The Progressive Democrats president, Mr McDowell, last night issued a rallying call to fellow Ministers to hold to the Government's liberal economic policy agenda, saying tax-cutting and deregulation have helped transform the State. Mark Brennock, Chief Political Correspondent, reports
After a week of sniping from Fianna Fáil backbenchers claiming a PD-driven Government policy agenda had brought about their disastrous election results, Mr McDowell said the Government must "stride forward with implementing the commitments which it made and on foot of which it won office".
His powerful speech at a dinner of the employers' federation IBEC was a direct response to Fianna Fáil backbench calls for a rethink of some Government policies, seen as too PD-influenced. He rejected claims that the PD view was inconsistent with the achievement of social justice.
The Minister for Communications, Mr Dermot Ahern, criticised again yesterday what is seen as the PD view of society, saying there was "disquiet" in Fianna Fáil after Mr McDowell said recently that inequality was necessary for the economy to thrive.
Mr Ahern said that while the PDs represented just 3 per cent of the electorate, Fianna Fáil represented 30 to 40 per cent "and we have to represent these publicly as well as privately".
However, Mr McDowell said: "No one has a monopoly on compassion and social conscience. Those of us who have driven Ireland's success - from within or without the political system - have accomplished more in terms of real, tangible social justice than all the high-minded incompetence of the 1973-87 period. There is absolutely no political morality in well-intentioned failure." From 1973 to 1987, "social democratic orthodoxy" involving massive State domination of the economy and suffocating tax rates had brought the country to "political and economic despair". In contrast, since 1987 liberal economics had been a key factor in bringing extraordinary economic success.
Essential components of this success were: sound public finances; a new approach to embracing liberal market economics; a new low rate approach to personal and corporate taxation; social partnership; generous help from the European Union; foreign direct investment; and a stable currency.
The proponents of liberal economics had brought a better way "which involved radical tax reform, which involved the breaking up of monopolies, which viewed profit as healthy, which argued that entrepreneurs and risk-takers had to be rewarded, which argued that workers should and could be incentivised, which embraced competition, which was open to at least consider the option of privatisation. It still takes some degree of courage to stand up for those policies."
He rejected the accusation that supporters of this way believed in the unleashing of unbridled market forces. "It is the essence of the liberal, republican tradition that the market is the servant and not the master of the people. No one I know argues that Ireland is or should be an economy rather than a society." He emphasised that he shared concerns of critics of the PDs over "problems in relation to health, education, disability, housing, infrastructure, planning and criminality".
Meanwhile, in Clonmel yesterday the Tánaiste, Ms Harney, expressed confidence that the Coalition would run its full term, but she cautioned it was important that all Ministers had confidence in each other if the partnership was to work successfully. "It will run its full term if we can return to a policy agenda now that the EU presidency is coming to an end," she said.
"I think the last thing you need in a Coalition Government is for one party to feel the other party is a problem. "