Lisa Keenan’s op/ed in today’s Telegraph-Journal is an important contribution. She ties it into the Atcon affair which is a little much given the pile of lost money given by the Tories to companies such as Atlantic Yarns which finally declared bankruptcy in 2009 after the government had put in in more than $80 million. The Lord government put in nearly $70 million to AV Nackawic as well – which turned out so far much better than Atcon but who knew at the time? Of course Bricklin is the most famous Tory-financed debacle – don’t forget I am on the record supporting Hatfield’s effort in that area, however.
But, the quick partisan slam aside, Keenan nailed the main reason why Ireland hit the skids. It was the Irish banks that broke the economy and the government’s agreement to back stop them that broke the public finances. It was not as so many have said – the boom of FDI that led to the failure. The fast growing economy in Ireland did lead to a housing bubble – that contributed to the problems but the main reason was the Irish banking system which wanted to be a global player and bought billions in assets which ended up being toxic.
People see what they want to see and there are people who are against efforts to bring national and multinational firms to New Brunswick. When Ireland collapses they were quick to say “see that’s what happens when you attract big bad multinationals” without even taking a first glance at the real reasons.
I still say the Irish example is very instructive for New Brunswick. They positioned themselves as an excellent location for specific industries. They crafted tax policy to support those efforts. They graduated workers with the skills for those industries and the promoted the heck out of it. They also worked Irish expatriate networks very well and other micro-targeted efforts. There is lots to learn there.
If we ever get to the point we are growing so fast that we risk a housing bubble, come and see me. That would be a great problem to have.