The none too subtle sense of entitlement of the Irish bourgeoisie: Tonight with Vincent Browne on NAMA… September 17, 2009
Posted by WorldbyStorm in Economy, Irish Politics.21 comments
Fantastic piece on TV3 last night with Vincent Browne… as the blurb said on the website:
On tonight’s NAMA special, Vincent is joined by former Bank of Ireland Chief Executive Michael Soden, UCD Economist Karl Whelan, Anti-NAMA protestor Rita Fagan and Irish times Finance Correspondent Simon Carswell.
Great to hear Michael Soden say to the question ‘what is it going to cost us?’ with… ‘well… if we’re going to get philosophical…”.
Listen to the thoughts of Browne at 8 minutes and he makes some fairly obvious but extremely concerning points. As he says ‘property prices will have to go down even further to be realistic in the current context”, and moreover as regards the issue of liquidity with the worry that banks will use cheap state provided money to pay off the expensive ECB money.
Karl Whelan’s point about liquidity as distinct from solvency is well made, and he notes that the debate has become diverted to an idea that liquidity was the problem...”that’s become something that people understand and that politicians can sell to the people…” His estimation, that there would be only a very small amount would see its ways to small businesses.
Karl Whelan...”Why are we deliberately paying more for these assets than they’re worth? So we’re paying €7bn more to save having to invest €7bn in the banks… but at least you’d get equity in the banks..”
As for the impacts of McCarthy, listen to Rita Fagan’s thoughts on the impact on the community sector and consider how that guts provision of services to people.
Wait too until about 28 minutes and as someone said to me, the mask really slips.
Michael Soden to Fagan when she says the community sector would take €7.5bn … ‘You’re just the same… you’ll take as much as you could…”
Er, no Michael. Not quite.
Fagan: The poor didn’t benefit…under social welfare cuts… if you’re a lone parent…
Soden: Sorry with all due respects lone parents… I don’t think our society should be carrying the burden… that’s just a political… you’ve a social status… I’ve got one…
All this is worth viewing for the shot of Karl Whelan, stunned with incredulity, who interjects… ‘we should be paying €7.5bn to shareholders?”
There’s more… it’s unbearable. Was this descent to vindictive populism because Browne et al were uniformly agin him? Didn’t seem to me that Browne was over the top, certainly no more so than usual. And feck it, he’s a big boy now.
But it tells us all we need to know about an intersection between a sense of absolute entitlement and utter disdain for others. Not a thought in Soden’s head that single parents might actually be… y’know, up for, as Rita Fagan said… ‘bettering themselves”... not an iota of social conscience. Just the reiteration of supposed and stale certainties.
And wait.. what’s this? I read on the entertaining P.ie thread something about this paragon…
[BTW, I couldn't give a rashers about the reason for his sacking, albeit stupid to do it from a work environment, but would be exercised about the fact that he implemented the rule that he subsequently broke...]
“Irish Taxpayers pay billions to write off high-risk speculators’ debts” September 17, 2009
Posted by Garibaldy in Irish Politics.11 comments
Not my headline. But the headline on a story by Henry McDonald on NAMA in today’s Guardian. I don’t find myself agreeing with much that McDonald writes, but it’s hard to disagree with his opening paragraph.
Irish taxpayers will hand over tens of billions of euros to the republic’s banks in order to write off high risk loans owed to them by the country’s builders and speculators.
Hard to deny that the state works in the interests of the wealthy when you see it put like that, especially when we remember the links between the speculators and Fianna Fáil. At a time when Fianna Fáil has been reminding people of the need for hard choices and swathing cuts to be patriotically accepted, Finance Minister Lenihan is in a suprisingly forgiving mood.
Lenihan said the Irish people were understandably angry about the state of the banks and appalled by the details of the behaviour of some bankers and property developers. “There is now unfortunately a breakdown of trust in the entire system,” he said.
But the public knew recovery of the Celtic Tiger economy could not come without fixing the banking system, which should be extremely grateful for the taxpayers’ help, he claimed. “We must all now overcome our … anger and get on with the business of reform,” he added.
Forgive and forget. It’s a wonder he didn’t appeal to Ireland’s Christian heritage, and openly ask us to turn the other cheek. No forgiveness though or soft landings if you are a mortgage holder who can’t keep up with your payments; or a civil servant whose pay has been cut and whose job is endangered as a result of the greed of these institutions. The citizens of the south may be opposed to NAMA, but that’s ok. There are after all alternative sources of legitimisation than the voters. Who needs them when you have international financial institutions on your side.
He told the Dáil that the resolution of the difficulties in the banks involved risk but said it was risk that the private sector was not willing to take on. The Nama proposals had received international approval, he said, with international agencies such as the International Monetary Fund and the European Central Bank commenting “favourably” on the Nama proposal.
And now we cut to the chase. Our success lies in the fact that we have one of the most globalised economies in the world; our success depends on our attractiveness to international capital; our success depends on keeping the state out of the way of the market, on allowing the private sector as free a rein as possible. Regulation and taxation will kill the golden goose. The market must be left alone; in the market we trust. We all remember those sentiments being repeated ad infinitum in the Dáil and in the media. We all know why we are not hearing such sentiments now. Free market ideology is a fraud, a disguise for using the government to the maximum advantage of capital, before turning to it to be rescued. Except of course what that really means is making ordinary working people pay for the contradictions inherent in the boom and bust nature of our economic system.
