‘The money is good and the suntan is free. You could fry an egg on the stones here, if you had an egg. And you could certainly sink a pint of Harp, if you had a pint of Harp.”
Do you remember that? The classic 1980s ad for Harp produced that famous line about “Sally O’ Brien and the way she might look at you.” It must have some magic to stay in the public consciousness for so long. The ad, first aired in the early 1980s, spoke to an Ireland of emigration and home-sickness felt by an emigrant out in the desert on good money, but having no connection with the place.
I am writing this from the middle of a different desert. It is 107 degrees today in Arizona and visiting the Irish Centre, here in Phoenix, reminded me of the ad. It is unbearably hot and talking to the many Irish ex-pats who have rocked up here in the desert reminded me of the bloke in the ad writing a letter home lamenting the things he missed.
However, Sally O Brien and emigration apart, one of the other things that has struck me in Arizona is the amount of frail elderly people working – putting in long hours working at shopping malls, garages, cafes and fast-food joints.
It is disconcerting to see women and men well into their late-70s, and in some cases older, working in jobs that pay the minimum wage. To a European, who expects a welfare state to look after us when we get older, the notion that we’d still be lugging ourselves out of bed, putting on some polyester uniform, beaming, “have a nice day” while on our feet for an eight-hour shift, seems all wrong.
But that is the reality for many Americans and it is very noticeable down here in the sunshine states, which have seen a huge migration of older people in the past three decades from the cold north.
Could this be the prospect for my generation in Ireland?
Yesterday, this paper carried a story that only half of workers in their 30s and 40s are saving for a pension. This generation has been most severely affected by the housing bust and is at the stage of their lives when they have young children and teenagers, so it isn’t surprising that there is hardly any money left at the end of the week to save. Yet, the same survey revealed that four out of 10 of them are concerned about having enough income for retirement.
The ability of a country to provide a pension system for its older people depends on having enough young people working to generate the tax income to divvy up to the older ones. That’s the deal. Therefore the system is dependent on having enough jobs for the average person and it is also dependent on there being not too many older people.
However, two structural issues immediately raise their head. The first is the fact that advances in medicine mean that we are all living longer. In 1961, there were 315,000 people aged 65 or over in Ireland; by 2011 this number had increased by 70pc to 535,393.
The second is the fact that more and more young people can’t find a job and without jobs there is no income to pay for the pensions.
One of the major questions is where the jobs will come from. Since the 1970s, there has been a dramatic fall-off in employment opportunities all over the Western world. For example, in the US in the mid-1970s, one person in 15 was unemployed. Today, the figure is one in six and that is after five years of the most active economic stimulus on record.
In Ireland, we know that the figures are worse on every comparison but many of us content ourselves with the fact that this is a function of the economic cycle and the worst recession in the developed world, where national income has fallen by one-fifth, domestic demand has fallen by one-third and there are over 200,000 fewer jobs in the country than there were in 2008.
But what if the lack of employment opportunity is not only cyclical but also structural – meaning that the gradual process of globalisation is moving jobs away from the country and they are not likely to come back?
A way of looking at how this process is developing is to look at the rate of inflation in various sectors since the Sally O’Brien Harp ad. If we take 1983 as our starting point and we compare the prices of various things we spend our money on, we can see how certain industries have been decimated and how certain ones have grown.
If we start at 1980 and price everything at 100pc, we see some very interesting patterns developing which have profound implications for job opportunities in the future.
For example, if telecommunications cost the equivalent of €100 in 1983, today it costs €98. Amazingly, despite the huge improvement in telecoms, it actually costs less today than in 1983. This is competition, technological advances and globalisation.
On the other hand, a day in hospital is now 511pc, or five times, more expensive than it was in 1983. Similarly, the cost of education has gone through the roof and is now 440pc higher than it was in 1983. The costs are mainly wages, so the industries to be in are clearly education and health. But these are not traded industries in the main, so we will have to sell something new to pay for these sectors.
And what might that new thing be?
