The Irish summer is hard to love. Walking towards the Twelve Bens, above Roundstone village on the bog road, beaten by torrential rain coming at you sideways, mightn’t be everyone’s idea of the perfect holiday.
In fairness, there’s something comical about paying for such a spiteful drenching. The late July temperature hits a sizzling 13 degrees, away from the wind.
The July stimulus plan announced by the Government this week is a step in the right direction. Expect more because the economic heft needed to lift the economy out of this slump will be hindered by coronavirus.
In normal recessions, the recovery emerges slowly as people become more confident, looking forward instead of backwards. An iterative process, this recovery is a step-by-step movement, like climbing a ladder, looking for the next rung. Confidence builds, one small decision at a time. We edge upwards. True escape velocity is only achieved when consumer spending – 60 per cent of GDP – kicks in. Without consumer spending, there is no recovery.
Whether they be city states or countries, all jurisdictions that experience growth rates and increases in prosperity that, for a time, dwarf those of their neighbours tend to have deployed an innovation, a resource or a policy that gives them a unique economic advantage.
For France, that policy might have been mass and brutal colonialism in Africa. For Holland it could have been the wholesale plunder, at gunpoint, of the natural bounty of Indonesia and Borneo. For Belgium, early 20th-century wealth came with the gruesome hacking-off of the hands of men, women and children in the Congo in order to force the enslaved African population to produce more rubber.
To understand new phenomena, we need new language. Language is critical to our comprehension because language allows us to paint mental pictures. Language is a shortcut and a sort of thought organiser that allows us to see the world with more nuance and depth.
Unfortunately, economics treats language as an afterthought, mangling its beauty and humanity in a grating, mechanical dullness.
“This will be a Government of enterprise, creating new jobs.”
“Creating 200,000 jobs by 2025” [in tourism].
There are 14 separate quotations from the programme for government, all citing something mythical called “job creation”. There is no such thing.
During the week I joined a fascinating webinar given by the brains and policy guru behind the European Central Bank, Philip Lane, its chief economist. He looks like a man with the job he always wanted and is comfortable with it.
The reason I used the term “brains” is very simple: Lane is now the intellectual driver of policy. As I listened to him, I heard a combination of Ben Bernanke’s deep appreciation of monetary history and Mario Draghi’s sharp understanding of the power of the central bank and the breathtaking array of tools at his disposal. Lane grasps what is at stake and is prepared to act comprehensively.