The decade the world turned


THE DECADE IN REVIEW:IT WAS THE AGE of bluster and fragility. Looking back from the serene distance of the future, historians will surely be struck by the great paradox of the first decade of the 21st century, the way hubris and nemesis seemed to be utterly entwined, writes FINTAN O'TOOLE

On the one hand, this was the era of the greatest assertion of the power of the West – of American military might, of hyper-charged global capitalism, of the values and culture of the Anglophone world. On the other, the very aggression with which all those things were asserted seemed to be a silent acknowledgement of how precarious they really were. The louder the insistence on the familiar forms of power, the clearer it became that those forms were falling apart.

It is poignant now to remember that the decade began with relief that the world hadn’t ended. The Y2K bug, supposedly a fatal flaw in computer systems, had not caused aircraft to fall out of the sky or the internet to crash. The relief was mixed with puzzlement – we would never know whether the whole thing was just a contemporary version of old millennial superstitions or the vast billions spent on fixing the bug had actually prevented meltdown. But the anti-climax produced a certain feeling of smugness. We resolved never to panic again.

JUST AS THEwestern world was congratulating itself on having dodged the apocalypse, an Islamist militant called Tawfiq bin Attash was flying on New Year’s Eve from Hong Kong to Bangkok. In his carry-on luggage, he had a box-cutter. His aim was to test security on international flights. He travelled, unchecked, on to Kuala Lumpur in Malaysia, where he met a small group of fellow followers of Osama Bin Laden. They “spoke about the possibility of hijacking planes and crashing them”. The rest of the world was laughing about the now-discredited idea of aircraft falling out of the sky. These men were not.

The atrocities of 9/11 that resulted from these plans were by no means the worst crimes of the decade. The deadliest conflict since the second World War raged – and still rages – in the Democratic Republic of the Congo, where well over 5 million people (the equivalent of the entire population of Denmark) has died. But the relative global indifference to the Congo was itself a clear statement of what mattered in the world. The US and its reaction to the attacks on 9/11 set the agenda.

That reaction in turn was shaped, not just by the consciousness of overwhelmingly military superiority (“shock and awe”), but by a deeper conviction that the contradictions of history had been decisively resolved in favour of American hyper-power and of a single model of so-called free-market capitalism in which American centrality could be taken for granted. Ireland, of course, was the great exemplar of these apparent truths. From the early years of the decade onwards, the complex social and economic forces that had created the Celtic Tiger boom of the 1990s were retrospectively reshaped into a simple moral tale. Ireland had “got with the programme” of extreme economic globalisation. (According to the AT Kearney/ Foreign Policymagazine Globalisation Index, Ireland was the most globalised society in the world in 2002, 2003 and 2004.) It had adopted the formula of low taxes and “light-touch” regulation. And, as a result, it was living what Le Mondecalled “un ‘american dream’ a l’europenne” – the American Dream in Europe. For developing countries around the world, and for the dominant neo-conservatives in the US itself, Ireland was proof that the new American century was taking shape and that, once a few scores were settled and a few obstacles removed, it would be an era of peace and prosperity. With a single political ideology and a single economic model, there would be no more conflicts and no more cycles of boom and bust.

In reality, of course, the model itself was a flimsy construct built on an increasingly unstable base. In retrospect, the Noughties will look like the last roll of the dice for a whole set of assumptions that have been in place since the end of the second World War – American military and economic invincibility, the superior democratic enlightenment of the West, the carbon-based economy, endless consumption, the idolisation of extreme wealth.

We learned in this decade what perhaps should have been obvious from the Vietnam war 30 years previously – that raw military might is of limited use. The invasions of Afghanistan and Iraq showed without question that the US (with or without Western allies) could project its power into Asia with devastating effect for both enemy regimes and civilian populations. We also learned, through the astonishing displays of incompetence, corruption and ignorance that followed, just how deeply deluded was the notion that this armed power could reshape the world to Western tastes.

We also learned – as again should have been obvious from the proxy wars of the Cold War era – how fragile Western democratic values can be when they are put under pressure. The pressure was considerable – 9/11, the murderous assaults on civilians in London, Madrid, Bali, Mumbai and elsewhere – but the whole edifice of legality and civilisation was shaken. It was not easy to imagine at the start of the decade that so many Western governments, led by the US, would more or less openly adopt or collude in policies of torture, kidnapping and secret prisons or that apparently accepted international laws like the Geneva Conventions could be so contemptuously flouted by a Western ally such as Israel. Advances in global human rights (like the trials of war criminals such as Slobodan Milosevic and Charles Taylor in The Hague) were clouded by ambiguity and double standards. Even the astonishing election of Barack Obama, with his commitment to restoring the rule of law, could not easily restore the idea that enlightened values can be taken as read.

IF POWER ANDlaw were proving to be frail, so was the other pillar of the accepted order: wealth. This was the decade of the triumph of a new kind of global finance capitalism. There was a huge shift in global financial power away from traditional western banks and pension funds and towards four new power brokers: oil-rich investors, largely from Russia and the Arab world; Asian central bankers; hedge funds; and private equity firms. The assets controlled by these entities tripled in value to $10 trillion over the course of the decade.

The movement of this vast flow of money was, however, increasingly mysterious. As the American financial strategist David Smick put it succinctly, “the industrialised world . . . surrendered control of its financial system to a tiny group of 5,000 or so technical market specialists spread throughout investment banks, hedge funds, and other financial institutions.” The problem, of course, was not simply that governments and regulators hadn’t a clue what these 5,000 wizards were up to, but that the wizards themselves made the Sorcerer’s Apprentice look like Gandalf. Driven by greed and short-term incentives, and locked in a small world where money was increasingly distanced from its sources in the real economy, they were oblivious to the inevitability of the catastrophe they were creating.

