The Irish government has been short on funds, causing concern around the world.
What happened? The financial crisis dragged Ireland down, in part because of bank failures.
At the height of the panic, nobody knew if banks were any good - any bank could fail on any day. To help calm fears, the Irish government promised to back Irish banks. Unfortunately, they didn't limit their exposure, and wound up on the hook for more than they bargained for.
The move probably seemed like a good idea at the time: fear was out of control, and every single bank (strong or weak) was suspect. Government backing may have even helped ease fears globally, as other nations followed Ireland's lead.
Ultimately, the cost was too high. The Planet Money team describes the Irish banking mess in more detail.