Today's young people have never known hard times, yet it is only 20 years since Ireland was mired into a recession that felt unending. Could it really get that bad again?
USUALLY THIS newspaper steers away from collar-grabbing shock headlines but there was something about last Tuesday's front-page lead that sent a shudder down the spine. It read: "ESRI warns of recession, job losses and renewed emigration."
It's almost two decades since that potent combination of words showed up in the same parish. And together they conjured up a moment of grim déjà vufor those in their late 30s and older.
As the story fleshed out, there were more ominous details. The level of unemployment is forecast to rise by 60 per cent; there will be a net emigration of 20,000 people next year; and the economy will experience a recession this year for the first time since 1983.
These are alien concepts to today's young. Looked at now, the Ireland of the 1980s seems as distant a place as all those sad, monochrome countries in eastern Europe were before the Iron Curtain came down. In particular, it was the inclusion of the weasel 'R' word that had an impact: the shot heard around the world. Within 24 hours, more than 500 news outlets around the globe were carrying the story of an impending Irish recession, according to the hits on the Google news site.
But does this looming recession really mean recession, at least in the sense of what it meant for anybody born before 1970 and for whom the 1980s was the decade they want to forget?
"We are not back to the position in which we were in the 1980s," the Taoiseach, Brian Cowen, insisted in the Dáil on Tuesday, "because we are in a much better position to deal with the situation than we were then."
In this he is right, according to economists such as Michael Cuddy and James Wrynn; and to the Economic and Social Research Institute (ESRI), which conducted the study; and even to Labour leader Eamon Gilmore, who responded in the Dáil that: "The ESRI did not say that we are going back to the 1980s and nobody wants to do so. As a country we have come a long way from the 1980s. We must move forward and out of the difficulty we are in."
That said, the prevailing atmospherics of the week could not prevent a harking back to the 1980s and the rhyming couplet that defined its mood: gloom and doom. Even when Cowen said at the Ibec president's dinner on Wednesday that "painful" corrective action would be needed, it recalled the infamous, utterly hypocritical televised address made by taoiseach Charles Haughey on January 9th, 1980, at the start of the decade-long slump: "As a community we are living away beyond our means . . . We are living at a rate which is simply not justified by the amount of goods and services . . . We will just have to reorganise government spending so that we undertake only the things that we can afford."
The first to ignore his advice, personally and politically, was Haughey himself. Quickly, all those terrible things he warned against came to pass.
"When I look back I still get the sense that it was terribly grim," says Cáit Ní Fhlatharta, from Inverin in Co Galway, who emigrated to London soon after finishing her degree in 1988. "Everybody was leaving, it was a case of 'when are you coming over?'."
The national debt was a crippling 120 per cent of GDP in 1986, compared to 25.2 per cent in 2006. Inflation was soaring in the high teens. Interest rates were prohibitively high. Half of government spending was absorbed by the public service. Civil servants were awarded an extravagant pay increase of 18.3 per cent in 1981 that exacerbated the crisis. And tax peaked at 65 per cent at the higher level for a period, prompting hundreds of thousands of people to march on the streets of Dublin for tax equity.
Unemployment peaked at more than 17 per cent between 1985 and 1987. In terms of numbers, that was a quarter of a million people on the dole. It would have been worse, only for the use of the one safety valve Ireland had for hard times. Net emigration crept up during the 1980s and peaked at 46,000 in 1989. But other research suggests the true figure was higher - as high as 70,000 per annum by the late 1980s.
Deaglán de Bréadún of The Irish Times did a series on emigration in early 1986 and found that south Connemara was denuded of young people. He came across well-qualified graduates in Co Sligo, all beneficiaries of Donagh O'Malley's free education revolution, doing menial factory jobs. Later that decade, football clubs in places such as Lettermore in the Gaeltacht were unable to field teams because their young men were in Boston or Chicago.
Those leaving school or college faced stark choices. Many thousands sat the Civil Service exams, vying for a paltry number of positions. There were massively over-subscribed lotteries for Donnelly and Morrison visas to the US. Those lucky enough to get green cards felt they had struck gold.
For many, the choice boiled down to becoming an illegal alien in the US or going to Britain. And before Ryanair came along in the late 1980s, that meant enduring a marathon journey on the ironically named Supabus, which availed of the late-night ferries, crossed Wales into England, and arrived in London at dawn. Hundreds of young Irish people were dumped by buses and planes in unfamiliar cities on a daily basis.
