In a recent issue of The New Yorker, an article by pop-sociologist Malcolm Gladwell (author of The Tipping Point and Blink) yokes together the decline of General Motors and the rise of Ireland Inc. The connection is demographics: just as the ratio of active workers to retirees became a major burden on the American behemoth, the ratio of workers to dependents in Ireland started to become favourable. Apparently, the belated Irish Wirtschaftswunder is all down to the fact we stopped breeding like rabbits:
But, as the Harvard economists David Bloom and David Canning suggest in their study of the ‘Celtic Tiger,’ of greater importance may have been a singular demographic fact. In 1979, restrictions on contraception that had been in place since Ireland’s founding were lifted, and the birth rate began to fall. In 1970, the average Irishwoman had 3.9 children. By the mid-nineteen-nineties, that number was less than two. As a result, when the Irish children born in the nineteen-sixties hit the workforce, there weren’t a lot of children in the generation just behind them. Ireland was suddenly free of the enormous social cost of supporting and educating and caring for a large dependent population. It was like a family of four in which, all of a sudden, the elder child is old enough to take care of her little brother and the mother can rejoin the workforce. Overnight, that family doubles its number of breadwinners and becomes much better off.
The demographic dividend has been long recognized as a factor is Ireland’s recent, much-hyped success (although, as I think historian Tom Garvin pointed out, it isn’t so much that we started succeeding so much as stopped failing). However, this factor seems to belong way down the league of reasons for economic awakening–the interlocking forces of EU membership, low interest rates, and massive inward investment by multinationals seem far more plausible locomotives. (And during the 1980s wasn’t there quite a lot of potential breadwinners queuing in dole offices?)
And just as Gladwell’s magical source of affluence seems a tad glib when applied to Ireland, his diagnosis of GM also seem slightly simplistic. For surely the American automaker’s woes are not just down to medical and pension costs. A bland product range, better cars from (mainly Japanese) competitors, and a dependence on SUVs and trucks as cash cows while oil prices doubled must have played their roles as well.
Nevertheless, even when you think his overall argument is tendentious, you usually learn something reading an article by Gladwell. It’s just that his journalism is analogous with the way the knight operates on the chess board: he get from his starting point to his destination via a trademark jump, disdaining the plodding steps of evidencing other might feel obliged to take.