Pat Leahy: Varadkar starts to show his hand
Taoiseach is targeting economic interests of the lower middle class, and we’ll see that in the budget
One hundred and two days in, Leo Varadkar is still getting used to the job of being Taoiseach. That’s entirely to be expected. It’s a job like no other. It’s different from being a Minister, when your prominence in political life and public attention is intermittent and manageable. The Taoiseach is never off. Dawn till dusk, every day, every week.
Sure, he can chisel out a few hours every now and again – and aides say he is conscious of the need to do so – but that’s about it. The change in his life since June must make coming out as a gay man feel like a relatively minor adjustment.
Every speech he makes gets attention; every comment he makes is reported. If he is insufficiently enthusiastic in mounting a tractor or handling a farm implement while trudging through the muck at a ploughing match, people will notice.
His is the ultimate responsibility – for the country, and its leadership – and so he is under constant scrutiny. That is how it must be. Even for someone as naturally self-assured as Varadkar, as intellectually self-confident, it must be daunting at times.
Perhaps the need to get used to the role explains the relatively quiet opening phase to Varadkar’s premiership – surprising those of us who expected a more kinetic start. The sense has been very much steady-as-she-goes rather than one of change.
But of late there are clear signals, I think, of the sort of direction which Varadkar intends to bring his Government and his party, and of his future approach and appeal in the electoral contests inevitably to come.
One signal is the clash between himself and Micheál Martin on the budget. Varadkar has made several suggestions – hardening these past days into definite commitments – that the budget will ease the income tax burden on middle-income earners by raising the level at which they pay the top rate of income tax.
Last Monday, speaking at his party’s think-in in Longford, Martin fired a medium-calibre shot across Varadkar’s bow. The confidence and supply agreement between the two parties stipulated reductions in the Universal Social Charge (USC), Martin said, and he would insist on them.
On the Government’s own figures, he insisted with some justification, Varadkar and Paschal Donohoe could not do both income tax cuts and USC cuts.
We believe that work should pay, and we want everyone, including those on middle incomes, to gain from the system they fund through their taxes
Martin’s support – or at least acquiescence – is required for the budget to pass.
Varadkar’s response was to go full steam ahead. He and Donohoe pushed on all week with talk of raising the entry threshold for the top rate. At the Ibec dinner on Thursday night, where the Taoiseach delivered the keynote address, it appeared as a clear commitment.
“We believe that work should pay, and we want everyone, including those on middle incomes, to gain from the system they fund through their taxes. Too many people feel that they pay for everything but get little in return,” he said.
“Where we have scope in the budget, it will be used to reward work and enterprise, and will benefit those on middle incomes and those who pay the highest rates of tax far too soon.”
He went on to joke about wishing to emulate the French example of taxpayers only hitting the top rate at €150,000 a year.
This is a clear reprise of the themes that Varadkar constructed for his leadership campaign in the Fine Gael contest before the summer.
Varadkar told Fine Gael that he would appeal to the middle class, middle-income people, who pay for everything. That is the direction he is moving. I have never heard an Irish politician speak so much about the middle class as Varadkar.
The middle class as a political theme was more or less invented in the US by pollster and political consultant Stan Greenberg. In 1985, following an in-depth study of voters in Macomb County in Michigan, he wrote a book called Middle Class Dreams analysing why traditional blue-collar automobile workers had defected to the Republicans for the first time ever – the so-called Reagan Democrats.
On Greenberg’s advice, Bill Clinton ran in 1992 on economic issues (“It’s the economy, stupid”) stressing the interests of the middle class. Macomb swung back to the Democrats. (It pivoted back to Trump last year) Incidentally, Greenberg’s firm of political consultants was employed by Fine Gael since the early 2000s, though I understand the relationship has ended.
Varadkar seems to me to be seeking to construct a similar appeal, targeting the economic interests of the lower middle class, and we’ll see that reflected in the budget. But it’s a tricky business in Ireland where expectations of the State are much greater than the US.
Your Government does not believe in a culture of dependency and victimhood, where people are down and dependent
Just because “Keep the Recovery Going” flopped doesn’t mean that an economic message can’t work; but it does demonstrate that it needs to be carefully arranged and cleverly applied.
There is also a harder edge to this appeal. What Varadkar left out of the speech was perhaps more significant as a signpost to his future direction. While speaking about the “culture of aspiration”, Varadkar’s script contained the following lines:
“Your Government does not believe in a culture of dependency and victimhood, where people are down and dependent. Rather, we believe in offering people a way up and a way forward.”
Varadkar chose to omit them, judging it too risky the optics of warning about welfare dependency in front an audience of 700 business leaders in dinner jackets and evening dresses.
Yet the fact that it was in there in the first place tells us more than the fact that it was ultimately left out. Leaving it out was a matter of political judgment on the night; putting it in was evidence of conviction.
Varadkar’s politics will be sharper, it seems. Irish politics may be about to get less consensual.