A nation once again? Don’t put too much money on it…

I am a big fan of David McWilliams, partly because he is a brilliant writer on global affairs, and partly because I view him as something of a role model when it comes to Devil’s Advocacy! From his latest example of both, he rightly earned a place on BBC NI Talkback yesterday.

Mr McWilliams is of course right to say that the UK’s departure from the EU would set in train a domino effect. He is right then to use the word “could” about the outcome of that domino effect, but certainly it makes Scotland’s departure from the UK likelier; in turn, a UK of “England, Wales, and, er, Northern Ireland”, especially outside the EU while Scotland and Ireland were in it, would be a simply ludicrous as well as incoherent construction.

However, there are a few aspects of his Devil’s Advocacy which need challenged (that is the point, after all!)

Let us start with the contention that “income” per head in the Republic of Ireland is €40,000 versus €24,000 in Northern Ireland. Actually, this is GDP per capita, which (as Mr McWilliams knows well) cannot be meaningfully conflated with actual income and (still more importantly) real spending power. Start from wages rather than productivity and then take into account housing costs, and suddenly the picture can differ remarkably. Apparently “poorer” Northerners in fact spend 20% more – on everything from fashion to fancy cars – than their fellow islanders. Far from looking South and saying “Look how much they earn”, they actually look and say “That costs how much?!”

Addendum: the clear discrepancy between Ireland’s GDP and AIC (consumption) figures can be seen here, via Eurostat.

(Let us leave aside that even GDP/head has been higher in Northern Ireland than in the Republic for the majority of the post-partition period, making a mockery of any contention that Northern Ireland’s apparent economic woes are due to the “Union”. They are in fact primarily to do with de-industrialisation in common with much of the northern UK, a situation hardly helped by decades of civil strife )

None of this is an argument in favour of Northern Ireland’s economic model (Northern Ireland is dependent on a £7-£10 billion present from the south of England every year, so there is scarcely an “economic model” to speak of at all); it is an argument that the two economies have now diverged so completely that it will be extraordinarily difficult ever to put them together again.

It is perhaps this more than anything which also explains why Mr McWilliams’ point about demographics is not working out politically as expected, something he chooses to overlook. The Nationalist vote in the electoral cycle to the start of this decade was typically around 41-42%; it has now fallen for an entire cycle to 37-38% and most recently was just 36%. In fact, far from looking South and eagerly awaiting unification, those predisposed to an all-island world view are turning away from Nationalism (and indeed in many cases to leftist parties which would make Northern Ireland even more different from the comparatively much more economically liberal and centre-right Republic).

Thus, it is not just Unionists who are ignoring the claimed “economic incentive” to join up with the Republic, but many of Nationalist background too. That is most obviously because an “economic incentive” does not always correspond to a financial incentive; and also because the two economies are now just unrecognisable from each other and becoming ever more so.

Nor indeed do I believe that (those who are currently) Unionists would ignore such a financial incentive, were one to become obvious – even the Covenant refers to “material well-being”, after all! The issue is that no such incentive is apparent (and if we move beyond assessing income and indeed general wellbeing merely by GDP, it is clear why it is not).

To be clear, absolutely none of this is good news in the case of “Brexit”. Indeed, it only serves to make a chain of events leading to Northern Ireland’s unmanaged and unplanned ejection from the EU and then potentially from a disintegrating UK even less palatable than Mr McWilliams suggests.

This is why no one in Northern Ireland should be taking the “leave” risk – Unionist or Nationalist, financially or economically.


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