Irish banking stocks rose after the minister’s speech, with shares in the Bank of Ireland recovering from a 3% loss to trade up 3% on the day. AIB also rose slightly on the news, clawing back some of its losses to trade down 2.3% at €2.63.
Shares in Irish Life & Permanent, which previously said it would not be seeking to participate in Nama, rose 1% to €5.83. Earlier, the shares gained as much as €5.94, a 2.7% rise.
The Iseq index of Irish shares – Ireland’s version of the FTSE – rose sharply following the announcement, gaining 54.21 points to 3363.34.
Don’t you feel better already?
The Lost Revolution: The Story of the Official IRA and The Workers’ Party – 1 September 17, 2009
Posted by WorldbyStorm in Irish History, Irish Politics, The Left.42 comments
I guess it’s worth discussing some of the issues that I’ve found most striking as I’ve read the Lost Revolution: The Story of the Official IRA and The Workers’ Party over the past two weeks. It’s hardly controversial to say that I’ve found it a fascinating read so far. As noted by Garibaldy this is an history rather than an analytical book, although throughout there is considerable information both newly discovered or reframed in a broader context to provide food for thought. As it is I’m having to get post-its and mark the passages that are of particular relevance.
It’s certainly well written, and easily read which is in no sense a criticism. There is a real vitality to the first third of the book and in particular the description of Sinn Féin in the 1950s and 1960s and through to the very early 1970s. And along the way there are some remarkable political observations.
For example, given the centrality of Sinn Féin, and more particularly the IRA – for the book makes it very clear that it was the IRA which led the way in the radicalisation process of Republicanism – in the Dublin Housing Action Committee, there is a profound irony that the Minister in charge of Housing was Kevin Boland who would be instrumental in assisting the political and military split in Republicanism. It’s those small, seemingly insignificant, details which build up into a compelling overview of the period. Or what of the fact that there were joint OIRA/PIRA events well into the early 1970s?
It also implicitly engages with the mythos of the period. Most striking to me is the manner in which it demonstrates that far from the political diminishing the military, as noted above, it was the military that was leading the way as regards ideology. That that led to a broad range of militant and in some instances paramilitary actions across the island well before the North caught fire has been largely ignored in other histories, but the sheer scale of those actions is impressive. One issue that comes across loud and clear is that far from the retrospective view of a quiescent movement after 1969 and after it until the mid 1970s this was a strongly active movement both on the social front and the military front. That this history has been lost was a function, I’d suspect, of both the WP reworking its history particularly in the 1980s (as it sought to jettison much of its past) and of an essentially complicit reading on the part of its rivals who were keen to play down the very real activism that existed. So we wind up in a position where a very significant element of what was a prolonged armed struggle on a number of fronts was white-washed from effective history.
That issue of arms is a fascinating one. It is now well known that in August 1969 the IRA in Belfast had very limited resources to call upon, and this became a central aspect of the retrospective legitimation of PIRA. Yet the book makes clear just how difficult it was in practical terms to access weaponry prior to those events. Indeed quite some efforts were made.
However, what I find remarkable is that even in the wake of August 1969 and the enormous spasm of Republican sentiment across the island…
…eventually nearly everything the IRA could get their hands on was sent north – about 96 weapons and 12,000 rounds of ammunition in the immediate aftermath of August. IRA members in the North believed that Southern politicians had supplied some of the weapons. Neil Blaney would later claim that up to 25 TDs and Senators had made privately held arms available during 1969. Republicans in Tyrone also received guns from Fine Gael or ‘Blueshirt’ sources. All manner of weaponry was assembled: there were .303s, .22s, shotguns, Webley’s, ‘Peter the Painters’ (Mauser automatics) and a pair of gold-plated automatics, like ‘something out of Patton’….
Yet consider just how minimal such numbers of weapons were, given that spasm of sentiment, and given that the IRA was no longer confronting Stormont but also the military forces of the British state proper. If that was the best that could be done post-August it seems unreasonable to argue that that could be matched or bettered pre-August 1969. And it brings home a point Brian Hanley made at the Desmond Greaves School this weekend that much of the early period of the conflict has been considered through the framework of the struggle as it later developed. This anachronistic view while serving the purposes of all those who indulged in it – and a broader and more politically eclectic group would be hard to find – does the overall history a grave disservice and profoundly distorts the scale and scope of those initial events.
The split itself and the intertwined dynamics that led to it is of considerable interest too (and Hanley addressed this too over the weekend).
