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A real choice in 2007? December 21, 2006

Posted by franklittle in Economics, Fine Gael, Irish Election 2007, Irish Labour Party, Irish Politics, Labour Party, Northern Ireland, Sinn Féin, Social Policy.
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Taken me ages to get around to writing this, first suggested by an article by Shane Coleman in the Sunday Tribune a few weeks ago. In it (free sub required) he provides the only substantial analysis of Sinn Féin’s recently published pre-budget submission I’ve yet to come across, and sparked enough interest in me that I sat down to read through the document.

Firstly, Coleman’s case is a simple one. Worth nothing by the way that Coleman is a good journalist. For far too long he laboured in the vineyard while the inexplicably highly regarded Stephen Collins blathered on. He argues that Sinn Féin’s economic policies are deeply flawed, would wreck the economy and ‘seriously risks returning Ireland to the bad old days of the 1980s’. Coleman warns us to be ‘extremely wary of anyone or any party that seeks to change that winning formula’, said formula being a reference to the all powerful and successful Celtic Tiger.

Leaving aside the commentary, and reading the party’s submission, one is struck by how utterly and completely different what they are proposing is to anyone else. In an interview in the Sunday Business Post in September, Fine Gael Finance spokesperson Richard Bruton said:

“Fine Gael had no unique selling point on the economy. I don’t think there is a unique selling point really. I think the truth of the matter is that there has been quite a degree of cross-party consensus on what is important in the economy.”

The Greens too have been edging towards this ‘consensus’ with Harry McGee pointing out in the foreward to the just published history of the Green Party that it is moving towards the centre on taxation, towards prudence. Labour, as has been pointed out elsewhere, are committed to ensuring that taxes will stay down, an inaccuracy as it happens as taxes have actually gone up with the taxation system becoming more service charge based and therefore regressive. I might pay slightly less PAYE than I did in 1997, but the Little household now has to pay bin charges and various other unpleasant taxes where I am charged for the packaging waste I didn’t want to buy in the first place. Nevertheless, Labour have clearly abandoned redistributative taxation.

Sinn Féin has gone a different tack. Firstly, they propose a vastly improved level of social welfare payments, over and above what Cowen delivered,; the introduction of a Cost of Disability Payment; an increase in the minimum wage to E9.30; a massive increase in the pension; improvements in maternity benefit and the introduction of parental leave and so on; medical cards free for under 18s. It’s all good stuff. But they also propose to pay for it.

This includes reform of tax loopholes and the like, with a special focus on tax breaks for private hospitals,  but also a 50% top rate of income tax for high earners; increase Corporation Tax to 17.5%; doubling Capital Gains Tax back to 40%; the introduction of a tax on second properties, rate unspecified and, the elimination of unjust tax breaks for private pensions.

Now, whether all this would work or whether it is all is a good idea is a good topic for a debate. But before we get into that, consider this. Sinn Féin is breaking the consensus on taxation, proposing a taxation system radically reworked and targeted at high earners and the better off, redistributing wealth to people on low incomes. For the most part, their proposals are costed, with expected revenue identified and expected costs. The notion of a ‘consensus’ on taxation must be called into question when the third largest party in Ireland, as Sinn Féin likes to refer to itself, is setting out a counter-argument.

And a reasonably thorough counter-argument. Their pre-budget submission is, as far as I know from a quick glance at the sites of the other parties, the most comprehensive economic document published going into the next election. Their desire to be seen as comprehensive can be found in the fact that a 23 page document has managed to accumulate over 50 endnotes.

For those of us on the left, there is a lot to like here. The absence of carbon taxation or any real kind of environmental reference at all is a bit glaring, and frankly unforgivable the more I learn about environmental issues, though in fairness to them they find space to deal with asylum seekers and immigrants, unlikely to feature heavily in many other party’s proposals. It would be going a little too far to call these proposals socialist. Without reference to control of the economy, the best we could call it would be very progressive and left social democracy, but it is the most thorough and radical set of left wing economic proposals currently out there. Does this mean voters will be faced with a real choice on economic issues in 2007?

So am I jumping for joy? With regret, I am not. I am held to the ground by the firm grip of Mr Eamon McCann on my belt. Because as I was reading Sinn Féin’s pre budget submission, I was reminded of another article, by another journalist, about another Sinn Féin document.

The article in question was a scathing attack by Eamon McCann, who lest it be forgotten as the entire establishment media seems to have, is a politician, a former election candidate and a member of the SWP, in the Belfast Telegraph in September on Sinn Féin’s submission to Sub-Group of the Hain Assembly’s Preparation for Government Committee. Wake up down the back. Now reading Eamon McCann on Sinn Féin and believing him is akin to reading Willie McCrea on the Pope and believing him, so I took a gander at the actual submission, which is contained around 150 pages into the 250 page long fourth volume of the report in question. I do not claim to have read the entire report. I do not believe anyone has ever, or is likely to ever, read it all. I read the various party submissions and shook my head in vague horror at the notion of the authors ever running anything bigger than a town council.

