection, we need income opportunities, health insurance, so that we can quit this life.'