In Belfast recruits flooded into the IRA… while the nationalist community now had ‘high expectations’ of the IRA, they had ‘not supported the organization in real terms for 40 years’, and some republicans resented the fact that people who ‘would have spit on you and refused to put [money] in your collection box’ before August 1969 were no expected to be provided with guns. There was also some contempt for the re-emergence of those – such as Drumm, Twomey, McKee and Cahill – who had dropped out of the movement during the 1960s or even earlier; ‘They thought the Republic was going to be got without them… and they were afraid to be left out of it’. Soon these veterans were suggesting that the IRA leadership had failed to defend nationalists. Gerry Adams later recounted that he was ‘perturbed and perplexed to find that extreme criticism of the Belfast leadership was being expressed most of all by republicans whom I didn’t know or had only recently met’.
Reading that one can – of course – see retrospective justifications on all sides, but… contempt and – no doubt – a degree of apprehension at losing control on one side and an arguably self-justificatory reading of actions and events on the other clearly combined in such a way as to hasten the split. The role of those who had been with Sinn Féin throughout the period but then chose to go with the Provisionals is of equal interest. One senses from the book that there was considerable closeness, despite differences, between those within the movement which undoubtedly made the subsequent events all the more bitter. While it is clear that Mac Stiofain had been champing at the bit for years the position of others is less clear (and the necessity to keep the coalition that was Sinn Féin as broad as possible saw the survival of the Rosary in what was becoming a vastly more secular organisation into July 1969 and after).
Beyond that the sheer size of the formations, both Official and Provisional, during the 1970 to 1971 period is something that has also been largely ignored. Later analyses have tended to see the rise of the latter as near inevitable, but one wonders whether had more measured decisions been taken at various points would it have been possible to manage what was clearly a transitional stage in Republicanism in a less bloody and ultimately futile way? That the Officials were vastly more open to other ideological currents during these early years (and in truth in the lead up to 1969) is also something that has been neglected. If later jibes were of ‘Stalinism’ one could make a reasonable case that what we might term a Trotskyist influence was initially much greater than hitherto acknowledged in those early years and to the benefit of the party in some respects.
And it is here that the title begins to make sense, because whatever one thinks of the mid and latter period of the party history, which I’ll return to at a later point, there is a sense that for all the inherent and all too visible flaws there was something during this early history of Official Sinn Féin which, unlike its main rival at that point and for quite some time after, did have a huge societal potential. And this, in part, was due to that openness (and in something of a contradiction a sense that for all the machinations around the OIRA it operated more openly than it would subsequently). The point has been made to me that the book may not engage sufficiently with the political activity in the early 1970s… it’s hard to say for sure…but for that I hope that issues of the United Irishman in the Archive over the next year or two will shed further light on that issue. This was an all-island potential and one that – as we see subsequently – was, to my mind, largely dissipated in the North.
So, perhaps not quite a Lost Revolution then… but something worth reflecting upon even at this remove.
Enormous errors were made. There’s no doubt about that. Reading this it seems possible that the 1969/1970 split while it might not have been averted it could have been minimised. The push towards dropping abstentionism, while understandable, appears to have been far too enthusiastically pursued at points where the purpose of it seemed – at best – aspirational. The souring of OSF in the mid-1970s to the very broad nature of itself comes across as a significant mistake, as does the rather cosmetic (given the number of actions that continued subsequently) ceasefire of 1972. And throughout it all one can see how personality conflicts were masked in supposed ideological trappings in a way which was profoundly destructive to all involved.
Perhaps those errors were near inevitable given the context within which people operated within. But perhaps there were paths away from those contradictions and pressures that might have resulted in more positive outcomes.
There’s so much in this book to think about, not merely in relation to OSF/WP but also as regards other formations operating during the same period. I’m genuinely not surprised that it is eliciting such a large response.
Perfect Example… September 16, 2009
Posted by WorldbyStorm in Economy, Irish Politics.1 comment so far
A letter in the Irish Times on Monday reiterated a point that some of us have made previously, that away from the superheated rhetoric of a bankrupt state (Colm McCarthy last week, a comment I intend to return to) and economic collapse and in particular wide scale wage cuts across the private sector the actual evidence for the latter is rather minimal.
Indeed, if anything, the evidence points to the opposite.
The letter is written by Gerald Flynn of Align Management Solutions in response to an article at the weekend about public sector wage cuts by Industry Correspondent Martin Wall.
Flynn notes that…
The introduction of wage cuts has not been nearly as extensive as many commentators have been suggesting, and hence their puzzlement that the CSO earnings data do not reflect widespread reductions in basic pay levels (News Feature, September 12th).
A survey of senior people managers conducted over the summer by the Chartered Institute of Personnel and Development (CIPD Ireland) and Deloitte found that one quarter (26 per cent) of respondents had implemented cuts in pay in the previous six months. This is broadly in line with similar findings earlier in the year by Ibec, Mercer and Hay. Of the minority of organisations that had introduced wage cuts, most were in the 5-10 per cent range with about one-third (37 per cent) implementing larger percentage cuts for higher-paid employees. Just over half of the organisations (51 per cent) had introduced a pay freeze while 28 per cent had provided some increases this year.
And he continues…
The pay squeeze has naturally been more noticeable in sectors closely aligned to the property bubble, and national media organisations, from The Irish Times and Independent Newspapers to RTÉ, have implemented significant cuts in their wage rates, fuelling the perception among media personnel that this is a widespread national phenomenon.
