September 2015        

All is not quite what it seems

Tommy McKearney

According to an article by Hugh O’Connell on the web site journal.ie, our now ailing and tetchy Labour Party leader has commissioned a company called Marmalade Films to produce a series of short social-media-based advertisements commending the party’s performance in government.1 These short film clips deal with the themes of jobs, families, and business, asserting that the Labour Party is good for all three, though offering little evidence to support the claim.
     In its anxiety to avoid a humiliating and richly deserved whipping from the electorate, the Labour Party is now frantically promoting Fine Gael’s right-wing narrative of economic recovery and the gradual ending of austerity.
     Undoubtedly the headline figure for unemployment has dropped, the Central Statistics Office is also recording an expansion in GDP, and, lo and behold, house prices in Dublin are rising again.
     To gain added purchase on the story, some especially nervous Labour TDs have drilled further down into the statistics and found crumbs of comfort for themselves. Joanna Tuffy recently wrote that the number of foreign trips taken by Irish people increased this year by 14 per cent. Perhaps she was referring to a possible uptake among the 13,000 job-seekers who were advised by the Department of Social Protection earlier in the year to accept employment options in Germany and Norway.2
     Is there, though, any real justification for claims of economic recovery and the phasing out of austerity? Moreover, if such a supposedly benign scenario exists, is it affecting beneficially working people? As with much of what emanates from the coalition press office, all is not quite what it seems.
     For a start, any examination of declining rates of unemployment must take into account the persistent lowering of wages, the erosion of workers’ rights, bogus employment schemes such as Job Bridge, cutting back on the social wage, and the never-to-be-ignored flood of emigration. Merely providing employment is not in itself of benefit if wages fail to make a proper contribution to a worker’s standard of living. Work should have to pay, and there is ample evidence that properly paying jobs are becoming scarcer in the Republic.
     There is then the bland and unanalysed quoting of statistics relating to gross domestic product. An increasing rate of GDP often masks the fact that a significant portion of this so-called benefit disappears as transnational corporations based here take their profits abroad. As a result, the level of Irish GDP is persistently larger than gross national product (GNP)3—a situation greatly facilitated by the government’s biased taxation system. In other words, keep a pinch of salt handy when listening to coalition claims in relation to GDP.
     As for those smug boasts about increasing house prices and a return to the good times for property markets—well, need we do more than point to the unedifying and cruel spectacle of the increasing number of homeless families in Dublin.
     Notwithstanding the questionable nature of the coalition’s claims for an economic recovery and an end to austerity, there is an altogether more important fact laying bare the flaw surrounding this hype. Neither coalition party has now or has had in the past any meaningful control over where the economy is heading. The Fine Gael and Labour coalition, just as with the previous Fianna Fáil and Green Party coalition, is obeying an order from the Troika to cut spending on the social wage and thus to force working people to repay speculative loans made by international financiers to Ireland’s gambling bankers and speculators.
     Moreover, the places where the Republic’s economy has apparently benefited are due in large measure to happenstance rather than any inspired management by the government. As the Financial Times commented in July this year, Ireland should be careful about celebrating its delivery from misery.4 The pink paper rightly pointed out that while such factors as cheaper oil, lower borrowing rates and euro-zone quantitative easing helped, these were matters beyond Ireland’s control, and could turn negative just as quickly. Equally ominous was the paper’s observation that much of the Irish “recovery” was dependent on exports to thriving British and American markets, both of which are vulnerable to global market events.
     So now, bring on stage China and its alarming economic difficulties. Whatever the eventual outcome of the crisis now affecting the Chinese stock markets, this is precisely the type of unpredictable financial earthquake that will derail economic recovery in the Republic as well as elsewhere. Capitalism is by its nature cyclical, and, with neo-liberalism reinforced by modern technology and globalisation, the frequency of cyclical crises appears to have accelerated, and there is nothing the coalition can do to alter this reality.
     Inescapably committed, therefore, to compliance with EU dictates, and trapped by the vagaries of market-driven economics, the coalition is no more deserving of credit for any upturn than they are for the weather. What they are responsible for, though, is attempting to mislead the people with hype—a wrong compounded by concealment of the fact that working people in this society are paying for the life-style of a privileged minority, here and abroad.
     In reality there is no more chance of answering this situation through a market economy dominated by forces controlling the EU than there is of finding answers in a marmalade pot, or a marmalade film company. There is no humane substitute for a rationally planned economy concentrating on its citizens’ needs and not the greed of a few. Whatever argument may be made in favour of a transition towards socialism, there is no case to be made for misleading working people about the transient nature of a temporary economic upturn favouring a diminishing band of the well-to-do.
     As the South Africans say, socialism is the future; build it now.

     1. Hugh O’Connell, “Here’s the real story behind those Labour ads you might have seen lately.”
     2. Sarah Bardon, “Welfare officials tell 13,000 people to find a job OVERSEAS,” Irish Mirror, 5 January 2015.
     3. Valentina Romel, “Ireland is the wealthiest economy in Europe . . . or not,” Financial Times, 13 May 2015.
     4. “Dublin should be careful not to celebrate too soon, Financial Times, 23 July 2015.

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