Pat Leahy: It hangs in the balance if the pandemic will change the political landscape

The last comparable event to the pandemic in Ireland was the great recession prompted by the financial crisis of 2008. That led to an earthquake in Irish politics.

The fallout from the crash, the bailout that followed and the years of austerity that paid for it turned Irish politics upside down, remaking the political landscape in a way that continues to take shape today.

Could the pandemic have a similarly revolutionary effect? Right now I think that hangs in the balance.

Why? Firstly, we are in the midst of a massive economic upheaval which cannot but affect politics.

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The healthy income tax returns for last year published this week demonstrate that for many people the pandemic has not had adverse economic consequences.

The judgments that people will make about the coalition's performance will be influenced by what happens in the future. It is ever thus

For some multinational industries it’s been boom-time. Many businesses have adjusted and carried on, continuing to pay decent salaries.

Public servants got a pay rise last autumn, and before Christmas negotiated further increases for this year and next. (Many public servants have, of course, been working furiously hard. Some haven’t.)

There is a glut of savings in many people’s bank accounts, the Central Bank reports.

But for a whole other class of people the pandemic threatens economic wipeout. And the income tax returns tell us they are in the lowest-paid sectors – that is why the tax figures haven’t been hit too badly because they don’t earn enough money to pay much income tax. But they have lives and livelihoods and hopes and dreams, and they have seen them shot to pieces.

This group includes business-owners and self-employed people. But is also includes many young people who work in service industries, retail and hospitality.

The pandemic, in other words, is proving to be an economically polarising event, with a strong generational edge. That will leave a lot of very angry voters, and that has to have an impact on politics.

Upheaval

Secondly, the upheaval is not just economic – it is social and psychological. If the health service is overwhelmed in the coming weeks the scars – from the deaths and all the rest of it – will be deep and lasting. They will forever remind people of a Government that lost its grip on a situation that was previously under control.

The judgments that people will make about the coalition’s performance will be influenced by what happens in the future. It is ever thus.

Just as people are now blaming the Government for an opening of social and economic life many welcomed in December, so if things turn out all right – if the third wave, as Tony Holohan suggested to Opposition leaders on Thursday night, is already near its peak and hospitals are not overrun – they may be more forgiving when making judgments in a Covid-free future.

If the numbers settle down in the coming weeks and the hospitals are not overrun – and that looks a 50-50 prospect this weekend – the Government will muddle on

My own view is that the Government had no choice at the time but to open up social and economic life before Christmas. If the pubs and restaurants hadn’t been opened there would have been a bacchanalia of parties at home.

It was plain that there would be a price to pay for this in increased cases in late December and restrictions in January; that was the implicit trade-off understood by everyone. Yet nobody suggested the price for Christmas would be so severe – obviously nobody would have been happy to pay it.

Even Rise TD Paul Murphy, the Dáil’s most consistent advocate of a zero-Covid strategy and who warned repeatedly about opening hospitality, foresaw only 500 cases a day by Christmas. In fact there was twice that number.

For all the fierce finger-pointing, neither Murphy nor Holohan nor Philip Nolan nor anyone else was warning of several thousand cases a day.

New variant

You can argue, of course, that Government should have foreseen it, but not that they did and chose to ignore it. The private view of one senior health expert is that socialisation got us to 1,000 cases a day; the new variant did the rest. That won’t be definitively known for some time.

Whatever your view on all that, if things get very bad in the coming weeks – if doctors are forced to choose who gets a ventilator and who doesn’t – there will be enough blame to go around for everyone.

And if that happens the political consequences could be limitless. At least one member of the Government believes it would spell the end of the coalition.

But there are also reasons to think that the political effects may not be so drastic.

For a start, the pandemic will be much shorter than the great recession. The financial crisis hit in 2008 and its after-effects continued to dominate for years, as far as the 2016 general election and beyond. The acute stage of the pandemic should – fingers crossed – be over long before the end of the year. Vaccinations will change the picture substantially within a few months.

Secondly, the Government has sufficient resources -–via vast amounts of cheaply-borrowed money – to cushion the economic impact. It will leave Covid supports in place for as long as needs be. That will ease the economic dislocation significantly.

Thirdly, the international evidence for Covid as a political destabiliser is sketchy. Many European countries had horrific death rates and brutal lockdowns but it hasn’t brought down any of their governments yet or caused a rupture in their politics. Covid may have cost Donald Trump the presidency, but it was only one of a number of factors at play.

My guess now is that either outcome is possible.

If the numbers settle down in the coming weeks and the hospitals are not overrun – and that looks a 50-50 prospect this weekend – the Government will muddle on, claiming to have handled the pandemic better than the US and UK and as well as most EU countries. The moment will pass; politics will resume.

But if the crisis gets worse and leaves permanent deep economic, social and political scars, I think it will inevitably change our politics, perhaps profoundly.