[Marxism] Irish opportunities

[D OC <donaloc@xxxxxxxxxxx>]

Gary,

 

I hope that you are keeping well on the other side of the planet.

 

> Interesting times are they not? The criminality and corruption and
incompetenceof capitalist modernity in Ireland is quite something. I wonder
though about the transition out of this stage to a revolutionary one.


Its the scale of the collapse. Unlike in the past, there's no outlet for the 
head of steam that's building up. No significant emigration  (that to Australia 
is drying up) as everywhere else is as bad. Public finances are incredibly bad. 
Looks well likely to me for a default in 2010 or 2011 tax years even allowing 
for a raiding of the pension fund. 

 

Nothing positive on horizon at all. FDI won't work as cost of labour too high 
compared to eastern europe and china. Besides protectionism is holding that up. 
People are tied to mortgages they cannot pay off. Worse still is the quality of 
life - even in the 'good times'. People travelling hours just to get to work. 
Inadequate public transport. Then no public childcare so you have to work 
longer to pay someone to look after children. People are going mad out there. 
Government is not just capping public sector wages but reducing (by up to 5% 
this year). Much worse promised next year. FF response is reminiscent of 
Herbert Hoover. That's what creates revolutionary potential. People's standards 
of living are being cut. What is holding it back the most is the absolute 
absence of any credibleconcrete alternative and it will take a few years to 
really undermine the credibility of the FDI model in public minds - it worked 
so 'well' for so long at least that's what the media tell us. Right now, cuts 
are being pressed home on back of TINA ideology. Lots of protests but mostly 
not connecting. Interesting, however, FF now third in polls behind both FG and 
Labour!! Who could imagine that? The potential is that they could be forced 
from Govt and that would I believe open massive potential for further change in 
the months and years ahead. The workers factory occupation in Waterford Crystal 
was a massive leap forward in consciousness. They even raised the flag of 
Connolly over the factory - the Starry Plough. It is still ongoing despite 
Dublin-govt attempts to 'defuse' it.


> For sure there are short term opportunities for anti-systemic propaganda but
other forms of resistance will take longer I think. Though of course no one
knows at all what could happen.


I would agree if this was only a temporary blip. Ireland's set back is far 
worse than that of US or Europe. We had most open economy in world. We were hit 
hardest by collapse in US FDI. Arguably we could expand quickest if growth 
comes but we're very dependent on overseas growth and inward investment which 
doesn't look very promising in an era of rising protectionism. In meantime, 
govt can't afford to bail out banks but because of class ties, they're 
committed to it. 

 

Borrowing mushroomed with low EU-wide interest rates. When their economies pull 
out of recession, interest rates will inevitably rise and kill off any hope 
here. The situation is aggravated by the fact that our economic cycle is closer 
to US than mainstream EU and results in overextended booms and busts. 

 

Very hard to see way out within mainstream paradigm. Govt cuts are forcing 
further collapse in domestic consumption. Increases in VAT are just forcing 
people to shop in north and more lost revenue. ECB/IMF loan package is most 
likely answer. What will terms of that be, more cuts across everything. Little 
hasn't been privatised as it is - so what more?

 

> For the moment everyone seems to be heading towards the pump to prime like
bejeezuss, except as you say in countries like Ireland where there the state
does not have the revenue. Does that not return us to the situation where
there will be a stronger welfare state in the North as opposed to the South
of Ireland?


Ireland unlike Britain cannot print its own money if things go from bad to 
worse. We cannot also devalue our currency. Borrowing is becoming much more 
expensive as the market thinks (correctly) Govt can't stand over commitments. 
Pump-priming to develop a productive economic base might work well in Ireland 
but should have started about 5 years ago when borrowing was cheap and Rose 
Dugdale and myself were calling for it along with a lot of other things. Of 
course, no-one really understood point. Things going swimmingly then - it 
seemed. State's revenues became massively dependent on property sector 
receipts. Suddenly these disappear and things look brutal.

 

Welfare state in North has always been arguably stronger than that in South. 
IMO, the deal with FDI growth was that we gave corporations low tax base and 
cheap enough labour, they gave us jobs, but as a result govt couldn't afford 
much by way of public services. So most everything was privatised. Today, cuts 
in south are far worse than those in North. North is hugely cushioned by scale 
of British subvention. Indeed, due to the UK VAT cut and the Irish VAT increase 
and the devaluation of sterling relative to the euro, northern businesses along 
the border are enjoying a boom period! But Britain's finances are almost just 
as bad as those of Ireland and they are a much bigger economy - it will be a 
much bigger problem to fix (IMF couldn't bail out Britain alone - would need 
ECB/UST). They are committing to bail out right left and centre but they are 
starting from huge levels of public debt whereas in theory Irish state still 
has pension fund to raid (and that is considerable). Britain's revenue from 
north sea oil is drying up and London's role as international clearing house 
for finance capital has been challenged by the collapse of Sterling interest 
rates and just the generalised malaise of the world economy. Brown is in 
trouble. He's got a pump-priming project going but whether it will turn the 
corner for British economy is very much open to question. Large swathes of 
northern Britain has been completely deindustrialised. They have no 
agricultural sector worthy of the name and the whole economy was built around 
London. I forecast problems for British public sector provision irrespective if 
Tories win next election.

 

Even when economic corner is turned, Britain will be lumbered with huge debts. 
It can devalue all it likes but still cuts are on the table. North's economy 
more exposed than most to those. We don't have a productive economic base to 
speak of. Over 60% of all employment in north is public sector (some call it a 
Stalinist economy!!)


> The collapse of the Southern economy will be music to the ears of the
North's loyalists, will it not? How that plays out in terms of the naitonal
quesiton is of course another mystery. And what about Sinn Fein? Will
their politics respond to the capitalist crisis? If so - how?


Without doubt. I think that this represents a fundamental challenge to the 
nationalist agenda. I have to say I've been rethinking my own position in 
regard to many questions but am unable as yet to really go into detail. SF 
really look to be sidelined by the whole events unfolding. I believe that 
massive potential exists but perhaps the whole context of struggle has been 
changed by the peace process. Everything has been changed by it and new 
potentials exist that must be grasped if we are drive forwards a revolutionary 
agenda. 

 

If you have been to Ireland since the Celtic Tiger, you will know how much it 
changed us as a people. Greed and the individual was centre-place - the 
majority seemed to become gombeen men! Well all that is being undone today. Our 
economy is closer to its third world predecessor than many would think 
possible. We remain entirely capital dependent. If the US economy picked up 
tomorrow, I'd reckon about 20% of people would emigrate the next day. But 
that's not going to happen, so the wild Irish might just return. I fear, 
however, that we are one of the weak links but no wire cutter at hand.

 

Le meas,

DoC

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