Facebook has a licence to print money. In fact, it has two.

The first is its business model, which allows an enormous network of ordinary people to share unprecedented volumes of personal and often private information about themselves – information that Facebook can collate and cross-reference to make perhaps the most detailed profile of huge swathes of the global population that the world has ever seen.

Its second licence to print money comes in the shape of its tax strategy.

Both of these have enormous relevance to Ireland at the moment, and their combination is far more relevant to Ireland than to many other countries, given Ireland’s increasingly tenuous ability to position itself at the cusp of what is increasingly seen as the dawn of the fourth industrial revolution.

It is worth considering both of these issues separately.

Tactics

First, in the glib and worthy language of Silicon Valley, Facebook is about connecting people.

But it’s not really; it’s about building a platform with sufficient utility that its users feel compelled to trade vast amounts of their data for access to the platform. This data enables advertisers to target them extremely effectively.

There is nothing inherently wrong with this; users should be aware that they are the product, and if they, as consenting adults, are willing to trade their data for access to Facebook, then so be it. The company’s end of this bargain is that it will guard this data closely and use it for its intended purpose only.

The Cambridge Analytica scandal shows that Facebook has manifestly failed in upholding its end of the bargain.

Its organising purpose is to bore into its users’ data to hone targeting solutions; this has clearly overridden any sense of responsibility the company has to its users. Its approach has been cavalier at best, and at worst, willfully disrespectful of its customers.

It must expect a legitimate backlash from its users, and the elected politicians who represent them.

For Ireland, the enormous and legitimately frightening threat associated with the abuse of vast sets of private and confidential data is not just a matter for Russia or Britain or America.

Our Data Protection Commissioner (DPC) is also the lead regulator of Facebook and many others for the entire EU. In an audit in 2012, it uncovered the very flaw that gave rise to the CA scandal, yet Facebook did not introduce policy changes for two years.

Whether this was the result of powerlessness on the part of the regulator, or resistance from Facebook, does not really matter.

It shows that we lack the tools to compel these companies to behave in an appropriate manner, and in a timely fashion. The asymmetry between the resources of Facebook and the DPC is profound, but Ireland must prove itself equal to the task it has set itself. Facebook’s jobs, regulatory and taxation functions are in Ireland because of the industrial model we have chosen. At a bare minimum, Ireland must prove itself equal to the task of managing the enormous multinational sector it has created, otherwise we must ask ourselves who really holds the power in this relationship?

How can we get companies like Facebook to behave in a proper manner towards their users? The example of the financial sector is instructive. Time and again, banks have been hit with multibillion euro and dollar fines, and yet time and again the financial sector rides roughshod over the interests of citizens. Fines, it is clear, do not work. We should not replicate this experience for the tech giants. Proper regulation should go after the sin Facebook has committed. It should intrude and inspect more completely how it manages its customer data, and if it exploits it, regulation should halt this.

Taxes

If a company has a licence to print money, go after the licence – not the money. That’s the only way to get their attention.

That’s not the end of the matter for Ireland, however. When it comes to tax – as this newspaper has repeated regularly – Ireland can no longer sit back comfortably and pretend that an industrial policy devised in the middle of the last century is relevant or useful in the beginning of the 21st century.

Over the years, Ireland has played a vital role in allowing the social media giant to funnel huge sums of money through its European headquarters, based in Dublin, and onwards to its offshore cash pile.

Facebook holds over one-quarter of its cash offshore – just over $38 billion. It is not unique in this, and not unique in using Ireland. Many companies around the world now have so much money they literally cannot find a purpose for it; so it sits, offshore, an insult to the countries from whose economies it is extracted.

The companies themselves are almost indifferent to this cash; it has no real useful purpose. Their R&D departments are well funded, their products are best in class, their employees well paid. It is merely testament to the effectiveness of the lawyers and accountants who concoct their tax strategies, and the indifference, incompetence or complicity of the jurisdictions – including Ireland – which facilitate its construction.

In an era where profound and widening inequality around the globe is loosening the social contracts which underpin the modern state, Ireland cannot pretend it is an innocent.

Ireland has made no friends in assisting these enormous multinational companies – many more powerful than nation states – from diverting the taxes they owe away from the infrastructure of the countries in which they operate.

Facebook, to its credit, has committed to paying more tax in the jurisdictions in which it operates – and less, you would think, in Ireland. In this, it is ahead of the curve. The tectonic plates of tax, trade and investment are shifting.

But our track record in helping multinationals to efficiently tax-plan – in that great industrial euphemism – will not help us when it comes to the much more pressing question for us of how to build a sustainable economy – one that is based on more than a small handful of those big companies providing jobs (especially when we’re at the dawn of an age of automation and the labour we offer becomes far less of an attraction).

Ireland faces a great many existential questions right now. The answers will define the next century of its growth – or stagnation. The conversation about how to frame the questions and adequately answer them must begin now. Otherwise Ireland faces economic oblivion.