The Wealth of the Nation report by Pat O'Sullivan of Bank of Ireland Private Banking produced an arresting headline this week: Ireland is now the second wealthiest country in the world, after Japan, and ahead of the UK, US, Italy, France, Germany and Canada, in that order.
Like many statistics, though, the headline did not tell the full story. The report's breakdown of net financial assets - excluding residential property, pensions and company equity - rearranged the table drastically, reducing our net wealth per person from €148,130 to €18,188 and placing us a distant eighth in the same league table and less than half that of the UK (€46,852). As another report this week, by Jim Power for Friends First put it, we are growth rich and wealth poor compared to those countries whose wealth has been building for decades.
There has been an astonishing rise in wealth in Ireland in the past decade, albeit from low levels and mostly on the back of the local residential property market. How it has come about depends to some extent on who is doing the explaining. With a general election coming next year, however, it is no harm to remind ourselves that the transformation is the result of political decisions, especially as some people seem to think that economic growth is now self-perpetuating and impervious to political actions.
Ireland's appalling economic performance in previous decades - which effectively expelled hundreds of thousands of citizens from this State and condemned many who remained to restricted opportunities - was also the result of political decisions which allowed entrenched lobbies - the public sector, farmers, trade unions, professionals - to dictate policy and keep their own members relatively comfortable and the country as a whole poor. One of the most important decisions in creating the economic growth of the last decade was the political consensus to join the euro, taken against the advice of most economists who argued that we should only do so when Britain also joined. Not alone did it lower interest rates dramatically, it helped to curb the power of the traditional lobbies at least while the conditions of joining the currency were met.
The political choices in next year's election are likely to hinge on the national cake, that analogy for the economy. Parties of the right are usually concerned with expanding it, those on the left with how it is shared. The problem with the latter is the tendency to simply hold on to what we have and try and rearrange it. This often results in stasis. The problem with the former is exemplified in the Bank of Ireland report: the wealthiest 1% now holds 34% of the State's net financial wealth.
There will be plenty of opportunities to debate the pros and cons of each approach in the run-up to the election. We should avoid the traps of the past and not allow public policy to be set by well-organised vested interests, spin-doctors and lobbyists, either of the right or left. And we should not be fearful of immigrants or economic growth and the wealth and possibilities they can bring.