The last time Ireland had an election on the back of a long economic expansion was 2007. That was the year Pádraig Harrington won his first Open Championship, Apple launched its first iPhone, and God Save the Queen was first played at Croke Park.
It was also the year that Ireland’s economic chickens came home to roost, and laid a feast of rotten eggs. In the budget five months before the election, Europe’s then fastest-growing economy inexplicably delivered an economic stimulus proportionally twice as large as any other country in the euro zone.
It was insanity, the very epitome of pro-cyclical fiscal recklessness. It was like downing a triple whiskey at closing time when you’re already swaying at the bar.
But in Ireland, this is the only way to win elections. Fianna Fáil was rewarded by the people for its economic stupidity in 2007 with a third term in government, and we all got what we deserved. Irish people like nothing more than being irresponsibly bribed with their own money. It's depressing but undeniably true.
Much of the decade that followed that election was caked in economic misery. And it wasn't just felt in the Department of Finance. Economic misery is really just human misery, after all. It was felt across the State by those lying awake in bed after dark, or worrying at kitchen tables, or crying over bills or their emigrated grandchildren.
Who can forget the pay cuts, the suicides, the unemployment and the despair? But as soon as an election rolls around, we seem to have no problem forgetting the cause of some of that misery – pro-cyclical economic risk-taking in the form of inappropriately hiked public spending.
There were many other factors, of course, such as the out-of-control banking sector. But once the tide went out, the earlier bribery of people with their own money caused untold damage.
We are now 13 years on from what was, in hindsight, one of the most depressing elections in modern Irish history. And here we are again: the Irish electorate, listing from side to side like a day-old foal, banging on the bar counter and roaring for more whiskey.
It is perfectly natural for voters, and those of us whose job it is to keep them informed, to want to blame politicians each time Ireland screws up economically. But we all ought to take a look in the mirror every now and again, too.
The guests this week on The Irish Times Business Podcast included economics writer and managing editor Cliff Taylor, and Friends First economist Jim Power. They concluded that, despite the already-booming and in parts overheating economy, another bulge in public spending "seems to be what the electorate wants", especially when it comes to health and housing.
The demands from the public to pour more fuel on the economic fire are as incessant as ever
But it doesn’t stop there. Farmers also want more subsidies to help delay the inevitable; public-sector workers want more pay without doing much extra to justify it; advocates for rural areas want a blank cheque for lightning-fast broadband in every last corner of the State; students in one of the most student-friendly countries in Europe want lower fees; small businesses want insurance subsidies; trade unions want social welfare increased.
Meanwhile, Fine Gael wants to be seen in this election as the party of fiscal rectitude, even though it has been on the economic lash for the last five years. Fianna Fáil wants everyone to forget its economic record of making even bigger mistakes than Fine Gael. Labour wants to cod people into believing it is now the most fiscally responsible adult in the room. The Greens, with their fetish for ultimately dishonest economic "degrowth" theories, want some sort of a recession to save the planet.
Auction politics
As the auction politics of the election kicks off, it is worth recalling what the chairman of the State’s fiscal advisory council, Séamus Coffey, warned about in December: “Either our memories are short, or we are not willing to accept that budgetary decisions have broader implications outside of the sphere of what is in it for us as individuals.”
In other words, we are selfish and short-sighted and, as long as we get what we want, we seem indifferent to the consequences beyond the end of our own noses.
A recent report by the council reminded us that, between 2002 and 2018, public spending rose by an average of 3 per cent a year, a manageable overall run rate.
But in the barmy years directly before the crash, public spending was rising at up to 9 per cent per year, which was completely mad.
Over the last five years, public spending has risen by an average of about 4.5 per cent per year, which is only half mad, but still way too high for an economy with public debt of about €42,500 for every man, woman and child.
Extra public spending, such as the preposterous annual over-runs at the Department of Health, or the pay rises for public servants, and the most gilded children's hospital in history, are all being paid for by illusory corporation tax receipts. People have been told that something is awry, over and over again. But they don't seem to care.
The demands from the public to pour more fuel on the economic fire are as incessant as ever. Will we ever learn? Probably not.
