Rake's Progress

Ireland's Prime Minister Liam Cosgrave, with his wisp of mustache, starched collar, bowler hat and understated manner, often looks like a Downstairs character asking a small favor of the man Upstairs. And indeed, until recently, the Irish were among the profligates of Europe, living it up as if someone else were responsible for their bills. Wages wildly outstripped productivity. Unemployment was the highest in Western Europe; inflation raged at an 18% rate. Public debt zoomed moonward at a catastrophic speed, while the idea of restricting consumption to narrow an enormous deficit elicited a knowing snigger. By calling a snap election for this week, Cosgrave has replaced romance with realism. The country, he says, must stop "this rake's progress."

Cosgrave's coalition government and the Fianna Fail opposition led by former Prime Minister Jack Lynch realize that the troubles of the economy must be faced, and the government is bluntly telling voters so. And an unusually alarmed electorate concurs. In the first public opinion poll of its kind, some 70% of voters voiced most concern about jobs, inflation and prices; only 2.3% think the country's position about the civil war in neighboring Northern Ireland is the paramount issue.

Nobody would agree with that assessment more than Minister for Industry and Commerce Justin Keating, 47, who was trained as a veterinarian, lectured in anatomy at a Dublin college, was a star television performer and joined the Cosgrave Cabinet in 1973. Although Keating is a member of the left-leaning Labor Party, his youthful radical ideology has been replaced by a pragmatic view: only heavy foreign private investment can ameliorate the country's unemployment. The jobless rate is now about 13%, and some 30,000 youths leaving school this summer will join the ranks, plus farm-laboring families that are being displaced by more efficient agriculture. No wonder the electorate is seething with dissatisfaction.

Because native capital and technical know-how are scarce, Keating has been traveling from Tokyo to Houston persuading industrialists to invest in the thinly peopled (pop. 3 million) republic. On just one swing in April and May to Japan, Australia, Canada and the U.S., Keating brought back $150 million in new contracts from the U.S. alone. Through the offices of the Industrial Development Authority, the government agency charged with stimulating industrial expansion, Keating sets up lunch and dinner dates with corporate chiefs and ends up with his cowlick flying, making speeches in a lyric tenor. Even bored businessmen come to life when they learn that money for projects can be borrowed in Ireland at rates ranging from 4% to 7%, that profits on exports are tax-free until 1990 and can be repatriated to any country in the world, and that Ireland offers a bagful of other incentives.

By one estimate more than $450 million has been invested in Ireland by U.S. companies ranging from General Electric, which makes components for color-television sets, to Bally Manufacturing Corp., the Chicago slot-machine company, which exports one-armed bandits from Dublin to Sydney. "We couldn't do business in Australia without that Dublin plant," says Bill O'Donnell, Bally's president, "because Ireland qualifies for special treatment on tariffs there." Although Keating is concentrating his efforts on the U.S., he recently lured Beecham Group Ltd., the big British pharmaceutical firm, to invest in a 50-acre site near Shannon Airport. (Britain remains Ireland's main trading partner; more than 200 British plants prosper in Ireland.) The products shipped from foreign-owned Irish plants, ranging from cardiac pacemakers to computers, transformers to cranes, are testimony, Keating says, to the adaptability of Irish workers.

A New God. The unique demography of Ireland (almost half the population is under 25) ensures that even if a controversial bill on family planning is passed by the government, some 30,000 new jobs must be created each year. Thus there is little or no resentment against foreign investors, save for the lunatic fringe of the I.R.A. In fact, the Irish color the overseas invasion with a touch of wit. Asahi, the $1.8 billion Japanese chemical concern, planted a $100 million textile factory in the barren wilds of Mayo, a western county haunted by memories of famine and emigration. Its peasantry have always been so poor that after the mere mention of "Mayo" they intoned the prayer "God help us." Now that Asahi is there, a local poet, with an eye toward more potential investors, wants it changed to "Mitsubishi help us."

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