Don’t believe the lies – Ireland is still rich

An essential ideological pillar of the attacks on workers and unemployed people over the past number of years is the idea that Ireland is broke.  The impression is given that the wealth created during the Celtic Tiger (where the top 1% of the population gained €75 billion) has simply disappeared.

Some recent research by CIT economist, Tom O’Connor, updating the 2006 Bank of Ireland report, “Wealth of the Nation”, detailed the ongoing wealth of the super-rich in Ireland. In 2006, the 33,000 millionaires in Ireland held a total wealth (not including their primary homes) of €156 billion. As a result of the collapse in the property market, this wealth has declined, but O’Connor still estimates that they still hold €121 billion.

The US Treasury released figures identifying the location of major holders of US debt in the form of bonds. Irish residents held $50 billion worth of US Treasury securities – almost as much as Germany and twice as much as France! In total, $1.3 trillion is held in securities and foreign equities by Irish residents – over $250,000 per person in Ireland! This figure includes holdings of companies as well as individuals resident in Ireland, and may have gone down slightly, but nevertheless gives lie to the notion of Ireland being poor!

Another major source of wealth in Ireland is the gas and oil found under Irish waters in the Atlantic Ocean. The government’s estimate is that there are 10 BBOE (billion barrels of oil equivalent) in the Rockall and Porcupine basins, off Ireland’s west coast. At the current price of $100 a barrel, this works out at $1 trillion, or about €750 billion. This figure could prove to be an underestimate, as it does not include reserves off the south coast!

So while the average major oil producing state has a stake of 68% in oil and gas finds, the Irish state has a 0% stake, having given away our natural resources to the likes of Shell! Countries like France, Norway and Switzerland have 1% wealth taxes – such a tax would raise over €1 billion in Ireland, while a steeper wealth tax of 5% would generate €6 billion – the total of the cuts and tax increases in the Budget.