McCann makes what seems to be a bizarre claim in his article that the submissions, if accepted as the economic proposals of the various parties, puts the SDLP substantially to the left of a right wing DUP/UUP/Sinn Féin consensus. And he’s right. The Sinn Féin submission is poorly written, vague, packed full of generalisations, obsessed with All-Ireland planning, unimaginative and largely devoid of anything approaching a specific proposal. As McCann points out :

‘Neither the DUP nor Sinn Féin mentions the existence of trade unions’, and

‘The SDLP is the only party to state opposition to privatisation and water charges, specifically pledging to “oppose the proposal to turn the Water Service into a Government-owned Company (GoCo) as this would be a step towards privatisation.”

It calls for “new, ‘not-for-profit’ models for investment…in public services,” and suggests that “income derived (might provide) a civic dividend for more hard-pressed communities.”‘

So, which Sinn Féin are we talking about? The one in the South that proposes radical economic and taxation reform, or the one in the North that whines for a peace dividend? It’s an interesting question and one that, once Sinn Féin has sorted itself out on policing, is going to come more and more to the fore. From what I understand, the bulk of policy development on social and economic issues in Sinn Féin is anchored in Dublin with a negligible input from Belfast. In a way, this makes a certain amount of sense as being part of a functioning parliament here in the South obliges Sinn Féin to put more meat on the bones than they are forced to in the North.

A couple of things are clear from all this.

1. Sinn Féin is, in all likelihood, going to be presenting the most coherent left wing economic and taxation package in the upcoming elections in the South.

2. Sinn Féin in the North is, on economic issues at least, at a very different stage of evolution to Sinn Féin in the North.

3. Sinn Féin, on the whole, continues to be a party dominated by a Northern based leadership disconnected from social and economic policymaking.

4. Numbers 1-3 point to an interesting clash on economic issues within the party in times to come, especially if it happens to be in government in the North, and not in the South.

Watch this space.

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Comments»

1. WorldbyStorm - December 22, 2006

Wow, that’s food for thought. But a couple of points strike me. Is this difference in emphasis (indeed we could call it a difference in approach) rooted in the membership in the North as well as the leadership, (apologies I’m not attempting to take a partitionist line, but clearly there have to be some differences in terms of dynamics in both parts of the island). Secondly is it a product of running full pelt towards the GFA institutions at the expense of a broader economic and social programme (which is interestingly contradictory insofar as fairly soon SF will be corunning an administrative structure in the North – fingers crossed). Thirdly why the distinction in terms of economic policy development between the two parts of the island – at least in terms of formation if not in terms of application? Surely a coherent approach by a single entity drawn from both areas developing it would lead to less, shall we say, confusing stances?

Having said all that with Eamon McCann my general response to anything he writes is to agree entirely with the first 50% and then find myself in complete disagreement over the final 50%. It’s a simple rule of thumb developed over years of reading his Hot Press pieces and others. :)

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2. Lorenzo - December 22, 2006

SF are all about the unification of the island’s two jurisdictions.

Everything else is subordinate to this aim, including their espousal of leftwing policies in the Republic. They need to grow the party down here and they figure the best way is to go Left – the ground is a lot less crowded out there. It could be a very savvy move; policies that only appeal to a disaffected 10% of the population during a boom may appeal to a lot more during a deep recession. Of course the three tax rate increases mentioned in the article would go a long way to inducing just such a recession…

This article has sort of cheered me up though. I had feared, despite Bertie’s protestations, that a SF-FF coalition might be a real possibility after the next election. If they are serious about these proposals, no party could form a programme for government with them. It’s to the longer term – the election after this one- that SF are looking.

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3. shea - April 27, 2009

found a link to this on a blog called ie.politcs. thaught it was fasinateing. two and a half years later. the more things change the more thay stay the same, by way of adams and mcdonalds drive up an economic cul de sac at the last election. but the contradictions in SF north and SF south. listening to adams ard fheis speach and mcdonald at easter the bugdet submissions put in for the emergency budget: i wonder have they been adressed and north and south are on the same page or will the contradictions repeat themselves.

intersting one to watch.

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4. WorldbyStorm - April 27, 2009

I’d agree, there’s a distinctly different tone. That’s in part a function of the relative sizes within the two areas, the nature of being in govt. and being in opposition… etc, etc… quite a tight rope to travel across…

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5. Five Years Ago on the CLR: A Real Choice in 2007? « The Cedar Lounge Revolution - December 1, 2011

[...] something to reflect upon written by franklittle in 2007 about differences between Sinn Féin economic and social policies [...]

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