As well as setbacks on the field of battle, one of the main reasons behind Sweden’s retreat from being a great military power in the 17th and 18th centuries was because it was the first country to have a census.
The first Swedish census was held in 1749 and showed the country had a population of 1,764,724. The military high command was shocked, not by how many Swedes there were, but how few.
Back in those days, before real statistics, population sizes were largely guesswork. The Swedes, who in the previous 50 years had gone to war with Russia, Poland, Estonia and Denmark, were regarded as a great military power along the lines of France or Britain.
They fully expected to have a huge population commensurate with their political clout.
When they realised that their population was a modest 1.76 million, the first thing they did after the initial shock subsided was to keep it secret. They knew that the likes of Russia and France had huge populations, but those countries had no idea theirs was so small. They knew straight away that they hadn’t enough people to fight prolonged wars, so better to make peace now before their enemies found out how few Swedes there actually were.
This began the great period of Swedish peace and neutrality which has lasted right up until today.
The Swedes were the first country to embark on what could be called evidence-based policy rather than operating on the feeling or instinct of experts.
Statistics may sometimes be regarded as boring and humdrum, but in fact are a sign of enormous sophistication.
Sophisticated societies measure things accurately, and normally when you base your policies on measured evidence, outcomes are likely to be better.
With this in mind, let’s look at an important piece of statistical evidence presented last week by our own Central Statistics Office on the mindset of the average consumer. Every three months the CSO surveys 18,000 households. The statisticians collate the results and they give us a good snapshot of the types of financial conversations that are being conducted around kitchen tables all over the country.
The latest CSO survey data paints a grim picture of a stalled domestic economy.
Eight out of ten households in Ireland have cut back expenditure in the past year. Some 65 per cent of people are going out less often, two-thirds have cut back on clothes and shoes, and just over one in every two households is spending less this year on groceries than they were last year.
Of course, never far away is the massive mortgage timebomb which is primed to go off all around the country. An estimated 15 per cent of owner-occupied households with a mortgage were unable to make mortgage repayments on time at least once in the previous 12 months due to financial difficulties.
Interestingly, the fact that 19 per cent of all renting households failed to pay rent on time at least once suggests that, despite significant falls since 2006, rents are still too high. This could reflect unrealistic expectations from buy-to-let investors who may be keeping rents high simply to stave off missing their own mortgage payments. If this is the case, it reveals how the debt mountain jaundices all prices in Ireland, even those that might not be directly related.
Two fifths of individuals were concerned about their level of personal debt. Over half of these said that they were currently more concerned than they had been 12 months previously. Only one home in 20 indicated that their level of concern had decreased.
The survey also gives an insight into just how precarious the position of the average person is at the end of the month and the fragility of people’s financial balances.
For example, out of households which had experienced difficulty in managing bills and debts, 47 per cent stated that this financial insecurity was due to falling income, largely due to someone in the home losing their job, their hours being cut or taxes reducing take-home pay.
However, a higher proportion – almost three quarters of all those in difficulty – cited a higher than expected bill or something out of the blue that they hadn’t seen coming.
When you drill a bit deeper into the survey, you see that 90 per cent of those in difficulty mention that a higher utility bill was enough to tip them over. One in three mention a higher school bill or university cost. Here we can see the middle class suffering. These are households that on the outside might appear to be doing fine, but inside they are one small financial shock away from economic chaos.
Now we are into the marrow, because almost a quarter of all adults reported that they had spent some or all of their savings on basic goods and services during the 12 months prior to the survey period. For thousands, the rainy day has arrived.
But things are not the same across the board because, while 30 per cent had reduced the amount being added to their savings, 11 per cent either increased the amount being added to savings, or had kept their stock of savings at the same level, or had actually started to save.
But you know what happens when people start to save and banks aren’t lending? Demand dries up if too many are saving because too few are spending, and without spending there can only be falling income. And, of course, when income is falling, debts as a percentage of this falling income go up. This means we all have to run to stand still. But we can only run for so long.
This survey – the quarterly national household survey – is the type of evidence that our politicians should be looking at rather than listening to the debt service agency that is the troika.
Like the Swedish census of 1749, surveys like this show what is actually happening in the country. This is the power of evidence. The Swedes had a choice; they could have ignored the evidence and listened to the king’s council of experts at the royal court which claimed that Sweden was still a great military power with imperial ambitions. Instead the Swedes listened to the statisticians and considered the actual evidence.
Today in Ireland, the equivalent of the Swedish royal court are the civil servants who obsess about what their counterparts in Brussels or in Frankfurt are thinking. Their concerns are buttressed by the small number of people who are making money out of turning Ireland into a large debt service agency. They high-five each other with a form of manufactured consent, suggesting things are going well, considering.
All the while, the actual statistical evidence screams the opposite.