September 10, 2007
Billy Bunker picked up his corporate hospitality tickets for the Rolling Stones’ Bigger Bang Tour concert at Slane. He didn’t go the last time, 25 years ago, but now, courtesy of www.corporate.ie, he got a weekend hospitality ticket for the Stones and brought clients. This was the Ryder Cup with music. It was a day out for the gilded generation, the people who run the country. We are ruled by an evergreen, middle-aged generation, who, like their idol Mick Jagger, are coining it.
The Jagger Generation were at Slane in their thousands on 18 August, air-guitaring along with Keith to ‘Sympathy for the Devil’, while checking their Blackberries. Like Jagger, they led the revolution, railed against
the system and threatened to overthrow the power, but today they are the power.
The Jagger Generation is not a bad generation. They are Ireland’s “Accidental Millionaires” finding themselves on the right side of the property boom. They have been enriched beyond their wildest dreams. They are reasonably good citizens with a weakness for tax-relief car parks, pension scare-mongering, the Late Late and digitally re-mastered Van Morrison CDs. The Jaggers were born between 1945 and 1960 when the country was in trouble. Close to half a million people left Ireland between 1945 and 1960. Those who stayed found themselves in a denuded country, on the cusp of social change.
Most of our enlightened laws have been made by and for the tolerant Jaggers.
The Jaggers supported the EEC, they fought for the separation of Church and State and kept the place afloat in the late 1970s and early 1980s.
They were Ireland’s first hippies and Ireland’s revolutionary generation. They made Carnsore our Woodstock, drove Citroen 2 CVs with ‘Atomic Power, Nein Danke’ stickers, picketed the British Embassy, marched at Wood Quay, took condom trains and manned the 1970s’ barricades. Those who weren’t so public about their politics, privately wrestled with their own conscience and went on anti-tax marches. Together, the Jaggers dragged Ireland, screaming and kicking, into the
Now they are in power, the Jaggers have abandoned the idealism that defined them and have replaced it with pragmatism. And that means holding on to what they have.
Many vote Green but take more polluting short-break flights than anyone else. They speak the language of Labour, yet have holiday homes in Connemara. They support the Rossport Five, yet invest their pension funds in American multinationals. They argue for better public hospitals, yet are fully paid up VHI Plan-E members, en route to the Beacon Clinic. They want more motorways, but vote for lower taxes. They were the first generation to benefit from free education, yet send their kids to private fee-paying schools. They rail publicly against the price of houses for first-time buyers but are actually the largest bunch of investors in the
country, cannibalising the first-time buyers.
Because they only make up 14% of the population, the Jaggers’ stake in society is hugely disproportionate and their wealth has been bolstered by the housing market, the very asset that is an anvil around the neck of the
commuting generation, the Jugglers.
The Generation Game
In the late 1990s, as the housing boom took off, the Jagger generation began to pull away in wealth terms from the younger ones. They have become Ireland’s Accidental Millionaires. Every time house prices rose, the Jaggers, who owned houses, got wealthier; the younger ones — the Jugglers- who didn’t, became poorer.
The Juggler Generation – those in their early 20s to late 30s – have been caught on the wrong side of the property boom and have paid 14 times their annual salary for starter homes which are now falling in value. They account for close to 44% of the population, yet find themselves locked out of the house party.
There is close to â‚¬500 billion of equity in the Irish housing market, the lion’s share of which is held by the Jaggers. Looking at the demographic profile of bank lending figures, the majority of the â‚¬161 billion of debt is held by those under 40. The demographic divide is democratically explosive and deeply unfair.
Of course it is likely that the wealth of today’s middle-aged Jaggers will be passed on to their children in time. But those who expected inheritance at a productive stage in their lives have been caught out by innovations in health care. Look at poor old Prince Charles across the water. The poor lad will be ancient by the time he gets the crown. He is trapped by his mother’s longevity. Prince Charles’ dilemma will be suffered by Ireland’s young prospective heirs and heiresses because their parents are living longer than any generation ever. And as the Jaggers were the last generation of Irish people to have children in their early 20s, there is every likelihood that their dauphins will be in their 60s when they get their mits on the lolly.
In the years ahead, the political battleground in Ireland will not be between Left and Right, Catholic and Protestant, urban and rural Ireland, but it will be between the asset-rich, well-off Jagger Generation and the rest, particularly the younger, cash-strapped, heavily indebted Juggler Generation about 20 years behind them, who keep the whole show on the road.
The Botox Nation
When seen through the prism of demography, in terms of housing wealth alone, if the Jaggers — Ireland’s Accidental Millionaires – were the luckiest Irish ever, the unluckiest were those born between 1970 and 1980.
Contrary to much of the media reportage, not surprisingly penned by Jagger Generation editors and columnists, the younger generation is not some feckless bunch of hedonists who can’t do a good day’s work. In fact, they are the first-time buyers, who have splashed out for the most expensive commuter houses in Europe, just as the market peaked.
The Jugglers are products of the 1970s’ baby boom and are the first generation to go to university in large numbers. Today, they are the fuel that drives the economy forward. They commute, live in expensive shoe-boxes and have children out in the Irish baby-belt. The Jugglers are keeping all the balls in the air: child-care, work, family and trying desperately to maintain appearances.
A kind of social contract is operating which works as a conveyor belt. As long as it keeps moving up, the Jugglers know they are going in the right direction. The locomotive for the conveyor belt is the housing market. Given their provisional outlook, the Jugglers are prepared to put up with poor infrastructure, long commutes and expensive crÃ¨che fees if their house prices and wealth are improving. Once that stops, all bets are off and
the status quo which saw Fianna FÃ¡il through the 2007 election will change profoundly.
In Ireland, in the latter stage of the housing mania from 2004 to 2006, hundreds of thousands of people were ‘making’ more money on the rising value of their houses than they were taking home in their annual salaries. This created a class of drone millionaires whose wealth was rising as they were sitting on their bums doing nothing.
We have become the Botox Nation. This boom was fuelled by enormous personal borrowing. All this credit has the same effect on the economy as Botox has on a Jagger Generation woman. Botox makes her feel and look younger, but underneath the wrinkles and lines are still there, ready to reveal themselves. Similarly, all the borrowing has made us feel that we are rich and helped us maintain a flashy lifestyle, but underneath the signs of economic weakness are ubiquitous.
Now that the financial Botox is wearing off as the housing boom turns to bust, the huge gulf between the Jaggers and the Jugglers will be exposed.
History tells us that asset-price booms–like the great Irish housing boom–do not make societies rich in the aggregate. Booms simply redistribute wealth from one group in the society to another.
In the context of our history, the return to land today and the fundamental inequality to which it has led, is more dramatic now than at the height of the Land League’s campaigns in the latter half of the 19th century. We have succeeded in replacing one system dominated by foreign landlords, with another dominated by local landlords. The worker bees continue to feed the drones. After nearly a century of independence, that’s quite an achievement!