Rhetoric laced with blame for EU-IMF is dangerous

INSIDE POLITICS:FG and Labour may be playing to populism with talk of lacerating the bailout deal. It distracts from reality

FOR AN election that is going to change the face of Irish politics, the atmosphere in the first week of the campaign has been strangely muted. All the parties sound as if they are engaged in a mock battle and afraid to engage on the truly appalling financial position of the country and the tough choices facing the incoming government.

Even if the Opposition leaders are not prepared to spell it out, the voters know in their hearts there are still some very tough years ahead. They might have been prepared to listen to an honest debate about the real options facing them but are not getting it.

The overwhelming message from the Irish Times/Ipsos MRBI poll, taken at the beginning of the week, is that the voters hold Fianna Fáil responsible for the state of the country and are determined to vent their anger on the party. The satisfaction rating of the Government at just 4 per cent and the Taoiseach at 8 per cent is quite extraordinary. Even Hosni Mubarak would probably do better than that if the Egyptian people were given a chance to express themselves.

The naked hostility to the Government translated into a dire 15 per cent rating for Fianna Fáil, despite the election of a new leader. At that level of support, the party will be lucky to get 25 seats. Unless there is a huge improvement by February 25th, Fianna Fáil will suffer a defeat not seen in Irish politics since the death of the Irish Party in 1918.

What is now happening to Fianna Fáil has been widely compared to the Fine Gael performance in 2002 but, in truth, it is far, far worse. In 2002, after a poor election campaign, when it was clear from the start that the party had no chance of winning, Fine Gael under Michael Noonan lost one-quarter of its vote, when compared to the previous election. If this week’s poll result holds until election day, Fianna Fáil will lose two-thirds of the votes it won in 2007.

Fine Gael has got off to a good start. Enda Kenny is looking and sounding more relaxed and clearly enjoys campaigning. After an early spate of good poll results, the party’s task is to consolidate its support and show it can provide responsible government. The memory of the last election when support drained away in the last week gives Fine Gael no grounds for complacency.

Given that Fianna Fáil is on course for an electoral disaster, come what may, both Fine Gael and the Labour Party might have been expected to make a greater effort to face up to the scale of the crisis in the public finances. Instead both parties have been giving the impression there is a magic wand called a renegotiation of the EU-IMF bailout that can solve our problems. Labour, in particular, has become almost hysterical on the subject. “It’s Frankfurt’s way or Labour’s way,” declaimed Eamon Gilmore as he denounced the bailout deal and pledged his party would renegotiate.

The problem is that, even in the unlikely event of the EU-IMF being prepared to give us much softer terms, and agreement on a new deal is forthcoming from all our EU partners, the hole in our public finances will still be there. Having to pay a little less interest on our borrowing would certainly be a help but that won’t eliminate the need to keep borrowing to fund public services.

Sinn Féin has argued consistently that we should have nothing to do with the bailout but the party has not come up with a coherent answer as to how the €19 billion gap between tax revenue and public spending can be bridged. Gilmore’s anti-Frankfurt rhetoric is heading in the same direction and while it may win some votes for his party, it will be no help when he gets into government and the actual attempt to renegotiate the deal begins.

Blaming outsiders is always a dangerous game, particularly as our problems are so obviously self-inflicted. The electorate chose Fianna Fáil in 2007 with eyes wide open. That probably accounts for the level of bitterness felt towards the party now.

Brian Lenihan came up with a historical analogy from Fianna Fáil’s past to explain the Opposition’s current strategy. Outlining his party’s commitment to the four-year plan, he said some parties wanted to deal in illusions as if it was 1930s Ireland and the debate was about land annuities. The analogy between the European bailout and the annuities is apt. Back in the late 1920s, Fianna Fáil, seeking to achieve power for the first time, fanned the grievances of the country’s farmers who paid land annuities to the British exchequer.

The annuities were paid in return for government loans that had enabled them to buy out their farms for considerably less than they had previously paid in rent. No other rural dwellers in the UK, or the rest of western Europe for that matter, got such a good deal but, after the establishment of the Free State, it became a stick with which to beat the Cosgrave government.

One sardonic London Timesreporter, covering the 1932 campaign, noted the electorate was "a curious mixture of shrewdness and credulity". Pointing to the impressive record of minister for agriculture Paddy Hogan, he wrote: "When Mr Hogan, unfolding his admirable programme of benefits for farmers, says O fortuantos ninum sua si bona norint, Mr de Valera and his friends send back from a hundred platforms the sinister echo 'No rint'."

The upshot was that having won the 1932 election promising not to pay the annuities, de Valera stopped handing them over to the UK exchequer. The British retaliated by putting up a tariff wall on Irish farm produce. The economic war between the two countries began, and commercial agriculture in Ireland was destroyed for more than three decades but Fianna Fáil became the dominant party in a country on a wave of nationalist indignation.

Maybe there is some justice in the fact that the ruthless political tactics used by Fianna Fáil all those years ago are now being used by its opponents to drive a stake through its heart. The problem is that the consequences of a serious rift with the EU over the bailout could inflict the kind of long-term damage on the Irish economy that the economic war did in the 1930s.

Taking a more short-term perspective, Fine Gael and Labour should look back just a couple of years to when Brian Cowen became Fianna Fáil leader and taoiseach. The Irish Timespoll in May 2008 gave Cowen a personal satisfaction rating of 52 per cent, the Government's rating was 48 per cent and Fianna Fáil was on 47 per cent.

All has since changed and changed utterly. But Fine Gael and Labour would do well to remember that such a fickle public mood is capable of changing as rapidly again.