Economics, not North, the focus of Bush administration's view of new, rich Ireland

Many were worried that the change of government in Washington would lead to a diminution of US interest in Irish affairs

Many were worried that the change of government in Washington would lead to a diminution of US interest in Irish affairs. It didn't, but it did lead to a significant change of direction.

The Clinton administration had worked day and night to bring the Belfast Agreement to completion. George W. Bush's administration continues to show an interest in Ireland, but in economics, not Northern Ireland, and in EU rather than Anglo-Irish relations.

The change of direction tells us more about Washington's view of Ireland's place in the wider world than some may realise. And this, in turn, is deeply relevant to Irish politics, its divisions and alliances, and the issues that are bound to be at stake in the next general election.

We've had a small but interesting procession of Pilgrim Fathers here since the beginning of March. The best known was Newt Gingrich, former speaker of the House of Representatives. Among the others were two of Ronald Reagan's former advisers, Martin Feldstein and Arthur Laffer.

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In the middle of the month a billionaire called Dick Egan, who is 99th in Forbes magazine's list of the richest people in the United States, was nominated as the next US ambassador.

His knowledge of Irish political affairs may be sketchy, but he is familiar with investment in Ireland. EMC, the company which made him wealthy, and of which he is still chairman emeritus, employs more than 1,500 in Ballincollig, Co Cork.

Gingrich, Feldstein and Laffer make no secret of their admiration for the HarneyMcCreevy line. They are particularly pleased with its emphasis on low corporate taxes, its unconditional welcome for US investment and its suspicion of the European Union.

Laffer has been described by commentators as a true believer in supply-side economics, an evangelist whose faith in taxcutting as the only way forward for any economy persuaded McCreevy to halve capital gains tax.

The suspicion among Labour and Fine Gael spokesmen that this form of evangelism favours the rich and super-rich is supported by some US reports. It was the Wall Street Journal which came up with the following estimates: under the Bush plan, Bush himself would pocket between $20,000 and $60,000 a year; and Dick Cheney would gain at least $250,000. An average taxpayer - a family in the middle fifth - would save $453 a year.

But the evangelists are persistent. Gingrich described the capital gains cuts by McCreevy thus: "As fine an example of supply-side economics as you will find anywhere in the world."

And, in interviews, he used the shortsighted, mean-minded arguments against the Kyoto protocol that have outraged in the last 48 hours those who take environmental protection and global responsibilities seriously.

Ireland holds a more important position than in the past. It's a member of the European Union, part of an English-speaking bridgehead into Europe, an increasingly important trading partner for the United States and a member, for the time being, of the UN Security Council.

Some weeks ago an audience at the Economic and Social Research Institute heard Martin Feldstein, who is both a professor of economics at Harvard and a former Reagan adviser, deliver the Geary memorial lecture.

Like Gingrich, some of his countrymen and fellow economists, he devoted much of his time to an attack on the EU generally and economic and monetary union in particular. McCreevy, he maintained, had been wronged by the Commission and the economic and finance ministers.

Then T.K. Whitaker, who'd been sitting with the audience, rose to explain that the issues of EU membership and economic and monetary union had been fully debated. They had worked to our satisfaction. We had no intention of leading a crusade against either.

It was a calm and pointed commentary on what had gone before.

We had better look to our place in the world, as we were reminded by events of the week, not least by the discovery that nurses from the Philippines, invited to this, one of the richest countries, should have been treated as they were.

Another Harvard professor, Robert D. Putnam, who came here to address non-governmental organisations, warned that Ireland and the rest of the EU might yet face the social disintegration that gripped areas of the United States in the past 30 years.