Notes on the Front

Somewhere on a distant planet a group of people employed by the National Irish Bank labour away on a publication which you may have come across, ‘The Emerald Isle: The Wealth of Modern Ireland’. They peer down from the heavens in their custom-made tele-socio-scopes and opine on the habits of the people on a small island off the coast of Europe. Their distance is no impediment to producing far-reaching conclusions; indeed, it is a help because they are unencumbered by the messy matter that constitutes life on that island. No, these are meta-commentators, squaring circles that us mere mortals find impossible, connecting dots that most of us can’t see, weaving and linking in such a way that assures everyone that we truly live in a democracy of chattels – paraphrasing the African-American spiritual: ‘Rich at last, rich at last – O Lord, rich at last.’

It must be the air.

Vincent Browne, in his irascible style, had great fun with NIB’s The Emerald Isle but truly no single column, no single blog post can capture the sheer majesty of the report. Take this small sample of conspicuous consumption:

• The Jaguars retailing for a cool 205K with lengthy waiting lists
• Yachts that go for an even sweeter 600K (did you know that we have more yachts per capita than impoverished Netherlands?)
• The Executive Backpacking trend (‘it differs from traditional backpacking in one important respect – out is the tight $20-a-day budget, in is a large budget to savour local culture in style.’)
• The latest craze in art investment (‘a good hedge against other asset classes’) and wine purchases (that bottle of 1993 Chateau Petrus, 1993 will set you back €750 so you better make it last longer – water it down)

To the extent that the report provides us the numbers and anecdotal consumption behaviour of the well-off, it is on terra firma. Such reports can provide helpful insights, especially as there is a dearth of studies on wealth and asset holdings in Ireland. The report doesn’t come anywhere near a complete picture, but it start filling in some colours.

However, we are literally beamed up when the Report attempts to explain a ‘conundrum’:

The increasing demands of Irish consumers are reflected across a spectrum of goods and services. Interestingly, this trend comes at a time when discount retailers such as Lidl and Aldi are expanding rapidly in Ireland. This paradox deepens when it is considered that many consumers who are the most demanding in terms of acquiring the most luxurious goods and services are the same ones that are shopping in their local Lidl. It seems that many Irish consumers can happily reconcile their conspicuous consumption with seeking the best value in other areas of their lives.

This observation creatively explains the simultaneous rise of conspicuous consumption and low-cost, no-frill retail outlets. Some might suggest this is due to several different trends in play here, but the authors won’t hear of it. It’s not that some are rich and most are not, that there are divergent patterns and lifestyles – dare I say, ‘classes’. The authors morph the life-styles of a small privileged segment of the population into the population itself. Those demanding the most luxurious of goods are also jostling the hoi polloi in the crowded aisle ways of Lidl. They ‘happily reconcile’ their wine auction bids with best value purchases. This is the democracy of consumption, a commonwealth where there is no rich, no poor – just ‘shoppers’ – waiting in the same cashier queue together. Through a strange social alchemy this select group of leaden Jaguar and yacht owners are transformed into golden ‘Irish consumers’

Yes, of course, the demographics of discount retailers here are changing, but it’s not as if the authors of Emerald Isle rest their arguments on such data; they give no evidence of their claim (I’d like to provide such demographics but they cost over €1,000 to purchase online). But one can see, if not a proof, then at least a rationalisation for their claim. For the activities of Lidl and Aldi are part of a long-term business strategy.

For instance, in Germany Aldi and Lidl are mainstream outlets – Teutonic Tescos if you will. However, as new market players in both the Irish and British markets, they adopted a well-honed entry strategy. Establishing a beachhead among the C2DE class – in both product line and location – they accumulated both PR and real capital, along with market experience. This first step had the advantage of being relatively inexpensive compared to a full assault across all market fronts.

Their next step (and they were never going to confine themselves to a limited market segment) was to both broaden their product range and expand outside their initial demographic profiles. Quite simply, they were going to go ‘upmarket’. The Daily Telegraph, with that usual descriptive sloppiness, stated that in the UK, Lidl and Aldi were moving into middle class areas and that Tesco itself was starting to be concerned (and in the UK, for Tesco to be concerned means that the discount retailers are really on the move).

The authors of the Emerald Isle use this phenomenon to employ their own peculiar syllogism:

1.  Jag owners and their conspicuous kind are ‘middle class’

2. Lidl and Aldi are moving into the ‘middle class’

Ergo

3. Jag owners are queuing up in Lidl and Aldi

Never mind that the checkout workers in retail outlets are also ‘middle class’ according to the ABC1 breakdown (and according to Robert O’Byrne), never mind that the 5% who own 40% of all the wealth are a class that is not in the middle of anything; this syllogism tells us absolutely nothing about what’s being viewed (society) and everything about who is doing the viewing (the authors of the NIB report). 

It can be tiring to track and contest these types of analysis. Fortunately, there are others engaged in this work (Dublin Opinion has even taken to monitoring children’s programmes). And good work it is. For it is a fundamental debate over how we look at ourselves. This is the first step in identifying the real trends and patterns over how we live, how much we have, how much we are denied and, ultimately, how little stake most of us have in the ‘Wealth of Modern Ireland’, despite the outward trappings and accumulated accoutrements.

But, really, we’re not going to get much of a picture floating so far away. The NIB’s report can still tell us a lot. But it’s probably not the case that the person you’re fighting with to get the last tin of mushy peas off the Aldi shelf is a yacht-sailing, Jag driving, Exeuctive backpacking, ordinary ‘Joe or Jospehine’ like yourself.

So if the authors really want to paint an accurate picture of wealth and lack thereof, they should work a little closer to home.