Is Ireland using its diplomatic superpower for good or evil?

Giving Big Tech anti-competitive tax benefits undermines democracy globally

“Companies such as Google and Facebook have been permitted to acquire unfettered power and through such power have increased their share prices at the cost of moulding the civic norms upon which democracy exists.” Photograph: Cyril Byrne

“Companies such as Google and Facebook have been permitted to acquire unfettered power and through such power have increased their share prices at the cost of moulding the civic norms upon which democracy exists.” Photograph: Cyril Byrne

 

A recent edition of the Economist wrote about Ireland’s emergence as an “unlikely diplomatic superpower” in global politics, outlining the many ways in which Irish diplomacy had scaled to global soft-power dominance. “On a per head basis, Ireland has a good claim to be the world’s most diplomatically powerful country.”

Sinéad O’Sullivan is a Sainsbury management fellow at Harvard Business School and a senior research fellow at MIT’s Sloan School of Management, leading research into geopolitics, technology and democracy

There is no doubt that Ireland has struck a chord globally – both as the underdog and as the rags-to-riches success story. The Irish narrative never fails to win over even the harshest critics; in sports and economics alike our story is one of relatability and against-all-odds triumph. This diplomacy is achieved simultaneously with a twinkle of the eye and rarely without a pint of Guinness at hand.

The biggest export of Ireland is not our agricultural products or biomedical devices, it is without a doubt our “craic”: packaged as diplomacy and marketed by a combination of our ancestral history, poets such as WB Yeats and Seamus Heaney and renditions of Michael Flatley in one of an estimated 7,000 Irish pubs outside of Ireland...

Ireland is a country full of people who are adored and envied globally, and we are proud of our ability to be adored. So when the Economist published its story of Irish praise, it was met with considerable enthusiasm. An Irish friend and colleague from MIT even went as far as to tweet: “‘Ireland has become an unlikely diplomatic superpower’ says the Economist. I disagree, it was not only likely it was inevitable.”

Joseph Goebbels: “If you repeat a lie often enough, it becomes accepted as truth.”

It was Joseph Goebbels, who said: “If you repeat a lie often enough, it becomes accepted as truth.” And in 2020, the mask of this feigned narrative is starting to slip. Because while Ireland is propagating diplomacy through the front door, it is ensuring the demise of democracy through the back door with an ill-fated strategy that cannot endure.

Tax haven

Ireland is the biggest tax haven in the world, used by multinationals to shelter profits. The Irish taxation of multinationals has been drawn back into headlines with the recent Apple case ruling, showing that Apple had a scandalously low effective tax rate for its European business of 0.005 per cent. There are many well-discussed and hotly-debated reasons why the Irish tax strategy both enables and hinders Ireland, mostly focusing on Irish jobs, Irish economic growth and the cost of living and property.

Having an essentially zero-tax cost base enables these corporations to grow at an unprecedented speed while creating long-lasting social devastation in their path

But the real danger inherent in Ireland’s relationship with the global tech sector is not an Irish problem alone. We need to look outwardly during this debate. Because while Ireland is winning the short game in terms of sector and economic growth off the back of these tech giants, the costs to this strategy are not only shared globally but are terminally damaging to the levels of democracy experienced worldwide.

The value and viability of global democracy is more highly contested today than ever before. While democracy has enjoyed widespread global growth since the latter half of the 20th century, technological progression is affecting the levels of democracy within old and new democracies alike. The creation of algorithm-based technologies has led to overwhelmingly private ownership of the production, collection and distribution of information and knowledge in the technological era.

The very nature of democracy seeks to create a balance between government and individual control, however the private technology industry has created unprecedented influence for governments (democratic and authoritarian alike) and for itself. Companies such as Google and Facebook have been permitted to acquire unfettered power and through such power have increased their share prices at the cost of moulding the civic norms upon which democracy exists. Democracy has been eroded by technology in a three-pronged way: through the creation of power asymmetries between governments and corporations with communities, by sowing a lack of trust and disinformation in the media and by changing our civic norms by hijacking our attention with endless targeted advertising.

You cannot use the local profits from eroding democracy to pay for your rise in global diplomacy

The relentless pursuit of these corporations and capitalist pressure to act so egregiously at the will of their shareholders has been helped, not hindered by Ireland’s exaltation of Big Tech and hence the jobs that this new religion has brought. Where the Irish economy was once propped up by the Catholic Church and ministerial decisions were made in the pew, global condemnation of the Vatican moved the ministers to a new god in the Silicon Docks. As Ireland’s complex cultural ties with religion have clashed with its young and progressive communities, these progressive communities now look not to the Pope but to Zuckerberg, whose following is exponentially increasing. And as Ireland moves the Catholic Church away from its economic and social core, there is another predatory and power hungry sect making its way to the altar.

Free from the shackles of regulation, Mark Zuckerberg has assembled a community larger than any religion or country. Photograph: Josh Edelson/AFP/Getty Images
"As Ireland’s complex cultural ties with religion have clashed with its young and progressive communities, these progressive communities now look not to the Pope but to [Facebook chief executive Mark] Zuckerberg, whose following is exponentially increasing." File photograph: Josh Edelson/AFP/Getty 

Social devastation

By housing Big Tech under anti-competitive tax structures and building their data centres, Ireland is making it nearly impossible for technology to be regulated in the European Union and beyond. Having an essentially zero-tax cost base enables these corporations to grow at an unprecedented speed while creating long-lasting social devastation in their path. The cost of Big Tech growth in Ireland can be felt everywhere, so we must start to ask ourselves if the trade-off will pay out in the long term, when the music stops and the semi-permanent jobs have moved to a lower cost base.

Eduardo Baistrocchi of the Tax Justice Network has explained: “It is triggering an ongoing clash between globalisation and democracy because of the increasing inability of tax systems to address problems of inequality within countries. This clash has been producing, in turn, electoral shocks in both the developed and developing world such as Brexit, Trump and Bolsonaro.”

I recently read a beautiful poem by Imelda May, You Don’t Get to be Irish and Racist, which explored the space of contradiction between our cultural heritage and our globalised, modern viewpoints. It made me think of the Economist article – is Ireland really a diplomatic superpower? In my mind, no. You cannot use the local profits from eroding democracy to pay for your rise in global diplomacy. You don’t get to promote a set of values abroad while quietly contradicting yourself at home. We cannot celebrate our Nobel laureates who have written about prevailing Irish sovereignty through wars fought on land while removing the sovereignty of others through wars fought online.

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