I think that’s a crucial point, because it is that dynamic which I believe is reflecting back onto media reporting of this current economic situation. While we’re on that topic I’ve always been a bit amused by how starry eyed the notion of ‘reform’ in employments (particularly, but not exclusively those in the public sector) is, particularly when articulated as a process whereby workers can be moved around or hired and fired almost at will. Having worked in the private sector for most of my working life the reality is rather different. The armchair generals who posit such ideas are often seem overly comfortably removed from the actuality of employment practice and law.
Flynn makes a couple of other pertinent points as well…
Cutting wage rates is a fundamental change in conditions and terms of employment and needs clear management skills to implement effectively while minimising the impact on morale and employee engagement.
Those who have experienced the really severe wage cuts are the 200,000 people who have joined the live register in the past year, and many of the 100,000 who have left the register and secured employment, often at wage rates below what they would previously have earned.
Very true, albeit a sort of appeal to a discourse of ‘well they’re worse off than you so…’, a logic I’ve seen or had used against myself in various employments over the years. Nonetheless retaining employment in the economy is crucial, but it should indeed be recognised that wage cuts are in and of themselves hugely disruptive. To be honest I think his point about morale and employee engagement is one that is absolutely central to this debate and yet is one that has been referenced fleetingly if at all. Anyone whose memory stretches back into the 1980s will know that excessively high levels of taxation married to low levels of public service provision produced a culture that was far from what might be described as ‘engaged’ – and understandably so. Since we appear to be shifting back to that model sooner rather than later it’s not unreasonable to posit that a similar attitude will emerge, or is that re-emerge. And how one can see increased service allied to decreased working conditions in either public or private sectors is beyond me. They’ll use the stick of course, but I wonder how effective that will be in the medium term.
But as interesting is Martin Wall’s original article.
WITH THE Budget still more than two months away and the Government’s deliberations on its spending plans for next year only now getting underway in earnest, the battle lines are already being drawn over public sector pay. And in the private sector, where the extent of pay cuts is a matter of some debate among academics and industrial relations specialists, senior economists are forecasting that reductions of 5 to 10 per cent over a three-year period will be needed to tackle unemployment. All in all, the last few days has seen the issue of pay move back towards the top of the agenda.
And that agenda includes?
In a speech at the Institute of Public Administration (IPA) on Wednesday, the Taoiseach, Brian Cowen, signalled that further pay cuts for more than 300,000 civil and public servants could be on the agenda.
It was not so much what Cowen said in his speech that raised eyebrows but rather what he did not say. The Taoiseach argued that the Government had to “look at all of the options that would minimise the impact on public services and public service jobs of unavoidable spending reductions”.
However, if public services and jobs are to be protected in the forthcoming cutbacks, the main target left exposed would be the Government’s €20 billion pay and pension bill.
Wall notes that…
The country’s 300,000-plus civil and public servants have already seen their incomes cut by around 7 per cent on average because of the pension levy introduced by the Government in February. However, Cowen’s comments at the IPA were not the first occasion that a Cabinet minister had raised the spectre of new pay cuts. Late last month, the Minister for Health, Mary Harney, warned that health sector staff could face pay reductions next year if the Health Service Executive (HSE) did not secure reductions in employment levels along the lines proposed by the recent McCarthy report.
There is a further interesting piece of information in the article…
In dealing with pay in the public sector, industrial relations practitioners tend to differentiate between core pay (or basic salary) and variable pay (which comprises the plethora of allowances, premium rates and overtime payments that can boost basic earnings).
While it was unclear as to whether Harney, or indeed Cowen, were hinting at reductions in core pay, the HSE, for example, has made no secret that it wants cuts in the €1.1 billion it pays out in variable pay.
On a political level, cuts in variable pay could be problematic, as these would fall disproportionately on particular groups, such as gardaí, nurses and prison officers, who provide round-the-clock services, rather than on those civil servants who tend to work more regular hours.
Which is an interesting statement in itself. Those are also the front-line services. That they cost more comes with the territory. How that circle is to be squared will be an education, no doubt.
And it’s not just on the political level that this is problematic…
However, any move on core pay across the public sector would also cause industrial relations unease and would probably put the final nail in the coffin of the current social partnership process, which has been unable to generate an agreed economic recovery programme over the last six months or so.
And there are intrinsic limitations to what can be achieved…
The Labour Party leader, Eamon Gilmore, yesterday re-stated his party’s proposals for a cap on top-level public sector salaries. But capping or cutting top-level pay will not generate large sums, as the number of staff affected is too small.
Figures issued last year (before the pension levy) by the Department of Finance showed that there were 37 officials in the Civil Service who earned in excess of €200,000, while there were more than 25,000 civil servants who were paid between €20,000 and €60,000 per year. This pattern is replicated throughout the broader public service, with small numbers receiving very large payments and the bulk of staff somewhere in the middle.
In reality, if the Government wanted to generate significant savings on the pay bill, it would have to make cuts among the middle earners, where the larger numbers are. However, this would bring into the net the average teacher, garda and nurse, with all the political consequences which would flow from that.
