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Fitzgerald's Electrical Expert Store by Singer's Corner on the Grand Parade in Cork was the first shop to show colour TV in Cork in 1970, the year of my birth. By then the Fitzgerald family had been in business for over 50 years.
Even though I haven't been near the shop in decades, I can picture the front of it in my mind's eye. It was part of the landscape of Cork when I was growing up, part of the scenery. It had always been there and always would be. Like its namesake, Fitzgerald's Men's Shop up on Patrick Street, still there, though no longer the only place someone like my dad would get his gear.
Other places might morph into new things, like the Munster Arcade, which became Penneys, and Cashes, which became Brown Thomas. But those family-owned businesses were a consistent part of life: men's outfitters like Leaders, which got a new lease of life when the Frank and Walters started buying flared jeans and orange polo necks there, and has been freshened up and is still there.
Even as small kids, we knew Mr Croft inside of Croft's, where we went to get measured for our Clarks shoes. And then Thompson's or the Green Door (bit posher) for a bun with your mother if you were lucky.
Fitzgerald's Electrical closed down recently after 90 years as a family business. I don't know why it closed specifically. I know that Deirdre Clune of the Barry's Tea family, in bemoaning the closure of Fitzgerald's, issued a call for people to support their local shops. So Fitzgerald's possibly closed for the same reasons as lots of shops – because out-of-town superstores made them obsolete as their loyal traditional customers died off and a new breed grew up who didn't care about old-fashioned service or loyalty to family businesses.
Celtic Tiger era rents are a huge issue for retailers too. Commercial properties in places like Grafton Street are now selling for a third of what they cost in the boom, but try and get your landlord to cut your rent commensurately. While some smaller landlords and, in fairness to them, Nama, have been amenable to rent cuts, big landlords have been more reluctant and the Government, perhaps to protect big property interests and the nominal value of properties, refuses to legislate to change leases with upward-only rent reviews.
Rates are proving a huge problem for lots of retailers too. And underpinning all of it
is the collapse of the local trading economy through the erosion of people's disposable income to feed the beast of austerity, surely by now the most discredited economic philosophy an establishment has ever clung to.
Shadow chancellor in the UK Ed Balls, where they are just beginning to discover the folly of austerity as they threaten to topple into a triple-dip recession, characterises George Osborne's sticking with austerity as exemplifying Einstein's definition of insanity – doing the same thing over and over again and expecting a different result.
The constant erosion of disposable income is probably felt most directly in retail. For example, in January retail sales in Ireland were down 1.7 per cent as the tax rises from Budget 2013 kicked in.
To explain the drop in retail, experts pointed to the changes in PRSI allowances which kicked in in January, cutting household disposable income by 0.4 per cent. Now 0.4 per cent might not sound like much but it is those marginal bits of household income that get spent on discretionary retail purchases. The €250m in property tax that households will start paying now will cut another 0.3 per cent off household disposable income. Again, a deceptively small figure but another nail in the coffin of a sector that has seen business down by 30 per cent in the last five years.
There is a direct relationship here. The more money austerity sucks out of the everyday economy, the less money will be spent in shops. And shops are big business in this country. While Foreign Direct Investment is the big obsession these days, sectors like chemicals and pharmaceuticals actually employ relatively few people. On the other hand, one in seven jobs in this country is in retail. That's a quarter of a million jobs. It used to be more, but over 70,000 jobs have been lost in retail in the last five years. It's devastation.
And it's not as if the quarter of a million jobs that remain are safe as houses. Vision-net did a random survey recently of 5,600 retailers in Ireland, and 2,000 of those businesses – over one in three of them – are at high risk of going bust.
Another one in five of them is at medium risk of going bust. That means that well over half the retailers in the country are at a substantial risk of going bust. Roughly speaking, that probably means half of that quarter of a million jobs – 125,000 of them – is in jeopardy in a worst case scenario.
So you know when you walk into a shop and it feels very empty and you wonder: how are they keeping going? How are they paying the staff? How are they keeping the whole show on the road without any customers?
The answer is probably that they are not keeping the show on the road. They might be hanging in there for now, going broke very slowly.
"How did you go bankrupt?" the guy is asked in The Sun Also Rises. "Two ways, gradually and then suddenly." When it finally happens, it happens overnight. Just ask Black Tie or HMV. They struggle on for ages, and then suddenly it all falls apart in an instant.
It's a fairly horrendous situation that half of the retailers in Ireland could go bust at any time. And it's not as if measures are being taken to bring these guys back from the brink. If anything, the property tax, the cutting of child benefit and further austerity measures are going to push these guys closer to the edge, and ultimately, over the edge.
It is a whole huge sector living on borrowed time, and we are doing the very opposite of what we should be doing to save it. Money is being pumped into certain sectors, like banking, but it is money that never makes it into people's pockets, or on to the high street, or into job creation.
There are many ways in which austerity is leaving permanent scars on this country. Will we ever again manage to rebuild the humanitarian society we have built up over the last 100 years and which we are now dismantling?
Will the disabled ever get back the dignity and the support that this State very deliberately chose to offer them over the years and that is now being slowly eroded? And you have to wonder too if our cities, towns, villages and communities will ever recover from the death of retail, from the obliteration of the public spaces where people interacted and traded and where money got passed around so everyone could work.
The pub is gone, the Garda station is gone, the GAA club is in decline and now the shops are disappearing too. When businesses that have been there for nearly 100 years, surviving all kinds of ups and downs, can no longer keep going, you have to wonder.
This Government now says that its major priority is jobs. If it is, then it needs to row back on austerity, which directly stifles growth, suffocates the domestic economy and causes unemployment.
One senior Government minister, Joan Burton, has accepted that we have reached the limits of austerity. The IMF has accepted this and has accepted that it was wrong about the effects of austerity. Europe at large is realising it too, though the Northern countries are slower learners. But the facts speak for themselves. There are 19 million unemployed across Europe, 12 per cent of the population. It is predicted that this will get worse in the short term. When unemployment does start to abate in Europe it will do so very slowly. It will still be above 11 per cent in 2017.
Our own economy is not looking good either. Ernst & Young just cut its growth projection for this year to a tenth of what it was – from 1 per cent to 0.1 per cent. And we continue to do things to aggravate this cycle.
It is, as Ed Balls says, madness, and what's worse, it is a dangerous madness, a dangerous madness whose effects will take decades to repair, if we can ever repair it.
It's time to stimulate. You can say we don't have the money to stimulate. But let me tell you, it won't cost much next to the price of 125,000 more unemployed in retail alone.
Irish Independent
