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The Virtuous Circle of Ever-Lasting Expansion of Domestic Demand and Labor Supply Is Broken: Yes, Ireland Really Is Dying

Or, how I learned to stop worrying and love brain drain.
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Rolling green pastures near Bantry, County Cork. (PHOTO: PAM BROPHY/WIKIMEDIA COMMONS)

Rolling green pastures near Bantry, County Cork. (PHOTO: PAM BROPHY/WIKIMEDIA COMMONS)

Almost a month ago, I wrote a blog post titled "Ireland Is Dying." I did not intend to probe into an existential crisis. When I tease that "X" place is dying, I play with the geographic stereotype of communities in decline. One week, Detroit is dying. The next, San Jose is the victim with essentially the same problem:

“We’re Silicon Valley, we’re not Detroit,” said Xavier Campos, a Democratic city councilman representing San Jose’s poor East Side. “It shouldn’t be happening here. We’re not the Rust Belt.”

According to venture capitalist Danny Rimer, San Jose is the Rust Belt. Perhaps Rimer is right and Campos is wrong. But for our dearly held geographic folklore, nothing in Silicon Valley can be Rust Belt. It does not compute. Dying cities are only located here. Geography is a social science, not a map of objective reality. Birmingham, Alabama, the Pittsburgh of the South, is located in the Sun Belt:

Long scarred as the site of brutal civil rights struggles and decades of industrial collapse, downtown Birmingham, Ala., has struggled to attract new business or visitors, even from its own region. ...

... Birmingham is the seat of Jefferson County, which in 2008 began wrestling with a daunting fiscal crisis when interest rates on a $3.2 billion sewer bond issue ballooned to 10 percent from 3 percent during the financial crisis. Unable to meet debt payments, the county eventually made a $4.2 billion bankruptcy filing in 2011 — the largest government bankruptcy in United States history until Detroit’s filing last month — and residents and businesses are certain to face a big sewer rate increase as the case winds it way to settlement.

The bankruptcy may be keeping businesses outside Jefferson County from moving in, Mr. Fleming conceded, but he maintains that it has not dampened the optimism about downtown or hampered the ability of Birmingham to foster growth in the district.

Emphasis added. Birmingham is dying. Well, when we put so much emphasis on municipal finances, we'll have a country full of Detroits. The United States is dying. What a bummer.

I read some really bad news last Sunday. Guess what? Ireland is dying:

Back in the heady days of the Celtic Tiger, Irish economics commentariat and banks experts were extolling the virtues of Ireland's 'demographic dividend'. A confluence of high birth rates, declining mortality and robust inward migration was propelling Ireland toward perpetually rising population counts. With these, the argument went, Ireland faced the ever-lasting expansion of domestic demand and labour supply.

Less than a decade later, the dividend has all but vanished in the maelstrom of rampant emigration. More ominously, as the latest trends suggest emigration is now reaching well beyond the traditionally at-risk sub-categories of the recent newcomers to Ireland and the long-term unemployed. Instead, outflows of professionals and middle-class families are now also on the rise. ...

... Ireland's emigration flows and population changes by age and nationality are retracing the structural collapse of our economy: the story of our paralysed and polarised society burdened by debts, taxes, unemployment, lack of opportunities for career advancement and fear for the future.

What a sourpuss. I realize a lot of Ireland boosters are pinning their hopes on robust birth rates. Demographic convergence is a bitch. Do not panic. The Irish are in the process of doing the fail, pulling a Pittsburgh. Current rates of emigration indicate success. The best and brightest are the most likely to leave. Globalization, at long last, has sun-kissed the Emerald Isle.