December 21, 2008

Ireland Inc gets innovative

Posted in Irish Economy · 153 comments ·
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The government is finally getting it. The €500 million innovation fund announced last Thursday is an enormously influential and intelligent move. In years to come, it may even be seen as Whitakeresque in its prescience. For the first time in a long while, we have a vision of this country that complements what is good in the economy and, more importantly, sees beyond the current malaise. In the weekend where the depth of the problems in our banking system were laid bare, it is encouraging to see that Taoiseach Brian Cowen has the capacity to think about the future.

Sure the present has to be sorted out, and we’ll come back to that. But, for the moment, let us concentrate on the positive opportunity engineered by the ‘Innovation Ireland’ idea.

The Irish state – ironically for a country that didn’t have diplomatic relations with Israel for the first 40 years of its existence – has copied the Jewish state. Israel is the most successful high-tech country in the world. It has more home-grown listed high-tech companies than any other country, apart from the US. With a population of only six million, that’s no mean feat. So they must be doing something right.

Up to the 1990s, the Israelis were a bit like the Irish. They competed with us for US multinational investment, and educated – using the military and the universities – an infantry of well-qualified foot soldiers for these multinationals.

Like Ireland, their record at seeding and cultivating home-grown high-tech companies was poor, given the resources at their disposal and the significant multinational activity in the country. Their problem then – like ours now – is that they couldn’t commercialise their ideas. They hadn’t the venture capital know-how or money to bring good ideas to fruition.

Smart Israeli companies, like Irish ones now, sold out to US companies before they could grow into any significant size. All this changed with the introduction of Yozma, an initiative designed to bring in US venture capital and commercial skills, fusing them with Israeli high-tech ideas and creating strong companies that were financially robust enough to become big players. The Israeli state came in as 50/ 50 investors with the US venture capitalists, and the rest is history.

The Israeli tech industry took off and never looked back. After a few successes, there were successful scientific role models for graduates and, within a few years, Israel was listing companies on Wall Street at the rate of one a month. Obviously success begets success, and more and more investment capital flowed into the country, creating the virtuous cycle whereby no Israeli idea would fail due to a lack of commercial nous or financial muscle.

The country used its links to the US and its diaspora there to complement the industrial strategy, something we could also do. This entrepreneurial spirit was so ingrained that, by the time I worked there for a bank in the mid-1990s,we found it difficult to recruit graduates because everyone wanted to start their own company. One thing to remember is that, until the early 1990s, Israel was practically a socialist country, with the state owning the economy.

Last Thursday, Ireland copied the Israeli model. The €500 million fund – designed to attract co-financing by venture capitalists who are willing to move to Ireland, set up shop and use Ireland as their European Silicon Valley – is ingenious. The government has also, smartly, given significant tax incentives not just to attract capital but to lure people here too. This is a significant move and should be welcomed by anyone who has championed industry in this country. If the venture capitalists move here in significant numbers, we will re-invent the economy. At the moment, it is easy to be cynical. But the question is not why would venture capitalists come here; the question is why wouldn’t they.

We are producing thousands of graduates every year. We have the most significant multinational industry per head of population in the world. There are now clusters of excellence in computing, healthcare and pharma – with all the big names and brands already operating here. The links between these existing companies with their know-how and trained professionals and new, decently capitalised start-ups will be irreplaceable. So why wouldn’t a venture capitalist come and set up here?

In the recession, the things that made Ireland uncompetitive are likely to reverse. House prices and accommodation costs in general will collapse, unemployment will force wage rates down, transport costs will get lower and, more to the point, Science Foundation Ireland will spend €7 billion on education and training in the years ahead.

We still have the youngest educated population in Europe. Of course, there are problems – our brutal infrastructure is just one – but, with enough capital investment, this can be solved.

Most importantly, our tax system with this new initiative is now explicitly designed to be attractive to entrepreneurs.

For example, a new 16 per cent tax on what is called ‘carried interest’, which is the money a venture capitalist can expect to make when a good idea is commercialised into a success and sold off, will be much lower than anywhere else on the globe.

The big idea is not to attract only US capital and commercial know-how, but to suck in entrepreneurs from all over Europe. At the moment, Europe has huge reservoirs of scientific talent, but a very poor record at creating start-ups. The question many investors ask is: where is the European Google? It’s a fair question. In the next ten years, what if that European Google was set up here using Irish and European brains and US capital? That is the prize.

If you are a regular reader of this column, you might be pinching yourself at this outbreak of optimism. But that’s the point. The time to be critical was when everyone else was cheerleading, and the time to be upbeat is when everyone else is suicidal. There are opportunities in every crisis, and the Innovation Ireland Initiative is one of them.

Frankly, it makes much more economic sense for the pension fund to be investing in the future capital of the country alongside the best venture capitalists in the US, than to be throwing good money after bad into our crocked banking system.

We have to tear up the script. We need to realise that the old Ireland, with its bloated banks, overpriced land and easy credit, nearly destroyed us. By all means, sort out public spending, partnership and the banks themselves, but the endgame is well known. There is really no debate here. Either the state sorts out the present, faces down the vested interests and takes the hard decisions, or the market will do the job for us. We know we are in for a torrid time, so let’s get on with it.

The real challenge is to position ourselves, so that, at the end of this, we have hope and a new vision. We could well have a whole new cast of politicians and leaders by that stage, but the key is to know where we are going.

Innovation Ireland can provide that roadmap. Let’s go for it.


  1. Aidan O'Neill

    > We need to realise that the old Ireland, with its bloated banks, overpriced land and easy credit, nearly destroyed us.

    True!

  2. As the owner of a small start up business in Ireland I think that we already have some amazing resources available to us here that are not in other countries. I do applaud this fund though as one of the main areas of concern that I hear from small start ups is the inability to raise funding. Hopefully the fund will be managed correctly and even more importantly the cash will start flowing into small companies ASAP as up until now similar schemes have been headline grabbers but slow to filter through.

    • Hear hear Niall. “I do applaud this fund though as one of the main areas of concern that I hear from small start ups is the inability to raise funding. Hopefully the fund will be managed correctly and even more importantly the cash will start flowing into small companies ASAP as up until now similar schemes have been headline grabbers but slow to filter through.”

      I approached Dublin Business Innovation Centre who were closely involved with the Business Angels funding and, despite being one of the Irish pioneers in proven electric vehicles, I was laughed off, being told that anything below a 100k requirement was of no interest. They were looking for HPSUs (export value) even though that was not strictly speaking part of the criteria for funding. So let’s hope that this funding is about genuinely funding smart ideas, not wasting money on the bankrolling of stereotypical HPSU businesses to date. If so, that’s a bit like investing money into ANIB preference shares or others when instead the right thing to do would be to allow the business idea to die (its not a business until its made some sales folks) or else to take it over completely. Ok, incomplete metaphor but I hope you get the gist.

      Invest money into CLEAR paths to money. And while we are on that simple simple rule of business, can someone tell me why this strange piece of government policy exists, particularly in these hardened times? >>> “It is State policy not to undertake mineral exploration, nor take any equity participation.” See http://www.gov.ie/en/services/prospecting_licence/ The mind boggles…….

      ps If all of this doesn’t work out in the next few months worldwide, here’s an interesting alternative from Money and Markets: -
      http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

    • Well done on the E63 :-) I live on an E61. Small victories matter. If we valued such freebies (luxuries) more frequently across society, we’d have a more Buffettian view of value. p.s. I don;t see your domain error as a biggie. Unison.ie was a much bigger one at the time (unison.co.uk being the union) and they survived oky smoky.

      State of mind is everything and you guys have it. Best wishes for ’09. Slay some dragons

  3. gearoid o dubhain

    Set alongside this good news is the report from Google that they have abandoned plans to locate up to 100 software engineering jobs in Ireland because it was unable to locate enough qualified candidates here. Google’s Vice- President has blamed the loss of the jobs on a “dumbing down ” of educational standards in Ireland.
    This serves to confirm what Peter Sutherland has been saying about the Irish education system for several years. This dumbing down and failure to produce sufficient high quality candidates in the maths/computer fields will serve to militate against the success of this fund.
    None of the main political parties are willing to address this issue seriousy, presumably for fear of upsetting the vested interests in the education field.

  4. [...] on this I’m going to be optimisitic and think that this might actually happen. I like how David McWilliams puts it: The time to be critical was when everyone else was cheerleading, and the time to be upbeat [...]

  5. Robert

    David, I do not share your optimism.

    The “innovation fund” mentioned last Thursday is just the same old bullshit & nonsense brought out (by the most incompetent government in the history of the Irish State) to screen out the fact that the Dail will be out of action until January 28th.

    A leopard doesn’t change its spots this quickly and the Builders Party (FF) will remain loyal to those in Irish society who have brought us to the mess we are now in.

    You say that “we need to realise that the old Ireland, with its bloated banks, overpriced land and easy credit, nearly destroyed us”. Well in the recent budget the two Brians declared their intention that there is no plan B and that they are going to invest €1600 million in the home choice loans government subprime lending scheme (homechoiceloan.ie) to provide state loans to people who cannot get them anywhere else — to buy brand new houses, of course, and not second-hand houses. This €1600 million certainly dwarfs the €500 million “innovation fund” you are getting very excited about.

    “Science Foundation Ireland will spend €7 billion on education and training”. Where exactly is this money being spent? It certainly isn’t being spent in primary and secondary schools where young children will see their class sizes rise by 3 to 4 pupils next year. Funding for Physics & Chemistry at second level is being completely withdrawn.

