Archive for the ‘Fianna Fáil’ Category

Future of the Church in Ireland

22/04/2013

As part of a series on the Church in Ireland, the Irish Times has written a number of articles on the subject.

The first article discusses the notions of belief in Ireland. The piece begins “Despite the fallout from clerical sex abuse scandals, a significant proportion of the country – including non-Catholics – believe the church has had a broadly positive influence on Ireland. The national survey was undertaken last month among a representative sample of 1,000 voters aged 18 and over. A total of 89 per cent of respondents were Catholic. The remainder were either not religious (6 per cent), Protestant (3 per cent) or from other faiths. Fianna Fáil supporters were most likely to be Catholic (95 per cent), followed by Sinn Féin (89 per cent), Fine Gael (88 per cent), Labour (85 per cent) and Greens (58 per cent). Overall, just under a third (31 per cent) of Catholics said they attended Mass at least once a week. More than two-thirds attended services far less frequently. Some 39 per cent said they either never or very occasionally went to Mass. A further 20 per cent said they attended every two to three months, while 8 per cent went once a fortnight. Those who attend Mass regularly are twice as likely to live in rural rather than urban areas. They are also more likely to be older and support Fianna Fáil or Fine Gael. When it comes to the church’s teachings, many Catholics do not subscribe to key tenets such as transubstantiation. Almost two-thirds (62 per cent) believe the blessing of bread and wine during Mass only represents the body and blood of Christ. Just over a quarter believe it is transformed (26 per cent)”.

It is heartening to see that many still think of the benefits of the Church in Ireland however, these people are normally too afraid to speak up and defend the Church when it comes under attack from those who preach nihilism and relativism. Either unaware of unconcerned by its consequences.  Thankfully there are some who do defend the Church. To be welcomed is the number of people still attending Mass, which is probably among the highest in Europe. Obviously what the survey does not highlight is the age profile of these people and it can be safely assumed that the vast majority are over 60 with only a small fraction under 30.

In a related article in the series notes “Nearly two-thirds of the over-65s attend Mass once a week or more, compared to 13 per cent of those aged 18-24. Interestingly, while women have always been perceived as the stereotypical daily Mass attenders, the gap between male and female attendance is not as wide as might be expected. Four per cent of women attend daily, while 3 per cent of men do. The gap widens to 8 per cent in the once-a-week or more category: 35 per cent of women versus 27 per cent of men. Overall, the gap between the two is about 10 per cent – substantial but still probably narrower than expected”.

The piece adds “Amid increasingly vocal proponents of rationality and science over belief in gods and supernatural explanations for the meaning of life and death, it is interesting to note that over 80 per cent continue to believe in heaven, a belief shared fairly equally across regions, party and class, and rising to 90 per cent among the over-65s and women” but worryingly for the supposed tolerance of society “Do people think the country would be better off without it? The question was asked of all respondents, not only Catholics, and the remarkable fact is only 9 per cent said yes. Nearly 40 per cent said the country would be a worse place without it, a figure that includes 29 per cent of Protestants. It also includes a third of those under 34, rising to nearly half of the over-65s”.

Again this obvious lack of tolerance is seen when another article notes “On one of his first visits to Poland, Scally almost laughed out loud when a Polish friend mentioned that he was a member of the Club of Catholic Intellectuals. The idea of Catholic intellectuals seemed hilarious. But when Polish people needed a bulwark against the communist authorities, the Catholic Church offered people a place to meet and an alternative space to think. It remains the case today: one of Poland’s leading weekly publications is a Catholic newspaper”. The fact that the Solidarity movement worked with the Church to overthrow Communist tyranny and have free speech, the rule of law and a free press after its downfall and the fact that Scally should be so narrowminded and dismissive of the Church speaks volumes.

Predictably reform is mentioned, “Fr Crombie distances himself from themes closely associated with the Association of Catholic Priests, such as the call for national assemblies and dialogue on the looming dearth of priests, on compulsory celibacy and on the ordination of women. Priesthood and celibacy are indivisible for him”. Indeed the ACP, far from being a canonical organisation is totally opposed to any thoughful (liturgical) reform as envisioned by Pope Benedict dismissing it out of hand. As for the question of celibacy it is not practiced in the Eastern Catholic Churches or the Orthodox Church so it should not be ruled out completely. The article goes on “A question that preoccupies the Association of Catholic Priests – the second Vatican Council’s unfulfilled decision that every parish would have a lay-dominated council, linked to a diocesan council, feeding into a national assembly – seems to puzzle him. He has never heard of it”. There is also the issue of what such a proposed assembly would be for.

Lastly, a piece notes the admittedly depressing figures, “In 1970 Ireland had almost 4,000 diocesan priests. Today that figure is 2,160, with 687 others retired, ill, on study leave or working elsewhere. Their average age is 64. In 1970 164 men entered Irish seminaries. Last year the figure was 22. The Amárach survey also found weekly Mass attendance in Ireland was 35 per cent. Last December [2011] Archbishop Martin disclosed that weekly Mass attendance in Dublin is down to 14 per cent and said that within eight years just 235 priests will be available to serve full time in Dublin’s 199 parishes. Dublin’s Catholic archdiocese was facing its biggest crisis since Catholic Emancipation in 1829, the archbishop said”.

Finally a piece calls for “new thinking”. The article mentions that “By 2020, the number of priests in Dublin will drop by about 36 per cent, from 456 to about 294. Just 235 will be available to serve full-time in Dublin’s 199 parishes, he said, with the remainder serving as chaplains or at central services. Meanwhile priests’ income in Dublin has fallen 15 per cent in the past two years to an average of €24,079 per annum, as weekly Mass attendance hovers at 14 per cent. What has been happening in Dublin is reflected in each of the 26 Catholic dioceses on the island. In each, too, as the priests get older and their income drops, their workload increases. This is due to parish clustering, whereby priests who would normally serve in just one parish must now also take care of the needs of the faithful in nearby parishes as well. This, itself, is due to the growing shortage of priests. No wonder morale is low among Irish Catholic priests”. However he adds that this is not the only story, “Of the 1,965 priests currently in parish ministry in Ireland, 838 are 54 years and under. Even the 54-year-olds will not have reached retirement age by 2032. And between now and 2032 more priests will be ordained on an annual basis, though nobody should get too excited about that”.

He adds ” in 2032 there will also be additional permanent deacons. Eight such men were ordained in Dublin’s pro-cathedral last Monday, with other such ordinations to take place in seven more Catholic dioceses in Ireland. It is highly likely this pattern will be followed in the church’s remaining dioceses on the island also. These permanent deacons will be able to officiate at baptisms, weddings and funerals. In so doing, they will greatly lessen the workload of priests. Another way of freeing up, indeed liberating, priests to exclusively exercise their essential spiritual function is for the laity to take over parish administrative duties. This is happening already and is a source of immense satisfaction to the great majority of priests”. Indeed this does make some sense. There is little reason for a priest to spend his time filling in forms when it could be far better spent elsewhere.

Yet is obvious from these reports is the the Church in Ireland faces organisational, financial, “personnel” and credibility problems. However,  the common thread that runs through these reports is that the Church is treated as some political actor rather than a divine institution run by flawed human beings who are trying to achieve some beyond the transitory existence of this life and at the same time aim for something more than just material possessions and whatever else this world offers.

Success for Ireland?

20/02/2013

In what was seen as a “great success” by the Irish government in lengthening the amount of time to pay back the debt, and in effect, pay back more money over time. The not unreasonable hope from the government is that inflation will eat away at the capital sum, leaving only the interest to be paid back, over a longer period.

Media reports note that “A bank debt deal that will reduce the country’s borrowing needs by €20 billion in the coming decade and ease budget pressures over the next two years was unveiled by Taoiseach Enda Kenny in the Dáil yesterday. There was sustained applause from Fine Gael and Labour TDs for the Taoiseach when he sat down after outlining the agreement with the European Central Bank (ECB) to the chamber. The announcement came after 24 hours of political drama which saw emergency legislation to liquidate the Irish Bank Resolution Corporation (IBRC), formerly Anglo Irish Bank and Irish Nationwide Building Society, being rushed through the Oireachtas early yesterday morning”.

The same piece goes on to add that “Kenny said the first payment of principal under the new deal will not now be made until 2038 and the last payment will be made in 2053. The average maturity of the Government bonds will be over 34 years as opposed to the seven to eight year average maturity on the promissory notes. ‘In effect, we have replaced a short-term, high interest rate overdraft that had to be paid down quickly through more expensive borrowings, with long-term, cheap, interest-only loans,’ said Mr Kenny. He said that as a result of the deal there would be a €20 billion reduction in the National Treasury Management Agency’s market borrowing requirements in the next decade with a very large reduction in the debt servicing costs of the State over the next generation. The Taoiseach said the agreement would bring the country €1 billion closer to attaining our 3 per cent deficit target by 2015. ‘This means that the expenditure reductions and tax increases will be of the order of €1 billion less to meet the 3 per cent deficit target,’ he said”.

Yet, it was Fianna Fail that tied bank debt to sovereign debt, under pressure from the ECB, and so made Ireland drown in debt when it could have been Iceland which let the banks go bankrupt, and started again, albeit with siginificant pain to people.

Another article notes that “deal happened only because the ECB agreed to bend rules Being able to manage one’s debts depends to a very great extent on their repayment terms. A small sum borrowed from a loan shark at a usurious interest rate can quickly balloon into an unpayable debt. An open-ended interest-free loan from a friend or relative can, by contrast, be easily managed and cause little worry. The new Government IOUs, unveiled with great fanfare yesterday to replace the promissory notes – the three-year-old IOUs issued to pay off depositors and creditors in Anglo and Irish Nationwide – appear at first analysis to be much closer to the latter kind of loan. While a deal on restructuring the promissory notes has been inevitable since the EU-IMF troika agreed to discuss the matter more than one year ago, the range of potential outcomes of those tortuous negotiations was wide. If the European Central Bank had really put its foot down, the deal reached might have been little more than symbolic.”

Now however, the Germans are attacking the plan, with typical tact. Reports indicate that “Bundesbank president Jens Weidmann has voiced concern that Ireland’s promissory notes deal came perilously close to illegal monetary financing. Last week the ECB “unanimously took note” of a plan to swap Anglo Irish promissory notes for sovereign bonds, easing Irish borrowing requirements by €20 billion. Mr Weidmann, a prominent member of the ECB governing council, has now hinted the deal set a dangerous precedent by blurring the ECB’s “clear line between monetary and fiscal issues”. “The transaction in Ireland demonstrates how difficult it is for monetary policy to free itself from the embrace of fiscal policy once you’re engaged,” he said to Bloomberg. The Bundesbank is unhappy with what it sees as indiscreet statements by Irish politicians on the role played by various officials in reaching the agreement.”

Ultimately the deal is little more than cosmetic with little significance for Ireland or any of the “bailout” countries in the troika programme and domestic Irish politics with the governing coalition gaining from it, though for how long is the most interesting question.

Making progress?

