As St. Paddy’s Day approaches, I find myself wondering: How did the Irish ever get a reputation for having good luck? Going by history, Ireland appears to be the unluckiest country in Europe west of Poland.
The luck of the Irish is terrible luck. It’s an insult the Irish turned around and use ironically (or was turned around by people who didn’t understand it).
Tell it to the cereal-leprechaun.
I wonder if the phrase is mostly an American one. The Irish have fared much better in the US than other waves of poor, unskilled, religious-minority immigrants. “Luck” is just a euphemism for “I got here early and I can pass for a WASP”.
Well, John Lennon made the same observation as the OP’s in his song “The Luck of the Irish”:
If you had the luck of the Irish
You’d be sorry and wish you were dead
You should have the luck of the Irish
And you’d wish you was English instead!
They love their mothers…
I’ve wondered that myself, always figured it was supposed to be luck on an individual level rather than a national one, though that’s pretty questionable as well!
Their “luck” is that they are even still alive!
It’s not that the Irish *have *more luck. It’s that they *need *it.
This is pretty close to my understanding of the term. TLotI means an outcome that’s better than the conditions warrant, or bungling oneself into an absurd situation and getting out of it (relatively) unscathed.
(My “presentment of Irishry”: think “Chicago”/“fire”/“cow”)
I didn’t know Homer Simpson was Irish.
While there is a bit of overlap (considerable in some cases), The Luck of the Irish and The Luck of the Doofus are distinct phenomena.
Says the Israeli Jew. 
I grew up thinking this phrase applied solely to Notre Dame’s football team, which was indeed the luckiest bunch of turds to ever play the game. Great, great players in abundance on their rosters and legions of rabid fans yet again and again they would require a lucky bounce or bad call to overcome --* at home* – some poor team that shouldn’t have been within three touchdowns of them.
It was infuriating and I still hold the grudge even after decades of their mediocrity (2012 notwithstanding).