    Meanwhile this morning we hear from rte.ie that “the Irish Financial Services Regulatory Authority (IFSRA) has set up a committee to conduct an urgent review of the circumstances surrounding directors’ loans in Anglo Irish Bank”. They’ve known about Fitzpatrick’s antics for ages and done nothing about it.

    I’m sorry David — but send us on whatever you were drinking last Thursday as we could all do with the same lift.

  6. Frankly the money won’t be spent where it’s needed in the same way it wasn’t spent where it should have been the last time the government gave our current crop of VC’s money.
    I would love nothing more than for the history to prove me wrong but I don’t think it will.

  7. Anyone who wishes to do so can find an excuse not to setup in Ireland, or indeed with Dell, leave for greener (cheaper) pastures and use the financial crisis to justify whatever they want. Googles decision is such that the advantages that existed no longer seemed necessary with greater numbers of unemployed in the US.

    I for one applaud this innovation fund and having setup many start-ups (and failures) I have always found access to funds being a matter of knocking on enough doors to get enough yes answers.

    It must be a contrarian in me but I setup a pharma company when everyone was getting money for adding .com to their company name and now I am in a start-up in technology when the world is falling apart in the financial world. Failure is not an option. :)

    Anyway time to be optimistic and enough about the past as we drive forward and stop looking too much in our rear view mirrors. I prefer to work with the intellect and management of Irish managers and out-sourcing of IT expertise to lower cost economies to ensure future revenues are maintained in Ireland and with the tax advantages this looks promising.

  8. mishko

    @gearoid o dubhain

    At the end of Cowen’s speech, at least he’s hinting at a get-tough approach towards unions such as the teachers’. For example, he says:
    “Those who expect to have their needs and ideas considered as part of the national recovery effort have a duty to participate responsibly in that process.”

    Like you I have little sympathy for teachers who are more interested in remaining the highest-paid in the EU than in teaching our kids the key subjects like maths and creativity in a better way (and I’m a teacher, by the way).

    I also like it that he says: “Particularly in the public service, we need to be prepared to look at new ways to provide the services the public need in the most efficient and effective manner. We must focus spending on areas of greatest priority and reduce sharply those activities which are not essential.”

    If he means this in the way people on this site do when they say it, a lot of the “boys” will soon have to be looking elsewhere for jobs.

    Anyway, great to get some good news right now; are we seeing the birth of the Hibernian Beaver?

  9. Lorcan

    I said on this site the other day that there is no such thing as an optimistic economist. Looks like I was very wrong! Perhaps I should have said that all economists are contrarians..

    David > let us concentrate on the positive opportunity engineered by the ‘Innovation Ireland’ idea.

    Innovation means something new, and as such I am not sure that we should be looking to create a new ‘silicon valley’. The software/computer market is now a mature market where high margins are becoming harder to achieve. This model would also put us in direct competition with India, a country that has lower costs, but also a large pool of ‘reserve labour’ with software qualifications.

    There are more opportunites in the science and engineering fields, where we can become the market leaders by being the first to market, thereby getting access to the higher margins that can be achieved from such a position. Why are Microsoft synonymous with software and Google synonymous with the internet? Because they saw the opportunities when others didn’t.

    What’s stopping us becoming leaders in energy, through renewable or hydrogen research?

    €500 million seems like small fish when compared to the €400 billion bank guarantee, but it is probably enough to get the ball rolling on Ireland’s innovative future. Just please make the process of getting the money to those who need it easier than it traditionally has been..

    • Furrylugs

      “What’s stopping us becoming leaders in energy, through renewable or hydrogen research? ”

      Further to my previous posts on the subject Lorcan, we are actually making strides in this regard.

      http://en.wikipedia.org/wiki/Sorne_Hill_wind_farm
      Which has an innovative energy storage system.

      http://www.openhydro.com
      Who are making big waves. (Pun.Sorry)

      And the news this week that the planning regs are to be relaxed for Off-shore developments, though this only benefits the really big players like Airtricity.

      The first step is to stop ESB protectionism dead. A small start would be to ask the question “Why do ESB double the standing charge when people sign up for nightsaver electricity?”

      The ESB are quietly spending fortunes improving the cabling infrastructure etc (Commendable)so that no new player will get a look in. (Not Commendable)

      This very week I’m looking at Nuclear in the UK with some big players but they smiled benignly when I suggested ESBI as a framework partner.
      I suppose in short all I’m saying is with what I know, that Ireland should be a net exporter of electrical energy to our largest market in the next 5-7 years with a good push. We have all the prerequisites on our doors and shores.

      The only impediment to this is the very valid comment above insofar as our business leadership is polluted by financial and HR support functions as opposed to engineers and scientists.

      Twas only supposed to be a short comment but this is a subject I get off on, not that you’d notice.

    • @ Lorcan,

      Its all about ideas. That’s all the world is about. Money’s money. When you’ve got the right ideas and a path or patents, money follows no problemo. €500m is big big bucks, let’s get real here. If you put it into the right entrepreneurial hands, the world’s your oyster (actually that much would run 5000 healthy start-ups in my view).

      “The software/computer market is now a mature market where high margins are becoming harder to achieve. This model would also put us in direct competition with India, a country that has lower costs, but also a large pool of ‘reserve labour’ with software qualifications.”

      The existing products and processes may be mature but new concepts and value chains are always around the corner. Google as a business concept rather than a business model is more what David is referring to, I feel. The same kind of mindset that turned Nokia from what it was to what it is. What we need is to feed the optimism and confidence of the Irish that we only have in the last 20 years. Look at the achievements of our boxers, based on focussed programmes and focussed spend (its hugely morale-boosting for Irish kids, we all know that, based on Jack Charlton’s legacy). We are already early leaders in nanotechnology and were in renewables but we’re letting that slip so badly.

      I don’t know if any of you have ever read the life’s work of Archbishop “Dagger” John Hughes? http://www.city-journal.org/html/eon_1_14_03ws.html This is pivotal, in my opinion, to where we are now as a society? Yes, we have poured away the government tax take from the Celtic Tiger and we could say its all been a horrible waste. But it hasn’t. We’re used to a certain life, a place in the world, and once that’s been tasted, it is much much harder to let slip away. I DO believe that profoundly powerful leadership is called for, and no, I am not calling for a return to prayer and churches (as Hughes did), but some form of moral code (patriotic zeal, Lenihan talked the walk) that is more or less a call to arms of the Irish people. Forget the flowery language implied here. I am talking about using this concensus and partnership movement NOW to ensure that Ireland holds its own on the world front and, as David has said, and Cowen is rightly doing, plant seeds for storming world markets when recovery occurs. We are not just house-builders and I do think that Cowen’s character and loyalty can become weapons of advantage in galvanising the partnership stakeholders (just drop Lisbon Brian, will you, it will destroy you politically).

      We are at a crossroads in the next quarter where key actions, just like that €500m fund, could have a butterfly effect on the irish psyche and future society and world standing. See how the Irish rose up in one generation in New York http://www.city-journal.org/html/7_2_a2.html.

      Look, we have a horrible financial mess. Maybe there will be inflation and then our debts will be wiped away. maybe it’s deflation for a short time til the inflation monster kicks in. Regardless, we would have an awful government if they didn’t plan NOW for future success, even in the eyes of such calamities.

      €500m is an awful lot of money for investment into small businesses. Let’s get a sense of that. On the other hand, its way too small of a sum to reap from the banks now that we as a people have them in this position. Venture capitalists will have choked on their cornflakes on such a limpwristed incision.

      We need a belief of where we can be in 10 years’ time. The tactics of how we get there (the businesses and cultural innovations that gain us that success) will arise in a market-created way as they are needed. Its more important to face 2009 with unswerving belief that, though there is a world crisis, we as a nation will use this to move further up the ladder; not at the expense of others, but instead through guiding and leading other nations through the age old recipe of innovation and hard work. Despite the rhetoric from our political elite in Europe, we are admired by most of the people of Europe, and always have been, for being free thinkers.

      Its time for brave individuals for the brave new world. We can only play the blame game for so long. Hopefully the government will make the necessary moves in banking and commerce that allows a rational purge and then we get back on track to carving our place in the world. Are any of you willing to go back to where we were? I am not.

    • @ Lorcan,

      Its all about ideas. That’s all the world is about. Money’s money. When you’ve got the right ideas and a path or patents, money follows no problemo. €500m is big big bucks, let’s get real here. If you put it into the right entrepreneurial hands, the world’s your oyster (actually that much would run 5000 healthy start-ups in my view).

      “The software/computer market is now a mature market where high margins are becoming harder to achieve. This model would also put us in direct competition with India, a country that has lower costs, but also a large pool of ‘reserve labour’ with software qualifications.”

      The existing products and processes may be mature but new concepts and value chains are always around the corner. Google as a business concept rather than a business model is more what David is referring to, I feel. The same kind of mindset that turned Nokia from what it was to what it is. What we need is to feed the optimism and confidence of the Irish that we only have in the last 20 years. Look at the achievements of our boxers, based on focussed programmes and focussed spend (its hugely morale-boosting for Irish kids, we all know that, based on Jack Charlton’s legacy). We are already early leaders in nanotechnology and were in renewables but we’re letting that slip so badly.

