After a pleasant and instructive visit last week as a guest of Dr Billy Kelly to the Institute of Ulster Scots Studies at Magee College (of which more at a future date), I will quote familiar Robbie Burns lines in the original Scots: Oh wad some power the giftie gie us. To see oursels as ithers see us!
These lines were applied in the vernacular at the recent meeting in Sligo of the Fianna Fáil parliamentary party to the present state of the economy.
The International Monetary Fund (IMF) is not a body given to mincing its words. A retiring director said cuttingly last week that the closest (continental) Europeans would come to economic recovery would be watching it happen elsewhere on television.
In contrast, the executive board of the IMF concluded its recent consultation with Ireland published in August thus: "Directors commended the Irish authorities for their exemplary track record of sound economic policies, which have resulted in a dynamic, open and robust economy - with growth notably above the EU average over the past decade - and resilience to external shocks."
The staff report to which it was annexed referred to "enviable achievements", unemployment reduced by three-quarters from 16 per cent to 4 per cent in the 10 years to 2001, substantial gains in competitiveness and a fall in the public debt ratio from over 100 per cent of GDP to well below 40 per cent in the same period.
National wage agreements, "sensible public policies in the form of investment in education and skills; tax reform that increased incentives to work and invest, and fiscal restraint" are all credited with creating "a virtuous circle" that took advantage of favourable circumstances; in particular, the global high-tech and financial services boom of the late 1990s.
The OECD report last May puzzled over how the Irish economy had avoided experiencing "a much more pronounced slowdown in economic activity" during 2001 and 2002. Both reports suggest that high levels of public investment; large-scale hiring in the public sector; and a somewhat expansionary fiscal policy, against the background of negative short-term interest rates in the euro zone, together with the 2003 national wage agreement offering no fiscal concessions for wage moderation, helped the Irish economy to achieve a "soft landing". A "soft landing" has been a primary objective of Government economic policy since the international downturn became evident in 2001.
As the IMF staff appraisal puts it, "After a decade of spectacular growth, the Irish economy has achieved a soft landing, thanks to a long record of sound policies that have left the economy comparatively robust and flexible", unlike other tiger economies.
The Government has been accused of being too pro-cyclical, and in truth the Minister for Finance does not do justice to his own economic management, by making the populist claim that "when we have money, we spend it".
In fact, during the boom years the Government ran huge surpluses, paid off all sorts of longstanding debts and obligations and tucked 1 per cent of GNP into a pension fund, which most of the opposition wanted him to spend straight away. In 2001-2002 propping up demand, no doubt with elections as well as the economy in mind, appears to have been just what was needed.
Two years into the downturn, notwithstanding some highly publicised job losses, the Irish economy in the words of the OECD "is operating at, or close to, full employment". It also states that "the public finance position over the next several years looks to be fairly sound".
It regards the policy of restraining current expenditure as preferable to increasing taxes and advocates wider use of benchmarking to pressurise reform. The IMF considers that, despite ignoring some previous advice, "Ireland has generally responded appropriately to policy challenges identified in previous consultations".
Both reports survey critically a whole range of sectoral issues and downside risks, but the economic fundamentals, which today include employment, are sound and healthy. Inflation has come down rapidly, not just because of external factors but also because the current social partnership programme Sustaining Progress broke the re-emerging cycle of inflationary expectations.
The Government has also been successful in bringing the rate of expenditure growth down quite rapidly. The dangers are not over, and there is bound to be bad news still to come, but at least the US economy that now is the major influence on us is showing some light over the horizon.
What is clear is that generalised changes of economic incompetence levelled at either the present or the previous Fianna Fáil-PD Government or in a highly personalised way at the Minister for Finance, Charlie McCreevy, cannot be sustained.
The sort of constantly bad-tempered Sunday commentator who presents a picture of a small-town economy inefficiently run by gombeen men abysmally ignorant of (Anglo-American) neo-liberal eternal verities, or the type of TV economic evangelist who likes to send fear shivering down the spine of the listeners, do not seem fully to appreciate the relative solidity of the huge achievements of the past 16 years in creating what is well on its way to becoming a model economy for its size.
The people's good sense after the bad experiences of a now more distant past; the responsibility of the social partners, especially the mainstream trade union movement; and consistent and stable political leadership have all played their part. Naturally, people in every country far prefer necessary adjustments, which they in principle support, to be made with the minimum pain, and certainly when the pain is occurring in the wrong places it must be remedied.
Bringing the country safely through and building on all the progress achieved in recent years is this Government's first duty, whatever political unpopularity that may involve in the short or medium term. There are many urgent social issues that need to be addressed with the social partners. The confidence and the additional resources that are generated by good economic management are the necessary but not sufficient conditions for progressing successfully with them.