Rich enough to sustain a decent society
The place is awash with cash and there is no excuse for targeting the vulnerable and blaming austerity
LAST WEEK, in the joke of the century, a painting sold in Dublin for five times what it fetched at auction in England just five weeks earlier. The joke is that the painting is called Insolvent. As the original seller remarked, the price “belies the fact that there is no money in Ireland”.
Also last week, I conducted a straw poll of my own. How much poorer, on average, were Irish households at the end of 2010 than they were at the end of March 2009? Guesses ranged between 10 and 50 per cent. They fit a narrative that shapes public debate at the moment: “we” were once rich and now “we” are poor.
The answer to my question is that Irish households, on average, were not poorer at the end of 2010. They were massively richer. Average household wealth didn’t decline, it increased by 70 per cent, from €14,258 to €22,125. (Wealth in this case means assets, not income.) This is an average – when you take into account those who are unemployed or in negative equity, an awful lot of people have to have very substantial wealth.
These figures were released by the Central Bank on May 18th. They didn’t get much coverage, partly because Queen Elizabeth’s visit was dominating the media. But partly too, I suspect, because they complicate the simple message of austerity: there is no money. Irish households have almost exactly €100 billion in net financial wealth. Irish people paid off personal debts of €18 billion in 2009 and 2010 – nearly €4,000 for every man, woman and child.
The place is awash with cash: about €120 billion is held in hard currency and bank deposits.
None of this means that everything is okay and that there is no crisis. It is merely to suggest that the notion that “we” are all poor is as much an ideological construction of the bust as the opposite claim was of the boom. The huge wipe-out of personal wealth in 2007 and 2008 has been followed by a quietly remarkable bounce-back. Nearly half of what was lost in those two years has been clawed back.
In 2009 alone, the number of people in Ireland with investable assets over $1 million increased by 10 per cent to 18,100. The number of people with investable assets over $30 million increased by 18 to 181.
This picture of household wealth is consistent with what we know about so-called national income: Ireland has lost a lot of the nominal income that was created during the property boom, but it is still a rich country. The best measure is gross national income, which excludes the outflows of capital through transnational corporations. At the height of the boom in 2007, GNI was around €37,000 for every person in the country. Now, it’s probably somewhere about €30,000. A rapid decline like this is economically and psychologically catastrophic. But we’re still left with a country that’s earning more than enough to sustain a decent society.
And this is the point. Public discussion in Ireland is still, rightly, dominated by the stupidity and injustice of the bank bailout and the punitive EU-IMF loan-sharking arrangement. The unsustainability of that policy still has to be dealt with. But it shouldn’t blind us to the reality that Ireland is a society with very considerable wealth.
Enough wealth, that is, to be able to provide a basic level of human decency for all its citizens. Ireland is not a society so poor that children in pain with conditions like coeliac disease should have to wait for 18 months for an essential endoscopy – the only country in the developed world where this is so.
It is not a society so utterly lacking in basic resources that children who don’t speak English have to be left sitting in incomprehension in the classroom because language support teachers have been done away with. It is not a place so destitute that it has to force carers to go on day after day and night after night with less and less help until they are so spiritually broken and physically exhausted that they can’t do it anymore.
So-called austerity (which continues to countenance great luxury for some) is now biting hard. Whatever fat may or may not have been in the systems that protect the most vulnerable has been consumed by four years of cutbacks. We are now getting down to the hard truths: the autistic kid left to fend for himself in the classroom, the 80-year-old wife left to care for the disabled 78-year-old husband, the parent who has to watch a child’s scoliosis get worse and worse because he can’t get an operation, the Traveller kids whose educational supports were simply wiped away. We are cutting though the flesh of injustice and into the bone of obscenity.
The excuse for all of this is cruel necessity. But there is no necessity for any of it in a society whose resources are more than adequate for basic decency – if they were shared with some degree of equality. Take away the excuse of necessity and we are left with mere cruelty.