April 12, 2006

Old Ireland - creaking at the crossroads by 2046

Posted in Sunday Business Post ·
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Most of this week will be spent looking backwards, either to the GPO in 1916 or Judea in 33AD, so why don’t we look forward?

Let’s take up the Taoiseach’s invitation to think about the country, the nature of the place and the essence of being Irish. What are we likely to look like in 40 years’ time?

Will the major influences be republican politics and religion? Will they be external shocks such as the rise of China, the disintegration of the EU or an oil crisis? Or will the major influences on Ireland be more gradual and predictable?

If you want to catch a glimpse of Ireland’s future go to Florida.
Down in the large retirement home known as the Florida Keys, you will see rich, old, white retirees being waited on by poor, black or Hispanic immigrants.

The old people in the main have migrated down from the northern cities of New York, Philadelphia and Boston to play golf and hang out in the sun.

The young – usually illegal – immigrants have largely escaped the poverty and chaos of Haiti or Central America. This demographic, cultural and financial divide is evident in hotels, hospitals and shopping malls. This is Ireland’s future.

Over the coming few decades the most radical change in our society will be the proportion of older people. When Eamon de Valera led the 1966 Rising Commemoration, the proportion of over-65s in the population was one in 10. This figure has remained more or less static since then.

In fact, the number of over-65s has only increased by 145,000 in the past 40 years. This is largely a result of mass emigration in the 1950s.

These emigrants, unlike the late 1970s and 1980s bunch, never came home. Now contrast this with the next 40 years when the number of over-65s will rise nine times faster. By 2040, more than 1.3m – or one in three of us – will be over 65. Ireland will no longer be home to the “young Europeans” as the IDA ads of the past decade have trumpeted. On the contrary, far from being young, vibrant and fast-moving, we will be an old, grey and conservative population not unlike the populations of France and Italy today.

A good place to start when trying to examine the implication of this demographic about-face is to look at what is going on in countries like Italy. Sunday’s election in Italy proved indecisive, with both centre right and centre left getting practically the same vote. This tells us that there is no real mandate for change of any sort in Italy. But why would there be?

Old populations, with secure state jobs, good pensions to look forward to and second houses on the Riviera don’t want change; they want things just as they are. Much of the commentary, especially in the Anglo-American media on Italy, paints a picture of a formerly rich country sleep-walking illogically into an economic cul-de-sac of high debts and high youth unemployment.

But there is nothing illogical about an old country voting to keep things just as they are. This is the most normal thing in the world. Fast-forward to Ireland in a few decades and we will see the same patterns. Irish governments of the future – like today’s Italian stalemate – will foster and reflect the concerns of a middle aged to older electorate.

This implies that there will be a much lower tolerance of crime and, as well as the health budget rising rapidly, so too will both personal and public security bills. This is good for private security and private hospitals. Places like the Beacon private hospital complex in Sandyford are ahead of the game already and will become commonplace.

As in Florida, the private security business – largely comprising of demobbed Russian conscripts – guarding condos, gated estates and the like, will boom. It also appears highly likely that sentencing will become tougher. Old people do not commit crime so a government that reflects their worries will seek to protect their property and assets. This will extend into tougher laws on anti-social behaviour and public disorder and a great proclivity to accepting the authority of the state and of the police.

In other areas, the idea of protecting what has already been accumulated will dominate economic policy. One of the reasons for Germany’s enduring aversion to inflation is not only that it suffered hyper-inflation in the 1920s, it is also due to the fact that Germany is an old population with millions of old savers. They will not tolerate their savings being whittled away by inflationary policies designed to provide employment for an increasingly small youth population.

Given that many services – like in Florida – will be provided by immigrants and consumed by old white people, anything that cuts the cost of these services and by extension enhances the value to the old consumers will be entertained. Therefore immigration will rise not fall because someone has to do the work and not only that, but if there aren’t enough local white workers, their wages would rise in the absence of cheaper foreign workers. These higher wages could only be paid for by older consumers – which they will seek to avoid.