The fall in the price of phones shows what has happened to employment and wages in manufacturing – people have been replaced by technology. So what is going to change to bring back manufacturing in order to employ the average guy?
And if we don’t find a sector in Ireland that might absorb hundreds of thousands productively, how will we generate the cash, which might pay for the pensions of people in the future? The cost of education and health are largely financed by the public purse, which is also dependent on the taxes from selling stuff at a profit.
This is the big conundrum facing the national economy and it is not easy to find the answers. However, one thing is clear: if Ireland doesn’t find that new industry or set of industries, the prospects for today’s thirty- and forty-somethings get closer to those of the elderly, minimum-wage workers of America’s sunshine states’.
Come to think of it, Sally O’Brien must be reaching retirement age some time soon. Doesn’t time fly?
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Time is how you fill it
The disgusting fact, all discussion aside, is that the ability of Ireland to provide a future for our young and by extension the entire Country has been sacrificed in the name of saving bloody Banks who care not one single jot for any of us!
Paradoxically, the introduction of technology into the health system has been an abject failure to improve cost or labour efficiency. Is it that there hase been a checking of progress every step of the way ? Or perhaps there has been an abject failure of management ? With education, costs might be going up, but standards are slipping. A lot of this is cultural. As society becomes more consumerist, and more superficial, exercises like reading and studying lose their importance. Concerning the pension system – the PRSI contributions of the decade of debt fuelled spending, has been thrown at the… Read more »
“This is the big conundrum facing the national economy”
Good article, political in nature thankfully.
Re above; the corporate sociopaths don’t care about the economy, old people or 40 something’s. They maximise profit and live in gated communities.
Sun tzu said you must know your enemy before you can deal with him David. More politics please David and less economic analysis based on a normal healthy rational persons view of the world.
David, medicine and education will follow suit. These too will be engineered and computerized as will all white collar disciplines. Even computer programming will be computerised. So we are all out of a job – except for the “elites” controlling it – but wait, are we not trying to predict a future based on the rules of the present? The fact is that most people who go through the education system as we know it wind up as generally useless. We are all rushing to get points for those jobs that pay the most. Pretty well like buying shares when… Read more »
Even those of us who have been paying into a pension fund for decades are unlikely to ever be able to retire. My pension fund, started when I was 24 years old, is worth less than the money that has been paid into it, and most of my middle-aged friends seem to be in the same situation. The answer, for those of us lucky enough to not have been caught in the property crash, is that we will emigrate. We will rent out our houses in Ireland, and live on the rental income in warm, low-cost places. Even in cheap… Read more »
Sure we’ll be grand David!!!
Don’t you know the American Multinationals (that pay no tax here) will supply endless jobs and prosperity for all!!!
Now move along people….
The system failure providing a suitable lifestyle for the elderly and a provision for opportunities for the young is because the existing system failed and not because of more older people are living longer . The failure of the English language to give insight to the obvious solution is the real problem and the dumbed up soap talk we watch on TV contributes to that . More elderly will continue to arrive and that should not be seen as a detriment or obstacle to the advancement of society . There are simple solutions and our failure to see those is… Read more »
I know people who spent a lifetime “working” in the c service, 20 yrs after retirement they are still being paid 35 k per annum. Completely unaffordable in a small stagnant economy. We will pay a high price for the crazy increase in the birth rate over the past decade, 65,000 new school leavers looking for paid work each year ! Rents in Dublin have barely fallen despite the collapse in the housing market, yet another problem . Americans are great @ taking any kind of job, most school leavers here wouldn’t take a restaurant job in a million years.… Read more »
I’ve come to the conclusion after years of ‘engaging’ with the General Public: The General Public consider you knowledgeable when you talk about the present economic problems that they are experiencing. The General Public consider you knowledgeable when you talk about how inaction to address their present economic problems will worsen their problems in the future. The General Public consider you a CRANK when you talk about solutions to the present economic problems that they are experiencing. The General Public are generally happy with the present economic problems that they are experiencing as long as some CRANK does not bother… Read more »
Funnily enough Sally o Brien was the the Mistress in Allo Allo and that scene was done in the Harbour bar in Bray.