      I don’t know if any of you have ever read the life’s work of Archbishop “Dagger” John Hughes? http://www.city-journal.org/html/eon_1_14_03ws.html This is pivotal, in my opinion, to where we are now as a society? Yes, we have poured away the government tax take from the Celtic Tiger and we could say its all been a horrible waste. But it hasn’t. We’re used to a certain life, a place in the world, and once that’s been tasted, it is much much harder to let slip away. I DO believe that profoundly powerful leadership is called for, and no, I am not calling for a return to prayer and churches (as Hughes did), but some form of moral code (patriotic zeal, Lenihan talked the walk) that is more or less a call to arms of the Irish people. Forget the flowery language implied here. I am talking about using this concensus and partnership movement NOW to ensure that Ireland holds its own on the world front and, as David has said, and Cowen is rightly doing, plant seeds for storming world markets when recovery occurs. We are not just house-builders and I do think that Cowen’s character and loyalty can become weapons of advantage in galvanising the partnership stakeholders (just drop Lisbon Brian, will you, it will destroy you politically).

      We are at a crossroads in the next quarter where key actions, just like that €500m fund, could have a butterfly effect on the irish psyche and future society and world standing. See how the Irish rose up in one generation in New York http://www.city-journal.org/html/7_2_a2.html.

      Look, we have a horrible financial mess. Maybe there will be inflation and then our debts will be wiped away. maybe it’s deflation for a short time til the inflation monster kicks in. Regardless, we would have an awful government if they didn’t plan NOW for future success, even in the eyes of such calamities.

      €500m is an awful lot of money for investment into small businesses. Let’s get a sense of that. On the other hand, its way too small of a sum to reap from the banks now that we as a people have them in this position. Venture capitalists will have choked on their cornflakes on such a limpwristed incision.

      We need a belief of where we can be in 10 years’ time. The tactics of how we get there (the businesses and cultural innovations that gain us that success) will arise in a market-created way as they are needed. Its more important to face 2009 with unswerving belief that, though there is a world crisis, we as a nation will use this to move further up the ladder; not at the expense of others, but instead through guiding and leading other nations through the age old recipe of innovation and hard work. Despite the rhetoric from our political elite in Europe, we are admired by most of the people of Europe, and always have been, for being free thinkers.

      Its time for brave individuals for the brave new world. We can only play the blame game for so long. Hopefully the government will make the necessary moves in banking and commerce that allows a rational purge and then we get back on track to carving our place in the world.

      Are any of you willing to go back to where we were? I am not.

      • Oops, posted twice :-( But as Goethe said ‘There is REPETITION everywhere, and nothing is found only once in the world.’ Now Michael McDowell, there’s a man who sounded like a broken record. Once was too much, the damage was done.

  10. John ALLEN

    Innovation – one small candle lighting in a large dark stadium can be seen from a far way distance lets hope it will turn into a flame of hope in 2009

  11. €500 million compares with €13 billion which the Irish put into commercial property, mainly overseas, in 2007 and while the fund in itself isn’t very significant, more importantly, there is no evidence that policymakers have moved beyond the marketing spoof that has been a substitute for enterprise policy over the past decade.

    The high hopes for the Irish-owned tech sector a decade ago, have foundered and while Israel has 65 companies on the US Nasdaq Exchange, Ireland has 5 including Ryanair. Israel also has the advantage of cross-fertilisation from the significant defence research industry. Ireland’s biggest home-grown tech company Iona, was sold to a US firm in 2008 and earlier this year, Xsil, the winner of the Deloitte Fast 50 in 2006, moved most of its operations from Ireland. Irish innovation companies generally are not able to achieve significant scale and the pattern is that the promoters usually sell to a bigger firm. What the policy makers views on this scenario are, is unknown, if there are any.

    In regard to the main innovation policy, the strategy of relying on university research for eureka moments, has also been questioned but again, the policymakers have nothing of substance to say on the issue.

    Innovation specialist Professor Danny Breznitz of the Georgia Tech says Ireland’s research infrastructure is too narrow in its focus and may not be sustainable.

    He says we are not creating enough new businesses, and when new businesses are set up, the financial supports are not there to keep them innovating.

    Breznitz says the building of Ireland’s R&D infrastructure is something that should be imitated by other countries, but he said he feared that Irish research is too narrowly focused on biotech and the ICT, or information and communications technology industries.

    Breznitz’s most recent book is a study on state support for innovation in Ireland, Israel and Taiwan, and he says that if a country wants sustained economic growth it has to focus on innovation, not only on the research side but on the commercialisation and the growth of productivity. He spent 4 days in Ireland at the invitation of Enterprise Ireland, in June 2007.

    While tax incentives are important, cost levels are also. R&D in emerging markets is growing and often the focus is to broaden the consumer base to lower income consumers.

    When the framework “plan” was first leaked, the IFSC in 1987 was used as an example to emulate but there are many more challenges for attracting mobile investment. That’s not to say that Ireland should not have promotion funds etc

    Finally, the rhetoric and superlatives from Mary Coughlan and previously Micheal Martin, seldom matches the reality when it comes to announcements on collaboration and the establishment of what are called “Global Centres of Excellence.”

    So yes to optimism but bigger than the €500 million is the over €8 billion being spent to become a world class knowledge economy in 4 years, which isn’t going to happen. The strategy is unclear and as with ignoring the state of the indigenous tech sector, were there any lessons from the broadband debacle?

    This is a golden time if you are an engineering professor dreaming of making your fortune from your crew of PhDs but fortunes can be made from rejigging old reliables like food.

    Tommy Doherty, Mazars partner said earlier this year that the food industry in New Zealand developed specific measures and worked with external partners to develop new technologies and new products. They created specific products for specific markets and created best practice dairy markets in Asia. And despite being 12,000 miles away from European markets, New Zealand has become increasingly competitive for its chilled lamb and their lamb exports to the EU have increased 40% in the last two years”

    http://www.finfacts.ie/irishfinancenews/article_1015583.shtml

    By the way David, if we are to emulate Israel, should it be Ireland Ltd.?

    • Furrylugs

      Quick one Michael.
      If Ireland Plc / Inc / Ltd doesn’t produce some viable assistance packages or policies for its SME’s in double quick time, no-one will touch this place for dust.

  12. I fully agree with your positive sentiments with regards this €500 million. Entrepreneurs and the true innovators don’t need stacks of money the way banks or other industries need it. They do need some money, of course, but it is the brains and encouragement that is mainly required. The 500 million will be more than enough cash and the government have done something that may well be regarded as a stroke of genius in a few years. We will have our Nokia, we will have our Google.

    • Nokia is an old company that used to make toilet paper and a raft of other products at one stage.

      Even if an Irish company was to develop some magical product, why wouldn’t it do as Apple with the iPod and iPhone- the products, including all components, are manufactured in Asia. Apple has a big premium for its design and most of its hareholders are American.

      We have have a very successful company CRH with a payroll of 92,000. It accounts for about 1/3 of the value of the Irish Stock Exchange. However, 84% of its shares are held overseas and its payroll in Ireland is just over 2% of the total.

      Is it an Irish company?

      About 28% of Nokia payroll is in Finland and it has a big network of local suppliers. However, good governance and a competitive economy are important for its local contribution.

      • b

        This government has consistantly stuck two fingers up at business. This 500 milliion is a smokescreen to hid the utter panic and confusion they are now in.

        We won’t have world class businesses so long as we have the nonsenical and petty attacks on companies that make it.

        We have a pathetic broadband infrastructure and academics from the leading universites are having to leave and find employment in universites in more forward looking countries.

        Knowledge economy my arse.

  13. the mediator

    David

    If I read correctly, you are taking the creation of the fund as a “signal” of a change in the policy mindset of this
    country.

    As another contributor put it the fund will only work if it can build on native talent in the areas of science, engineering, IT, etc…The problem that remains and is endemic in this country is short termism. Our education system has
    gone backwords in many areas since the 1980′s and we’re starting to see the results now in third level education.

    I’m a lecturer in the areas of finance/economics which require a small degree of numeracy and some critical analytical ability and these areas are sadly lacking in the students we’re getting (Many of whom have higher points than I obtained in my leaving cert). All they can do is learn stuff off and god forbid if they are asked to think outside the box they flounder. This is particularly the case with Accounting students who just want the exemptions from the professional bodies and an easy ride to a good career. In the main they do not want to think or develop those skills at all. In Ireland we still reward accountants and regard them way too highly – they rarely add value in an economy. Contrast our model with that of Germany which has CEO’s that come from engineering or science backgrounds as distinct from our Anglo American beancounter culture.

    Students need to see that those who study the sciences or engineering/IT etc…will get rewarded if they are to be encouraged. What they’ve seen over the past 10 years is soft skills and BS being rewarded and in particular law/accounting as the best career choices. Law and accounting do not create value. The former is an economic rent and the later is an expense (necessary) in the system.

    Also – unless we fund primary and secondary education properly, and importantly, ensure the primacy of maths etc as the very core of our education system we are doomed to lag behind other countries in the future. I don’t think in the main that the problem is the teachers themselves (although you’ll always have some deadwood in the system) its the inability of the government to set good ciricula and to support teachers in teaching as distinct from ever more form filling and “quality assurance”. Big changes are needed if this fund is going to be more than just another “initiative”.

    • Colin

      Med, I fully agree.

      The sooner all accountants come out with their hands up saying accounting is just a sham the better.

      The problem goes back to the Irish Mammy, who wants to gloat to her peers that her son/daughter is studying law / accounting. Its also a problem with medicine / dentistry / pharmacy.

      Leaving Cert Students know Engineering degree courses require much more effort, and turn their noses up to it since they are more interested in having a good time with lots of free time while in college. I mean, have you ever heard anyone who went to UCG because of the course that was on offer? No, its the craic and the “arts” scene they go for – primarily. Its Galway’s iconic status of being a haven for middle class partying that seems to be the main attraction.

