There is no such thing as private enterprise


After years of talk about the unimportance of the State, we're back with the simple truth that governments are crucial, writes Fintan O'Toole 

CRISES ARE innately nasty, but they do have one advantage. They sweep away layers of obfuscation and wishful thinking and reveal what lies beneath.

What the present crisis is revealing is something that those on the left have always known. It is, quite simply, that there is no such thing as private enterprise. The market system, even in its most enthusiastically buccaneering forms, is underpinned by governments. It is not just that governments create the framework of law and the physical and social infrastructure that allows businesses to function. It is that governments, whether they like it or not, are the ultimate guarantors of the financial system that in turn drives the entire economy.

As we've learned in the last month, the only real difference between left and right is that the right believes in socialism for the rich, while the left believes in socialism for everyone. All the guff about private enterprise exists merely to distract from the hypocrisy inherent in the insistence of the wealthy that the State should prop them up while telling the poor to stand on their own feet. When money is flowing like Château Petrus at a stock dealers' dinner, the Nanny State is a dreadful bitch. When the bill has to be paid, the Nanny State is the beloved mother beneath whose skirts we can hide from the storm.

And so, after years of loose talk about the increasing unimportance of the State, we're back with the simple truth that governments are utterly crucial, not just to political and social life, but to economic life as well.

That, unfortunately, is not an especially happy thought in Ireland. While we were wallowing in uniquely favourable global and demographic circumstances, we could persuade ourselves that the poor quality of public governance didn't really matter. Our mainstream politicians were themselves telling us that the State was a bad thing and that the evils of "big government" were axiomatic. So we granted ourselves the luxury of being fundamentally unserious about politics.

We thought it was okay to continue to vote for glorified messenger boys to pull strokes on behalf of their constituents. We tolerated both outright corruption and low ethical standards, re-electing with great enthusiasm people whose own parties, in spite of their high embarrassment thresholds, found embarrassing. We allowed Ministers to get away with astonishing incompetence in episodes like e-voting, PPARS and the nursing home charges debacle. We smiled indulgently as they ran off on pet projects like the Bertie Bowl, so-called decentralisation and hospital co-location to distract themselves from the real job at hand.

This lack of seriousness was rooted in an almost Italian notion that governments have relatively little to do with real economic life. The actual success of the economy, combined with the right-wing ideology that explained that success (wrongly) as a triumph for "small government", had a politically soporific effect.

If you weren't interested in "politics", you could ignore it altogether. If you were, you could treat it essentially as a game, a tribal and/or regional competition for patronage and prestige, as passionately contested but as ultimately decorative as a Munster football final.

This fecklessness extended from our attitude to national governance to our engagement with the EU. We increasingly came to see it, too, as a system for which we had no responsibility. We could casually weaken it in a time of growing global uncertainty without bothering to inform ourselves about it or, worse, while misinforming ourselves with rumours and conspiracy theories.

And so we wake up again in a world where governments are suddenly the only game in town. Greed, fraud and self-delusion have brought the global financial system to the brink of collapse. "Private enterprise" is tapping us on the shoulder and saying, "by the way, there was a hidden clause in the social contract that says you're responsible for my screw-ups". The market has no solution, or at least none that doesn't involve the high probability of another Great Depression. Governments, central banks and intergovernmental institutions - politicians and public servants, in other words - are all that stand between us and chaos.

Here in Ireland, this would be a much less uncomfortable prospect if we'd paid more attention to the quality of government over the last decade. We can't do anything about that past neglect now, but we can wake up to its consequences. We can really question whether a choice between two virtually identical parties, each committed to the same beliefs that have got us where we are now, serves us well. We can support genuine reform of the system, starting from the bottom up with a real system of local government. We can demand the accountability that is the precondition of good decision-making, starting with the restoration of the Freedom of Information Act.

We can stop insisting that our politicians be ward-healers and fixers, and start expecting them to be fully engaged on national and international issues.

Above all, we can pay attention, because however much we despise our governments, we can no longer afford to ignore them.