Society gets lost in a blizzard of statistics

ONCE upon a time, proof of a visit to Ireland demanded tourists buy a little globe in the centre of which sat a leprechaun. Turn it upside down and the idyllic scene became clouded in an artificial snowstorm. Many of us today attempting to make sense of the blizzard of figures swirling around out there on the country’s economic performance will share the woozy feeling of the little figure trapped in the plastic bubble.

Yesterday, according to EU Commission estimates, our economy grew by 7.3pc, making it the fastest growing in Europe.

But speaking in Dublin also yesterday, Finance Minister Paschal Donohoe explained how economic activity in the Republic last year was almost a third lower than the gross domestic product figures published by our Central Statistics Office.

Measuring the true size of the economy is getting trickier; according to Mr Donohoe,p this has much to do with the fact we are so “deeply embedded in global supply-chains”. To illustrate the full complexity involved, he cited the now infamous figures from 2015 recording our 26pc growth rate.

And all of this leads us neatly back to our little friend in the snow globe, for it was that self-same fantastical figure that led Nobel prize-winning US economist Paul Krugman to fashion the phrase “leprechaun economics”.

Too many people in this country wonder where they fit into this tale.

For instance, how do you square the circle where the Central Bank is revealing that households have never been wealthier with unprecedented crises in health and housing?

As we near full employment, why are so many sick people on waiting lists for vital medical procedures and why are our young doctors, nurses and teachers so eager to head overseas?

Too often in economics, the story begins with data or a number, and a narrative is fashioned to support it.

Somewhere, the human being gets lost in the figures. All of these considerations need to be included if we are to see ourselves as a society meeting its social responsibilities and not just an economy powering on regardless.

When we talk about the multinational sector we are referring to the jobs, income and tax they might generate. It ought not be too complicated.

But because so many of them are located in Dublin, Cork Limerick and Galway, many feel untouched by the cornucopia. Assessing the true performance of Ireland Inc is further complicated by what Mr Donohoe calls the “on-shoring of intellectual property and outsourcing of production” – two key features of the “new economy”.

The CSO has been tasked with coming up with an indicator that assesses the size of the economy that excludes the effects of globalisation. They came up with “modified gross national income”, known as GNI* (said as GNI-star). For the record, this strips away the depreciation of foreign-owned intellectual property assets based here, which so distorted the picture in the past.

Economists can hardly be expected to come up with answers to all our searching social issues. That must be part of a national and inclusive discourse and a Government which is answerable to the voters.

But the various paradoxes, contradictions and omissions economists have been responsible for ought to have taught us not to overly rely on them.

When we ignore human values and see everyone as either a cost or a profit and loss, then reality has a habit of slapping us in the face – with or without the statistics.