I think we’ve already seen some of those consequences in the shift from FF to Labour of what would appear to be about 5 to 7% of the formers vote. But here is where aspiration rather than reality enters the picture…
At the IPA conference, economist Colm McCarthy called for a new benchmarking process for public servants which would be free to recommend pay cuts where necessary.
A new benchmarking process, which would it is clear benchmark downwards, would have an obvious problem to face.
John Fitzgerald, of the Economic and Social Research Institute, also suggested that there should be further cuts in public sector pay but said that this could be politically difficult to achieve until the picture in the private sector was clearer. He said that there were major problems with the Central Statistics Office (CSO) figures on pay and that it was difficult to know what precisely was going on in the private sector. For despite a general perception that pay cuts are widespread in the private sector, much of the published data does not back this up. Different studies – albeit of different types of companies – have produced divergent pictures, while the CSO figures do not yet cover the situation in the construction and services sector.
And…
According to a CSO report issued in early August, hourly earnings in the industrial sector, including irregular bonuses, rose by 5.9 per cent, from €20.82 per hour to €22.05 per hour, in the year to the first quarter of 2009.
It said that, in the financial sector, hourly earnings, including irregular bonuses, fell by 11.1 per cent, but that when the irregular bonuses were excluded, hourly earnings rose by 5.4 per cent.
Earlier this year a survey carried out by employers’ group Ibec found that just 10 per cent of companies had cut pay for production workers in the previous six months. In fact, the study found that more companies had actually increased pay rates.
So, what precisely are they benchmarking against? If the argument is that the public sector cannot be employed at current rates, or must see significant cuts as against private sector wages, then that begs the inevitable question why the comparisons were made (clearly without supporting data) in the past six months and what precisely is the future shape of what, to make any savings at all, would be a much much less well paid (and with rapidly diminishing benefits) public sector area? How is that tenable?
If the idea is that this will act as a spur to the private sector to decrease wages yet further, well, I’m wondering how that will play in the context of further tax increases, increasing mortgages and other charges? There comes a point where this will profoundly impact on economic activity and in particular consumer spending.
The anecdotal remains king in certain sectors, consider the following two paragraphs.
BOTH OF THESE reports tend to support the view held by the specialist publication, Industrial Relations News, which carefully tracks pay developments, that pay freezes rather than cuts in basic pay have predominated so far this year. The magazine’s editor, Brian Sheehan, says that close to 100 companies had paid the first phase of the pay deal agreed between the social partners a year ago.
However, Mark Fielding, of the Irish Small and Medium Enterprises Association (Isme), which represents mainly non-unionised companies, says that a survey carried out by Isme found that 45 per cent of member’s firms had introduced a pay cut since the start of the year. The average size of the reduction was 13 per cent. Fielding says that 49 per cent of member firms surveyed have put in place a pay freeze.
The problem for Fielding is that that does not tally with actual research as distinct from potentially self-selecting surveys by lobby groups…
Dr Doris said that the CSO data, which is the best available, appears to show that pay cuts are not happening on a wide scale, despite anecdotal evidence to the contrary. However, she says that this does not mean that wage cuts are not happening. She says that even taking into account the CSO data, it is possible that wage cuts are taking place on an individual basis, as the official figures deal with averages.
Yesterday, NCB Stockbrokers economist Brian Devine said that the CSO first-quarter data had left him wondering whether everybody has been “lying about their earnings”.
Never! That he could suggest such a thing.
He said that he had a few caveats about the data: only 15 per cent of the workforce is captured in the earnings data; there is likely to be a delay in pay cuts feeding through to the earnings data figures, as many pay cuts were apparently implemented in March/April; and there could also be measurement error in the earnings data.
“Nonetheless the lack of deflation in the core CPI measure hints at smaller-than-expected wage cuts in the private sector,” he said.
Astounding… Although could I propose the small cynical notion that it seems reasonable to suggest that those who are in a position to are increasing wages in order to defray the impact of future tax rises. And as to who they might be? Well, note again…
This is broadly in line with similar findings earlier in the year by Ibec, Mercer and Hay. Of the minority of organisations that had introduced wage cuts, most were in the 5-10 per cent range with about one-third (37 per cent) implementing larger percentage cuts for higher-paid employees. Just over half of the organisations (51 per cent) had introduced a pay freeze while 28 per cent had provided some increases this year.
So of those who are introducing wage cuts only a 1/3 made them greater for those with larger salaries. Clearly the concept of progressive cuts has yet to come home to many many.
The political import of this is clear. If there is a sense that private sector wages are being cut then this can be – and as we have seen has been – used to demand public sector wage cuts.
As Wall notes:
Further CSO data later in the year may clarify the position. However, if it emerges that private sector pay cuts are not as widespread as anticipated, it will make it all the more difficult for the Government to introduce any additional measures of this type for public servants.
I’d think that evidence has already emerged. And given the upswing in business sentiment over the Summer the idea that private sector wage cuts will be extended seems highly unlikely.