      I’m sure there will soon be a software program that will perform all the duties that accountants dress up as professional work. I would love to see accountants joining the dole queue.

  14. Furrylugs

    “If you are a regular reader of this column, you might be pinching yourself at this outbreak of optimism”
    Quite so.

    The comparison to the Israeli model on economic terms belies the political fact that the investment drive mentioned came on the back of a pro American state, beleaguered on all sides, which developed a nuclear capability with South Africa. Israel was flooded with defensive US armaments during Gulf War 1 so that it shouldn’t need to deploy tactical nuclear weaponry to, essentially, survive.
    “Give us the investment or we might have to lose the head with the Arabs” type of business model.

    Notwithstanding that, Jewish financial acumen is far more focused than our Band of Brothers. They have rebuilt a global financial network despite the ravages of WW11. They will never be savaged in that manner again and so the clarity of thought for the greater good outweighs petty politics or gain. Canary Wharf is the potent symbol that King Davids money will never join with the Bourse in Deutchland. Not my comment but a comment made to me some years ago by my Brother-in-Law, a senior City banker.

    They actively and generously engage in investing for the next generation to survive a hostile geo-political landscape.

    Brian Cowen is not Ben Gurion and Mary Harney is not Golda Meir.

    We’ve blown the greatest chance for a whole generation to “Stand among the Nations of the Earth” so a step forward to reach out to the next generation is to be welcomed, even if that step signals the consignment of this generation to the economic dustbin. This Framework is the official recognition that our recession will de facto be Irelands biblical wilderness for a generation to come. “We know we are in for a torrid time, so let’s get on with it.”

    Some of us will have to get on with it with far less resources than others.

    The Framework is also, as Robert alludes to above, somewhat aspirational, given the educational morass our children try to negotiate. Will this Framework be backed by meritocratic infrastructure investment or will it be accessible by a streamed elite, as before?

    I bought my nephew, a gifted child, a new notebook because there was one in his class shared between 30. He’s 11 and already reading Stephen Hawking but taught to the standard of a 9 year old. His teachers are taking to the streets for more pay.

    So there it is in a nutshell. Forget trying to better yourself. The chances for this generation are over. The job in hand is to make a future for those coming behind.
    Israel and Ireland finally evicted the British and gained sovereignty at much the same time. Israel evolved and now stands a strong nation with huge resources, sense of nationality and internationally influential.
    In the coming months and years, Ireland will resemble the Gaza Strip.

    • ger

      Israel domestically is a broken country, the only reason it is standing at all is due primarily to the billions pumped by the US, in order to maintiain its proxy state in the middle east – you should read up on it, see Noam Chomsky for further details, all well documented.

  15. mishko

    Interestingly, only a couple of days ago some interesting proposals were made to by The Expert Group on Future Skills Needs (EGFSN) “aimed at ensuring Ireland becomes one of the top OECD countries in terms of mathematical proficiency”.

    See: http://www.finfacts.ie/irishfinancenews/article_1015530.shtml

  16. John ALLEN

    The Power of Now – the minister has not empowered us for today to find work at home except cunningly he hopes some of us will emmigrate and take our anger elsewhere – history repeats itself except this time we hurt ourselves in that process and must learn to forget our irishness to find new hope – call in our ballads we knew and thought were forgotten we must re write these again

  17. gearoid o dubhain

    Re Mishko comment: I dont intend to criticise teachers who are as entitled to make as good a bargain as anyone else is, but rather my comments are directed at those who devise, implement, and onersee policy.
    How can it be that with such a high proportion of TDs and Ministers coming from the teaching professions that we don’t indeed have the high quality education system that politicians say we do ? Consider that Michael Martin,Mary Haffin and serving Education Minister Batt O Keeffe are from the teaching profession. Why doesnt anyone prominent suggest that Ministers who hold on to permanent teaching positions with a view to getting full time teaching pensions for work they havent carried out, are hardly the kind of peope who may be relied upon to act with a view to installing a first class eduction system rather than acting in a way that appeases the vested interest groups and is politically expedient. And why don’t the Teaching unions condemn a morally dubious practice that sees substitute teachers, who are willing to work full time but are unable to get these full time posts ? The schools are unable to benefit from having a permanent teacher/lecturer at their institutions actually working at their schools/colleges.
    The answer of course is that the Government has in its gift very lucrative appointments to the boards of Semi-State boards and these would be jeopardised by rocking the boat. We can hardly expect the leader of the opposition or a high profile TD such as Finian McGrath to highlight this issue because they are offenders themselves.
    The importance of this matter is because it highlights how a practice that is detremential to good teaching practice, that is at the very least morally dubious, is allowed to continue because it is serves the interests of those who are paid to be legisators.
    From this perspective, it is easier to understand how the large sums that have been invested in the education system have failed to produce the kind of education system that would have produced the numers of graduates that Google looked for but failed to find in Ireland. It has been more politically expedient not to. The Fas / Florida episode is futher proof that budgets can and are abused and that politicians are happy to accomodate those who are charged with investing these monies productively but who do not do so.
    How many politicians have stood up to argue that the annual fees that membership of CERN costs would be a better investment of taxpayers monery than the costs of having a Minister of State for Education and the costs involved in providing full time teachers pensions for TDs and Ministers who have long departed the class rooms ?

  18. John ALLEN

    Innovation – the irish income tax system is broadly calculated on two sectors of the income tax payers namely : the paye employees and the self employed . There is now a need for reform arising from recent sudden change in economic events .I believe that the paye sector should now be subdivided into civil servant paye workers and other paye workers .I believe that this can be expediently carried out without any significant costs to the exchequer and with immediate effects to government savings in running the country.I propose that the civil servants be factored in additional tax to pay arising from their privileged positions and this can help to defray the proposed innovation costs and bank subsidies .

  19. Malcolm McClure

    Great article David. Positive and to the point, when all around is doom and gloom. Definite nominee for Irish Person of the Year.

    Back to business (reluctantly, because of holidays., but there a National Crisis going on and we obviously can’t depend on the layabouts – and latteabouts–in the Dail to come up with anything useful soon.)

    For a country to be successful, it needs to build upon what it already does well. The construction industry has come in for a lot of stick recently, but to their credit, given leadership and ultramodern methods, they are as good at what they do as you’ll find anywhere. There is huge scope for innovation in construction methods, and there are firms with Irish backgrounds in tunneling, trenching, damming, shuttering, the list goes on and on. Big money is spent on the right tools and there are practical people all over Ireland with ideas about how to do things faster or with less effort by adapting existing tools. Getting them to contribute to an innovation initiative depends on gaining their trust. This means promising absolute confidentiality about their innovative suggestions and a share in the profits if the idea gains a market.

    Thus our success depends on patents, copyrights and intellectual rights management. It is this area where the spadework needs to be put, The machine making and metal bashing can be done elsewhere, so long as the intellectual rights deliver a steady stream of cash back to Ireland. The beauty is that we don’t need elaborate distribution networks if the world beats a path to our door because we have invented a better (mousetrap) –say, for example, a 3D shuttering system to pour organic forms in concrete.

    • Furrylugs

      Malcolm,
      I’m on record as being Luddite when it comes to economics but I’m nothing short of world class when it comes down to fire fighting construction projects which need some impetus to get over the line.
      In my experience, “they are as good at what they do as you’ll find anywhere” is absolutely true. Go anywhere worldwide and we’re succeeding in heavy civils, infrastructure etc and respected for it.
      Irelands turn to pour the concrete and and drive the roads was typified by D4 inefficiencies and waste. Those of us who returned to build the Tiogar had one refrain; “If they saw this in (pick a country) they’d laugh their b..ll.x off”. Some of the working practices were archaic to say the least and the mistreatment of battle hardened workers was abysmal. And then wait up to two years to get paid if you were a contractor.
      So the one thing you learned in construction once you committed a family to Ireland was to toe the line. Else find yourself on the Letterkenny by-pass with your wife in Cork. The last thing you did was try to change the status quo.
      “He’s back with his big ideas” was a tag to be avoided.
      Spoken from personal experience.

      • Malcolm McClure

        Furrylugs: Right on, all of that. But incomers and returners are gently but firmly put in place by stay-at-homes. As are consultants and advisers by the permanent staff, after a short period of feigned curiosity. Been there. Done that.

        This is a phenomenon not peculiar to Ireland. Conservative nature will never change; in Europe, social hierarchies established over generations reluctantly concede even a whit of precedence only for very compelling reasons. That’s life. Just live with it. Or stay put and suffer like the rest of them. Or go to America, where in the suburbs, the Welcome Wagon often did help to ease the pain of yet another U-haul move.

        ‘On yer bike’ was never practical advice in Ireland, where people traditionally expected the government to bring the jobs to them. How many billions in subsidies have been wasted by acceding to that democratic demand?
        Where is Fruit of the effing Loom and others like them now?

  20. Angelina

    David,

    While I’m usually in agreement with you, this is not one of those weeks. Firstly, I cannot see Irelan and Israel as a fair comparisons, since culture and overall intellect are quite different. The Irish Government are so far removed from reality, with tunnel vision personnel, and likely do not yet understand why Ireland is in a “recession”. As far as Ireland having the youngest educated population in Europe, most have no life experience, or common sense, since they have been handed everything on a silver platter. “Give a man a fish and feed him for a day, teach him to fish and feed him for a lifetime”!
    Some great comments, thanks!