Author Joseph O'Connor summed it up evocatively and mock-heroically in a piece he wrote for a UCD publication. Writing about the disorganisation of his graduation ceremony in 1984, he said the queue awaiting the conferring of their degrees fast assumed biblical proportions.
"A don stepped forward to assist the president," he wrote. "As we filed dutifully past, he uttered to each of us the words which would neatly sum up what it was to be young and Irish in that pre-boom era: 'Congratulations, keep moving please.'
"You could see the water-tower at Belfield as your plane took off from Dublin airport. And you thought of the place often, in London or New York: that cluster of draughty buildings just off the Stillorgan dual carriageway in which you had come of age."
THAT WAS A standard experience. "You got out of college and the economy was in recession," says Michael Cahill, from Rockbarton, Co Galway, who left Ireland in 1986, soon after graduating with a commerce degree from NUI Galway. "Back then, it was the last guy leaving Ireland switches off the light. Just about everybody was emigrating. I was one of five siblings. All of us left for the US and Britain within a year of each other. When the recovery came, three came home and two of us stayed on."
Ní Fhlatharta travelled by Supabus to London in 1988. "I had never been outside Ireland before and I wanted to stay at home, but there was nothing happening," she says. "I was lucky in that I had two sisters living in Tooting and I bunked in with them. I had a degree and HDip, but they were no good. I spend two years pounding the pavement and working in job agencies. The money wasn't great. I worked in a record factory, packing records, before getting a permanent job with Westminster Council."
The exodus was such that support agencies for Irish emigrants, more or less dormant since the late 1950s, sprang up in British cities for those who found themselves struggling with accommodation, or alcohol, or the shame of being unable to find a job or return home. Mary Cummins, writing for this newspaper in 1986, reported that many young Irish people ended up living in hostels, lining up for the early-morning hiring fairs of labourers on Cricklewood Broadway, getting targeted by the National Front, and drinking at dance halls where the Wolfe Tones and other Irish bands regularly played.
Unlike in the US - where most of the Irish quickly bought into the lifestyle - there was a sense of inferiority in some Irish people who moved to Britain.
"It was the era of the Prevention of Terrorism Act, and that had an effect," says Ní Fhlatharta. "I remember going for an unskilled job in the packing section of Harrods and not getting it because of my Irish accent."
The prevailing mood became one of bitterness over the decade.
"There had been emigration in the 1950s, but what happened in the 1980s was different," says Jim Fahy, RTÉ's Western Editor, who reported widely on the phenomenon. "The 1980s generation were just locked into that notion that the country had failed them."
In the years between 1988 and 1990, just before Christmas, Fahy would film emigrants coming back through Knock Airport in Co Mayo, and all the excitement and jublilation. A few weeks later he returned to watch them depart.
"It was snowing heavily one year and people were streaming out," he says. "It was raw and very distressing. Bishop Tom Finnegan from Killala arrived, saying he wanted to be there to witness what was going on. He said that he, as a church leader, had a responsibility to reflect the anger and heartbreak. It was dark and the snow played on the faces of families departing. It was a moment when we captured on film that despair and bitterness."
Thirty years earlier, journalist John Healy wrote of emigration from his native Charlestown and of the train passing that point at the end of the platform from which, parents knew, there would be no return. "I often felt that I was looking over John Healy's shoulder at Knock, 30 years and more later. You sensed exactly the same desolation," Fahy says.
It wasn't any better for those who were left at home. Mike Allen, now general secretary of the Labour Party, was working for a start-up (and cutting-edge for the time) information technology company in Galway, which closed in 1984 after a prolonged demise.
"There were 120 graduates working there and another 40 people inputting data," he says. "When we did close, it did not merit a mention in the national newspapers. There were so many closures."
Allen became involved in setting up an unemployment centre in the city, one of many scattered around the country, which eventually became part of the Irish National Organisation of the Unemployed. This provided services from advocacy to welfare and housing advice to a constant stream of people coming in.
"I remember the unemployment exchange was in the Claddagh, near the quay," Allen says. "The queue would stretch all the way along the quay, with hundreds of people having to stand in the driving rain for hours." Allen says he does not believe in "wartime romanticism" and has no nostalgia for the period. "It was all very hard. You got to see what really hurt. People came in whose lives were shattered by losing a job, losing their home and seeing their families break up. It amazed me how people kept going."