And given that information how does one implement this supposed ‘parity’ between public and private sectors. Let’s assume for the sake of argument that the 7% levy already introduced is seen as going some way to cover the pension issue. What is the next stage? Should one quarter of public sector employees have to take a 5-10% wage cut in line with the private sector? Or should that be spread across the entirety of the public sector? To engage with this on those terms is to see the vacuity of the ‘sharing the pain’ arguments.
It seems to me that there is little doubt that public sector pay will be cut. Partially through expedience, partially through sincere belief that this is the right way forward, partially as an example to others. But if public sector workers find fault in that they will have the [slight] comfort of knowing that the figures [largely] support their complaints.
But, my main problem with this is that yet again a line has been fed to the public on another central issue. Our old friend Michael Casey late of the Central Bank and the IMF pointed to this months back when he noted that:
First, the forecasting (and budgeting) record has been poor. It is hard to remember many occasions in the last 15 years when the Department of Finance came close to an accurate prediction of revenue. Too many statements made by government and other official bodies about the state of the economy and of the banks have been proved wrong. It is not that long ago when we were told that the boom would continue and that the banks had plenty of capital. When these versions of events were not believed by the public and the markets, the stories began to change.
When the Government sought to cajole the unions into a pay freeze they painted a more downbeat picture of the economy. In the event this made no difference to the unions, and social partnership failed its first real test. Then we were told a depressing story about the public finances and the virtual impossibility of borrowing. This was designed to soften up taxpayers for the pain to come. Much of the uncertainty is caused by inconsistent stories designed to manipulate public opinion.
And yet it continues.
The urgency of ‘public sector’ reform and tackling ‘bloated’ public sector wages and conditions was predicated on a private sector where wages were in free-fall. That the reality is otherwise, and in a significant percentage strikingly so, makes this of a piece with rhetoric about our supposed inability to borrow internationally and so forth. And policy has been shaped very deliberately on foot of this discourse.
None of this is to ignore some central facts. There are companies who have been badly impacted by the recession and have been unable to continue without significant changes in work and wage practices. There are others which have been unable to continue full stop. And those who have lost their jobs are in a very difficult position. But each of those is a distinct issue in itself with specific requirements in order to ameliorate them, whereas what appears to be an essentially deceitful trope is being used in order to further a particular ideological viewpoint.
Makes no sense at all… September 16, 2009
Posted by WorldbyStorm in Economy, Irish Politics.32 comments
Reading Stephen Collins today I was much struck by the following, really a part of his there is no alternative mantra.
The sombre prospects ahead were emphasised by Taoiseach Brian Cowen at the start of the two-day Fianna Fáil parliamentary party meeting at Hodson Bay on the shores of Lough Ree, where he warned his TDs and Senators that he would not shirk the stark realities facing his Government in the days and weeks ahead.
Whether his backbenchers got the message is a moot point.
Hmmm… what ‘message’ could that be?
While most of them spoke at some stage during the “think-in”, a number warned the Minister for Finance against making the kind of cuts in public spending that are likely to provoke strong public opposition.
Ah!Even those who accepted the need for deep cuts argued for a sensitive approach in the budget.
Now, isn’t that an telling throwaway line? Collins appears – at least to judge from the use of the word ‘even’ in the sentence above to dismiss the idea that a ‘sensitive’ approach is a good idea.
I’m not really surprised. In the world of macho economics, or, to put it another way, let’s inflict cuts that we personally won’t experience to anything like the same degree as those on lower middle and lower incomes will (and let’s be clear, writing for our paper of record is the sort of job which while – admittedly – there have been cuts those at the middle and higher reaches won’t be overly exercised by upcoming tax increases) there’s no end to the rhetoric.
It seems that many backbenchers are an accurate reflection of the continuing public mood of denial about the kind of decisions that have to be made. In broad terms they accept the need for substantial cuts in public spending but they don’t want to accept any of the individual spending cuts recommended in the McCarthy report.
I’ve mentioned this before, this trope of ‘denial’ is an interesting one. There is of course the alternative that the public mood is one where they simply disagree with the proscriptions of Collins and others and seek alternatives. That’s not, in my book, ‘denial’ but a rational approach to our situation. That Collins et al seek to close down any alternatives effectively before they’re articulated is but another reason – perhaps – why many many are dubious of the current ‘solutions’ being put forward.
So, let’s remember that McCarthy and the McCarthy report focused on a figure that was reiterated by the Taoiseach…
During his pep talk the Taoiseach said: “This country is borrowing almost €400 million a week. That cannot continue.” The message was fine but, going by accounts of the meeting, which was held behind closed doors, it seems many TDs didn’t quite get it. They still seem to think that public spending can be slashed in some painless fashion that won’t be noticed. A number of them spoke of the need for a political approach to the budget spending cuts as if pain can actually be avoided.
Now, I’ve noted that there’s some disagreement about that figure. But what I’ve also noted is that even if we take that figure as accurate the the implementation of €3bn ‘savings’ from McCarthy would see a drop to €343 million. However as noted by Michael Taft and others such savings would be unrealisable. A more realistic figure, and one which appears to be underpinned by the ESRI projections is in or around €371 million.