17/01/2013

An article from the Economist discusses the economic situation of Ireland, the “best behaved  of all the euro zone countries that have been given a “bailout”.

The piece notes that “By the end of 2013 Ireland could leave its bail-out programme and stand on its own feet again”. The article goes on to mention “An Irish recovery would provide a boost for Europe and its de facto leader, Angela Merkel, the German chancellor, as much as for Ireland and its prime minister, Enda Kenny. It would show that the controversial treatment of austerity and structural reforms imposed as the price of bail-outs can work”.

The article continues “It would reassure the electorates of core Europe, especially German voters who go to the polls in the autumn, that rescues do not condemn them to a never-ending call upon their taxes, as seems to be the case with Greece. And a sustained return by Ireland to the bond markets would boost confidence more generally, helping other bailed-out economies such as Portugal and Spain”. Yet, to equate Greece, to Ireland, Spain or Portugal is unfair as these nations are not sliding into the abyss as Greece seems to be doing with lots of help from Frau Merkel. What should also not come as a surprise, but is still worth noting, that (German) domestic politics seem to be key. How can EU “leaders” expect EU “citizens” will look to them and not their own national leaders when making decisions all the while hoping to create some kind of legitimacy for a body that is either loathed or treated with total indifference?

The writer goes on to say in an optimistic manner “Last year it dodged the euro zone’s wretched recession. Unit labour costs in the country have come down sharply, making the economy more competitive. That has enhanced Ireland’s allure for foreign companies, which continue to favour the country as a manufacturing and services hub for international markets, not least because of its low corporate-tax rate. These are useful advantages. If things go well in 2013, Ireland might be able to leave its programme without any further assistance”.

Thankfully he injects some realism into the picture ” Ireland’s very reliance on foreign firms creates both economic and fiscal vulnerabilities. If global growth falters this year, for example, Ireland will be hit hard because its exports are bigger than the economy. Any economic setback will make it more difficult to get the deficit down, as planned in yet another austerity budget (the sixth) late last year. Even if things go to plan, public debt, which amounted to only 25% of Ireland’s GDP in 2007, will exceed 120% in 2013; and once the large slice of GDP which goes to low-taxed foreign multinationals is taken into account, it will reach almost 140% (see article)”.

The discussion of recovery that is taking place is laughable, Ireland’s debt is actually rising, not falling and it will continue to rise for many years to come. The piece adds, “About a third of its public debt has been incurred bailing out its banks, an imposition which Irish taxpayers resent bitterly. The Irish government is largely to blame for that, because it issued blanket guarantees to bank creditors at the height of the financial crisis in 2008. But European leaders, scared about the repercussions of a default in the bond markets, later forced the Irish government to protect the banks’ senior bondholders”. Yet for all their resentment the Irish seem to do nothing about it being as passive as ever in the face of their country being, yet again humiliated but corrupt and incompetent politicians.

The article ends saying that Merkel could help Ireland and her own credibility by softening the “terms on the promissory notes—IOUs—which the Irish government used in 2010 to prop up its banks could be eased. A more effective measure would be to allow the European Stability Mechanism (ESM), the euro area’s permanent rescue fund, to take stakes in the Irish banks that remain operational. That would help Ireland both by removing some of its sovereign debt and by insulating the government from any further calls on public funds as a result of more mishaps to Irish banks”.

The EU being as decisive as ever however are unsure about this option saying that “the ESM could be deployed in this way only in new rescues. It will be hard for Mrs Merkel to shift course again, especially in an election year”. It ends arguing that a successful Irish debt deal would not only be good for Ireland but also Germany and therefore the EU.

Europe’s failed state

04/12/2012

As the EU/IMF/ECB “bailout” package progresses and on the eve on another austerity budget that is about to be announced, some have noted the strange characteristics of Ireland and the Irish.  Indeed it has been commented here before that while riots occur in Greece and mass protests in Spain as the endless euro crisis grinds on the Irish remain passive in spite of all that has happened over the last years.

An article in the Irish Times, mentions that the Irish “lack self-esteem despite a veneer of ‘garrulous sociability and self-deprecating twaddle’, according to the latest edition of the Lonely Planet which has just been published. The best-selling guide book says Irish people’s reputation for having an ‘easygoing, affable nature is justified’, but our reputation for friendliness is mostly a manifestation of our desire to chat – and our lack of self-esteem is our ‘dark secret’. The piece goes on to note “the Irish are ‘fatalistic and pessimistic to the core’, which is why they have accepted their economic fate more readily than the Greeks, who have rioted in the streets”.

A different article writes published earlier this year notes that the institutions of the Irish State have little or no significance or respect for many, though obviously not all, of the country’s citizens. It notes “You forget how tenuous and fragile a thing is the Irish State, how little it means to so many of its citizens. By the State, I don’t mean the nation, the flag, pride in being Irish – all that visceral emotion. I mean, rather, two rational things, one tangible, the other abstract. The State is a set of institutions – the Government, the Oireachtas, the Civil Service, public services, the law, the courts. It is also a broad but crucial sense of mutual dependence – the idea that there’s a collective self that goes beyond the narrow realms of family and locality”. The writer goes on to make the point that “To function at all, we have to make the working assumption that those institutions and that idea are part of what we are, that, however vehemently we disagree with each other about however many things, there is this common ground on which we stand. Even when we rail against the institutions (for loyalty is not the same thing as passive obedience), we do so because we identify with them – they are ours to criticise”. He then argues that “Everyone knows, of course, that there are subgroups – criminals, subversives – who have no loyalty to the State at all, who have contempt for its institutions and who don’t recognise the notion of the common good. But the working assumption is that these groups are small, marginal and outside the mainstream of society”.

Indeed, this notion of the common good seems to have been all but obliterated as a result of Ireland’s bizarre history and culture coupled with the ravages of rabid individualism which is prevalent all over Europe and throughout much of the Western world. He depressingly, continues ” every so often, there’s a moment when those assumptions crumble. The idea that the vast majority of people are loyal to the State is suddenly exposed for what it is: a useful fiction. What happens is that very large numbers of people who would never think of themselves as criminals or subversives reveal the truth that they don’t really have much time for key State institutions such as the law and the courts and that they simply don’t believe that there is an over-arching common good that means anything when you set it against more potent local loyalties”. He gives a concrete example, “This is what we’ve seen over the last fortnight in the Quinn affair. Very significant numbers of decent, respectable Irish people – not a majority but not a tiny minority either – are in literal contempt of the courts. They really don’t give a damn what the courts find – if those findings come into conflict with their own deeper loyalties”. He ends his piece “Nor do these decent, respectable people believe that there is a common good that operates at the level of the State and that could possibly outweigh an almost feudal loyalty to a local hero. The State, for them, is a vague, hazy and distant thing – too nebulous to command any real fidelity. The idea that encouraging the Quinns to siphon off €455 million of public assets might harm their fellow citizens has no meaning for them because, deep down, they don’t actually believe that there are such creatures as fellow citizens”, concluding, “The entire political culture of clientilism encourages people to think about the good of the locality, not of the State as a collective entity. Large parts of the Irish elite have demonstrated, with impunity, their own contempt for the law and the common good by evading and avoiding taxes. And of course the State itself is now a sad and tattered thing, stripped of the sovereignty that gives it life”.

An Irish historian weighs in and says that Ireland is not only economically but morally bankrupt also. He argues cogently “the cumulative affect of the various tribunal reports, most recently Mahon, may require political scientists and historians to question or qualify some of their earlier assumptions about the achievements of independence. Taking the long view, perhaps the very impulses that created stability and consensus in the earlier decades of independence also facilitated a fundamental neglect of civic morality and citizenship. This neglect ultimately allowed the sort of ‘systemic and endemic’ corruption exposed by the Mahon report, and as revealed previously by the Moriarty report, what amounted to a devaluing of ‘the quality of democracy itself'”. He goes on to note “There was not enough debate about policy, ideology or the consequences of a ruthless centralisation and authoritarianism. As Garvin observed, in 1922, whatever about devotion to national politics, ‘these unenthusiastic democrats were qualified in their attachment to democratic ideas and were not prepared to trust people with the power to run local affairs'”. Indeed, the nascent Irish state was too homogeneous, being almost entirely Catholic, white and poor. There were no differences in the political parties, a problem that persists to this day, and when a civil war did occur, it was over an irrelevant matter that divided the country then but has no significance in modern times. The writer goes on to mention “This point about trust is vital: if people are not trusted to run their own affairs, they devise other ways of getting things done and with that the likelihood of corruption increases. While there were valiant attempts from the 1920s to clean up malpractice in local government, in the long run local authorities were stripped of most of their powers and the few that they were left with, including the power to rezone land, were abused. In terms of national politics, Fianna Fáil and Fine Gael were born of Civil War divisions, rather than having competing visions about how to shape society. After the laying of the State’s foundations, the practice of politics became about the spoils of the system rather than engagement with ideas about the nature of citizenship. It was about management rather than vision. It was also about, in a society so homogeneously Catholic, abrogating responsibility to the Catholic church in too many crucial areas, including education, with a resultant narrow focus on what constituted immorality”. He adds importantly “Political culture was male-dominated and a closed system in which those who had ideas about doing things differently were dismissed as maverick, or, worse still, intellectuals”. This anti-intellectualism is rife in Irish culture, he mentions “Bertie Ahern – one of that glorious class of Fianna Fáil politicians first elected in 1977, that included Albert Reynolds and Pádraig Flynn – recorded in his memoirs Bertie Ahern: The Autobiography, he had nothing but contempt for intellectuals challenging the ward boss conception of politics”.

He ends his piece “Another problem was that Fianna Fáil was simply in power for far too long and the longer it held office and dispensed patronage the more perverted the definition of loyalty became, in order to justify cover-ups and lies. Lightweights were rewarded and promoted well beyond their capabilities, which resulted in a considerable devaluation of politics and the status of public office. Those who called for accountability within this culture experienced fear, menace and intimidation. As we edge towards the centenary of the events that comprised the revolution of the early 20th century, we face a stark conclusion: this is a State bereft of meaningful sovereignty due to its bankruptcy and a State whose governing culture has been exposed as rotten”.

Two pieces, published more recently, but on the same topic are also of interest and relevance. One of them reports on a conference that took place in Dublin recently. It mentions “The mistakes made in the Celtic Tiger era might be seen as Ireland’s adolescent stage but there is no guarantee that the country will grow up”. The article goes on to say “Counselling psychologist Elaine Martin said Irish society was trapped in a ‘narcissistic system’ as a result of its colonial past and would need to take active steps to move on to the next phase of development”, adding later that “The Irish tendency to devalue themselves as individuals and as a society and to idealise others were among the traits of a colonised people, she said. This is covert narcissism, which manifests itself in low self-esteem, as opposed to the grandiose narcissism more commonly associated with the term. Both types are characterised by self-obsession. The conference held a symposium on the Irish psyche in the aftermath of the Celtic Tiger in which it was claimed that we saw ourselves as a ‘deeply flawed people’. Ms Martin said Ireland needed to develop a sense of identity and self-confidence set apart from its colonial past. She said Queen Elizabeth II’s visit had helped the process, but there was a long way to go”. The piece goes on to note that “New Zealand had sought to move on from its colonial past by promoting traits such as excellence and integrity as values to develop as specific national traits. Ms Martin maintained the relationship between Ireland and its former colonisers was similar to that of a narcissistic family”. The piece ends “Dr Trisha McDonnell, a clinical psychologist, told the conference that Irish behaviour exhibited three postcolonial traits in particular: our deferential attitude to authority; our tendency to avoid the truth; and our communications strategy, which was manifested in a failure to speak plainly and assertively”.