  21. [...] money provided by professional capitalists and venture capital firms to promising companies Ireland Inc gets innovative – davidmcwilliams.ie 12/21/2008 The government is finally getting it. The €500 million innovation [...]

  22. B P Woods

    Ireland Inc is insolvent. The national income (taxes) has declined significantly. If you apply this to yourself, your company, whatever – your expenditure being greater than your income; your insolvent. QED. We, the taxpayers of this state have had our future incomes mortgaged for decades; its poverty time.

    The solution: Think VERY carefully about this. All mortgages on private (owner) homes are canceled immediately. No ifs, no buts. All credit cards are withdrawn, debt is canceled, and replaced by debit cards – no exceptions. No further credit, except short-term for several years. Mortgages for home purchase are maximized at 2.5 times your income (one income only is allowed), with a minimum of 20% cash down payment.

    As I said above, please think this through – its not pleasant, but it will save this state- and its citizens from poverty.

    Brian Woods

    • Furrylugs

      Brian,
      Thats apparently what Obama is working on as we debate the way forward.

    • @ Brian Woods, when I saw your initials BP Woods, I couldn’t help but thinking this was a pseudonym for Bretton Woods! such are your are brave and interesting comments that I am still wondering if Bretton Woods as become self-aware and is typing on David’s forum !! :-)

      Footnote: – We shoudl follow Lidl and Aldi’s philosophy and on January 1st, hugely discourage use of credit cards through massive stamp duty. Ye can’t even use them for cocaine lines, now, the party’s over folks.

  23. John ALLEN

    Innovation – this only benefits a few now and more later because there are many contraints in that paradigm to make it work that would be visible immediately – my concern now is to stop emigration and the depletion suddenly of the pool left of our irishness – my proposals on civil servant’s additional tax above is too serious to ignore eg. rule out immediately their rights to paye credit that would be an easy start and senior civil servants earning over €100,000 become taxable at higher rate at a lower threshold also reduce their car rate expenses .

  24. Ed

    David, I agree that this move is a change for the better, but is it too little and too late. The Israeli situation back in the early nineties was very different to what ours is right now, their backs were against the wall and they simply had to have an industrial defence programme – nothing concentrates the mind like the threat of extinction. We on the other hand, are all over the place and when the going gets tough, we can up sticks and move to any one of a host of countries where, at some time in the past, a British flag was flown. This safety valve, while being a godsend to the politicians down through the decades, has been a major factor as to why we weren’t forced to become an industrial nation in our own right – it has always been much easier to leave it to outsiders.
    The idea of attracting Europeans here to build a major world class enterprise is a good one, but as things stand, they don’t regard us as a very technically competent people – we have little show them. They may know that some well known American brand names are based here, but that’s considered to be a sign of weakness – a nation of gofors in their minds.
    I do hope that this is a groundbreaking moment and not just another PR stunt – if only a fraction of the amount that was squandered on property had been invested in modern indigenous enterprise – our situation would be so different now. As I said on this site before, I invested in R&D instead of property and the returns are far, far greater – property is for the insecure.

  25. John ALLEN

    bp woods – your idea is encouraging and you will have a lot who will be angry too but this needs to be worked on at least you are talking sense ‘in the power of now’ .For your information switzerland is in serious trouble too and maybe insolvent or will be and have more serious problems than we do .I am a firm believer that we in ireland are unique and we Do have Solutions and Now .I am totally convinced of that – its about Good Management of our scare resources and we have opportunities to make that happen

  26. Philip

    While the 500M is possibly significant, I think little will happen as a result.

    Innumeracy is rampant here. A love of physics/ technology – which demand the highest attention to the application of maths is a rarity if not a certification for booking you into the local looney bin. There is an attitude problem in the country that is very anti-tech and fatally very referential to the old professions of accountancy, doctor, civil servant, etc. Our application of technology to our infrastructure is disjointed and spotty at best and contrary to a previous commentator, our typical construction industry does not come with an asses roar of what is typically done in mainland Europe.

    Interestingly enough, all the anglo saxon speaking world is actually very similar.

    Isreal is just a funded US militrary machine. Their tech comes from spinoff Military R&D. As I said before in these blogs, weapons make money and really get your R&D going.

    Innovation is a screwed up over used term. What do you want to be when you grow up? I wanna be an innovator. No clear statement of need.

    Actually, we are making something simple unnesessarily complicated. We need a policy that addresses a need. i.e. Energy, Agric Yield, Island Isolation etc etc…solve problems!!! We do not want Entrepreneurs. We want to solve problems. Clearly our Government still beleve that consultants pulled in from abroad solve problems while we need to keep them wacky entrepreeurs with a few million…. Audi’s Vorsprung durch Technik needs to be unpacked.

  27. Deco

    David – I commend you on your excellent high level thinking. Basically, like you said the other night on the RTE documentary ‘Prime Time’. We have to learn to follow the Finns, the Israelis, the Swedes etc.. However there is a reason why it works in these countries – they are inherently meritocratic.

    I work in software and I feel obliged to inform of something. It is not going to work. The current Irish authority model needs to be completely burned and the ashes need to be cast to an Atlantic Gale. The nepotism, cronyism, amatuerism and apelike behaviour that is called ‘managment’ in this country, is completely diametrically opposed to your point of view. But if it keeps people optimistic, then they will gladly sign up to it. Ireland is full of useless people, because Irish culture has a high tolerance for useless people living off the hard wortk of others. I am not talking about people on wlefare. I am talkig about the entire set of arrangements that can be called the ERI (Economic Rent Infrastructure), and the culture that is availed of by authority figures in Irish society. Irish society is inherently corrupt. All those societies that succedded at innovation, have strong egalitarean tendencies, based on religion, and political philosophies that guided them in the modern age. They always were very transparent, open, societies. Selfishness and meglamaniac tendencies were clipped. Learning is far more important than the ego, or trails of deceit. In Ireland, as we have learned that deciet, corruption, improper behaviour, and opaqueness are the norm.

    Our societal culture, and in particular with respect to authority makes this impossible. Basically, we would need to go very deep to make it work. And to start with, we would need to haul authority out of it’s priveleged position. We would need to amend the libel laws in the media, as much as update patent laws in the technology sphere. We need a more honest business climate. And to get there we need severe sanctions on corruption. Let’s face it, when the Irish go to America they innovate – and this has always been the case. But Ireland at home, is structured as a claustrophobic society which detest original thinkers, odd balls, earnest effort, fair players, and inventors.

    We are culturally incapable of matching your plan David. This is very sad. But it is the truth.

    • PaddyThePig

      a truly excellent post Deco. How much of the 500 million will end up being swallowed up by d’brother, d’cousins or d’in-laws?

      It seems that ‘debt forgiveness’ is still in some poster’s letter to Santy. For society’s sake, lets
      hope that Mr Claus never delivers on this false and dangerous panacea.

    • PaddyThePig

      excellent post Deco. How much of the 500 million will be hoovered up by d’brother, d’cousin or d’in-laws?

      The ‘debt forgivers’ are out again, writing to Santy to be absolved of their responsibilities. Society would pay a terrible price for this false panacea, as the dutiful and responsible would be left with no choice but to join in the binge.

      Kids are demanding these days aren’t they.

  28. Dave

    David:
    I’m normally with you but I truly despair at the naive optimism of this article. I can only assume that this flakey BS decision has been taken on your advice, Otherwise I have no idea what you are getting excited about. Let me put you straight on a few points. I have personally raised $30m in venture capital over the past 4 years. All directly invested into my own high tech business. All of it West coast American Capital, and the business is based in Europe. There simply are no borders to VC investment if the idea is good enough.

    Secondly, everyone knows that the reason Israel has huge VC investment is pretty simple. Hold onto your socks ..this is gonna shock you….yes their indirectly enormous Jewish control of the American investment industry. Now I’m all for unbridled optimism but if you can find a few Paddy’s in there to save ol’ Eire (Seamus Goldstein perhaps) you’re a better man than me and I’ve spoken to most of them. Coupled with this, what do you think VC funds are going to be like over the next 2 years? Ours are currently asking us to count the paper clips. So don’t expect any indirect US bail-out via the VC community, they are watching every cent right now. Their current investments are whithering on the vine.

    OK, now onto Ireland….when I emigrated 25 years ago we were telling the world we had the youngest work force in the world. 25 years later according to your article we STILL have the youngest workforce….That’ll be Tir-na-Nog.com then. Eternal youth…forget Hi-tech we should be bottling the water of eternal youth. …In realty what advantage does youth bestow on the country in a knowledge economy in lieu of serious Engineering skills from our universities? We don’t have one university in the top 100 world wide. No one gives a shite about Irish tech…It’s an oxymoron in 2008…..name me 5 Irish Uni spin-outs that have become global brands?? It’s not in the culture. Anyone and I mean anyone with an Entrepreneurial bone in their body will dash to the airport and get the hell out of there. Like I did, like you did….plain, simple ..That’s where we are

    Just a thought …the average VC company is handling a 1Bn fund to be invested over 2 to 3 years. The Irish Gov in its infinite generosity is ear-marking 500M over 10 years. 50M per annum. At best enough to fund 5-15 serious companies. Of which (using VC Pareto) 70% will fail. Google my arse David …the country hasn’t got the talent, the will or the biz smarts to make it happen ….I love the optimism and who could blame you when the country has all but pin-pointed you personally as the man who talked the economy down (lol) so you need to walk the streets in relative safety, hence articles such as this. But its a dose of reality that’s required next not this patronising…..you’ve made a media career out of keeping it real, don’t lose it on the bend Dave…..as the people that backed you intellectually (will leave you standing in your Calvin Kleins .

