Leave aside for now the wrangling over the construction of the next government that began before all the votes were counted and will continue, I expect, until well into the new year.
Whoever makes the line-up in the end, the next government is going to face a series of immense challenges which will require guile, nerve, judgment and luck. Here are the five biggest:
The economy
Just because we kept droning on about it during the election campaign and nobody paid a blind bit of notice doesn’t mean it’s all going to go away now. Since the general election was called four weeks ago Donald Trump has nominated a series of what might politely be called radical thinkers for his cabinet and reiterated his plans to impose tariffs. The nominee for commerce secretary Howard Lutnick, recently observed: “It’s nonsense that Ireland of all places runs a trade surplus at our expense ... When we end this nonsense, America will be a truly great country again. You’ll be shocked.”
“It’s over,” one senior Irish executive in a big European company said to me about Ireland’s current economic model. On Wednesday, Seamus Coffey of the Fiscal Advisory Council renewed warnings about corporation tax. The people who run and advise multinationals here are acutely aware of the threat; one told me he fears Ireland will be “ravaged” by Trump.
Smart people still insist the truth of a patent absurdity – that Gerry Adams was never in the IRA
Ireland’s five biggest problems: War, climate change, an EU crisis, housing and Trump
Someone should take Simon Harris’s phone away before he bankrupts the country
Here’s what we should be asking politicians in the aftermath of Trump’s victory
Everyone knows this, they just didn’t want to talk about it during the election – at least, not until the Fine Gael campaign was going down the tubes and they sent up the bat signal for Paschal Donohoe. The arrival of the Apostle of Prudence may well have rescued the Fine Gael campaign, and it certainly strengthened Donohoe’s hand in future budgetary decisions. We’ll see.
[ Is Donald Trump chasing Ireland’s corporate tax boom?Opens in new window ]
Security
The invasion of Ukraine and the weakening of the Nato security guarantee have fundamentally changed the security outlook in Europe. There is no way of discussing this without giving the ostrich tendency in Irish life a fit of the vapours about neutrality, so let us not try. Just look at what other reasonably sensible countries in Europe are doing.
Last week the Swedish government sent a booklet to every household in the country telling them how to prepare for war. Sweden has been neutral for two centuries, but recently joined Nato in response to the threat from Russia. The booklet contains a checklist of things to have at home (a week’s drinking water, and so on), advice on places to seek shelter in an air raid, and explains the different sirens that will indicate the level of emergency. Governments in Finland, Norway and Denmark have issued similar advice. Even in pacifist Germany, they cite the Roman proverb “Si vis pacem, para bellum”: if you want peace, prepare for war.
We can, of course, continue to ignore all this. Or we can face the reality that the world has changed.
Housing
It would be wrong to say that the Government must act quickly on housing to avoid a social catastrophe. Because the catastrophe is already upon many thousands of people.
And the numbers mean that unless there is a step-change in supply, it will continue to worsen. If the government cannot persuade, push, incentivise and bully the construction industry, local authorities, the Department of Housing and the housing associations to produce more housing units quickly, it is facing a monumental failure that is unlikely to be forgiven.
[ Next government must get real about the promises it made during the campaignOpens in new window ]
Climate change
There are two urgent areas that require immediate attention. The first is the need to accelerate climate action measures in order to hit the 2030 targets and therefore avoid the huge fines – estimated by the Fiscal Advisory Council this week at some €20 billion – that will be levied if Ireland fails to hit its targets.
The second is to prepare for the inevitably disruptive effects of climate change. These are both short-term (more severe weather, especially flooding) and longer-term (the possible disruption of North Atlantic ocean currents, which would paradoxically make our climate much colder). It will not be possible to pretend that these don’t exist, even if the Green Party has been punished for trying to do something about them.
Cracks in the EU
The French government has collapsed and president Emmanuel Macron is teetering on the brink, his fall eagerly anticipated by both the far-right and the far-left. France is beginning to look ungovernable, and the markets are getting jumpy. There is an election in Germany early next year, with the far-right AfD running second in the polls. In Romania the ultranationalist, pro-Russian Calin Georgescu leads polls ahead of the country’s presidential election on Sunday. Ireland assumes the presidency of the EU in the second half of 2026 – by which time the bloc could be in the middle of a deep crisis.
Two final things are worth mentioning about the political landscape that will face the next government.
There was fighting talk from Mary Lou McDonald during the week as she sought to rally her troops after a disappointing election. She will still be the leader of the opposition, but she will perhaps no longer dominate it like she did.
The second thing is that if a coalition of Fianna Fáil-Fine Gael and Independents is what comes out the other end, it will look to many people very much like a right-left divide between government and opposition.
In a country that is increasingly happy to tilt to the left – the entire general election campaign was about promises to expand the State in various ways – there are obvious political dangers for a government that will be described from the get-go as “right wing”.
Unless it makes sharp progress on some or all of the above – especially housing – it might be the last time Fine Gael and Fianna Fáil have the numbers for a government.
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