Lastly, another opinion piece argues that no-one is held accountable in Ireland. It asks “What is it with ambitious public sector projects? It seems almost preordained that they end up with eye-watering cost overruns or getting long-fingered indefinitely after being bogged down in controversy. The National Children’s Hospital is the latest project to suffer from the dead hand of the public sector. It’s six years since reports by consultants McKinsey recommended a single, world-class paediatric centre which would amalgamate three children’s hospitals in the capital. Even though the location in the Mater was chosen shortly afterwards, political sniping and growing uncertainty over the location slowed progress. Two chairmen selected to oversee the process ended up resigning. As in excess of €30 million was poured into planning and design, it soon became clear the enormous scale of the development was a major issue. The plan rolled on regardless. It culminated in An Bord Pleanála refusing planning permission”.

He adds a further layer to this when he writes “After all the expensive consultants’ reports, expert groups and glossy plans, no one was accountable for the failure to deliver a project, while the taxpayer has been left to shoulder the burden of wasted expenditure. But perhaps it’s too simple to blame public servants. Is the Civil Service, for example, taking the flak for the failures of politicians or ministers, who have been all too keen to spend millions on half-baked schemes or ill-conceived vanity projects such as the so-called Bertie Bowl, e-voting or the Ppars computer project? For Bill Kingston, who lectures in business at Trinity College Dublin, the answer is simple: the lack of accountability in the public sector”. He goes on to add later in the article “There is also, Molloy says, a lack of expertise. The Civil Service and much of the public sector is based on “gifted generalists”. But it needs to be technically qualified and robust enough to place the public good ahead of the preferences of the incumbent government”.

While Ireland is not about to turn into Yemen or Pakistan, its utter failure to deal with these issues after more than 90 years of independence has effectively rendered it a failed state. Even worse nothing seems to have changed and so there will be another crisis in two decades or so that will set off the same pointless soul searching.

A victory for some

02/06/2012

After the announcement was made that the Irish government was to hold a referendum on the fiscal compact there was more uncertainty when it was the last thing the EU wanted, or needed. The vote took place on 31 May and the sided backing the compact, as expected, won out with 60.3% of people voting Yes with 39.7% voting No. The turnout was 50.6%.

The BBC reports that “Just over 60% of voters taking part in the referendum backed the controversial pact, which is aimed at enforcing budget rules in the eurozone. Prime Minister Enda Kenny said Ireland had sent a “powerful signal” that it was committed to overcoming its economic challenges”. It adds that “A ‘No’ vote would not have blocked the pact, but it would have barred Ireland from emergency EU funding when its bailout package expires in 2013. In late 2010 Ireland received an EU-IMF bailout worth 85bn euros (£68bn; $105bn) after debts overwhelmed its banks. The treaty must be approved by 12 of 17 Eurozone countries, but Ireland was the only one putting the issue to a public vote”.

The result has been seen by some as a result of the “key element in the Yes argument was that access to future funding from the European Stability Mechanism (ESM) would be cut off in the event of a No vote. That unambiguous fact helped to concentrate the minds of voters who might have been tempted to vote No in protest at Government policy or EU-wide austerity measures”. Others have noted that the choice was between fear and anger, with fear winning out.

Media reports in The Irish Times, have noted that “Kenny has told German chancellor Angela Merkel he wants a deal on the Irish bank debt following the decision of the Irish people to vote Yes to the fiscal treaty. Dr Merkel was one of a number of European leaders with whom the Taoiseach had a phone conversation yesterday when it became clear that the electorate had delivered a decisive Yes to the treaty. He said later that by voting Yes the Irish people, who understood the banking situation, had sent a message that the issue had to be dealt with by the political leaders of Europe. ‘Without going into technicalities, yes, I did raise directly the issue with the chancellor,’ Mr Kenny told journalists”. The article goes on to note that “Merkel said the referendum result was good news for Ireland and for Europe and deserved respect because of the hardship that Ireland had endured. ‘The referendum result strengthens the euro zone’s joint course toward the creation of a new, lasting stability union,’ she said in a statement. Tánaiste Eamon Gilmore said last night that the decisive Yes vote in the referendum had ‘significantly strengthened’ the Government’s hand in the negotiations about the bank debt”, yet the report adds that “A diplomatic source in Brussels warned that the Government still had big obstacles to surmount to secure a deal to reduce the debt. However, European officials said that the ultimate prospect of an agreement had improved a little. There was no sign, however, that Germany was willing to lift its opposition to any restructuring of the debts of the former Anglo Irish Bank. In addition, the diplomatic source said that any push to allow the European Stability Mechanism bailout fund to directly recapitalise Ireland’s banks was likely to face strong resistance”. The article concludes interestingly that “The strongest Yes vote in the country was in Dublin South where 75.8 per cent backed the treaty. The neighbouring constituencies of Dún Laoghaire and Dublin South East were the next most strongly in favour. Just five of the 43 constituencies voted against, with the highest No vote in Donegal North East, where 55.6 per cent voted No. There was also a No vote in neighbouring Donegal South East and in three Dublin constituencies”.

A separate piece on the domestic consequences notes that “The fiscal treaty has been passed but key elements on the No side are in many ways the real winners. For Sinn Féin and the parties and groups on the far left, EU referendums are the political equivalent of a lottery bonanza or a licence to print money. Once again they have benefited hugely in terms of access to the news media. This should pay off in increased votes in the local and European elections two years hence”. The writer adds that “Unless there is a major change in the political climate, Sinn Féin is likely to do very well in both contests and the United Left Alliance (ULA) should also increase support. Already Sinn Féin is planning its European and local campaigns”. As has been mentioned here before, if Fianna Fail are to have any hope of returning they need these local seats. The same article notes that on the right of the spectrum, that is after 90 years, finally beginning to emerge, Declan Ganley of Libertas, “is refusing to rule out a second run for Europe in two years’ time and he gave the three successful candidates a good run for their money in the North-West constituency last time around”. He concludes noting “by opening the door to Sinn Féin they may have damaged the future prospects of their own party. The same has been said of John Hume and the SDLP. In the North, Sinn Féin sounds more and more like a constitutional nationalist party; south of the Border it sounds more and more like the old Fianna Fáil: another outcome of the history-making events of Good Friday, 1998”.

A different piecemakes a similar point put it well saying “the treaty was largely backed by voters in rural and middle-class areas and the No vote did well in working-class areas”, adding that the result highlighted “a significant divide between poorer and more affluent areas. However, opinion is mixed over whether this represents a historic shift towards social class-based politics in Ireland, as is common in European countries”. He goes on to note that “The highest Yes votes were recorded in the most affluent urban constituencies of Dún Laoghaire (74 per cent voted in favour, 26 per cent against) and Dublin South East (72 per cent for and 28 per cent against). In contrast, the highest No votes were recorded in Donegal, which has a history of bucking the national trend, and Dublin constituencies with high concentrations of working-class voters. These included Dublin North West (47 per cent voted in favour, 53 per cent against), Dublin South Central (49 per cent in favour, 51 per cent against) and Dublin South West (49 per cent in favour, 51 per cent against). The social polarisation was most striking at local level. Tallymen recorded No votes of up to 85 and 90 per cent in traditionally disadvantaged areas such as Ballymun. This pattern was reversed in more privileged areas such as Sandymount, with some precincts reporting Yes votes of close to 80 per cent”.

The article ends noting that “Dr Donal Ó Drisceoil of UCC and co-editor of Politics and the Irish Working Class, 1830-1945, said the results appeared to form part of a historic shift in Irish politics. ‘The voting in this referendum confirms a pattern that has been emerging since the collapse of 2008, as evidenced in recent surveys, in the last general election, and in the mass resistance to the household charge,’ he said. ‘As the class divisions in Irish society become starker in the context of austerity, they are starting to be politically articulated. This marks a fundamental, historic shift in the Irish political landscape and suggests the beginnings of a move towards a system of class politics that has been absent in the State since independence – a so-called left/right divide.’ He said this shift may be the beginning of Irish politics being “normalised”, and it would be interesting to see how this would affect the existing party system”.

The biggest loser in this is the Irish Labour Party that have no ideological differences with the centre right Fine Gael with both parties targeting middle class, well educated voters. Now it seems that the historical remnants of Labour’s working class support is finally and justifiably, ebbing away. Maybe the Irish party system is beginning on the path to normality?

One more nail in the coffin Pt II

12/04/2012

In the final, and most relevant, part on the consequences of the recently released Mahon tribunal report the future of the political party that lead Ireland for 60 of the last 80 years is now in question.

After the Mahon report there have been a number of recommendations. One of them is that the Courts should have the ability to disbar members of the Parliament from holding office as well as remove their rights to a pension. The article notes that Mahon also suggests “legislation governing elections – the political finance acts – should be changed to place new limits on amounts that can be given in donations. It says the definition of a ‘donation’ should be widened to be seen as ‘any contribution given, used or received for political purposes’. The report says anonymous or cash donations pose corruption risks and that amounts above €55 in a donation to an individual electoral candidate or elective representative and €175 for donations to a political party should be prohibited”, the article also reports that Mahon suggests a register of lobbyists and notes “submissions received by local authorities and the county manager’s report on these submissions should be available on the internet. It maintains that where elected members decide to depart from the county manager’s report, they should be obliged to give reasons”.

Yet, the political fallout is still to be witnessed in its entirity. One commentatornotes that “latest report comes on top of the shocking disclosures in the Moriarty tribunal reports about the vast sums obtained by another former Fianna Fáil taoiseach Charles Haughey and the findings in an earlier planning tribunal report about the behaviour of former senior minister Ray Burke. It is an indictment of the Irish political system that such grave findings have been made against so many of the leading figures who dominated Fianna Fáil from the 1980s onwards”. He adds that “The report has severe things to say about senior government ministers who engaged in a ‘sustained and virulent attack’ on the tribunal while it was inquiring into Bertie Ahern’s financial affairs in 2007 and 2008. ‘It was entirely inappropriate for members of the Government to launch such unseemly and partisan attacks against a tribunal of inquiry appointed by both Houses of the Oireachtas to inquire into serious concerns regarding corruption in public life.’ The current relevance is that some of the current members of the depleted Fianna Fáil parliamentary party engaged in those attacks”. Indeed, Independent MP Séamus Healy called for all those who were in the Ahern Cabinet to resign their seats.