    • Malcolm McClure

      Bit strong Dave. We left not because we lacked opportunity but because openings were easier to find abroad. In Ireland it would have taken more pain and sweat, but not impossible to establish ourselves if we had a brain in our head. And we had seen previous generations head for the boat. It seemed a national blessed inevitability.
      Regarding VC requirements, in Dragon’s Den most entrepreneurs need only a few hundred thou to float their boat.
      So 50 million a year should go quite a long way. What they really need is experience businessmen as mentors.

    • ger

      well done, thought you sized it all up very well. The univerisites are a serious weakness, senior people are excellent at talking their game up, global this, global that (because they need to justify their extensive salaries, bonuses and expenses), just see the salaries of the presidents of any Irish university – crazy stuff. These salaries for dubious positions are a serious drain on univeristy resources, the money is not trickling down to employing first class lecturers, or having top class lecture theatres. the money is all gone on people’s standard of living, salaries absord a disporportionate amount I would say. The gov. said they look at this (again the horse has bolted) and how can those who should be policed (with their extensive financial packages and holidays) do the policing. The country needs a change from top to bottom, it is going to take something dramatic for that to happen, therefore i think it extremely unlikely that anything will happen. These politicians will be happy for people to leave this country because they offer no solutions, but are quick to look after themselves. Sometimes I think Ireland deserves this set of circumstances in reward for its grubby, politician at the pump, nepotistic, fumble in the greasy till, cute bullshit way of doing business.

    • “…We don’t have one university in the top 100 world wide. No one gives a shite about Irish tech…” Untrue.
      http://www.irishtimes.com/newspaper/ireland/2008/1009/1223445617983.html

  29. Deco

    BP Woods – If you are saying that we should be prepared to let some of the financial instituions fail – and give them nothing on the way down, except the usage of Irish bankruptcy law – I am in agreemnet with you.

    It would make far more sense to make a state owned bank called – the Irish Key Enterprise Sector Bank. IKES Bank. It would have €5 Bn as starting capital. It would provide funds to key wealth generating sectors of the economy. Natural resources, Energy, Agriculture, Personal Vocational Education loans, and industry. There alreayd is a bluebprit for this – Forfas. David recommends something like the Israeli fund called Yozma. It can offer direct seed capital, capital investment, preference share investment, overdraft facilities, liquidity, and ong term loans. It should be headquatered in Athlone or Portlaoise – in a compete break from the banking traditions of the unhealthily centred in Dublin 4, and Dublin 4 thinking. (i.e. ‘Oi got ahead in the boink, thanks to thee ol mon, ruger, golf, yuh knouh…and the old skuule toi’). It needs to be a bank with a fresh meritocratic thinking from top to bottom. We need a bank that communicates with the intelligent people in this country, and not the gamblers, movers, shakers, celebtrities, and monopolistic element.

    And let the market decide the rest. They can continue to play bob the builder, and compete for tickets at the K-CLub, and the Rugby internationals. The rest of the country can just concentrate on the concept that Minister Hanafin dicsovered a few weeks ago, that elusive concept that Bertie Ahern never bothered about – sustainable development.

    I think the government have lost the plot, in following the failed policies of Brown, Darling, Mandelson, etc…We need to let failed banks go, and compensate the depositors. The obsession with property prices is creating a massive visual block, preventing people from seeing which sectors of the economy really matters. We need to concentrate on real worth economy, and not status obsessions of a failing culture.

    We need an “IKES Bank”. And let the Dublin 4 banks remove their decrepid boards, and incompetent managers.

  30. John ALLEN

    Good Management ( proper ) – I think many are in agreement that we can save ourselves NOW . What we need now is a Good Leader …….and thats all ……….that is the truth …..it will work Believe in it
    In Limerick a new Leader was appointed by the Government to make Real Changes ….and its working – under Regeneration Programme – why cannot we do the same at a national level. ( we are born Irish but Munster by the grace of God ) – its about attitude and determination to work and win .
    I believe new Banks should be formed west of the Shannon with their monies for their Regions

  31. EI has already handed over €175m to Irish VCs, now we are going to give even more to their old-school counterparts in the US?

    How many early stage _Irish_ Tech companies have been backed since Delta, NCB etc completed their funds? Anyone, anyone? Their idea of early-stage is “already generating revenue” and €1.5m investment minimum. They have become Venture Socialists whose motto is “nothing ventured, nothing ventured”.

    Instead, create a €5m fund run by a few smart Irish entrepreneurs to dish out to start-ups in which they see potential and I guarantee they’ll get a much bigger ROI than any of these spreadsheet jockeys.

    The successes we should be imitating are Y Combinator, SeedCamp, Union Square Ventures and Softtech VC. Lots of small investments spread widely with a bunch of decent exits and a few superstars every year.

    Regarding education David, have a word with the heads of the Insts of Technology and Eng/Comp Sci in the Unis. They continue to despair over the collapse in numbers taking science and engineering degrees. We have created a generation of solicitors, estate agents and civil servants instead of people who can actually create wealth.

  32. John ALLEN

    we can only start at the beginning and what we have is what we get and use that to make a change that results in something we can all sell and make a profit our beginning is no bigger or smaller than any other country -we must push and pull and sweat – success always follows and thats guaranteed

  33. Furrylugs

    From http://uk.biz.yahoo.com

    “At least one German banker, however, thinks the doom-and-gloom forecasts are overblown.

    “Some compare the situation to that of 1929, others talk about the worst crisis in near memory,” said Wolfgang Sprissler, head of the German bank HypoVereinsbank (HVB) in an interview with the Sueddeutsche Zeitung to appear Monday.

    “It bothers me that the institutes in their studies try to outdo each other with more pessimistic scenarios,” he said, adding that what is needed is signs of “optimism.”

    Rumours of an urbane irish economist seen boarding a Lufthansa flight this evening may be far fetched.

  34. Dear David
    Please change prescription to 4 by 50mg per day.
    I am a fan and watched as you were the lone dissenter but this silly misplaced enthusiasm is like the fiddling of Nero.
    The VC industry in Ireland have already confirmed 10% fees minimum, this was discussed at the recent Microsoft Bizspark event with a VC and a Minister in the room, this leaves €450, how will it be split, as usual entrepreneurs will not see hide nor hair of it.
    It will be dispersed with the usual panache of the VC community in Ireland, “lets see what the lads in Trinity College are doing”
    ,My estimation is €45 million per year excluding management/consultancy fees (we know how they go) and probably ten companies to benefit per year.
    Usual rules apply, real entrepreneurs whom dont wear the proper school tie/attired will be directed to Enterprise Ireland.

  35. John M

    David

    Just one or two comments
    You praise the goverment which you normally critiisise by the way for opening a 500 Million Euro innovation fund for investment , Yet only last week it was announced that there would be further cutbacks in the health service so to pay for this and people would have to make do with a crap health system where only the rich could afford good health care , something sounds a bit odd here , our health is not very important , we are only machines !
    you mentioned yourself that the infrastructure was a disaster here , could that money not be used to build up more infrastructure and itself create jobs .

    Are we the only country that seems bent on arselicking the americans to set up industry here and to attract investment. I was lwatching British Television last week and I heard an interesting comment “We are a small island but we are a great country ” Now hate the Brits it wou want to but they are proud of what they have achieved . It is not possible for us to have the same attitude about ourselves ?
    Do we not have our own people who are as good , maybe better educated and would be very capable of setting up world class industry here in our own country without any need for investment from other countries if given the correct backing from the banks and the state. Instead we have in this country the strange attitude ” Ah we´re only a small country , what can we do” .It does not make sense
    Somebody made the comment earlier about Irish universities being shite . Now thats a pile of crap as I know a lot of people who received a very good education from Irish universities and were very well regarded abroad when they unfortunately were forced to emigrate.
    The last comment is David is that you laud Israel for being a great country with fantastic industry. The only reason is that American capital injection has kept itself and its military alive otherwise the county would not have survived. Israel´s human rights record is possibly the worst in the world for the treament of the Palestinians and the Arabs , do you condone that ? or is it conveniently overlooked by buisness people ?
    The same could be said for China incidently

  36. mishko

    And today here comes the sweetener for the banks:

    “The government said the state would receive an annual dividend of around 500 million euros, either in cash or ordinary shares, from its investments (in ANIB, AIB and BoI)”.

    Well that’s the cash for the Innovation Fund sorted too. I think they’re really all accountants!

  37. Oppenheimer

    I think there are many misplaced comments so far. Regarding indigenous education of science and engineering, I agree this must continue to be a focus for improvement. I also think that the domestic VC industry is parochial and stale and this is said from experience of it. I do think however, that if this fund incentivises two international groups, scientist\engineer entrepreneurs from Europe and elsewhere, and top tier VCs then what will follow will be a shake up as Irish graduates start to find themselves behind the curve talent-wise and will have to learn to compete at a higher level in addition to more stress through competition for deals etc. of Irish VCs. Both, in my opinion, important elements of the next phase of the evolution of Ireland Inc.

  38. John Q. Public

    The recapitalisation scheme has been announced, the state will now have significant voting rights (eejits can now vote for eejits), a 30% increase in lending capacity for first-time buyers which will probably prop up the market and get more young people into a financial struggle. The market should have been let to fall to the bottem first. And just for a laugh they will give us ‘financial education’ based on the Financial Regulator’s Financial Capability Study. Is this real or am I going mad?

