Charlie McCreevy: “You can’t rely on theory.”

FINANCE Minister Charlie McCreevy, in a typically understated observation in the Senate two weeks before Christmas, said if a watertight model of economic theory existed every chancellor and finance minister in the world would follow its prototype.

It was his way of saying that day-to-day economics in practice defies theory.

It called to mind the famous story told about Garrett FitzGerald who after a very complex discussion about some piece of legislation had been trashed out to the cabinet’s satisfaction was alleged to have said: “That’s all very fine in practice but how does it work in theory“.