The fundamental point as one journalist notes is that “the kind of appalling behaviour on the part of political leaders and businessmen exposed by the tribunal was not an aberration: it was a central feature of Irish political life for the past half a century”. He goes on to write that “Ahern’s electoral record was even more remarkable than Haughey’s. His personal popularity was far higher and he managed to win three general elections in a row between 1997 and 2007 despite the fact that he was Haughey’s protege and the sordid detail of his former leader’s finances had already become public knowledge”, yet in the crucial paragraph he argues correctly that the “collapse in Fianna Fáil support that happened in the years since then has had nothing do with standards in political life but everything to do with the collapse of the economy. It seems that a substantial section of the electorate was willing to close its eyes to unethical behaviour by politicians for as long as the boom continued”.

He concludes “The electoral disaster resulted from the economic crash rather than questions about political standards but the two issues were interlinked. The fact that the speculators and builders who frequented the Galway tent were at the core of the speculative bubble that led to the crash is something the party will find it very hard to live down. Even harder to cope with may be the fact that Micheál Martin and other leading members of the parliamentary party were key figures right through the Ahern era. Even if they did not engage in wrongdoing they will have a difficult time explaining why they turned a blind eye for so long”.

The irony of course is that the very party that set up the tribunal in November 1997, just months after their win in the 1997 General Election, came out worst as a result of the Mahon report. The only real chanllenge that FF has as a test of its political survival is that of the local elections in 2014. If the party loses a significant number of seats then its future fortunes will be all but impossible to restore.

One more nail in the coffin Pt I

10/04/2012

So what began in 1997 has finally been completed. The final report by Judge Alan Mahon, chairman of the Tribunal of Inquiry Into Certain Planning Matters and Payments was released last month. The tribunal which is estimated to cost €250 million, heard the evidence of 400 witnesses, sat for 917 days with 3 barristers earning €5 million or more in costs.  The words “corrupt” or “corruption” are used 977 times throughout the report. The tribunal also found against Fine Gael and Labour Party councillors.

Media reports said that “Corruption affected every level of government from cabinet ministers to local councillors during two decades of political dominance by Fianna Fáil, according to the final report of the planning tribunal”. The report was particularly damning of former government minsiters and two former prime ministers, with the same media coverage proclaiming “accused former taoiseach Bertie Ahern of untruthfulness. It found former European commissioner Pádraig Flynn behaved corruptly, and said another former taoiseach, Albert Reynolds, had abused his power”, the coverage adds that, “Ahern last night strongly disputed the report’s conclusions, saying he was incredulous at what he described as “objectionable and inaccurate” findings. He said he would be looking to vindicate his name”. The report itself was rightly damning of the political culture of the time noting,” Corruption in Irish political life was both endemic and systemic. It affected every level of government, from some holders of top ministerial offices to some local councillors, and its existence was widely known and widely tolerated”.

Current Fine Gael Prime Minister Enda Kenny said that he would bring the “report to the Garda Commissioner, the Director of Public Prosecutions, the Revenue Commissioners and the Standards in Public Office Commission”. Though, such is public disenchantment that little, if anything, is expected to come from these referrals.

The same media source says that the “tribunal found Mr Ahern had given untrue evidence about his personal finances, including lodgements to accounts that the tribunal found were large sterling and dollar cash lodgements. The tribunal found Mr Ahern knew the true source of some lodgements investigated by the tribunal, but chose not to disclose their origin. It also rejected the evidence of Mr Ahern and others to the effect that collections or ‘digouts’ occurred in 1993 and 1994 that resulted in Mr Ahern being given £22,500 and £16,500. The tribunal said it was satisfied a lodgement of £28,772.90 on December 5th, 1994, by Mr Ahern’s then partner, Celia Larkin, to an account in her name but to be held for Mr Ahern’s benefit, was not the proceeds of a payment by Manchester businessman Micheal Wall. The tribunal said it was satisfied it was in fact the result of the lodgement of $45,000 in cash”. It adds that “The report said because Mr Ahern did not give a true account as to the source of money lodged to his accounts, the tribunal had not been able to identify where the money came from. For that reason, it could not determine whether Mr Ahern had received corrupt payments from developer Owen O’Callaghan. The report also said while the tribunal was inquiring into matters relating to Mr Ahern in the 2007-2008 period, it ‘came under sustained and virulent attack from a number of senior government ministers who questioned, inter alia, the legality of its inquiries as well as the integrity of its members'”. The media article concludes that “The tribunal made more than 100 recommendations, including the appointment of a planning regulator, wider disclosure of interests by public officials, restrictions on political donations and a code for lobbyists”.

In response to the Mahon report, current leader of Fianna Fail, Michael Martin “proposed that former taoiseach Bertie Ahern be expelled from the party, saying he ‘betrayed the trust’ of the country and the political organisation. Mr Martin said the planning tribunal’s final report, which found Mr Ahern failed to “truthfully account” for the source of bank account lodgments, confirmed the former Fianna Fáil leader’s personal behaviour had fallen short of the standard expected of holders of high office. ‘In the manner in which he received this money while holding high office and in the giving of rejected evidence to a sworn tribunal Bertie Ahern betrayed the trust placed in him by this country and this party,’ Mr Martin said”. Yet, just days after this, Ahern resigned from the party. Martin’s actions are indeed ironic as he one just one of many Cabinet members who attempted to discredit and derail the tribunal.

In a statementin response to the findings of the tribunal Ahern said that the tribunal is “not the findings of a court of law”. The statement continues, ” I have never accepted a bribe or a corrupt payment”, adding, ” After spending over a decade of inquiries and countless millions of euros, the Tribunal has not made – nor could it make – a finding to support the scurrilous and untrue allegation that I had been given a corrupt payment by Mr Owen O’Callaghan”. Ahern adds amazingly, “I am disappointed that the Tribunal has said that I failed to give “a truthful account”.That statement is unfair and inaccurate having regard to the evidence. It is one that I cannot and I will never accept and I will continue to examine ways in which to vindicate my name”. This is in spite of the tribunal being unable to account for  IR£165,000.

The fact that such corruption and greed was so widespread is a damning indictment of the people of Ireland and the politics of that country that have, once again lead to to ruin. The irony of course is that the very party that set up the tribunal in November 1997, just months after their win in the 1997 General Election, came out worst as a result of the Mahon report. The future of the party hangs in the balance and will be dealt with in the final part.

Pop?

03/01/2012

As has been written here before, the Chinese economy is based on a huge property and minerals bubble. This bubble, like all bubbles will pop, eventually.

In an article in Foreign Affairs, Patrick Chovanec argues notes that “analysts have warned of a looming real estate bubble in China, but the predicted downturn, the bursting of that bubble, never occurred — that is, until now”.

He mentions how “Shanghai property developers started slashing prices on their latest luxury condos by up to one-third. Crowds of owners who had recently bought apartments at full price converged on sales offices throughout the city, demanding refunds. Some angry investors went on a rampage, breaking windows and smashing showrooms. ”

He notes that “According to the property agency Homelink, new home prices in Beijing dropped 35 percent in November alone. And the free fall may continue for some time. Centaline, another leading property agency, estimates that developers have built up 22 months’ worth of unsold inventory in Beijing and 21 months’ worth in Shanghai”.

He notes that “the lack of escape routes. If Chinese investors panic and rush for the exits, they will discover that in a market awash with developer discounts, buyers are very hard to find. The next three months will be a watershed moment for a Chinese investor class that has been flush with cash for years but lacking a place to put it”.

He adds that “Instead of developing a more balanced, consumer-based economy, an entire regime of Beijing technocrats — drunk on investment-led growth — let the real estate market run red hot for too long and, when forced to act, lacked the credibility to cool the sector down”. Of course a similar thing happened in Ireland except in that case an incompetent and moronic government.

Whatever blip Ireland is to the world economy, China is bigger. Tellingly he notes that ” steel production — driven in large part by construction — is down 15 percent from June”.  He augments this by arguing that ” Chinese radio reports that half of all real estate agents in the southern city of Shenzhen have closed up shop. According to Centaline, more than 100 local government land auctions failed last month, and land sale revenues in Beijing are down 15 percent this year. Without them, local governments have no way to repay the heavy loans they have taken out to fund ambitious infrastructure projects, or the additional loans they will need to keep driving GDP growth next year”.

He notes that a Chinese collapse could have devastating effects on the so called BRICS, that were long heralded to balance against America and bring world peace. He says that ” The impact of a housing downturn would have a significant impact globally. International suppliers who have been fueling China’s construction boom — iron-ore miners in Australia and Brazil, copper miners in Chile, lumber mills in Canada and Russia, and multinational equipment makers such as Caterpillar and Komatsu — could be hard hit”.

The scale of such an impact would be beyond that of the US housing bubble with “Residential real estate construction now accounts for nearly ten percent of the country’s total GDP — four percentage points higher than it did at the peak of the U.S. housing bubble in 2005”.

Even worse the Chines authorities seem to have learnt nothing from the economic collapse in “the West”. He mentions that “To maintain GDP growth of nearly ten percent during a massive downturn in global demand, China’s leaders engineered a lending boom that expanded the country’s money supply by roughly two-thirds”. Of course, this was done to keep the Communist Party in power and for little other reason. However, the irony is that instead of keeping them in power it may only hasten a Chinese collapse.

Finally, “Real estate investment has continued growing at nearly 30 percent annually. But inflation began to rise from 1.5 percent in January 2010 to a peak of 6.5 percent in July 2011, and authorities began to sweat. They broadened their cooling efforts. The central bank tightened credit expansion, and China’s economy began to slow. As 2011 progressed, developers scrambled for new lines of financing to keep their overstocked inventories”. With sales collapsing and buyers disappearing a sellers market has turned, very suddenly into a buyers market.

Does a collapsing housing market mean economic collapse and revolution? No, but in a country with no mechanism for venting public anger, a subservient media and a leadership in transition, all mean that in an effort to distract the public from the mess their officials made an increasing belligerence could be used to unite the people into attacking Taiwan, with the predicted American reaction.

Why did this happen?

01/01/2012

After all that has happen it is worthwhile recounting how all of this began.

An article in the Economist gives a good idea how. It notes that “Ireland and Spain ran budget surpluses. Both meticulously kept within the limits for deficits and debts set down by the stability and growth pact—unlike Germany, which flouted the rules for four years from 2003 (and avoided punishment)”.

He adds that “Debt in these countries has become a burden not because of government profligacy but because each enjoyed a decade of low interest rates and was then hit by the financial crisis. Easy credit fuelled debt in households and the financial sector. The European Central Bank oversaw a binge of cross-border lending”. While this is of course undeniable the incompetence of the Irish government, whatever about the Spanish, led to a huge property bubble that was dramatically worsened by the ECB and the low interest rates it offered.

