Saturday 16 February 2019

'We got it wrong and thought Ireland would escape. That was a low point personally'

Professor John FitzGerald is retiring from the Economic and Social Research Institute (ESRI). But if you think he'll be giving up work, think again.

Retiring: Professor John Fitzgerald.
Retiring: Professor John Fitzgerald.

Colm Kelpie

PERHAPS it was much more organised than usual, but there was little evidence in Professor John FitzGerald's office earlier this week to suggest the well-known ESRI economist was retiring. His desk was neat, with files still crammed on shelves.

But after 30 years at the influential think-tank, the son of former Taoiseach Garret FitzGerald bids farewell this week, with Sunday his official departure day.

Colleagues, including Central Bank governor Patrick Honohan, gathered at the ESRI on Dublin's Sir John Rogerson's Quay yesterday for a conference organised in his honour.

But it's not really farewell. Because for FitzGerald, retiring doesn't mean giving up work.

He'll be moving to Trinity College where he'll be teaching a Masters in Public Policy and will be a research affiliate at the ESRI.

But he'll no longer be the face of the institute's Quarterly Economic Commentary.

FitzGerald has been a hugely influential figure in Irish economics over the last three decades. His work has been published in a range of journals including the European Economic Review, Economic Modelling and The Economic and Social Review, as well as in many other ESRI publications.

One colleague recently spoke admiringly of his passion, joking that FitzGerald would regularly burst into his office, enthusiastically setting out how he could use some latest find in the national accounts to decipher what was going on in the economy.

"It's like doing a jigsaw puzzle," the veteran economist says.

"You have a load of information and you're trying to put together a picture from it. You have conflicting pieces that don't fit well together and I enjoy trying to build a picture of what the economy is. It's a model in your head, and the ingredients are the data that you can get hold of."

A love for statistics is in his blood, he says, but he was less than inspired during his first exposure. In fact, he found it utterly dull.

Granted, he was just a young boy, but to this day FitzGerald has a vivid memory of being taken by his late father to a dreary-looking office in central Dublin where the latter sifted through a mass of files.

"I can remember being taken into the statistics office in Ship Street, when I was six or seven. My memory is of a room full of dust, with piles of files all over the place and being bored," he recalls.

The former Taoiseach's all-consuming passion for statistics and the national accounts, as well as opinion polls, is well documented. Indeed, it was said that his talkativeness on the subject more than once wrecked a whole day's schedule, to the consternation of staff.

"My father would have had the same excitement about accounting and national accounts and what they mean. He probably spent a bit too much time on that, rather than on being Taoiseach," jokes FitzGerald.

So it was always likely some of that passion would rub off on at least one of his children.

"My father, in my teenage years, would have talked to me about it. He lectured in an incredibly boring topic of economic statistics at 9am on a Friday morning, which was actually entertaining. And he did a weekly column for the newspapers on the economy in the '60s. I would have grown up with it, but I didn't particularly want to be an economist. I thought of being an engineer and then tried being an historian, but there's no market in historians," he says.

And so, having studied history and economics at UCD, he joined the Department of Finance. But to have had a parent who held such a significant public office, I suggest it must have been difficult to forge an identity beyond simply being Garret FitzGerald's son.

While working in the Department, which he joined in 1972, five years before Garret became Fine Gael leader, he says he was no more than a "seven-day wonder".

But difficulties came when he moved to the ESRI in 1984. At that point, his father was now in his second term in power, grappling with an economy that was in deep trouble.

"Moving to the ESRI, because you publish under your own name, it was probably complicated for both my wife Eithne [who later served as a Labour minister in the early 1990s] and my father. They had to live with me saying things which were politically difficult," he says.

"The first significant thing I published here, the headlines in the paper were, 'Garret's son denounces government'. You have to live with that. The great thing about the Department of Finance was, I wasn't Garret's son, I was John FitzGerald."

It wasn't the last unfavourable headline. He recalls a 2005 piece in this newspaper in which he was dubbed John 'the Grinch' FitzGerald, for, just before Christmas, largely correctly forecasting rising unemployment and debt, and a fall in property prices by (what now seems a tame) 30pc.

But he notes his low point at the ESRI was when, in 2008, he claimed Ireland would escape the worst of a global crash.

"Having seen the dangers, we got it wrong and thought Ireland would escape and that was certainly a low point personally. It's my responsibility and 2008 was a particular low," he says.

"I thought we would escape the worst of the crisis and I was completely wrong. Patrick Honohan, for example, would have been aware of the dangers in a way that I was not. I just feel that we should have done better."

He lists Ray MacSharry as one of the finance ministers he was most impressed with, as he "turned around the '87 government". He also has fond words for the late Brian Lenihan.

"His last year or nine months, the outgoing budget and the job he did, it made it easier for the incoming government," he says.

"He under-promised going into the election which politicians never do, which made it easier."

Michael Noonan is doing a "good job", but he declines to comment any further just yet. But he believes Budget 2015 was a "bit too generous", and the Government will have difficulty taming expectations next time around.

"People's expectations are already running ahead of reality, and that's going to be difficult to manage," he says.

Interestingly, he characterises the relationship between the ESRI and the Department of Finance as one marked by "creative tension", although largely it's been "very good".

"Finance ran into problems in the final years of the boom. They didn't criticise us, but I think that they were not in listening mode," he adds.

Although his wife Eithne is also an economist, he stresses talk isn't always about economics. "One has a life which is independent of economics," he quips.

The couple have three children - Aoife, a doctor in the UK, Iseult, who works in the Department of Foreign Affairs, and Doireann, who works in the US with the Federal Reserve Bank of Minneapolis and whom the couple usually visit twice a year.

"She hasn't forgiven us for calling her that," he says. "She says nobody outside of Ireland can pronounce it."

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