Ideology jettisoned in pursuit of profits

It is entertaining to watch Michael O'Leary effortlessly abandon his free-market ideology, writes  Fintan O'Toole.

It is entertaining to watch Michael O'Leary effortlessly abandon his free-market ideology, writes  Fintan O'Toole.

THERE IS precious little amusement to be had from economic crises, so we should take it where we find it. One place where it can be picked up in abundance is in the field of ideology. There's real entertainment in watching absolute ideological convictions become suddenly inconvenient. As in a stage farce, when the screen falls down and the trouserless lover is revealed, the naked truth becomes apparent. Points of principle are seen for what they are - useful instruments for pursuing one's own interests.

The great current case in point in Ryanair. As well as running a massively successful airline, Michael O'Leary has been the most effectively populist proponent of so-called free-market ideology. It is instructive, therefore, to look at the four pillars of that ideology as he has expressed them, and to consider their fate in circumstances where they have become a hindrance to Ryanair's interests.

1. Monopolies are evil. O'Leary believes this, both in theory and in practice. "Monopoly situations," he told the National Foundation for Teaching Entrepreneurship (NFTE), "don't work, competition does. We should privatise everything in order to create more competition." Why don't monopolies work? Because they inevitably abuse their power.

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A few weeks ago, Ryanair was complaining about the dominant aviation fuel supplier, Air BP, at Belfast and Glasgow airports: "Air BP has a complete monopoly on the supply of aviation fuel at these airports and is abusing this position to unilaterally impose over 50 per cent cost increases."

Likewise, the British Aviation Authority: according to his biographer Alan Ruddock, "He has waged a relentless war of attrition against BAA, accusing the company of 'raping' passengers and abusing its monopoly position to set ever high charges."

Ditto "the dead hand of the Dublin Airport Authority (DAA) monopoly". And, once upon a time, when the State airline was the dominant player in Ireland, the evil "Aer Lingus monopoly".

But what's this hurtling along our flight path? What else but the Ryanair monopoly? O'Leary wants to swallow up Aer Lingus, and as for little Aer Arann, as he told the Oireachtas transport committee, "If Aer Arann was to go bust this winter . . . we frankly could not care less."

2. Subsidies are bad. Last May, for example, O'Leary called for the scrapping of the public service obligation (PSO) subsidies for flights to small regional Irish airports. He believes that Donegal, Knock, Waterford and Galway airports should be closed. In a letter to the Irish Times last week, Ryanair's Jim Callaghan mocked Aer Arann as a "subsidy-junkie airline". Yet, Ryanair has taken illegal subsidies from regional airports in Charleroi in Belgium and Pau in France and secret ones from Derry. It takes more than €5 million in subsidies for its Kerry-Dublin route.

In a wonderful vindication of his Jesuit education, O'Leary explains: "We have no problem taking Government hand-outs - if unjustified subsidies are available, then we're right to apply for and win them."

3. Governments have no business sticking their noses into industry. "Any time," said O'Leary in 2004, "the politicians get involved in an industry or regulating an industry, they f**k it up. It's what they do best. If they stay the hell out of it, the industry works much better on its own by letting people compete."

He told the NFTE that "the incompetence of the Irish government has been a huge barrier. They can't even build a Luas, never mind run a country." Politicians are "clowns".

And now that he needs the Government's shares to enable him to take over Aer Lingus, to whom does he wish to give absolute control of the most valuable assets in Irish aviation, the Aer Lingus Heathrow slots? The Government.

4. Trade unions are the spawn of the devil. O'Leary doesn't recognise trade unions. He regards them as an illegitimate barrier in the way of his generous and loving relationship with his workers. He has fought those workers, from baggage handlers to pilots, through the courts when they've sought union recognition. He threatened to close the subsidiary airline Buzz if pilots insisted on union recognition. He compared the British pilots' union to "the Taliban, the Monster Raving Loonies or indeed the Moonies".

But now that O'Leary needs the unions' block of shares in Aer Lingus, he will "honour and respect" the airline's policy of trade union recognition. He hasn't yet offered to change his name to Michael Connolly-Larkin and open a route to Havana, but watch this space.

All of this is perfectly reasonable for O'Leary, whose only job is to maximise profits for shareholders and who is entitled to be as ruthless with ideologies as he is with everything else. What is strange, though, is the silence of the right-wing commentariat. Have they gone soft, or do they, too, see deeply held beliefs as a disposable mask for self-interest?