In search of a new blueprint for post-troika Ireland

Opinion: Plan to reflate euro zone with investment

Photograph: Getty Images

Photograph: Getty Images


It was the triumph of William Martin Murphy in the 1913 Lockout that damned Ireland to recurring crisis. Those formative months of struggle led, ultimately, to the capture of the nascent State by a value system that reduced all human activity to one imperative – “to add the halfpence to the pence”, as Yeats decried.

Four times in our short history we have perched at the edge of the economic abyss. The most recent outbreak, in 2008, provided clear proof of how deeply embedded that value system is, as the government first sank the State in a bid to save private banks and then cut the minimum wage by 12 per cent. Any attempt to build a recovery on these foundations is a fool’s errand.

We need a new blueprint for post-troika Ireland, one which encompasses a fundamental reorientation of policy, strategy, vision and values. Is being “the best little country in the world to do business in” really the best we can hope for: a global leader in adding the halfpence to the pence?

The Irish Congress of Trade Unions is hosting a conference to begin sketching this new blueprint for post-troika Ireland. Much of the emphasis will be on reversing the ruinous policies of recent years – both in Ireland and across Europe. A keynote speaker is Reiner Hoffmann, incoming president of Germany’s largest union federation, the DGB, which has proposed a massive, multiannual and multibillion co-ordinated programme of investment across the euro zone, with the aim of reflating the entire region. The plan prioritises investment in energy production, communications infrastructure and skills. The DGB has titled its ambitious initiative “A Marshall Plan for Europe”.

Damaged landscape
It has been broadly adopted by the European trade union movement as the only effective means to undo the damage done in the last five years, primarily by the European Commission. This body has overseen an erosion of trust between debtor and creditor countries and between institutions and citizens. More than 26 million people jobless is abject failure.

The commission’s flawed economics has spawned toxic politics across the European Union. At a domestic level, Ireland’s most pressing need is for a wage rise – to infuse money and demand into the economy and escape deflation’s tightening grip. But we need to reimagine industrial policies and borrow from what works in similar-sized economies, particularly those of northern Europe.

The conference title – New Course for Better Times – is borrowed from an old election manifesto of the Danish Social Democrats. It seems to have worked for them.

We went tentatively down this path in the 1990s, when we saw the capabilities of the State intelligently harnessed to help us catch up with the rest of Europe. For a short time, productive investment trumped bricks and mortar. That needs to be recaptured.

The needs of most people are modest: a home, decent work, the ability to raise a family with dignity and not to see your children forced abroad. Those basic needs have been denied countless thousands of our citizens over successive generations and it was a mark of our 1990s success that, for the first time, we began to imagine how they could be met into the future.

Had we continued on that path, it is likely we would have aligned our economic capacities more closely with the Nordics. But our future is highly contingent on what happens in Europe.

Danger of isolation
Equally, Britain’s steady drift away from the EU holds dangers for us. We are the UK’s sixth-largest trading partner, but matter little to Germany. The threat of isolation is all the more real when you consider our liberal market economic system derives substantially from the Anglo-Saxon model and sticks out like a sore thumb among the mainstream of social market economies in Europe.

Again, the logical response would be to deepen ties with our northern neighbours. This would have implications for taxation and public spending, areas where Ireland falls well behind most others in the EU.

The core problem of the present time is not economic – it is the conflict of ideas and values. We urgently need to start reimagining ours and consign Murphyism to history.

n A New Course for Better Times runs today

in the Mansion House, Dublin. See

David Begg is general secretary of Ictu

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