Somehow the sole trader in me – for yes, that’s been part of my shtick too – doesn’t find the line ‘This country is borrowing almost €371 million a week… and that can continue” highly persuasive – and that’s before the socialist in me gets to the issue of what we lose societally for that €29 million saved. And particularly not at the cost that Collins appears to think acceptable.
The mood of the meeting convinced some of the senior figures in the party that the implementation of the detailed recommendations in the McCarthy report will simply prove impossible to sell to the backbenches, never mind the public.
The alternative is to adopt a strategy focused on a few big cuts that will deliver the €3 billion in savings required by Brian Lenihan for next year rather than fight a line by line battle over the 1,000 cuts recommended by McCarthy.
So how does Collins recommend that that occur?
“The only way to deal with this is to cut public sector pay across the board and probably do the same with welfare payments. There will be war, of course, but at least we will face a straightforward battle and not a whole range of debilitating skirmishes that will ultimately leave us weaker politically and probably not get the job done anyway,” said one Minister.
Except there’s a problem there. The figures don’t add up. Even a 5 per cent cut across the board, as advocated by John McHale recently (and note our Stephen is remarkably sanguine about the deflationary effects of such an act) would only save €0.7bn or to put it another €13 million saved a week if it were lashed in in one year, or €6.5 million per week if it is introduced across two. I mention that last because McHale argues for the policy introduced across two years although he is no man of the left – perhaps because he’s a little less sanguine about the deflationary effects… And by the way that would deliver at best .3 per cent reduction in the borrowing requirement.
Which would mean that the €400 million would drop to… €387 million. As I noted not that long ago, I’m feeling safer already.
And here he delivers what he sees as further evidence of ‘denial’ and even outright LMF (or should that be L of economic MF) from the political front line…
The indications are that the parliamentary party doesn’t really have the stomach for the big bang approach but then again it doesn’t want the incremental approach either.
Theirs a mutiny in the ranks… the cowardly bastards are cutting and running because they won’t accept ‘cutting’.
“Cutting welfare is just out of the question,” said one TD.
My God, they’ve even, some of them found hearts… closely connected it would appear to their political brains…
“It goes to the heart of what this party is about and we won’t do it,” he added, but didn’t have any alternative to suggest.
Yes, well. Ask an FF backbencher an economic question and expect a partial answer.
That, in a nutshell, is the problem facing Fianna Fáil and facing the country. Everybody can agree that something drastic needs to be done but nobody wants to do it.
But his proscription seems to be essentially cosmetic. The ‘drastic’ action would result in rather less than spectacular results, financially speaking, while still seeing nothing near a significant reduction in our borrowing requirement. Perhaps a bit more ‘denial’ would be no harm. No harm at all.
BTW…Worth noting as well that Collins appears to be swinging back towards a position where he just barely acknowledges the coalition can weather the political storms ahead. Interesting.
Lisbon: What the All-New EU Might Look Like September 16, 2009
Posted by Garibaldy in Lisbon Treaty.10 comments
Simon Tisdall in today’s Guardian has a piece that talks both about why he thinks the Lisbon Treaty referendum will succeed this time, and how the new rules are likely to lead to a round of infighting over the newly-created plum jobs of EU Council President and EU foreign policy chief, and may well be ignored anyway.
But barring a major upset, euro-pragmatism is likely to trump euro-scepticism this time around.
The reason is not hard to find. It’s plain the Irish have not suddenly fallen back in love with Brussels; many reservations remain. Nor are newly negotiated concessions, such as a guarantee that Dublin will retain its own EU commissioner, responsible for this change of tack. The key difference between now and June last year is Ireland’s transformation from Celtic tiger to timid puss. What happened is the recession happened. The referendum is not about principles, if it ever was; it’s about fear.
Hard to argue that fear isn’t a major part of the current climate, and that people aren’t still deeply suspicious.
“Without the steadfast support of the European Central Bank, our financial system would have collapsed,” said the finance minister, Brian Lenihan. So far, at least, voters seem to be heeding these scary warnings.
Of course, perhaps if the government hadn’t agreed to bail out reckless banks and property speculators then there would be no need to borrow £400m per week. Not that you’ll hear that from the government. And by the way, very interesting to see the DUP effectively demand a say in the way in which NAMA will operate lest it affect property prices in the north, backed up by Martin McGuinness.
Anyway, Tisdall moves on to the new EU positions, pointing out that there is already a battle shaping up for the big jobs, with Tony Blair and former Spanish Socialist PM Felipe González squaring up for the presidency. How Blair’s name can be taken seriously after Iraq and his utter failure to have any impact on the Middle East is absolutely beyond my comprehension. Tisdall raises the interesting proposition that whoever gets it may well be ignored anyway
Yet it remains perfectly unclear how much power the two office-holders will wield and whether EU governments, let alone the US, China, Russia, Brazil and India, will take serious notice of them when the geostrategic chips are down.
That seems like a fair point, as does his point that the the big powers in Europe have during the economic crisis demonstrated a tendency to do whatever the hell they like anyway. I’ll leave the last word to Tisdall
It may be that, as proponents of the treaty argue, the EU will work more efficiently and effectively, both internally and internationally. It is equally possible that, as many Irish voters seem to suspect, the treaty, delivered from on high and apparently irresistible, is another load of Brussels blather that will bring no positive advantages to most European taxpayers – and may even have the opposite effect.