  39. Being in a high tech start-up I’m pretty pleased to see this being put in place. In all likelihood we will have to secure series A before this fund really gets rolling, so we may well not benefit. But there’s no shortage of very bright IC engineers who have lost their jobs recently (Freescale in Cork, several smaller outfits in Dublin) that have had no choice but to look at entrepeneurial routes for their future well being. Let’s face it most new companies fail, but the experience gained by those involved will be used to drive the success of those that thrive.

    • Oppenheimer

      Not sure what your business is but the thing I think is important if all this gets moving is that there will be serious growth capital available. Your Series A will get things going but what has been a problem for companies in the past is that when they get to the point where they need an injection for growth, this is not available from any VC fund in Ireland. It is likely one of the key reasons, as David puts it, there is no European Google…the pockets are not deep enough, bar one or two big Euro funds to support this kind of escalation in funding, and what usually happens is the the amounts get drip fed by the incumbent VCs who cram down the stock of the founding team.

  40. Malcolm McClure

    Lets give credit where credit is due, even if the debtor, Lenihan, is seriously in arrears. “The minister said he had asked the Financial Regulator on December 10 at the end of a lengthy meeting to examine the loan position of the directors at Anglo Irish Bank having noticed the figures were larger in the bank’s annual reports, compared to others. He said the “global figure” was “much larger” than the other guaranteed banks.”
    So while we all were groping in the dark, Lenihan himself apparently fingered the smoking gun.
    Now he has his sights on Paddy Neary and not before time. A lawyer turned sleuth is a formidable adversary.

  41. Agreed as David has said we need to create networks! We need to sell Ireland to the world. Our Brand is so well known Ireland! We need to create networks with emerging markets in Asia and around the world. Imagine start up business selling niche products from local areas around the world. This would be of great benefit to local economics dependent on agriculture or construction. The essential point being small niche business out there need help to start up and establish a presence online. There are thousands of niche ideas that could be turned into business all round the country.
    We need to reduce our reliance on selling in the domestic economy.
    I set up my website for €20! Now it’s hardly flash but it can be replicated throughout Ireland creating thousands of niche businesses with a focus on external markets.
    The fund is welcome but we all need to help each other at this time and show off Ireland’s full potential and of the creative people in it.

    Regards,

    Danny Kenneally

    • And the all-knowing Minister didn’t even need Merrill Lynch at his knee at all never mind number-crunchers in hi Department to find such a nuggett!!

      Malcolm, God bless your faith!

      Cynicism is well in order in these times.

      • Malcolm McClure

        All politicians spin their pronouncements and claim credit for the work of others. Thats a given in anyone who successfully climbs the greasy pole. But success ultimately depends on using their ersatz knowledge constructively, and thats what Lenihan did.

  42. The funding is a good move but the issue we all agree on is that we don’t trust the implementation. It’s notoriously difficult to get angel investment in Ireland. Enterprise Ireland is largely asked to fulfill this role in conjunction with remortgaging, F&F (friends & family) and the Bank of Mom and Dad. It’s simply not enough as, EI apart, these fine institutions are probably bankrupt by now. Also, EI is a special case and not the kind of “open doors” state VC we probably need.

    I disagree with those posting to suggest that we’re not innovative enough or don’t have enough smart people. It’s not true. The specific case of Google is interesting. I know 2 people who took jobs elsewhere as the interview process was taking too long. Multiple months and over 4 interviews to see if they were “Googley” enough. It’s insulting and IMHO horsecack to suggest they couldn’t find 100 engineers in the whole country to hire. We also have this famous diaspora to tap into.

    Those saying that David’s optimisim is naieve need to assess what the alternative is. We’re not going to get anywhere by curling up and waiting to economically die.

    We do have a serious problem in promoting the Knowledge Economy however. What we’re really bad at doing here is enabling a techie to formulate a good idea and then funding it to market such that they actually benefit from it. I can think of very few Irish companies where the scientists or engineers who founded it benefitted from its growth. As our VC’s give smaller chunks of capital with huge skepticism regarding the ultimate valuation the technical founders chunk of equity is often diluted over a greater number of funding rounds to almost nothing. Then, of course they’re first to go when there’s a problem. The more likely beneficiaries come from sales/marketing/business backgrounds so, again, the engineer is left wondering why he spent all that time poring through maths and arcane physics tomes to have so many “soft skills” make off with the loot! In Sweden, Israel, Germany and many of the countries we’d like to emulate, the engineer gets considerable respect and salaries that are high relative to the norm. Siemens, Benz, Fraunhofer, Bayer were all engineers and scientists. Where’s the Irish “Dyson”? No disrespect to Dimplex but you know what I mean.

    Take the example of Mark Zuckerberg in FaceBook. He’s a very young but a great engineer and has good ideas. He’s not an experienced businessman yet he’s now fabulously wealthy on paper. I’m not convinced this would happen in Ireland.

    What we really need are technology incubators. Dedicated and professional centers with the sole purpose of generating successful and innovative R&D led companies. There’s enough office space in the country now that I don’t think this requires a major building spree. Cash alone is not good enough, it requires organisation and purpose also.

    • I could have found the 100 damn fine engineers. All a question of where you look. There is a start-up I know of that has quietly hoovered up about 100 engineers of various types in the last year with no difficulty through the Irish engineering network, everybody knows everybody, but typically recruiters are a last resort of an engineer desperate to get out of their current position. That’s why Google drew a blank.

      • Furrylugs

        Recruiters in the UK typically charge 8 – 10% of gross salary. Up to a short time ago, the typical Irish fee was 15 – 25%.

      • I agree with you. I just wanted to stop this idea that we’re all friggin useless in its tracks. If there’s a uniquely Irish trait it’s knocking people and we don’t need the help of US multinationals to do so.

  43. ger

    David, what are you smoking? Horse has bolted, these should have been introduced 5 years ago and not after the country has tipped over into the abyss. Too little, too late – the fact that you dress it up as some prescient move is extremely depressing not to mind, disingenuous. I believe all the advisor jobs have been culled.

  44. MK1

    Hi David,

    > The €500 million innovation is an enormously influential and intelligent move. For the first time in a long while, we have a vision of this country that complements what is good in the economy and, more importantly, sees beyond the current malaise. Last Thursday, Ireland copied the Israeli model.

    The move is a reasonably welcome one in the grand scheme of things but I dont share your uber-enthusiasm. First, creating a US VC “hub” in Ireland wont be that easy. Ireland is still seen as high cost, small, periphery and that is not going to change quickly. Secondy, its a long term vision and will only bear fruit at a later stage, if at all of course. Its not the first time ourselves or any country has courted US VC’s who are more succesful than European or Asian counterparts due to their higher levels of risk taking.

    Would you (as a VC) give 2 students who had still not finished college 10m? Would you (as a University) allows 2 students to use 5m worth of computers for their own ‘hobby’? Thats the google story, and the backers were the same ones that did Yahoo, ironically. We do have the “my great grandmother was from Cork” card to play which is an oft-forgotten advantage that we do have.

    The Israeli’s have a stronger card though. Their diaspora have historically been better financed, with closer links to finance and law, and a stronger bond to the newly (1948) created homeland which is seen in the US as persecuted. They have been helping out with their dollars for a long-time, so the Israeli example cannot be used as a template. Not unless we send a lot more Irish over to the US. We should think perhaps more like Scandinavians, companies (as you pointed out on TV) like Nokia in Finland, Vestas in Denmark. We do have some succesful indigenous companies in Ireland, but few that have global multi-national multi-billion euro success, such as a Tom-Tom (better than a give-a-give-a-give-a-Garmin (hope your kids dont like that one!)).

    > Frankly, it makes much more economic sense for the pension fund to be investing in the future capital of the country alongside the best venture capitalists in the US, than to be throwing good money after bad into our crocked banking system.

    Agreed, and therefore us giving 5.5 billion to the ailing banks in the very short-term compares how exactly with the 0.5 billion we MAY put into the future of our country over many years?! You can see which ‘vision’ the government is backing by how much it is spending on it.

    I think the 500 million ‘programme’ was more a sop to soften up the 5.5 billion to be given to the banks and the more to come. Granted, the government are extracting some monies back from the banks, more than the banks would like, but not as much as they could get as they could have nationalised Anglo for less than the 1.5 billion they gave. Would you buy a 75% of a 250k house for 1500k? No, neither would I, buts thats just what the government have done on our behalf wih Anglo! Will they be able to change the banks culturally and systemically or it it a case of a propping up support, life support even, but with a charge? It looks like the latter.

    Merry Xmas !

    MK1

  45. AndrewGMooney

    Optimism is the vital counterweight to pessimism. With both securely anchored there can even be dangerous outbreaks of realism!

    ‘Nothing great was ever achieved without enthusiasm.’ – Ralph Waldo Emerson (1803-1882)

    There must be zillions of other appropriate quotes that justify a temporary pause in examining the current national insolvency hearings. So let’s roll!

    Lots of other commentators are also asking if ‘science is the new finance‘, whether or not all these destitute quants can be retrained or face a lifetime of late breakfasts and afternoon telly.

    Israel is one example. But there’s also a serious question as to whether or not reactionary elements in Israeli society perpetuate conflict to re-ignite the military-industrial complex and how much economic growth has been squandered by the failure to deliver the ‘peace dividend’. In other words, anything but ‘free market capitalist’ conditions apply. I guess other imperfect examples would be Singapore, Taiwan and Iceland.

