Howard Lutnick, former CEO of the financial firm Cantor Fitzgerald, and now Secretary of Commerce in the Trump administration, has quickly attained the status of pantomime villain in Ireland.
Last year, Lutnick criticised Ireland’s tax arrangements, saying ‘It’s nonsense that Ireland of all places runs a trade surplus at our expense.’ He increased his pressure on Ireland last week when he appeared on the All-In business podcast and sarcastically referred to Ireland as his ‘favourite tax scam’ – the one he was most looking forward to ‘fixing’.
This has prompted an increasingly nervous Irish government to make extra efforts to placate the Trump administration – which they previously treated with a degree of disdain. Tanaiste Simon Harris spoke to Lutnick in a hastily arranged phone call this week.
According to Harris, ‘it was good to have the call’ and he referred to it as ‘a useful opportunity to exchange views’. A Harris spokesman later expanded: ‘The Tanaiste took the opportunity to congratulate the Secretary on his appointment and said he looked forward to working with him and the US administration. The Tanaiste values the economic relationship between the US and the EU.’
One can only hope that call went better than the one between Harris and US Secretary of State, Marco Rubio, at the beginning of March. On that occasion, Harris said he was satisfied with the conversation. Yet within 24 hours, the US State Department issued a statement directly contradicting Harris’s account of the call. It insisted that, contrary to the Tanaiste’s initial claim, the pair had discussed ‘the US priority to address the US/Ireland trade imbalance.’
While Lutnick has remained silent on his conversation with Harris, it’s hard to imagine it being a particularly warm encounter.
During his rather chilling appearance on the All-In podcast, when he spoke with relish of ‘fixing a whole bunch of tax scams’, Lutnick incorrectly claimed that Ireland enjoyed a €60 billion trade surplus with the US, when it is in fact ‘only’ €25 billion.
But one gets the impression that quibbling about the precise figure is rather beside the point, because relations between Lutnick and Ireland in general – and with Harris in particular – are unlikely to ever be cordial.
Apart from his determination to recover money he believes Ireland is stealing from the US treasury, Lutnick is well known in Washington circles for holding the Irish government in disdain over its highly publicised animosity towards Israel.
In American circles, the Irish are seen as the most hawkishly anti-Israel of all the EU governments and this has not gone unnoticed by the man who was being touted as US ambassador to Israel before he took his position in the cabinet.
Apart from being a vocal supporter of Israel, he is also a prolific donor and fundraiser for groups such as United Hatzalah and Birthright Israel and there is a feeling among many Irish observers in Washington that he has Ireland in his cross hairs as a result.
Given their wildly different views on that matter, and on trade, it might have been better for the Irish Minister for Finance, Pascal Donohoe, to speak to Lutnick instead. Donohoe has largely refrained from making any inflammatory remarks that might provoke the US Commerce Secretary. But it seems Donohoe had even more pressing matters to deal with.
On Sunday, he issued a rather gloomy prediction for Ireland’s economic future if Trump’s tariff and trade war really kicks in from April 2. As he put it: ‘It’s very possible that between 50,000 and 80,000 jobs that would have been created or kept within the economy won’t be.’
Refusing to rule out of the possibility of Ireland plunging into a recession (‘That depends on the severity of the tariffs,’ he said) he also indicated the cuts in personal income tax which were promised in the Programme for Government would have to be put on hold.
Further adding to the gloom, he told RTE’s The Week in Politics to expect a drop in living standards and warned that the GDP could shrink by between 2 to 4 per cent.
With Ireland facing massive job losses, a possible rise in tax rates, a shrinking economy and a crippling recession, it would have hoped to have the EU on its side. But there was a worrying
recently of how little the EU really cares about Ireland.
When the US threatened to slap a 200 per cent tariff on EU booze exports, former Belgian Prime Minister and MEP Guy Verhofstadt, issued a furious statement denouncing Trump as a ‘madman’ while extolling the virtues of Belgian beer, French Champagne, Italian grappa and, incredibly, ‘Scottish whisky too, if the Brits come back’. There was no mention of Irish whiskey; a reminder that Ireland is lower in the list of priorities than a country which isn’t even an EU member.
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