This in turn was made worse by the fact that “Germany then signalled that defaults could happen and that investors would have to bear a share of the losses—a reasonable demand, but a hard one to introduce in the middle of a crisis. Some investors asked to be rewarded for the extra risk and others, unwilling to start paying for credit research, just walked away. This set off a spiral of falling bond prices, weakening banks and slowing growth”, crucially he adds that “low interest rates fuelled domestic spending and spurred inflation in wages and goods, which in turn made their exports more expensive and left imports relatively cheaper. But it was also because Germany was recycling the surpluses produced by its export machine, financing their consumption”.

He rightly points out that “even when the crisis has abated, restoring Europe to health will take many years. That is because the troubled countries need to control their government deficits and to re-establish sound current accounts by improving their competitiveness. Germans feel that the responsibility for this lengthy adjustment lies exclusively with borrowers, which must urgently restore budget discipline”.

Yet the whole crisis has been made irreparably worse due to the inability of the ECB to have full control. The reason for this is obvious.

Testing the limits of marketing

01/08/2011

So the party that is to blame for Ireland’s economic collapse, Fianna Fáil are deciding how to get their hooks back in government.

The article notes that the disgraced party, must make a decision and “decide exactly what it stands for in a changed world”. However a party that has run Ireland for the vast majority of the history of the Ireland has always been a catchall party appealing to wildy different groups. It would not be suprising that party apparatchik’s “decide” on a compromise and the party fails to satisfy any of its previous groups. Indeed, “the electorate has given its answer to the question of the party’s identity: it is more Enron than Apple”.

The example of new Labour is cited, “playing with logos is not enough. The New Labour brand made sense to the electorate only after Blair’s clause-four moment, when he insisted that the party change its constitution and weaken its long-established links with the trade unions.”

Crucially the article notes that “Until such heavy ideological lifting has been undertaken, any attempt to create a new identity for Fianna Fáil is doomed to failure”. Some have questioned what the party can stand on in any future elections, noting that “For a long time its two main aims were national unity – the restoration of the 32 counties – and the restoration of the Irish language. Then they stood for economic competence”. The first two of these are irrelevant to a nation with 15% unemployment and that fact destroys the last possibility with which the party can campaign on.

The article notes that “In 2002 and 2007 Fianna Fáil did its research and the public said they wanted the boom to go on. It didn’t work. What the party offered was based on short-termism”.

These mistakes may, hopefully, prove to be fatal and wipe the party off the Irish political landscape.

Moving forward?

17/07/2011

After the party’s election decimation in February, Fianna Fail have been discussing how to recover their position. They will never again be the largest party in Ireland and should act morally for once, do that nation a favour and just dissolve themselves.

To default, or not to default

30/05/2011

After a recent post commenting on the merits of a bailout  for Ireland, what will happen if such a senario does occur has been discussed by a recent Irish Times article.

Discussing the Argentina default, “After the default came the meltdown: a 70 per cent devaluation of the peso in six months, a rapidly shrinking economy, an avalanche of poverty and unemployment. Millions of middle managers, salaried factory workers and state employees lost their jobs in the sell-off of state-run industries and the collapse of local companies. Bank accounts were frozen in an attempt to stem a bank run. US and European bank subsidiaries converted customers’ dollar deposits into devalued pesos, virtually wiping out their nest eggs. The income of Argentinians went through the floor: in 1999 it was the equivalent of $8,909 per capita, double that of Mexico and three times that of Poland; by 2002 it had shrunk to €2,500 per capita, about the same as Belarus.”

Interestingly however the article notes that currently in Ireland it is not a desperate as it was in Argentina with “Six out of seven jobs are still in place, notes Seamus Coffey, an economics lecturer at University College Cork. More than nine out of 10 mortgage holders continue to pay up on their original contract terms. Out of every €100 of disposable income, €12 is being used to pay off debt or to build up savings.”

On the question of the damage done to Ireland’s reputation “would pariah status matter once we had decided to be proudly self-reliant? That depends on the value you place on reputation.   ‘We are one of the economies in the world most dependent on international business,’ says Eunan King, of King Research. ‘We cannot walk away from 50 years of the Whitaker philosophy that we compete and co-operate on an international platform. EEC entry and the encouragement of foreign investment helped Ireland step away from protectionism and dependence on our major trading partner, the UK.'”

Many question whether there would be any money in the ATMs, in essence a shorthand for the citizens to buy the basics to survive. The article says that “‘we would be international pariahs without a functioning banking system. But as our money, or what’s left of it, is still in the bank, couldn’t we use the ATMs? ‘With no functioning bank system there’s no guarantee that the ATMs would continue to work,’ says Fergal O’Brien. Coffey thinks the notion of empty ATMs is a bit ‘overblown . . . The ATMs wouldn’t close, but we’d have no money in the bank accounts anyway, and that wouldn’t be the ECB’s fault’.”

It has been posited that the euro is the rooted of much of the current problems that face Ireland, yet “‘The EU has no provision to kick anyone out of the euro, and there’s no legal provision for handing banks back to the ECB either, for that matter,’ says Stephen Kinsella. ‘But if we did leave the euro I’d like to see the new currency being called the Anglo, so we’d never forget . Of course, the first item would be a 50 per cent devaluation, so all outstanding debt doubles immediately. And you’ve just burned €160 billion, so what central banks are going to hold our money?'” Secondly it is noted that “deposits would flee the system because the government guarantee to depositors could not be honoured, as Ireland wouldn’t be able to borrow abroad. Exchange controls would have to be reimposed. The Central Bank of Ireland would have to print money to keep the banks afloat.” As a result of this many argue that bartering would return with a lack of a real currency.

The article questions would Ireland survive if Ireland did default, “’Property prices would fall further, as there’d be no banks or Nama to prop up the market,’ says Coffey. And food? ‘Well, we’re food exporters. We’d eat a lot of dairy, but we wouldn’t starve.’ And oil? ‘The question is: if the government had it, could we afford to buy it from them?'”

Finally, “the external money supply would have been abruptly disconnected, our deficit of €15 billion to €19 billion (depending on who you talk to) would have to be wiped out – immediately. The Department of Finance warns that this would entail cuts of 30 per cent in public-sector pay and social welfare. Fergal O’Brien of Ibec suggests that the figure would be about 40 per cent.” This in turn “would trigger what economists call feedbacks: a crash in tax revenues as a result of pay cuts, zero consumption, a stalled economy and so on.  So the amount to be made up could rise from €15 billion to €30 billion, according to Coffey, which is why some see the short, sharp shock not merely as an implement of terrible suffering but also as a futile gesture.”

Would it be worth it?

The only option

20/04/2011

Economists Joseph Stiglitz and Michael Cragg have recently argued that Ireland’s IMF and ECB backed economic plan is “doomed to failure”.

They argue that Ireland allowed itself to be duped by “false economic doctrines advocating unfettered markets”. They note that the new government can still save the Irish economy, and indeed Ireland itself, “but has failed thus far to address the underlying problems.” Yet it should be borne in mind that the new government’s economic policies are exactly the same as those of the hated Fianna Fail government with new faces delivering old policies.

They note that “in more optimistic scenarios, Ireland’s debt to GDP ratio is expected to soar to 125 per cent in 2013, up from 25 per cent in 2007”. This they say with stifle whatever little growth is in the Irish economy as it is. They pull no punches when they say that “the EU recipe for recovery is more of the same: to meet the deficit reduction targets, more austerity – which in turn means still lower growth and still higher unemployment.” They argue, correctly that “It is the system of incentives that underlies the success of a market economy” with the implication being that those that lose money are aware of this and should not be recompensated for the losses they make on their investments.

Their indictment of what had been happening in the world before the crash involved, “those who seemed to believe in markets, started to rewrite the rules in the midst of the crisis. They argued for the socialising of losses, while the gains had been privatised. Such a system of ersatz capitalism is doomed to failure, and is fundamentally corrupt and inequitable”.

As always part of the blame lies the the incompent and moronic government that “governed” during these years, who are now fittingly reduced to 20 seats in the 166 seat parliament.

They go on  to say that “the IMF, ECB and Government must come to terms with imposing losses on the international lenders whose loose lending policies played a central role in the current crisis.  Debt restructuring [default] is neither easy nor costless; but the costs are far less than the alternative”.

Ireland may not default first, it looks like Greece may beat Ireland to it.

To be continued

06/04/2011

The euro crisis rumbles on. The Portugese government collapsed recently after the parliament refused to take European Union supported austerity measures. This itself is a sign of how little trust even EU member states put in the how the European Central Bank’s ability to manage the crisis and find a solution. It is also a sign of the lack of legitimacy the EU has in a crisis where authority needs to be asserted. It is also a sign of the unwillingness of many in Europe and the Western world generally to see a drop in living standards even though it is beyond the control of even the most powerful government’s in the world.

Now Portugal is going to have to take a bailout and following the past trends of the Greek and Irish bond yields, the rate of interest they pay on the money they borrow, will soar. The irony is however that these yields soar after they take the bailout money. It was reported that Portugal’s “budget deficit stood at the equivalent of 8.6pc of its gross domestic product (GDP) for 2010, missing the government’s 7.3pc target by more than a percentage point”. The Protugese government openly criticised the ECB with Lisbon blaming “the size of the deficit on a change in the calculation methods at Eurostat, the European statistical agency, which meant the figure had to reflect nationalised bank losses and the state of public transport companies. Politicians have complained the alterations were ‘like changing the score after the match is over'”.

Meanwhile in Ireland, it was reported that the government there would be putting in an extra €24 billion of capital to fix its banks bringing to €70 billion that amount that the small nation has, with loans, pumped in to attempt to bring the economy back to life.  Yet it is difficult to see where the country can go from here. It has been reported that Ireland “At more than 800pc of the country’s GDP, the staggering liabilities left for Irish taxpayers to pick up in the wake of an ill-advised decision in October 2008 to backstop all the banks’ debts and deposits proved too large to handle” resulting in the IMF taking over the nation’s finances and national humilation. The report notes how with “€146bn of outstanding liabilities to the central payments system, the Central Bank of Ireland has borrowed 50pc more from the intra-eurosystem than second-placed Portugal”.

Now understandably, questions are being asked of the euro. With the only real options for the members of the common currency either radical integration, which is wholly unpalatable to many member states, or dissolution of the eurozone itself.

Even worse after German Chancellor Dr Angela Merkel lost in regional elections, largely on the basis of nuclear power her “room for manoeuvre – not just on nuclear, but on Europe and just about everything else – has been severely compromised”. It has been argued forcefully that as a result of this she will be reduced to “defending and pursuing the majority German view; on Europe, that means no transfer union, no European bonds and no further expansion of the bailout fund”. He notes that “monetary union is fast approaching the outer limits of the politically possible”.

As has been stated here above he argues that “austerity that the absence of a transfer union imposes on the periphery is also testing democratic acceptability to destruction”, perhaps destruction is too strong a word but serve strain nonetheless. He says that default has been openly discussed in eurozone summits but even “Countries that default, even in a planned and agreed manner, pay for their sins in higher interest rates for years, sometimes decades, to come. And because the European banking system is so heavily intertwined, default by one country will require banking recapitalisations in others”.

The crisis continues.

