Reshaping Reality

Ten days of vacation out of the country is often a great way to get a little perspective. When that country is Ireland, one realizes that magical transformations are still possible.


After recovering from the shock of $12 beers and $25 hamburgers (I opted for more affordable $16 ham and cheese sandwiches), and peering over hedges at exquisite but tiny $2 million road houses, I picked up a newspaper to discover that the consensus was that Ireland had entered its first recession in 15 or 16 years. Conventional wisdom holds that this country evolved from a poor agrarian society, skipped the industrial revolution and became a 21st century information/asset-based economy in fewer than three decades. While this interpretation merges some myths with facts, it's understandable that a recession is jarring and unfamiliar to many.

A combination of an excellent education system, European economic integration and low taxes has propelled Ireland's GDP growth, which ranged between 6% and 11% from 1993 to 1999. The explosion in wealth and living standards-Dublin today has roughly the same number of millionaires per capita as New York-on a small island morphed into a property bubble that is now deflating apace with America's.

The Irish people, I'm told, were always hyper-friendly even when the nation was one of Europe's poorest, realizing that in the end, money isn't that important. The human warmth is genuine and spirits remain high.

That's until the subject turns to the economy. Those who complain about media negativity in the U.S. should spend five days reading newspapers in the Emerald Isle. The absurdity of it all was captured clearly by Medb Ruane, a columnist for Irish Independent, who wrote, "What is a recession? My teenage son asked and I found myself an unwitting expert on 1980s Ireland, as though I'd survived a holocaust and could pass on the knowledge."

But it's not easy, she continued, "to speak to a land of plenty about a time when less was more." As in much of the developed world, times of uncertainty, coupled with the blinding pace of socioeconomic change, can produce "a sense of powerlessness that begins to write its own script," she concluded, and those who are painting the most apocalyptic views of the latest crisis du jour are tacitly subscribing to the belief that "money was all that glues people together, when it is not."

Speaking of money, it was nice not to have to look at the stock market during the final week of June. As I discovered reading The Financial Times on the flight home, one couldn't help wondering if we were returning to a period like the 1940s and 1950s. This was an era when people bought equities, not for price appreciation but to live off the dividends, because stocks yielded more than bonds.

But we're not going back to the 1950s, or the 1970s, as so many commentators want us to believe. We're going someplace we've never been before. It probably won't be the mythological perfect society of the Celtic Tiger in the 1990s. After all, to assume we've experienced all the different states of economic existence is hubris.

Evan Simonoff, Editor-in-chief

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