I wrote on this topic in the Irish times.
http://www.irishtimes.com/debate/the-jilted-generation-ireland-has-spared-the-old-but-robbed-the-young-1.1397504
I think you are spot on in a lot of what you are saying.
The outlook for people in their 20’s-40’s now is grim.
Another aspect is that from the CSO virtually nobody who is renting even those over 35, has a pension. This is double trouble as people wont have a free place to live when they retire.
Hi Eamon, Well written piece. I an intrigued that you cited the ESRI study about this problem which was published in 2013 and told what has happened, anyone can do that. But you didn’t refer to not the book and doucumentary which foretold it all and was publihed six years ago before the crash – The Generation Game? http://www.amazon.co.uk/The-Generation-Game-David-McWilliams/dp/0230706517 http://www.goodreads.com/book/show/2520129.The_Generation_Game Why is it thst so many Irish writers wait until somethign is confirmed by some State institution or other before they write and then don’t even cite that this has all been predicted and put squarely in the public domain… Read more »
Gold won’t save the day Neither will an Punt nua Our politicians and voters are allowing the banks to continue with their programme of devastation… so what not castrate these banks and reinstate Glass Steagall? as for the future?? …well if the derivatives bubble goes ‘KABOOOM’ and it’s a good bet it might,then we will be blown back to the Stoneage! DMW,who can’t seem to help himself remind us of his Oracle status, can’t or won’t devote even one article or even a few contributions here on his own blog about Glass Steagall…his silence is simply deafening and David,even Homer… Read more »
Well, Larry Summers has withdrawn from the race to be Fed Chair. Jannet Yellen will presumably take the position. To be honest, the decision is of no relevance, when the priorities of both are the same. And the priorities of both are Wall Street. And let’s face facts – after Duisemburg stood down in the ECB, the priorities of the ECB have been at the same level. And now the Irish banks are accountable to the ECB. The ECB is increasing it’s power all of the time. And it does not care about who pays for this expansion. Let those… Read more »
“If Ireland doesn’t find that new industry or set of industries, the prospects are …” So it’s wait for the ‘next big thing’ to sweep us up in its wave then? But what is this next big thing? What’s it going to be? Does you even have an idea of what it might look like? The last ‘big thing’ was, broadly speaking, computerisation and the technology following from it that transformed workplaces. That wave has more or less subsided – the dividend has been reaped. Whatever new industry, or set of industries that comes along in its wake, will not… Read more »
Short posts are effective and deadly. Monologues are interesting but no-one cares.
So what do we do people? Would you allow someone put you across a table and f**k you up the a** without your consent? We’ve allowed these people to do that to our State, by failing to protect our poor and vulnerable, by failing to protect our children who are emigrating,and therefore failing to protect our future. Do we shout stop or keep suggesting a different brand of lubricant every week?
Yesterday my lawn was cut and finished and it beamed under the sunshine .So clean nothing on it and the greenery in abundance . A bird landed and another and then another .They walked around it looking busy .There was no bread or seed left out for them and still they were looking very busy . I watched .I could not tell the ages of them and it did not matter .They continued walking around .Their necks twisting sideways and stopping ………and they seemed to be listening directing their ears sideways towards the grass . Then they suddenly scooped …a… Read more »
As Obama Crumbles, More Voices Are Heard for Glass-Steagall
The checkmate that Putin organised has opened the door. Was Obama and his ever-lovin’ Queen prepared to go to war to avoid this? Cameron did a real about turn, I am sure the Royals are not amused.
Now to call this Glass-Steagall action “hijacking” when Obama/Bush have hijacked a plane full of politicians including Noonan et al, and are flying the entire thing right into a fiscal building, in the manner of Obama’s favorite terrorists, is missing something , would’nt ye think?
