PRESENT TENSE:WELL WE DIDN'T see that coming. Just as we were finally getting comfortable with our newly reduced circumstances came the news that we are no longer, technically, in recession.
As with any economic data, there are caveats galore in the CSO Quarterly National Accounts, the big one being that “the decline in GNP was more severe than that in GDP”. Considering that GNP is a better indicator of how Irish people are doing, and these figures indicate a rise in exports without any improvement in the job situation, we should hold off on the hosannas for the moment.
Still, though, positive news about the economy wasn’t in the script. We hadn’t even reached the point where ghost estates seemed like interesting features on a previously dull landscape, with bus tours guiding us to the most dilapidated and spooky, which was surely just around the corner. The pain and suffering of this recession, and above all the inequity of the pain and suffering, has become a key part of our national identity in the past two years. Rage at the incompetence and greed of politicians, bankers and developers evolved into an emotion of its own, on a par with sadness, joy or boredom. Just as we had naively embraced the gauche excesses of the boom, we have adapted to our new status as paupers with not much more than a long, collective whinge.
A peculiar manifestation of this has been our reaction to our role as the global flag-bearers of austerity. Swingeing cuts made by the very people who had engineered the bubble would rationally be a cause for riots, particularly as the cuts have come in tandem with massive injections of public money into the institutions responsible for funding the boom, but we have been rather phlegmatic about it all. And our only reward has been the approving recognition of international deficit hawks from the IMF to the Economist. In the condescending parlance of the day, we are taking our medicine without complaint.
Every time we get praised for suffering stoically through the austerity, we take it as a meagre reward. Things might be the pits, but at least we’re getting our due for being in the pits.
When George Osborne waved his UK emergency budget in the air, did a small part of us not collectively think, They’re following us now, they want a bit of our suffering? When we see the Greeks riot and the Spanish protest in the face of deficit-reduction measures, do we wish we emulated them when we had the chance or do we judge them for not taking their medicine like we did? When the G20 leaders debated the right balance of austerity and stimulus, how many of us thought, Stimulus? We haven’t had a whiff of stimulus.
We are the austerity stars of this global financial crisis, and I suspect there’s a part of us that’s rather too comfortable with that awkward fact.
This came into sharp focus in the past few days when both the New York Timesand the Wall Street Journalgave their takes on how we are being affected by the austerity measures. The NYTis arguing for greater stimulus spending in the US, while the WSJis advocating budget cuts to rein in the deficit. And it just so happens that our economy is the guinea pig in their ideological dispute. The NYTwas forthright: "Rather than being rewarded for its actions, though, Ireland is being penalised. Its downturn has certainly been sharper than if the government had spent more to keep people working." Well that's as black and white as the ink on the page, right? Here's the WSJ: "The Emerald Isle has high unemployment and one of Europe's deepest budget deficits, and is taking some of Europe's harshest austerity medicine . . . Investors have started to back Ireland, especially compared with other indebted countries on the euro zone's fringe." Excellent news, right? Not so fast, says the NYTcommentator Paul Krugman: "One often reads news reports claiming that . . . Ireland's resolve has impressed and reassured the financial markets. But the reality is that nothing of the sort has taken place: virtuous, suffering Ireland is gaining nothing."
And how do we feel about all this contradictory analysis of how we’re doing? I’d wager a lot of us are just satisfied that our stoicism is being noticed.
No point going through all this suffering without getting a few pats on the back, even if the pats are for entirely different reasons. But this so-called recovery threatens everything. Sure, we’ll have growing GDP, even if there will be no jobs to go with it. But almost worse, we will still be saddled with all of the austerity but without any of the accompanying sympathy. And if we can’t have the jobs, we’re certainly going to want to keep the sympathy.
