Editor’s Note
On Monday 6 December, many people will raise a glass to Michael Collins and Arthur Griffith, the two men who led the Irish team that signed the Anglo-Irish Treaty on 6 December 1921. The Irish Free State came into existence on the same day. In his new book In Fact: An Optimist’s Guide to Ireland, author Mark Henry declares that the Irish live longer, have never been healthier, and have never been better educated. ‘There have never been more of us at work, yesterday’s luxuries are now commonplace, and we are among the happiest people on the planet,’ he writes.
In fact, though, how far has Ireland come since its independence a century ago? In an April 2021 essay, historians Alan de Bromhead, Robin Adams and Ciarán Casey opined that Ireland’s story is one of convergence, not exceptionalism. In 1921, Finland, Norway, Sweden, Portugal and Spain all had lower GDP per capita than Ireland. Benchmarked against Wales and Scotland, Irish living standards fell further behind in the first decades following departure from the United Kingdom, only returning to their relative pre-Independence position around 1980.
Academic Patrick Honohan also looked into Ireland’s economic achievements in a recent paper. Honohan noted that on a purchasing power parity basis, Ireland’s per capita GDP is tops in Europe. The picture is less impressive when per capita income and consumption are analysed. On those metrics, Ireland’s position is between eighth and twelfth in the European Union.
Honohan also zeroed in on ‘actual individual consumption’, a rough measure of household living standards. On this basis, Ireland falls behind not only the UK but all six of the original founder members of the EEC, along with Austria and the three Nordic member states.
Ireland’s AIC per capita is about 95% of the EU average, way down from 115% in 2007. One reason is the relentless increase in taxation since the property crash – the 23% VAT rate clobbers not just the rich but entitlement recipients too. Honohan also observed that while consumer prices were about equal to the eurozone average in the 1990s, they were 27% higher by 2008. Though prices fell back subsequently, they have reverted to the previous high, largely due to the soaring cost of housing. “Ireland is not as prosperous as is often thought, and no wonder returning emigrants find Ireland expensive,” Honohan commented.
Absentee landlords were the bane of the Irish pre-Independence, and Collins and Griffith hardly expected that they would return. The great unfinished business since Independence is sorting out a solution to social housing that doesn’t crowd out private renters and purchasers.