How fortunate to have avoided such disaster

Michael Taft: Pat McArdle celebrates the fact that the Fianna Fail government has taken up the austerity cudgels:

‘With hindsight, we were fortunate to have gone down the road we did. The alternative of job creation schemes or expansionary measures would have been disastrous.’

Let’s run through some comparative data to see just how ‘fortunate’ we have been and how we avoided ‘disaster’. These cover the years 2007-2010 – three years of recession (for Ireland, anyway). The Euro zone data and estimates come from the EU Statistical Annex. Irish data and estimates come from the recent ESRI Quarterly Report (except for Irish domestic demand which comes from the EU estimates).

• Euro zone GDP is estimated to fall by -2.7 percent. Irish GNP is estimated to contract by -13.3 percent.

• Euro zone GDP per capita is estimated to fall by -4 percent. Irish GNP (for the domestic economy) per capita is estimated to fall by -16.1 percent.

• Euro zone domestic demand is expected to fall by -2.3 percent. In Ireland it is expected to fall by -19.3 percent

• Euro zone consumer spending will hardly fall at all: -0.4. In Ireland, consumer spending will fall by -8.8 percent.

• Total investment in the Euro zone is projected to fall by -12.8 percent. In Ireland, the fall is projected to by -51.7 percent.

• Non-property investment is estimated to all by -17.7 percent in the Euro zone. It is estimated to fall by -38.9 percent.

• In the Euro zone, employment is projected to fall by -3 percent. In Ireland it is projected to fall by -12.7 percent.

Pity those other Euro zone countries with their ‘job creation schemes and expansionary measures’. We’re just ‘fortunate’ that Fianna Fail is in power.

Posted in: Economics • Economics

Tagged with: Irish economy • Deflation

Michael Taft     @notesonthefront

Michael Taft is an economic analyst and trade unionist. He is author of the Notes of the Front blog and a member of the TASC Economists’ Network.