New government formed

10/03/2011

The new session of the Irish parliament began after the recent general election. As feared, Fine Gael and Labour joined together to form a government and have produced a coalition agreement. Gone is any hope for agonism, for now.

Fine Gael which holds 76 of the 166 seats is expected to receive ten ministries with their coalition partners getting the remaining five in addition to the attorney general’s post. Enda Kenny was elected prime minister by the newly assembled parliament by 117 votes to 27 and has received his seal of office from President McAleese.

His Cabinet consists of:

  • Taoiseach Enda Kenny
  • Tánaiste (Deputy Prime Minister) and Minister for Foreign Affairs and Trade Eamon Gilmore (Labour)
  • Minister for Agriculture, Marine and Food Simon Coveney (Fine Gael)
  • Minister for Arts, Heritage and Gaeltacht Affairs Jimmy Deenihan (Fine Gael)
  • Minister for Children Frances Fitzgerald (Fine Gael)
  • Minister for Communications, Energy and Natural Resources Pat Rabbitte (Labour)
  • Minister for Education and Skills Ruairi Quinn (Labour)
  • Minister for Enterprise, Jobs and Innovation Richard Bruton (Fine Gael)
  • Minister for the Environment, Community and Local Government Phil Hogan (Fine Gael)
  • Minister for Finance Michael Noonan (Fine Gael)
  • Minister for Health James Reilly (Fine Gael)
  • Minister for Justice, Equality and Defence Alan Shatter (Fine Gael)
  • Minister for Public Expenditure and Reform Brendan Howlin (Labour)
  • Minister for Social Protection Joan Burton (Labour)
  • Minister for Transport, Tourism and Sport Leo Varadkar (Fine Gael)

Kenny has created a new ministry that of Children which previously been a secondary post under the Minister for Health. Notably, the Finance Ministry has been split into two with one being held by a Fine Gael while the other, Public Expenditure and Reform, being held by a Labour. Also notable is the merging of the Defence and Justice Ministries into one. What should be borne in mind is that of the fifteen Cabinet ministers, ten have prior experience in previous governments, albeit, quite some time ago.

Some in the media are arguing that the number of women is low and that they are not given better ministries – this is of no significance to the running of Ireland or fix its current crisis. Commendably at its first Cabinet meeting the government took a pay cut. Kenny’s first engagment will be to “travel to Brussels this afternoon for a meeting with European Commission president José Manuel Barroso, ahead of meetings of the European Council and the euro zone heads of government”. This is notable as at the same time the EU changes its mind, not that is will alter Ireland’s inevitable default.

Any belief that Irish politics has changed is not to be believed. Fine Gael and Labour having a history of coalition government before, though admittedly not with this majority,  and Fianna Fail on the opposition benches.

Labour will be forced to make cuts, often to the poorest and most vulnerable in society, and it is possible that they too will face a Fianna Fail type moment at the next election with massive losses by being attacked by and ideologically much purer party. While any middle class support drifts away to another party, possibly Fine Gael.

What is certain is that Ireland’s politics is in flux with no outcome determined yet.

Irish election – Part III

07/03/2011

Now that an outline of the seats held after the Irish election and the make up of the next government have been discussed. Lastly, it is pertinent to discuss the meltdown and future of what was once the dominant force in Irish politics, Fianna Fáil.

How did a party that since 1932 managed to form nineteen governments and along the way craft Ireland’s current constitution, end this year going from 77 to 20 seats, with four short years as its longest period out of office.

What future, if any, is there for the party? There have been numerous accounts of Ireland’s rise and spectacular crash but perhaps the best is What went wrong in Ireland by Professor Patrick Honohan now governor of the Irish Central Bank. It was the property crash that burst in 2008 and took the country down, but it was tying, by way of wholesale bank guarantee, the vast debts of the reckless and incompetent banks who foresaw only rising property prices, to the large but manageable debts of the State, in addition to those of the banks that drew so much anger at the ballot box.

There has understandably been much talk that Irish politics would “never be the same again” and that the “era of Fianna Fáil dominance, which lasted for three-quarters of a century” was over. However, this does not mean that they will not be back in government in four or five years time. All it does mean is that they will not be as strong at the next election. As the author says, “Proportional representation saved Fianna Fáil from total obliteration but whether the party can survive as a serious political force is open to question. One thing is certain; it will never recover its place as the dominant party of power”.

As has been stated here before, “There is an argument in Labour for staying in opposition to try and build the party to a position where it would be a real contender to be the biggest party at the next election” this would mean Labour would be the biggest opposition party and that would allow FF to disintegrate and then be wiped out at the next election.

Noted academic Michael Marsh said that “Political Ireland is now largely a Fianna Fáil-free zone, but remains a long way short of a fundamental realignment of the party system”. He says that the recent election was about “vengeance” but people have short memories and a modern political is not possible until FF are wiped out and Labour take to the opposition benches along with a new electoral system. He does note however that “Fianna Fáil fell from 41.5 per cent of the vote in 2007 to just 17.4 per cent, effectively deserted by six of every 10 people who supported that party last time” as well as the interesting fact that “Proportionally, we would expect a party winning Fianna Fáil’s vote share to win 29 seats, so their total was nine fewer than this. We can often expect a smaller party to get no more than a small seat bonus but not that it would fall so short of an expected share”.

The reason for this he says is that the party ran too many candidates which split the vote as well as the party’s “failure to attract transfers”. He makes the point that “Three-quarters of all deputies are from the three parties who have dominated politics and government to date, but the relative size of these three is quite unlike anything we have seen before”.

A party that has controlled and dominated Irish politics partly because of its flexibility and lack of any clear ideology should be punished in the next election before any real political transformation in Ireland occurs. They are assisted however, by an electorate that simple voted against them this time, rather than for any one else.

It will be interesting to see if the party can rebuild itself from this, let’s hope it can’t.

Irish election – Part II

02/03/2011

With the final results for the Irish election in, excluding the speaker, Seamus Kirk, the seat allocation is as follows: Fine Gael 76,  Labour Party 37,  Fianna Fáil 19, Sinn Féin 14, United Left Alliance 5 and an assortment of Independents getting 14 seats. After the last election the parties excluding the speaker were: Fianna Fáil 77, Fine Gael  51, Labour Party 20, Green Party 6, Sinn Féin 4, Progressive Democrats 2, Independents 5,

With the lower house due to meet on 9 March (Ash Wednesday), formal discussions to form a government will be extremely fast with any hope of an FG government backed by like minded independents fast fading. With this, any sort of agonism that was hoped for by having Fine Gael and a number of like minded independents join together is all but gone. The result of which would be to have Labour as the dominant opposition party instead of the disgraced and incompetent Fianna Fail, thereby relegating FF to a long deserved obscurity. Not that it is of any relevance, but FF only have males in the party after the election in addition to only having only one representative for the capital, Brian Lenihan with no MPs in counties Kerry Meath, Tipperary and Roscommon at all, with long time incumbent and prominent member Mary O’Rourke losing her seat also.

However, the 31st Dail should be an interesting one as a small number of Socialists were elected as well as the like minded Sinn Fein and ULA which will challenge the new coalition on every and every measure.

Now it is almost certain that there will be a Fine Gael/Labour coalition with talks already underway but not expected to take more than a few days due to a lack of any real ideological difference between them. FF are the majority opposition party but only just, however it will be interesting to see what FF do, as the manifesto of Fine Gael is so close to that of Fianna Fail that FF should wholeheartedly back whatever the coalition does in office if not FF will rightly be leveled as hypocritical.

Once the coalition talks are complete the ministries will be assigned.

Irish election – Part I

01/03/2011

And the results are in. The General Election that was held in Ireland recently has resulted in a decisive swing against the long time governing party, Fianna Fail, that were decimated, though not destroyed as was hoped for.

With only the last remaining seats to be counted it looks as if Fine Gael will have around 76 seats in the 166 seats in the lower house. It was reported that the “share of first preference votes was: Fine Gael 36.1 per cent, Labour 19.4 per cent, Fianna Fáil 17.4 per cent, Sinn Fein 9.9 per cent, Independents 15.2 per cent and Green Party 1.8 per cent.”. These will translate into “, Labour will take 36 and Fianna Fáil will get 25, including outgoing Ceann Comhairle [speaker] Seamus Kirk.  Sinn Féin looks set to take 12, Independents will win 13, the United Left Alliance will take four and the Green Party will lose all six of their seats”.  Turnout was higher than last time at around 70%.

What is extremely surprising is that the electorate carried through with the threat that the polls had been showing for months and decimated FF. Fine Gael won with “electoral meltdown for Fianna Fáil”. It is extremely doubtful that it was really a vote for Fine Gael as opposed to against FF.

Both Mary Hanafin and Barry Andrews lost in their shared constituency as well as Dick Roche and the disgraced John O’Donoghue not only that the Green Party returned no MPs at all.

Also eliminated was incompetent deputy prime minister, Mary Coughlan, who shared a constituency with “Pearse Doherty [who] was comfortably elected on the first count having won the seat in a byelection last November. He won 14,262 first preferences, almost a third of the vote”.

Unsurprisingly the population of greater Dublin did the most damage to FF with only former finance minister Brian Lenihan retaining his seat, with “Labour’s Pat Rabbitte stormed to victory, being elected on the first count” not only that but “Independent senator Shane Ross topped the poll in the five-seater Dublin South.  He was elected on the first count, having exceeded the 12,108 quota by almost 5,000 vote”, exceedingly rare in the PR-STV model that Ireland uses to elect its MPs.

Interesting times ahead.

Estimates for the 31st Dail

23/02/2011

People are finally coming to terms with the view that Fianna Fáil will do better in the election than opinion polls suggest.

Not only that but Fine Gael will probably do less well off than expected and fall short of an absolute majority and need Labour to join with them, giving FF a chance to regrettably come back from the brink of extinction.

It says that “Fine Gael’s position is solidifying (not surging) and Labour is slipping slightly (not falling). The Greens look unlikely to return any seats. Fianna Fáil and Sinn Féin also seem not to be moving”.

Predictably people should “consider that all polls are underestimating Fianna Fáil for a number of reasons. One is that people will be shy of admitting to vote for Fianna Fáil, particularly in face to face interviews because of a stigma attached the party now”.

Sadly, “It’s difficult to come to any firm conclusion about whether Fianna Fáil estimates are about right or systematically below the real vote intention. But perhaps we shouldn’t be surprised to see Fianna Fáil closer to 20 percent in the final results”.

This would translate into “Fianna Fáil return 25-29 TDs (incl. Seamus Kirk [speaker]); Fine Gael would win 65-69 seats, a good deal lower than the estimates Adrian Kavanagh predicts; Labour would win 33-37 seats and Sinn Féin 17-21 seats”.

This is perhaps the closest realistic estimation that has been seen. Previous figures quoted here by others put FF on 16 seats while FG were on the high 70s, neither of which is likely even after all that has happen to Ireland.

Unless Labour see the light and has has been discussed here before, stay out of government and make sure that FG are squeezed in government and FF fade into irrelevance in the opposition, while Labour bide their time for the future.