Sean Garland Campaign Public Briefing and Social: September 18th Liberty Hall at 8 September 15, 2009
Posted by Garibaldy in Uncategorized.60 comments
The Stop the Extradition of Seán Garland Campaign is holding a Public Meeting and Social in Liberty Hall on Friday September 18th at 8pm. The meeting will be addressed by Chris Hudson, the Chair of the campaign, and others, and will be followed by music in the Connolly Hall. Information will be provided on the campaign ahead of the next court appearance in early October. It should be a good night, and the more the merrier. The Campaign needs your support.
The Red Menace… September 15, 2009
Posted by WorldbyStorm in Irish Politics, The Left.9 comments
Channelling… well, channelling who…The Independent decided to cover the launch of An Economy for the Common Good – Strategy for a New Direction. A colour piece? Well, if so tinged in shades directly opposite to red, albeit playing up that colour…
“Comrades, it is a real pleasure to be here with you tonight,” the man with the beard and the ill-fitting suit told the small assembled crowd.
It’s last Thursday night, and in the bowels of the Pearse Centre in Dublin city centre, less than 20 people have gathered to mark the launch of the Communist Party of Ireland’s latest publication [a pity that it was launched the night of The Lost Revolution, one suspects attendance would have been significantly greater otherwise - wbs]
And?
There to give the keynote address, Jack O’Connor, president of Siptu, a group which represents over 200,000 workers, and president of the Executive Council of the Irish Congress of Trade Unions which represents over 832,000 workers.
Before the event got under way, those gathered spoke quietly as O’Connor and his media spokesman and former journalist Frank Connolly huddled tight together. Such were the diminutive numbers, chairs in the small room were placed against the walls.
It continues:
O’Connor, one of the most powerful trade union leaders in the country, began his address saying how pleased he was to be asked to address the hard left.
Did he use the term ‘hard left’? Sounds unlikely.
He described the communist publication, entitled An Economy for the Common Good — Strategy for a New Direction, as the best analysis of the global economic crisis that has yet been written.
So, can we expect an engagement by the Independent with the publication?
We cannot.
O’Connor, head of the largest workers union which negotiated social partnership, said the Communist Party has a key role to play in the direction the political left will take in the coming decade. He also said he would have no problem in recommending the communist pamphlet to anyone, going on to say it is required reading for anyone involved in the labour movement or in politics.
Which is a problem why? Well apparently it is alarming… for…
…even more alarmingly, he said many of the rights workers currently enjoy came as a result of the Soviet Union.
“Much of the gains made by workers happened during and as a result of the 70 years of the Soviet Union,” he said.
Now, I’d be one of the first to offer a critique of the USSR across the 20th century across a range of areas, but it’s hardly an controversial notion that the existence of it and other communist nations were a spur to liberal democratic states introducing or accelerating their societies welfare and other services in order to block the appeal of their ‘hard left’ rivals.
Since the fall of the Soviet Union, O’Connor, a self-described social democrat, said there has been a hard-right reaction to many of the facets of socialism and Marxism which he called a dangerous development.
Again, hardly controversial. Articles such as this one in the Independent start with the implicit assumption that the ‘hard left’ is an illegitimate source of thinking. Alarming is, I think, the term. Which is odd if we believe in anything like a… well… market place (to coin a phrase) of ideas.
And it’s not as if O’Connor was merely conveying honeyed words to his audience.
He said he disagreed with the communists’ criticisms of the trade union movement in Ireland but welcomed the publication saying it is a most welcome addition to the discourse of the left. He said he also lamented the collapse in numbers involved in the communist movement, and pointed out the age profile of its members are “around my age or even older”.
But…
O’Connor, the union leader, earlier this summer threatened widespread action if the Government pursued a policy of pay reductions in the public sector. In July he said: “I am not going to threaten the Finance Minister with the riots in the street that seem to pre-occupy his imagination. “However, I believe we can offer instead the prospect of a sustained and relentless industrial campaign conducted workplace by workplace.”
He admitted last Thursday that social partnership had been a very frustrating process as increased access ultimately resulted in reduced influence.
So, relatively moderate union leader, who has explicitly not ‘threatened… riots in the street’… and has disagreed with his hosts publicly… is regarded as making ‘alarming’ comments. That’s alarming alright.
Invitation to Belfast Lauch of The Lost Revolution September 14, 2009
Posted by WorldbyStorm in Irish History, Irish Politics, The Left.add a comment
Brian Hanley has asked me to put this up. As usual, all welcome and no doubt the conversation and debate will be great. Sorry I can’t make it…
Meanwhile at the Greaves Summer School September 14, 2009
Posted by WorldbyStorm in Irish History, Irish Politics, The Left.add a comment
I couldn’t make the Greaves school this weekend but, Conor on Dublin Opinion could, and here is the fruit of his endeavours. Check out the panelists and the recordings of them. Required listening for all of us…and a big thank-you to him for doing that.