Bonbon you have me almost sold on the Glass-Steagall stuff but would you please go out and have a few beers and chase a few women(or men if that’s your thing). You are fixated on the GS thing. There really is more to life.
Jesus Bonbon, Glass-Steagall again? Build a bridge a get over it.
Hello David,
Remember max keiser?
Very sobering video 2nins or so.
http://www.youtube.com/watch?v=v2GK0XJhsJs&feature=youtube_gdata_player
Maximillian… 500 not out. A mini-milestone!
Oyez Oyez OYEZ… The pravda-esque propagandists in RTE have been at it again. . . On the Six one news yesterday at the top of the bulletin Mr Dobson exclaimed triumphantly “Ireland is out of recession!” All he was missing was his town criers hat and bell! The basis for this was a CSO report (also appeared in the I.T.) which showed 2nd quarter growth in GDP OF 0.4% As foreign repatriated profits had also risen in the quarter ,GNP dropped by 0.4% (which he omitted to mention!) This merely evened out the GDP contraction of 0.4% in Q1, plus… Read more »
Some more sober viewing from keiser.
http://www.youtube.com/watch?v=GLQbAvK9Wws&feature=youtube_gdata_player
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Five Months Workfare Introduced To Train Young People To Be Apprentices
http://johnnyvoid.wordpress.com/category/tory-scum-3/
Look, I ask is we somehow let things breath. No prescription. No Rules other than do not screw with others trying to breath.
People who sail and know how to manage a spinnaker know exactly what I mean.
If you want to retire with grace then one has to be educated to reality.
Reading this whole news letter will be a good start.
http://campaign.r20.constantcontact.com/render?llr=n7vdaxbab&v=001hkrcbzQb4VWu8eZEuI0S8Fmi9oj6TjNVWazoTl78tilG5PZlvWHVYgIJreLjEdEhoXoO1RSfA88ib2uJpHxzFxaTnmlQ-m6VNny-pU6zqJwqMibTTpIPfJM9PxA3Bz6l
It would not hurt David to read it either.
Crazy Buffett Declares the Fed “The Greatest Hedge Fund in History”.
Buffett evidenced his terror at what is about to hit the financial system by praising George W. Bush for coming out with “the economic insight for all times,” when he said in 2008 that “if money isn’t loose enough, this sucker could go down.” He praises Bernanke, who cannot land his money helicopter anytime soon.
How’s that for insight? Terror does drive oracles insane!
I think DMcW maybe has seen a glint of the policies at work – but to make it a bit more clear for the befuddled (ex-) Tigers I posted aabove a very brutal expose of what is in motion right now. Ever hear of Blair’s N.I.C.E, or Obama’s “evidence based” healthcare? These are nothing less than useless-eater programs, today under cover of “better decisions”. This may upset the polite company here, and perhaps DMcW’s social club. Another look at the Triple Curve, and realize what a plunging physical economy means – depopulation and cutting longevity to “manageable levels”, for the… Read more »
Now back to the EU, Health Care Collapse in Greece Spells Troika ‘Genocide’
The bail-in, now official policy, tested in Cyprus on Enda’s watch, is a just a glimmer of what is intended for the entire OECD. Try “gracefully retiring” then! As testified at the 1947 trials, it was considered much easier in 1935 to start the useless-eaters program in emergency conditions. Would the collapse of even one of the Too Big to Fail, Deutsche Bank, Morgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley, be exactly what’s expected to open that door again?
‘Growing old disgracefully: Where elderly can never afford to retire’- The above caption invokes the fringe economics of ‘demand and supply’. By extention and not straying from that expression it eventually should lead us to ‘ Resurrection Men ‘ or body snathers who would disinter the recently deceased and sell their corpses to medical schools and surgeons for dissection fuelled by speed of science research . Increase demand gave rise to the illicit trade in fesh cadavers and this trade was carried out by Gangs . In t early nineteenth century this trade prospered To veify this visit Glasnevin Cemetry… Read more »
Welcome back Adam by the by!