With the most likely possibility of a FG/Labour coalition offering no policy/ideological difference hopes for agonism in Ireland remain a distant dream.

Labour under pressure

20/02/2011

Finally the centre is being squeezed out of Irish politics, or at the very least is under pressure.

In an interesting post about the Labour Party’s increasingly slipping poll numbers, the author describes  how the other party with which is it vying for the largest number of seats, Fine Gael, is not in the same position.

Fine Gael it says “has had very little policy competition. The PDs are gone, which removed an old threat for Fine Gael whenever it moved too close to the centre”. Thus FG are free to roam the centre ground as they see fit, Labour on the other hand have the problem of “If it wanted to position itself in the centre, it had to be careful not to concede too much ground to ULA or Sinn Féin candidates”.

Not only that but FG have skillfully warned Labour’s large group of middle class supporters that Labour is a high tax party. However this should not be all that surprising being a party of the left, yet not when the middle classes are so heavily involved it its support base.

If that were not enough Labour has to be careful as should “be careful not to concede too much ground to ULA or Sinn Féin candidates” on the left. The author goes on to say that “each time Labour mentioned more tax than cuts (to protect its left flank) Fine Gael could attack it as a high tax party”.

Whether any of this will happen and FF support will really collapse and at the same time FG will manage to get enough seats only to need support from independents and keep Labour on the opposition benches is too soon to tell, with the Irish electorate keeping their real intentions, for want of a better word, in pectore.

The IMF arrives

23/11/2010

The only thing the Government managed to communicate in the course of the week was its own terrifying irrelevance“. Indeed.

Irish collapse, Franco-German alliance exposed

19/11/2010

So the inevitable has finally happened, Ireland has been turned over to recievership. After nearly all the government saying last week that there was no need for a bailout it happened as has been confirmed by the governor of the Central Bank of Ireland, Dr Patrick Honohan.

So ends whatever independence Ireland has was washed away in a sea of incompentence and denial. The “opposition parties” are getting increasingly angry at the same time, while hoping that the coming budget to be passed in December will go through, whence they can takeover after an early general election in early 2011.

The broader significance should not be missed out either. Ireland is just one of a number of countries that have the chance of destroying the entire euro currency. Portugal and Spain have also been in the news and the scale of their problems and with Ireland could tip the long feted currency into the abyss. In the unlikely event of this actually happening, it has been suggested that Ireland would be in a much better position and could simply devalue it currency while at the same time it could control its own interest rates so that it would benefit Ireland when it suited Ireland.

It should be noted that far from coming to the aid of their euro-bretheren in solidarity Germany and France have decided to shove them to the wall instead and look out for themselves when they “issued a clear warning that it [the ECB] will press ahead with plans to raise interest rates and withdraw lending support for banks despite the eurozone debt crisis, even if this risks pushing Ireland, Portugal and Spain into deeper trouble”.

So much for euro camaraderie and the end to national interest that the EU was meant to rise above, indeed end.

End of the line

12/11/2010

As Irish bond yields not only continue to rise seemingly inexporably towards either default or bailout, the cost of the financial crisis is still battering the Irish economy, partly thanks to an inept and incompentent government.

In a piece written recently Dr Morgan Kelly predicts that “Ireland is effectively insolvent – the next crisis will be mass home mortgage default”. He notes emotionless how “During September, the Irish Republic quietly ceased to exist as an autonomous fiscal entity, and became a ward of the European Central Bank.”

Dr Kelly remembers how “Until September, Ireland had the legal option of terminating the bank guarantee on the grounds that three of the guaranteed banks had withheld material information about their solvency, in direct breach of the 1971 Central Bank Act. The way would then have been open to pass legislation along the lines of the UK’s Bank Resolution Regime, to turn the roughly €75 billion of outstanding bank debt into shares in those banks, and so end the banking crisis at a stroke”.

He argues how “The Government has admitted that Anglo [Irish Bank] is going to cost the taxpayer €29 to €34 billion. It has also invested €16 billion in the other banks, but expects to get some or all of that investment back eventually.” He argues how Ireland’s other major banks are eventually in for the same fate as Anglo with a similar amount of money needed between them in order to correct them, as he says “When you apply the same assumptions about lending losses to the other banks, you end up with a likely taxpayer bill of €16 billion for Bank of Ireland (deducting the €3 billion they have since received from investors) and €26 billion for AIB: nearly as bad as Anglo”.

Correctly but sadly he notes how “This €70 billion bill for the banks dwarfs the €15 billion in spending cuts now agonised over, and reduces the necessary cuts in Government spending to an exercise in futility. What is the point of rearranging the spending deckchairs, when the iceberg of bank losses is going to sink us anyway?”. Ireland is effectively dead with little or no hope of recovery. He adds that “What is driving our bond yields to record levels is not the Government deficit, but the bank bailout”. If this is true which in all probability it is, it is only a matter of time before Ireland is buried under a mountain of its own debt.

Mournfully he continues saying that “The next act of the crisis will rehearse the same themes of bad loans and foreign debt, only this time as tragedy rather than farce. This time the bad loans will be mortgages, and the foreign creditor who cannot be repaid is the ECB”. He argues that as many as 200,000 households will be unable to pay their mortgage and that the result will be that “The gathering mortgage crisis puts Ireland on the cusp of a social conflict on the scale of the Land War“. This will have the result he says of pitting those who have paid off their mortgages with those who have not and demand a taxpayer funded bailout.

Finally he adds that “With a sufficiently low interest rate on what we owe to Europe, a combination of economic growth and inflation will eventually erode away the debt, just as it did in the 1980s”, he continues however saying that “An interest rate beyond 2 per cent is likely to sink us.”.

He concludes saying that “My stating the simple fact that the Government has driven Ireland over the brink of insolvency should not be taken as a tacit endorsement of the Opposition. The stark lesson of the last 30 years is that, while Fianna Fáil’s record of economic management has been decidedly mixed, that of the various Fine Gael coalitions has been uniformly dismal”. He goes on to predict the collapse of the current Irish party system and the rise of the far right. However, the Irish political culture would need to be remade if this were to come true to any real extent, a tall order to say the least.

In a piece, Ireland is praised for “Ireland has done everything that could reasonably be expected to set its fiscal house in order, and, unlike others, it has done so ahead of time and voluntarily” yet at the same time it argues that “The reason the resolution mechanism is being reformed is to address the fury of German taxpayers at being asked to bail out the profligate fringe” and warns of an authoritian capitalism taking hold – Chinese style.

What is being seen increasingly however is The main opposition Fine Gael unveiled plans to bring Ireland back to the sunny uplands of solvency where peace is restored and everyone smiles. An election is due by 2012 but will probably be held early next year. If there is any justice it should be the dmise of the ruling Fianna Fáil party but two things should not be forgotten, people have short memories and the absolute supidity of the Irish electorate is renowned.

Ireland’s future

05/11/2010

In a piece written some time ago on the best direction for the future of Ireland, the writer, Fintan O’Toole “sets out a programme to fix the country”.

He argues somewhat naively that “Irish parliament is probably the weakest in the democratic world. The Dáil does not make laws: it passes them. Legislation is almost never initiated by TDs. At best they get to debate the rights and wrongs of legislation proposed by government and perhaps to make some minor amendments”.  The while this is true to make any reforms to this would be dangerous as it would destroy the much needed power of the executive to pass the laws it wants and needs.

The author does give the example that on one day in July of this year, four seperate pieces of legislation were passed by the lower house.  While this is less than desirable, there is something to be said for more time for bills to be closely examined in committee stage, but for this to be truly effective the bill should be introduced into committee first and not almost before the bill is passed into law. Secondly, for there to be effective debate there needs to be a real party system with genuine differences – not rooted in something of no relevance to Irish people today.

O’Toole goes on to discuss how ministers never resigns “from office because of maladministration in the department that he or she theoretically heads. And yet in law (reinforced as recently as 1997) the Minister is the department”. He rightly asks “Why does the transparent pretence that the Minister is the flesh-and-blood incarnation of the department survive its own patent absurdity? Because it suits both Ministers and civil servants. It is the perfect shield against accountability”. Even worse when ministers have done wrong they are not even dismissed from office, only the PM can do that and as ever, party before common good. The only other alternative is for a different authority to excerise this power, either wholly or partially to remove incompentent or people not worthy of holding high office.

He continues asking, if the assembly “does not legislate and cannot hold Ministers to account, what does it do? The one remaining recognisable function of a democratic parliament is to conduct inquiries on issues of public policy and the performance of state institutions”.

He does make the point that a small country needs a smaller parliament when he says that  “local issues handled at local level, the Dáil can be both smaller and more efficient. Exact numbers can be argued over, but it is hard to see why the Dáil needs more than 100 members”. There is a case he says for the radical reform of the upper house, which he says “is so discredited that no one seems to care that a constitutional amendment to reform it slightly by broadening the numbers of third-level educational institutions whose graduates could vote for Senators, passed by referendum in 1979, has not been implemented”.

He rightly decries the PR-STV voting system as one that “contributes hugely to the maintenance of a clientelist culture”, he argues instead for a  additional member system which is a mix of first past the post and a party list system. He then goes on to advocate for quotas for women, which is utterly absurd and should not be implemented as it brings no tangible benefits except to ease the conscience’s of whining liberals.

He does make the point correctly that “is that the Oireachtas has not merely the power but also the duty to conduct inquiries for the purposes of examining the uses to which public money is being put”.

Even if a fraction of these ideas were implemented it would go a long way to the destruction of the “gombeen politics” that is destroying Ireland.

Dangers of the herd

19/10/2010

Moving to secular politics for now, tomorrow’s a different story, the Irish “government” is floundering waiting for spring when it can call early elections.

Recent polls show that voters are “deeply pessimistic about the future of the economy and a majority does not think an alternative government would do any better”. This reflects, not only a justified pessimism but also the fact that humans swing from deep despair to extreme happiness, also the fact that there is, especially in times of upheaval a herd mentality and an increased sense of the loss of rational thought. The article notes how people “Asked if they thought a change of government would improve the economic situation or have no impact on it, 45 per cent said it would have no impact, 39 per cent said it would improve the situation, 6 per cent thought it would make thinks worse and 10 per cent had no opinion”.

This shows little change from the fact that most people in Ireland can’t see any difference between the two main party leaders and thus the result is that “Two fifths of voters do not want either Brian Cowen or Enda Kenny as taoiseach [prime minster]”.

Things are not helped by the fact the the current incumbent is either wholly incompentent or deeply indecisive. Only when the Irish party system collapses and is reborn for the twentienth century (no, not an error) will any semblance of order begin.

Decision time

03/08/2010

It’s time for small countries, in this particular case, Ireland to decide. Do they want to maintain and equip armed forces that are fit for purpose or should they be abolished altogether and the money spent elsewhere.

Taking the example of the Royal Irish Regiment, the article says that “Eighty men from the Republic serve in the Royal Irish, with most of the remainder hailing from Northern Ireland or places such as Liverpool that have a strong history of Irish emigration.”

