WORKINGTON in West Cumbria enjoys “Uppies and Downies”, its very own version of mediaeval football. Around Easter the two ends of the town mass as teams and fight over the ball. Pity the ball.
Our national discourse reminds me a bit of this, with the sophisticated addition that there is no crisis, issue or moment too grave or unique to be wedged into the game as another ball to be played for.
The banking crisis? That will do, lob it in. The banks were Scottish therefore proving Scotland can’t can’t can’t.
Ireland falls? Ireland is a small independent country ergo that proves that Scotland can’t can’t can’t. Hurrah.
Greece is in crisis? Hang on, Greece is in a currency union and St Andrew is the patron saint. Wahey – it is yet more incontrovertible proof that Scotland can’t can’t can’t.
But it would, in truth, be hugely instructive for all policymakers and politicians in Scotland to reflect more deeply on what got Greece and Ireland into their respective pickles and what has made it so much worse for the first and better for the second.
Incidentally, the latest forecasts of the International Monetary Fund place the performance of the Irish economy in terms of wealth created per head (GDP per capita) as ranking ahead of the UK at 14th compared with 27th. Interesting.
Nothing is straightforward of course. Some would like us to think of this as a simple battle between two competing orthodoxies of (loveable) Keynesians, who prioritise growth over austerity, and (evil) Austeritites, who want cuts to be severe and immediate and care not for the lean muscle that is slashed along with the fat.
Let’s be clear, in a simplistic binary choice I side with those who prioritise growth. But seeking and achieving are quite different things.
Borrowing through a crisis can ease the stresses on the muscle of the economy and the welfare of people, but only if someone is willing to lend and there is an end in sight.
Devaluing a currency can buy time and some export growth and so close the trading deficit that needs financing and therefore help. But it is only a temporary boost to buy time. Growth is only sustainable if the country produces something of value that competes in the world and gives others something they want to buy but can’t produce as well as you.
Portraying this as a political struggle between the left progressives of Greece and the evil empires of the right is also simplified nonsense. Greece is in a mess of many generations’ home cooking.
It’s not the euro that has caused Greece’s deep-seated problems nor does Greece destroy the euro. Greece is the outlier. Ponder that reality.
Neither improves the other’s welfare just now but nor did they create it.
These woes would be faced irrespective of which currency Greece used. Why? It doesn’t work hard enough, pay tax squarely, doesn’t produce enough things that others want to buy and expects too much for too little. Just look at those pensions. The result? The gap between its imports and exports is so vast that it depends on borrowing which is no longer available, and certainly not at the price it once was.
Ireland’s story rhymes, but is different. With inflation running at a higher rate than interest rates it seemed illogical for everyone not to borrow, until big debts no longer made sense.
The big difference I observe between Ireland and Greece is that Ireland has fundamental assets in both its economic base and structure and its political stance that give it a far greater chance of sustaining the wealth it currently enjoys.
An open, export-focused, knowledge-led economy, it has used its manifold charms and wiles to attract exporting companies to its shores, by hook or by crook. Greece in contrast offers tourism exports and very little else.
Ireland faced into its own hurricane and endured major restructuring pain that reverberates in its politics now.
The Greek stance buys brownie points for a minute at home but we all know the politicians involved will be long gone before the full pain is felt and the long-term solution realised.
So what do I take from it all?
That there is no free money solution to any problem. Beggaring the next generation is the ultimate badge of shame for any current one. Debt and deficits must be fixed with purpose. We owe it to our children.
But in doing so we must have a proper eye on genuinely understanding what it takes to build the exporting muscle of our economy and the strength of the tax base.
And when it comes to the country we seek, recognise that open, trading, welcoming and engaged is exactly the pose we need.
We need a giant “welcome” sign to job creators, wealth creators, innovators, exporters, investors, employers. That’s where the muscle will come from. Give the masses a stake in the gain that comes from wealth creation rather than a jealous attack on those who already have one.
There are lessons for all of us in all of this mess, but to learn them takes a calm long term sook. Less noisy battling for the Workington ball and much more of that famous native wit we kid ourselves is our national inheritance. «