    Actually, Iceland is one to watch. Once they get their financial apocalypse EU/Euro membership sorted, they’ll bounce back. Why? Well, not because of their corrupt leadership mired in dodgy dealing. But because of their cultural strengths, their balance of fearless risk taking and personal and societal protection. Once they return to their cultural possibilities, the new financial centre of Europe may be once again, Reykjavik, but this time competing with Dublin. And everyone speaks English and they have cool nightlife and are halfway between London and New York. Hmmmn. They have secret weapons like Bjork’s ambassadorial eruption in recent months. Check out the post-collapse think tank site ‘Nattura’ which is named after one of her ‘songs’:

    http://nattura.info/

    Where’s Bono when he’s needed? Oh, he’s putting the finishing touches to another perfect day of a U2 album. Just what the Ireland and the world needs. *rollseyes*

    When David says, “it is encouraging to see that Taoiseach Brian Cowen has the capacity to think about the future.” I can only say this is capacity is newly found, selective and probably a psychiatric defence rather than ‘the vision thing’. As a leader he needs to ensure his ample frame is secure on the three-legged stool of learning from the past, managing the present, and shaping the future.

    The next investment, production and profit cycle / thesis is demonstrably the Green Deal of Obamanomics and the similar Chinese realisation that in making their Great Leap Forward to industrialisation they have destroyed themselves ecologically and socially. Both will interact to ensure China moves up the energy/ecology cost per unit of GDP because the MAD of the dollar/yuan end game demands it.

    Ireland surely can be a niche player in this geo-political realignment, by forcing Obama into the diaspora by amping up his Irish Grandma / Phil Lynott re-incarnated propaganda psy-ops before presenting him with a Shamrock rose bowl. Oh, to be a fly on the wall!

    The main driver of the initial recovery will come from profligate states such as the US and UK refloating their boats with decadent Keynsianism whilst the German (and Irish) monetarist hair shirt fantasists will delude themselves that their posturing on fiscal rectitude is the reason for their recovery. It’s called ‘a free ride’. Bogus thinking, but for different reasons.

    The classic capitalist entrepreneur will remain risk-averse in the extreme until such time as investment conditions return to something approaching ‘consensual reality’.

    An Irish ‘Framework for a blueprint for a strategy for a solution‘. All fine. Everybody clap hands. But once this ‘blue-sky away day’ is over, the Irish Nation has to get back to the grim task of quarantining the infected and burying the dead today.

    In my view, 3 things need to happen to make ‘Ireland Inc Gets Innovative’ a plausible pitch, rather than an episode in comfort food denial:

    1] The current FF government needs to take a torch to itself, cut the crap, and level with it’s client base and the populace, without freaking the Market any more than is strictly necessary. Lenihan should have that testicle clamp on Neary by now.

    2] FF, having fessed up, can then get on with bringing the Banking Situation to some sort of dignified resolution before Ireland Inc is rendered a total as opposed to partial laughing stock amongst current and future investors.

    3] Then it’s time for an election, putting a recovery plan to the vote. And, having been stripped naked at the poker table by the banks over the ‘7 seconds to midnight panic’ also known as The Guarantee: They should face the judgement of the nation. Who will decide whether or not they want to be governed by such patsies, and by ‘representatives’ whose behaviour exposes the whole country to mortification. “Do my nails look big with this pink?”

    Regards.

    If this appears twice, my roaming ID is causing me to be classed as spam.

  46. Martin

    Good article David
    As well as innovation we need to make Ireland a low cost destination of doing business. Wage costs, property and accommodation will fall over the coming years
    I work in the Pharma industry for a multinational company. Our biggest costs are energy costs. Ireland has the most expensive electricity prices in the EU. This needs to be addressed as a matter of urgency. There are a number of options, nuclear being one of them, but it is very expensive to build and decommission, but there are other alternatives. Ireland needs to embrace renewable energy. The following link details a pumped storage facility that would allow the connection of large amounts of wind power to the national grid and allow Ireland to become an exporter of energy. http://www.timesonline.co.uk/tol/news/world/ireland/article5298767.ece
    As a small country we need to focus our resources on areas that we have a distinct advantage. to use a sporting analogy look at Irish boxers at the Olympics, or the British cyclists, instead of spreading funding over a large number sports it was concentrated on just one or two, thus success followed in these sports. We need to do the same in business; Energy should be one of the areas that we concentrate on, along with other high tech industries.

  47. Jan

    “Either the state sorts out the present, faces down the vested interests and takes the hard decisions, or the market will do the job for us.”

    - I think we got our answer to that today. No changes in the boards of the banks beyond those who have already resigned. No change in the regulator’s office……so all remains the same, and as usual, we foot the bill. Why oh why will they not face down the vested interests.

    As for innovation, I would love to share your optimism. However, a reality check is needed. The evidence of today’s bank deal shows that the will is not there to tackle the vested interests.

    Apart from that, this nonsense of “Knowledge Economy” is being spouted by the govt as our saviour. There is no evidence whatsoever to support this assertion. Here is a little anecdote: Yesterday, I was in Dundrum Shopping Centre, Ireland’s biggest and most modern Shopping Centre. I needed to get access to gmail. I asked if there were internet terminals available and was told that there were on the 2nd floor. I tried 2 terminals and neither worked. Then I realised it was a cafe and I had to pay. So I paid €1 for 20m. I then tried 3 different terminals and the internet did not work. When the lady came over, she said “Oh, you cant use gmail here anyway, its not allowed……”. I didn’t bother to tell her that neither yahoo nor google worked either.

    Is that our “Knowledge Economy”? Is that the basis on which our new economy will be built? Irelands biggest Shopping Centre has no public working internet terminals available. 6 years ago in Sweden, the govt were rolling out 8MB broadband to rural communities so people could work from home……Actions, not words.

    In my eyes, they are talking through their hats when it comes to the “knowledge economy”. The reality is scary.

  48. Ed

    Where’s the Irish “Dyson”? Good question, Shane – I think that the answer lies in the fact that the Irish put too much store in academic achievement and not enough in application.
    You’ll rarely find Irish engineers who are also hobbyists in their field – Dyson, was always a hands on individual and was Saxby the founder of ARM Holdings. Hobbyists have to work within tight budgets and getting around problems is what it’s all about – it’s an ideal training ground for innovators. Personally, I don’t know any successful tech. company whose founder wasn’t a keen hobbyist in their youth.
    I always judge a job candidate by his hobbies – what they has done out of sheer passion is far more revealing than exam results.

  49. MK1

    mediator > Law and accounting do not create value. In Ireland we still reward accountants and regard them way too highly. critical analytical ability sadly lacking in the students.

    I agree, not all professions are given the weighting that they deserve, and some are clearly over-weighted. And yes, I have worked with recently graduated students and was aghast that they were first class students. Then I found out that nearly 40% of students get firsts these days. Its all relative rather than absolute. We have created a conveyor belt of degree-clad young people, and not smart young people. And with the recent boom, they may be lazy ones too. sheesh.

    Furrylugs> Israel: “Give us the investment or we might have to lose the head with the Arabs” type of business model.
    ger> billions pumped by the US, in order to maintiain its proxy state in the middle east

    Yes, I agree, Israel’s reliance on the US and the military aspects means that we should NEVER be compared to them. Its apples and oranges, or spuds and oranges really.

    > numers of graduates that Google looked for but failed to find in Ireland.

    I too find it hard to believe that they couldnt find the technical people they needed. More a case of not willing to pay for what was on offer compared to what is available elsewhere. Any organisation google’s size could easily establish a 100-peron technical unit in Ireland (such as Intel have done, IBM do, etc) whether its financially efficient or not. They chose not to not because of availability, but for some other reason. Maybe Ireland is not googley enough.

    John ALLEN> I propose that the civil servants be factored in additional tax to pay arising from their privileged positions

    John, I wrote previously that we need to get the public sector to pay their fair share of tax, the same as normal PAYE (private sector) workers. Today they aren’t, so not only do they get better conditions, are paid more on average, have a better pension, they pay less tax. Even the blindest of the blind can realise that “this cant go on”.

    Deco > Irish culture has a high tolerance for useless people

    You are correct. We see it every day, we dont need examples. It is endemic. But will that ever change? Has the ratio of useful/useless budged in the last 30 years? I would have hoped so, but its stubbornly slooooow.

    Deco > We are culturally incapable of matching your plan

    probably correct too.

    Dave> There simply are no borders to VC investment if the idea is good enough.

    Agreed. I guess the difference with the plan is that the government will match/assist VC’s to support businesses/jobs here where the VC’s without the support would otherwise not have considered. In theory, there is nothing wrong with the plan. In practice, it remains to be seen long-term if it will make one iota of a significant difference.

    ger> These politicians will be happy for people to leave this country

    Yes, they will. For one, a dissaffected person that leaves is essentially a ‘No’ vote leaving the place. However, I for one am glad that we do have ‘valves’ for people to go to. The only problem with this recession is that it is a major global one, so the UK is not booming, the US isnt, Europe isnt, Australia isnt, and Asia is being dragged as well. (Canada, central and S.America, and Africa, I didnt forget about you!). So, the release valves for our recession with emigrantion wont be there to the same extent as it was in the 1980′s, 1950′s, for example.

    “Got on a lucky one …. ”

    MK1

  50. Furrylugs

    @MK1 & ger

    “a dissaffected person that leaves is essentially a ‘No’ vote leaving the place”

    Thats what they see but behind the dissaffection lies a brain drain and resultant demoralisation that effectively scuppers any “innovation” plan.
    Muppets on handouts aren’t the best sort to initiate solid ideas.

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