An enormous amount of time and energy is devoted to the analysis of short-term trends in the economy. Tiny movements in official estimates, which may be subject to big revisions later on, get front page coverage and are subject to over-interpretation.

A few years back, there was a major political fuss in Britain when the statistics office announced that real output for the previous quarter had fallen by 0.1%, that is one-tenth of 1%.

This was their first shot at the figures, the so-called ‘flash’ estimate. In due course, the estimate got revised and the economy was deemed to have actually expanded by some equally miniscule amount. The revised estimate was in turn greeted as a success for the Government and an embarrassment for its critics.

Here’s a dirty little professional secret: economists and statisticians do not know, even years after the event, what was the level of national income or national output to within at least 4% or 5%.

Some components can be estimated with reasonable precision, but others are just informed guesswork. National statistical offices take great pains, in the footnotes that accompany their regular releases, to draw attention to the incompleteness of the data on which estimates are based and to the likelihood of future revisions. But journalists do not bother too much with footnotes.

The headline in the British example was simply ‘Economy contracts’.

If your own personal income expands or contracts by one-tenth of 1% over a quarter, or over a year for that matter, you are most unlikely to notice. You will probably feel that your income has not changed very much and that is usually all you need to know.

The picture changes, however, if you have heavy debt repayments. Right now, both the Irish Government and many Irish households are in precisely this position.

A fixed portion of income is earmarked in advance for debt service, so any small change in income translates into a bigger change in living standards.

Since lenders have to renew loan facilities from time to time, they are highly sensitised to any weakness in the income prospects of their debtors. A debtor on the brink, whose income is rising even at a modest rate, is a source of reassurance, whether that debtor is an individual, a business or a country.

Hence, even scattered evidence of an upturn in the Irish economy is greeted as important news. But what really matters is not a short-term improvement, which could reverse for all sorts of unpredictable reasons.

The crisis in Ukraine, which has come more or less out of the blue, could result in more expensive gas import costs and bring the fledgling European recovery to a halt. Or it could all be resolved in weeks. What matters is the prospect for sustained improvement and the wobbles along the way do not matter.

The levels of both public and private debt in Ireland are at danger levels, in the sense that a sudden reversal of sentiment caused by events entirely outside Irish control could spark another crisis of confidence.

The Government and the banks, both experiencing easier financing conditions over the last year or so, could find access to market funding begin to dry up if sentiment turns negative.

There is ultimately only one sure protection against this kind of exposure and that is to get the debt burdens under control, which means repaying as much debt as possible and as quickly as possible.

If the economy can be placed on a long-term path of sustainable growth, debt burdens will become even more manageable.

Ultimately, any country (or business) which has low debt levels relative to its income should be able to ignore the occasional fits of nerves in credit markets.

Since the crisis struck in 2008, the private sector of the economy has, at great pain in many cases, been repaying debt on a net basis. But household debt is still at historically high levels relative to household income. The Government remains a net borrower and looks likely to stay that way for another few years.

You could be forgiven if it had slipped your memory that the Irish Exchequer is planning to borrow around €650m/month during 2014, given the amount of celebratory spin doing the rounds in these last few months.

Clearly, if the economy grows at 2% or 3% over the next few years things will begin to look brighter. But any improvement in output cannot be devoted to an instant consumer blow-out or to new schemes for public spending, much less premature tax breaks.

The solvency of the State and of its businesses and households requires that the proceeds of recovery be devoted, for at least the next few years, to shrinking the debt burden.