Well, Paddy has it generally right, but he's missed some of the details, so I'll fill in, for I was a witness to the new old Ireland as well.

You really had to have seen it back in 2006 when Paddy and I were there, and the grand days were at their height. Money literally rolled down the streets. Prosperity was everywhere. Upon their entrance to the E.U., the Irish had devised a new "social partnership" idea. Government, unions and other interest groups came together as early as the '90s and agreed to lower wages in return for low-interest mortgages and other bonus rewards for workers.

It was a great idea, but difficult to impose on most obstreperous workforces. Yet this idea to consolidate now so that everyone could gain later was accepted by the Irish.

Then, on top of this, the Irish Development Authority marketed Ireland to America as an economic, financial and social entry point to the E.U., and the money began pouring in: Microsoft, Intel, Dell, all located in Ireland in order to penetrate the E.U. market. And the charming Irish, right up to the prime minister's office, knew just how to roll out the red carpets for these powerful CEOs from afar.

At the same time, the U.S. financial markets were going through the roof with fancy, little-understood credit default swaps, and little frozen-up Iceland was going through the same dangerous, but to-all-observers delightful, process.

On the surface, Iceland was booming. Its banks were buying up businesses all over Europe, and the world and everyone was amazed that such a tiny (350,000 people) ice-bound country could carry such leverage. That country's phenomenal growth was also kicked off in the 1990s by structural reforms that liberalized the Icelandic market, including the deregulation of the financial markets.

The country's President Olafur Ragnar Grimsson told me at the time: "What you observe in Iceland today is the coexistence of a competitive market society and a welfare state -- a remarkable formula for success. My American friends think you have to choose between them ... but Iceland is the proof that you can have both."

In fact, by that time, little Iceland had the fifth highest per capita income in the world, $54,000.

But by this St. Pat's Day, the "Irish miracle" or the "Celtic Tiger" had collapsed right alongside the near-collapse in the United States. It is still struggling to find out where to go next, as real estate is close to worthless and American companies are pulling back. And Iceland is even worse.

All of Iceland's major banks, which had overseen the boom without the necessary financial backing for it and had gravely overextended its reach, are now deeply involved in a nasty exchange of views on how to reimburse U.K. and Dutch investors in Icelandic banks who lost everything. A full 93 percent of Icelanders refused a government plan to reimburse $5.3 billion to the European investors in an Icelandic Internet bank.

A full repayment to foreign depositors would have cost every Icelander more than $100 per person per month for up to eight years -- and at a time of high unemployment and general financial devastation.

Meanwhile, it is perhaps time for the American financial giants on Wall Street, who got US into our near-collapse, to realize that it was their criminal carelessness that also got small governments like these into THEIRS. One has to wonder, too, whether we will not live to see a time when we are the ones asking the Chinese to help us out of our financial hole.