Joe Connolly, from Dublin, was typical of somebody who kept going. At 32, he found himself on the dole after 16 years in a job at the Clondalkin Paper Mills. The mills closed in acrimonious circumstances that involved two workers going on hunger strike and an occupation of the mills by workers - including Connolly - that lasted three years. Connolly eventually found himself one of those "people on the dole who did not want to be on the dole". Living in Tallaght, the crowds at the labour exchange reminded him of a cattle stampede.
"I had two young children," he says. "One Christmas after buying the presents, all I had left in my pocket to tide me over the whole period was £2.50. It was tough. My own parents had it tough in the 1950s and in a way we expected it. Everybody went to Thomas Street to get cheap bargains . . . You survived, by doing bits and pieces, but you survived. Now we are all under pressure of time. I can remember then that it was the other way round: you had too much time to think."
Fahy and others identify 1988 and 1989 as the trough, when the recession had the worst impact. But like snows in January, problems that seemed long-term and intractable seemed to evaporate almost overnight. "Within a few short years, people were seeing themselves as commuters," Fahy says. "And they were coming home too. Very quickly, that feeling of gloom lifted."
For her part, Ní Fhlatharta had always dreamt of working in film and returned home just as a nascent Irish-language TV service was developing in 1992. Connolly worked in landscaping and decorating, eventually returning to printing, and is now employed by Oireachtas Éireann. Cahill, a former banker and now a property developer in Massachusetts, made the step-change decision that he would remain in the States. "We had the American wake in my house when I left in 1986," he says. "Then, in the US, we had the reverse. We had Irish wakes when people started going back home in the 1990s. Ireland had done a 180-degree turn."
THERE IS NO likelihood of another 180-degree turn, plunging us back into the 1980s, according to economist Prof Michael Cuddy of NUIG.He says that the prime driver of expansion in Ireland in the 1990s and 2000s was foreign direct investment, mainly from the US, in high-income sectors such as software, medical appliances, pharmaceuticals, engineering and financial services. That expansion led to a further expansion in consumer goods and services, including an increased demand for housing. Wages, prices, and the costs for services all increased.
"There has been a bursting of the bubble in the housing market," says Cuddy. "That is all that has happened. Yes, it has had a marked knock-on effect for all the ancillary services. It's not the end of the world right now. There's a downturn in the housing market. That came on the back of an expansion that was not justifiable, with banks willing to lend at 100 per cent."
Cuddy identifies the high cost of labour and services as the biggest threat. He also says that capital investment in transport infrastructure must continue, to help competitiveness. "In the 1980s, we were in a terrible state. Borrowing was about 120 per cent of GDP. Then we had a lot of manufacturing. Now we have become a service economy. Our planning and the strategies of government agencies have become very sophisticated."
James Wrynn, of Dublin Institute of Technology, says we are no longer even playing the same game as in the 1980s. "There is no comparison. The platform of wealth upon which we are operating is completely different. There are two million people in employment. There were one million people employed then."
Like Cuddy, Wrynn identifies housing as the culprit. "Construction accounted for more than 20 per cent of the economy in the peak year of 2006. Half of this was housing. If housing is halved from 90,000 units to 45,000, this takes 5 per cent out of the economy. So zero growth or small decline means the rest of the economy is holding its own and is in fact growing. That's respectable.
"What is happening now is a cyclical downturn caused by mismanaged housing policy, and now married to external shocks . It could develop into a deep recession if not carefully managed."
Anecdotally and visually, there is evidence. Fahy has noticed queues lengthening outside the social welfare office near his base in Galway. Dublin pawnbroker Patrick Carty says the jewellery side of his business has been quiet since Christmas, but not so the pawnbroking side. "There are definitely people coming back to the pawn shop. There are always people who need the service. Banks are not lending now, so there is always a niche for us."
Another thing Carty has noticed is the increase in the number of non-Irish people coming in. Fahy also points to the number of non-Irish in the growing queues of unemployed. Many suspect that the worst aspect of the ESRI projections - a net emigration of 20,000 next year - will mainly involve not Irish people but those who have arrived here in the past decade.
"The generation who grew up in the 1990s never experienced failure like those who went before," says Fahy. "I find it hard to imagine that they will ever see the depths of despair that those others saw."