You can't understand how Ireland went from boom to bust so fast? Well, settle back, folks, and I'll tell you a story, a true story. And I know it's true because this story happened to me.

Over the past three weeks, I have been refurbishing a small three bedroom house near my own home. I bought the little house about 15 years ago with some pension money I cashed in when I changed jobs.

Our child minder used to live there, but these days it's rented out. (In a few years, one of my kids may inherit the place if she's very nice to me in the meantime). I was refurbishing the house because the last tenant who had young kids had moved out, and the place needed some TLC before a new tenant would move in.

The living rooms in the house are wood floors, but the hall, stairs and landing and the three bedrooms all have wall to wall fitted carpet. All the carpet needed to be replaced, but not the underlay or carpet grabs which were still in good condition.

So my wife rang Carpet Right, a major carpet store in a retail park on the north side of Dublin, and they sent out someone to measure up and give her a quote.

Like all the stores here right now, Carpet Right is having a big sale so the price was really good. She paid for the carpet, and they told her that one of their fitters would bring the carpet in his van and fit it on an agreed day last week. Yes, it would all be done in one day.

The fitting cost would be €300, to be paid to the fitter when the job was done to our satisfaction. In the meantime, we were to remove the old carpet.

So the day arrived last week, and I got a call from the fitter to say he would meet me at the house at 11a.m. He arrived on time, had a look around, agreed that the underlay was okay and started to carry in the rolls of carpet from the van. He was by himself, but within 10 minutes the rolls were in and he was on his knees laying carpet at high speed.

I explained that I had to go, I had things to do, and I would be back at the house by 4:30 in the afternoon to pay him for the job.

He stopped the furious cutting and laying for a moment, straightened up and looked me in the eye. "But I should be finished by one,” he said.

I told him that was not a problem, I'd come back at lunch time. But then I thought about it. He had arrived at 11. If he finished at one, the job would have taken two hours.

"If that's all the time it's going to take, it can't be €300," I suggested. "Even my doctor does not charge that much."

There followed a rather tense discussion. He said he could drag the job out to four hours if I wanted, that we had agreed to pay €300 for the fitting, that €300 was the rate for the job.

I said that my wife had agreed to pay €300 because she (and later me) had presumed that it would take a full day to fit carpets to three rooms, the hall and stairs. We had also presumed that there would be two people involved, not just one. I repeated that if it was only going to take one person two hours to do the job, it should not cost €300.

He said that he was not changing the cost. So rather than prolonging the argument (and it was quickly changing from a discussion to an argument) I told him to continue with the job and that I would negotiate with Carpet Right.

When I got back to my own house, I rang the store and the sales assistant told me that their fitters were actually self-employed and that they all charged a rate agreed with Carpet Right which was €3.75 per square yard plus €50 extra if a stairs was included.

Our job was 60 square yards, including the stairs, so the cost should have been €225 plus €50 which was €275. Because there was no underlay to be fitted, they would knock that back to €250.

I said that was still way too much for two hours work. She said it did not make any difference how long the job took. I demanded to talk to the manager.

“You'll have to ring our customer service department in London,” I was told (Carpet Right is a British chain).

Bear with me here, because this is where it gets really interesting. So I rang the British head office (I was in that kind of mood) and asked how much they charged to fit a carpet in London, one of the most expensive cities in the world. The answer was £2.50 sterling per square yard.

I asked him to hold the line while I looked up that day's exchange rate, and found that £2.50 was equivalent to €2.68. And at that rate, fitting my carpet in Dublin should have cost €211, including the extra €50 for the stairs.

I told the British manager what I was being charged in Dublin. His explanation was that carpet fitters in Dublin earn much more than carpet fitters in London (and probably New York as well). What I was being charged in Dublin was the going rate for Ireland “where everything is more expensive."

Here's another example. Refurbishing the house included painting all the internal walls, ceilings, doors and skirtings. The quote from the painter was €3,500 for the five room house.

I asked a builder friend if that was okay, and he said it was "about average for good painters." So I agreed. The internal painting took five days.

On three days, there were two men on the job and on the other two days the head painter was alone. That's eight man days. The paint and materials would have cost around €300. So our painters were charging around €400 a day each. That works out at €2,800 a week for a painter.

But that's nothing. The carpet fitter (l ended up paying him €250 for two and a half hours work) was on a rate that works out at €4,000 for a 40 hour week.

So if you are wondering how Ireland went from boom to bust so fast, now you know. It's not just the fault of the Irish bankers who were paying themselves annual salaries of millions while they made stupid loans to property developers, loans that are now bankrupting the country.

As the property boom fed its poison through the Irish economy over the last decade everyone went a bit crazy. Everyone wanted to earn big money.

The greed permeated its way right down through the workforce until we priced ourselves out of markets everywhere. The cost of everything soared. As my granny used to say, people knew the price of everything and the value of nothing.

The result is that I now look around me here and virtually everything I own or use on a daily basis comes from somewhere else. Nothing is made in Ireland anymore. Most of our boom came from building houses, and now no one wants to buy the tens of thousands of houses that are unsold.

To turn this around is going to be extremely difficult. Taoiseach (Prime Minister) Brian Cowen said last weekend that the standard of living here would have to drop by at least 10%.

But that's only the start. We have a long way to fall before we hit bottom and start coming back up.

And some people here like the carpetbagger -– sorry, I mean carpet fitter -- and the painter, all the way up to the bankers and professionals, still have not learned that it's a different Ireland now.

But they will learn the hard way soon enough, staring on Tuesday of next week -- B-Day -- when the emergency budget will be revealed.