So it is likely that immigrants will be pitted against younger Irish workers to provide best value for the ruling class of Septugarians. Late Victorian Britain operated on this basis as the leisured class – that lived well off its savings – emerged towards the end of Britain’s global economic hegemony. Thus the State was happy to keep the doors open to migrants – particularly Irish labourers – who served to keep domestic costs down and thus provide all sorts of cheap services to the leisured classes.

The extent of these implications will be based on longevity. In the past 100 years the proportion of us surviving longer has increased almost every decade. So now, for example, a great number of us survive until we are 75. (In 1900 the same proportion survived to 50.)

But, interestingly, it is rare to live past 90. The big question is whether future ageing patterns will replicate that of the past 20 years.

Data from SwissRe Life & Health (the insurance company) reveal that most of us are likely to live to around 90 and then die in great numbers with very few living longer than 105. This type of pattern would make financial planning for Ireland’s coming “grey boom” relatively simple. Today’s fortysomethings would have to work longer and save a bit more, but they should cover their retirement without dramatic change.

What if we started living much longer in greater numbers? For example, what if a sizeable amount of us lived on to 105 or 110 even? It is a real possibility now with so much of commercial medical inquiry devoted to prolonging the life of rich Westerners.

If the combination of healthier lifestyles, the growth of the “wellness” industry and development in preventive medicine continues apace, we could be looking at the biggest change in human experience in centuries.

While this brave new world throws up huge opportunities, for Ireland it suggests a profoundly different, much less dramatic and arguably duller next 40 years than the last 40.

Had Padraig Pearse been writing the Proclamation now and looking into the Ireland of the future, would he have written about “cherishing all of the children of the nation equally?”

More accurate, but less romantic would be an inscription “cherishing all the grandmothers of the nation equally.”

That’s what happens when demography shrugs – every political aspiration is crushed in its wake.


  1. CiaranMcG

    I agree that Ireland’s changing demographic profile will
    alter Irish society. I’m not sure, however, that the result
    will necessarily be a nation of conservative grannies,
    defending the status quo with their considerable wealth and
    voting strength.
    You mentions France and Italy – but the current stasis in
    these countries owes as much to their political institutions
    as it does their age profiles.
    Moreover, those who are growing up in Ireland today are
    not enjoying the stability of secure state jobs and good
    pensions to the same extent as French people have done
    over the past 30 years.
    Workers today, in Ireland and elsewhere, know more about
    instability (or as right wing economists would say,
    flexibility) than did previous generations. Therefore, when
    silver haired, they may not be as fearful of change.
    Finally, while the conservative instinct comes with age,
    I speculate that as the human lifespan extends, so too does
    each life-stage. Those who consider themselves youths today
    would have been established adults in times past. Similarly,
    in the near future, if we are ‘ living’ to be 100, life will
    begin at 50 not 40, and people who are 65 will be far bolder
    than you imagine. In such a scenario, the conservative
    granny remains important but hardly central to the nature of
    society.

  2. Dan Hayes

    David & Co.:

    It is not preordained that Ireland should make the same
    mistakes that we in the United States are doing: the
    importation of serfs to do the “dirty” work. Who does the
    mundane tasks in Japan? The Japanese, of course! The
    Japanese people have made a decision to keep their country
    homogenous, and their politicans dare not deviate from this
    mandate. Japan is a pretty successful country, and I
    venture to guess that it will remain so without importing a
    future demographic time bomb.

  3. Paul Rux, Ph.D.

    Dan Hayes, you overlook the declining work ethic in the
    USA because of the plethora of rights movements. To my
    knowlege, the Japanese still have a work ethic – for now.

  4. David Mc Williams

    Sean, I mean that it is far from certain that the EU will
    continue to thrive as it has done for the past fifty
    years. David

  5. Seán

    David,
    What do you mean by “the disintegration of the EU”?

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