Underlying this utterly volatile situation was the gradual shift in economic power away from the West. Asia – principally China and India – was growing from 19 per cent of the global economy in 1970 to 28 per cent in 2007. Apart from the loss of manufacturing jobs and the flood of cheap imports, this change manifested itself in the West in the form of cheap credit, much of it from the Chinese, who preferred to save their earnings rather than spend them. That credit in turn gave western economies and western consumerism the appearance of rude good health.

Nowhere, of course, was this more true than in Ireland. We scarcely noticed that the classic Celtic Tiger boom, driven by exports and productivity, essentially ended by 2003. It was replaced by what the National Competitiveness Council summed up as “growth derived from asset price inflation [the property bubble], fuelled by a combination of low interest rates, reckless lending and speculation”. A natural high was substituted with an artificial hallucinogen, but it still felt good.

For those of us who have to live with the pain of the fall that followed all this delusional pride, it is little consolation that future historians will probably regard it as a salutary shock. They will say that the illusion of American hyper-power was in fact dangerous and destabilising, that the vast power of an uncontrollable global financial system was a threat to democracy and to real economies, that the oil was running out, that endless consumption was going to destroy the world and that the emergence of a multi-polar global system was a good thing. They will see the Noughties as a period of messy transitions in which clapped-out assumptions kicked and screamed while the world dragged itself agonisingly towards a more sustainable future.

Turning Points For Ireland And The World

OCTOBER 12th, 2000

A boat with two men aboard rams the US warship USS Colein the harbour of Aden in Yemen, blowing a 40ft hole in its hull, killing 17 sailors and injuring 39.

In light of the horrors to come in the conflict between the US and Islamic extremists, the incident seems little more than a footnote. Yet the ability of just two suicide bombers in a small vessel to inflict such damage on a destroyer prefigured one of the key concepts of the decade: asymmetric warfare. The attack on the USS Cole involved several forces that would resonate through the Noughties: the zeal of the suicide bomber; the vulnerability of US power; the emergence of a media-savvy brand of post-modern terrorism; and the willingness of civilised societies to ditch human rights. But its primary lesson took the US and its allies a long time to learn: that military might is of limited value in the 21st century.

APRIL 14th, 2003

At a press conference in Bethesda, Maryland, it is announced that the international effort to sequence the 3 billion DNA letters in the human genome has reached practical completion.

The unravelling of the mysteries of human genetics is one of the greatest scientific achievements in history, and perhaps the thing for which, in the far distant future, the decade will be remembered. Yet it also encapsulates the ambivalence of the times. It was the epitome of international co-operation in an era of global conflict. It pushed back the frontiers of knowledge while at the same time creating new anxieties about the human capacity to use such knowledge wisely. It both held out the prospect of cures for terrible diseases and conjured up, at least in the popular imagination, the image of new Dr Frankensteins playing God with the very stuff of humanity.


Figures show that the classic Celtic Tiger boom is over. The relentless growth in Irish exports goes into reverse. Having grown by 20 per cent a year at the start of the decade, exports have now fallen by almost 1 per cent in the previous year.

The immediate causes are the aftershocks of the 9/11 attacks in the US, the bursting of the bubble and its effects on the IT sector, and the consequences of foot-and-mouth disease for agriculture and tourism. But more broadly, the drop in exports should have been the moment at which serious questions were asked about the long-term sustainability of the boom. This was the moment for Ireland to stop partying and start thinking about how to create a more modest, but more durable and socially decent prosperity. Instead the moment passed and a new kind of boom, built on construction, debt and delusion, was cranked up.

JULY 28th, 2005

Seven years after the Belfast Agreement, the Provisional IRA finally and definitively calls an end to its armed campaign.

In a statement read by Seanna Walsh, the group’s leadership stated: “All IRA units have been ordered to dump arms. All volunteers have been instructed to assist the development of purely political and democratic programmes through exclusively peaceful means. Volunteers must not engage in any other activities whatsoever.” The IRA promised to conclude decommissioning “as quickly as possible”. The statement was far from being purely symbolic. The IRA had ended its active campaign, but had continued robberies, intimidation and “punishment” attacks. However flawed the peace process might have been, and however tedious the endless attempts to implement what had been agreed, this wording had the feel of historic finality.

APRIL 2008

China, with 220 million users, surpasses the US (with 218 million) as the country with the largest number of online citizens.

As a proportion of the population, internet use in China is far behind most developed countries, but the centre of gravity of the web has shifted east. By the end of 2008, the number of net users in China would be larger than the entire population of the US. This shift points to two developments: the emergence of China as an ever-larger presence in the world; and a change in the meaning of globalisation. In cultural and economic terms, the internet has defined and driven the integration of the planet. In the early part of the decade, cultural globalisation was essentially Americanisation – the adaptation of societies around the world to norms and modes of expression shaped in the US. The growth of a Chinese online world complicates, and arguably reverses, that process.


Sean Dunne pays €130m for Hume House, an office block adjacent to Jury’s Hotel in Ballsbridge, which he owns.

The price of Hume House was the equivalent of €195m an acre. Dunne subsequently claimed in a court case that the true value of the site, even at the time, was between €65m and €95m. Over four days in February, his bid went from €92m to €130m. It later emerged that the nearest competing bid was €102m. Dunne paid €28m more than anyone else was prepared to pay – even in the atmosphere of the property boom at its boomiest. The sale of Hume House wasn’t the apex of property mania in Ireland. One could cite the €17.2m paid for a farm in Co Laois in June 2006 (the guide was €5m) or the sale of the Irish Glass Bottle Company site in Ringsend for €412m (now valued at €60m). Dunne’s deal signalled the end of any rational calculation in a contest between developers.