In the words of one soldier, “‘They want to go to places like Afghanistan. The Irish Army doesn’t offer anything like that. Sure, they have a stable job for five years, but with very slow promotion,’ says Coyne. ‘They want extra money for going away to places for six weeks. And you can buy your way out. Guys [in the Irish Army] are getting bored and fat and lazy. And they come back from UN missions with €25,000 in the bank'”. With a deployment to Afghanistan coming next month, the men seem eager to finished their training and ship out, for not to make light of the situation, some adventure.

Many countries such as Sweden spent millions of euros/dollars on their armed forces because they want to rely only on themselves, be truly netural. While it might be debatable if this is possible or even desirable in this modern world, countries like Sweden are at least making a concerted effort to avoid hypocrisy as far as possible.

Ireland however, maintained this ridiculous, laughable policy during WWII of being “neutral on the side of the Allies“. Ireland must decide, is it worth spending money on armed forces when the chance attack is so small, or does it really value its supposed neutrality and is prepared to do something about it, eg spend money to ensure as far as possible that this claim is true.

Just the beginning

29/07/2010

As was discussed recently, the world will face many challenges over the coming decades, just one of which will be a shortage of water. This is already happening, in Ireland of all places.

As a result of the lack of water “The capital has no strategic reserves of water when it should have 10-20 per cent reserves at a minimum, while existing sources are operating near sustainable limits”.  So more grand projects are being envisioned, “Dublin city councillors this week approved the consultants’ main proposal to bring excess water from the basin of the Shannon river to meet needs in the east and midlands”.

Things are apparently very near tipping point, the “four main water treatment plants in the greater Dublin region, which includes Kildare, north Wicklow and parts of Co Meath in addition to the capital. Their maximum output is between 540 and 550 million litres per day, while under normal circumstances demand is between 530 and 540 million litres per day”.

In an attempt to reduce waste, “Leakage from the system has been reduced from 42 per cent in 1996 to 28 per cent in 2002, but the report says that the maximum supply levels will be reached in the 2020s despite further efforts to reduce leakage”. However, more needs to be done before such a controversial project is even contemplated, water charging needs to be brought in and functioning, which might not be until 2012 or 2013 before anything else is considered.

If however as the report says that the best way of suppling water to the east  “involves taking the water from a point north of Lough Derg and piping it to a reservoir at a cutaway bog at Garryhinch, close to Portarlington, Co Laois, where it would be treated and distributed” then so be it. Many in the west of Ireland seem accepting that Dublin with its population “predicted to reach 2.2 million by 2031” needs more water as a local resident said “We’ve an abundance of water . . . My land has been flooded and half the farm submerged in three to four feet of water for three years. This plan won’t solve the flooding but I believe it makes good sense to share an abundance with those who need it”.

What is promised for those areas that are affected is a “reservoir in a cutaway Bord na Móna bog that would double as ‘an innovative water-based eco park, with fishing, boating, cycling, water and leisure sports’, with the promise of 1,000 construction jobs, plus long-term tourism and recreation employment for the region.”

However, as the article points out it is not quite that simple. There are fundamental issues of mistrust, “farmers and anglers agree on only a few important points. Both insist the plan will do nothing to alleviate flooding and that it’s cynical to suggest otherwise. They hold Bord na Móna responsible for the silting of the waterways, and finger this as a prime cause of the summer – and some of the winter – flooding”.

The article continues saying that there is a need for real government agency with real powers to control the waterways, but the bigger point is that there is not one already, coupled with the fact that the one already in existance is not trusted. However, the bigger problem, as has been stated here before is that Ireland has perhaps one of the strangest political divisions in the world, with no relation to the modern world and worse which people are unable to relate to. This only leads to politicians feeling remote which in turn leads to mistrust, that fact that job creation figures and costs are seemingly plucked from the air together with wild and inaccurate comparisons made hardly helps matters.

However “parties” like  Fianna Fáil need to die in order for some of this mistrust to fade. As for the water issue, this is just the beginning.

Ideological purity gone too far?

04/07/2010

Firstly, happy Independence Day.

In a piece written some time ago examining the tea party movement, David Frum argues that the tea party is costing the GOP many of the independents that it needs to win in the upcoming midterms and on to 2012.

This raises an interesting point, just how far should parties bend their policies to the electorate and what, if any, principles should or could be ditched for the prize that is political office? Frum compares the Senate elections in Ohio and Illinois where he says “In Illinois they have Mark Kirk – a socially moderate, fiscally conservative member of Congress, who represents the suburbs north of Chicago. In Ohio, the Republican candidate is Rob Portman, a former US Trade Representative and White House budget chief”.

Frum contrasts these with “Kentucky and Nevada, [where] Tea Party activists won nominations for two of their own: Rand Paul and Sharron Angle. Both have aligned themselves with an array of wild positions. Mrs Angle wants to abolish social security and Medicare and has spoken favourably of armed insurrection against the federal government”. He understandably dismisses the candidate in Nevada, who Harry Reid must be thanking his lucky stars for. Frum says that “Mrs Angle’s problem seems less that she is kooky and more that she cannot speak without saying something foolish. Republican leaders have barred her from speaking to the press until she is ‘ready’ – which they acknowledge may take some weeks”. While of the contest of Kentucky, he makes the point that “On the day Rand Paul won the GOP nomination, he led the Democratic nominee Jack Conway by almost 30 points. Mr Paul now leads by only six – and Mr Conway has not yet launched his negative ads.”

He sums it up succiently saying “while moderates have held two and gained one, the Tea Party radicals may have lost one and thrown away another.”

However, there must be some fundmental tenets from which a political party must not deviate if they are to have any credibility with themselves as a party, or with the electorate. In one sense what the principles comprise of is irrelevant. What is interesting about the tea party movement is that it refuses to alter its message for the voters, irrespective of the electoral results, which is highly admirable. Instead of a party, or section within a party, trying to get into office by telling the electors what they in essence want to hear, the tea party movement resolutely sticks to its principles and waits for the electorate to follow it.

Now doing away with social security and Medicare might be a step too far but, irrespective of how successful this movement is, and I think Mr Frum is broadly correct in his analysis, you have to admire the passion of the convictions they hold.

Dangers of populism and the erosion of childhood

27/06/2010

The Irish givernment’s plans to hold a referendum on the rights of children this year is absurd and ridiculously populist knee jerk policy, and can only by expected from a party like Fianna Fáil.

It is, of course, understandable that such a measure would be put before the people after the rightly damning evidence of the Ryan and Murphy reports, however article 45 of the Constitution of Ireland already says that:

“The State pledges itself to safeguard with especial care the economic interests of the weaker sections of the community, and, where necessary, to contribute to the support of the infirm, the widow, the orphan, and the aged.

The State shall endeavour to ensure that the strength and health of workers, men and women, and the tender age of children shall not be abused and that citizens shall not be forced by economic necessity to enter avocations unsuited to their sex, age or strength.”

In his excellent piece about the referendum, John Waters notes that “the Fianna Fáil TD Mary O’Rourke has ‘warned’ that ‘various groupings’ are ‘joining forces’ to ‘fight’ the proposed referendum on ‘children’s rights’. Oh my! How distressing that citizens are preparing to engage in democratic debate concerning an important question about the direction of their society!” Waters gets to the point, many people, for example Fianna Fáil, take a very knee jerk view to everything without thinking things through – just look at Ireland now.

Many people will be unable to see how you could vote against a referendum on children’s rights. Despite obvious theoritical flaws, such as giving children under the age of majority, rights, thus further weakening the important division between adulthood and childhood, they will brand anyone who raises questions and has concerns about it, reactionary or just plain detached from reality.  

Waters contiunes saying that “It seems O’Rourke’s powerlessness to prevent this incipient nuisance-making is causing her anxiety. She ‘warned’ that, arising from the involvement of ‘pro-life’ and ‘anti-Lisbon activists’, the referendum might not have ‘a sweet passage’. ‘The forces of old will wish to re-assert themselves,’ she prophesied.”

He continues saying “A visitor from afar might have difficulty understanding what O’Rourke was getting at. What does ‘forces of old’ signify? Isn’t this referendum about a new and discrete question? What is the connection between a referendum on ‘children’s rights’ and a treaty concerning internal EU housekeeping? What has this to do with ‘pro-life and anti-abortion’?” Indeed, as was stated here only recently, the very reason that many people who hold strong views on emotive subjects become so vocal is because there is no regular outlet in the Irish party system for them and thus able to separate the real conservatives with the people who are unhinged.

Or as Waters says, “O’Rourke, who chaired the cross-party committee that produced the amendment proposal, is entitled to argue for constitutional change. But she is not entitled to present this amendment as incontrovertibly beneficial or to cast aspersions on the legitimacy or bona fides of those contributing to the discussion on the other side.” He says rightly that “Citizens may even find her arguments persuasive. But she is not entitled to disparage arguments before they are made on the basis of snide throwaways concerning the pedigrees of those who may seek to make them.”

I fear however, the O’Rourke’s and the hard left Geraldine Kennedy’s of this world will dicate the terms of the debate so that they can stifle the arguments of the other side that deserved to be heard. It is due to Fianna Fáil’s populism and lack of ideology that lead to measures such as this which, while of on the surface beneficial it is unwise to put such measures into a constitution that such contain only the fundamentals of a State.

Collapse of the Irish party system?

16/06/2010

Labour is now the most popular party in Ireland. The “Labour leader Eamon Gilmore gets a far higher satisfaction rating than any of his rivals, while the party is ahead of Fine Gael and Fianna Fáil in terms of its core vote as well as the adjusted vote”.

While the other main parties seem to be collapsing, “Fianna Fáil has dropped back to the record low it reached last September, while the standing of the Government and Taoiseach has fallen sharply over the past six months. There is also bad news for Fine Gael, with the party dropping to its lowest rating in two years and leader Enda Kenny falling back in terms of satisfaction rating”.

The poll numbers say that “When people were asked for whom they would vote if there was a general election tomorrow, the adjusted figures for party support, compared with the last Irish Times poll on January 20th last, were: Fianna Fáil, 17 per cent (down five points); Fine Gael, 28 per cent (down four points); Labour, 32 per cent (up eight points); Sinn Féin, 9 per cent (up one point); Green Party, 3 per cent (no change); and Independents/ Others, 11 per cent (no change)”.

Even the Irish voters know that things aren’t going well with the country when “12 per cent of voters are satisfied with the way the Government is doing its job (down seven points) while 83 per cent are dissatisfied (up seven points)”. Similarly, Cowen gets a well deserved hiding for his mix of incompetence and spinelessness, “Brian Cowen gets a satisfaction rating of 18 per cent (down eight points); Mr Kenny is on 24 per cent (down seven points); Mr Gilmore is on 46 per cent (no change); John Gormley, 21 per cent (down three points) and Gerry Adams, 31 per cent (no change)”.

What is suprising is that Fine Gael and, perhaps Enda Kenny, failed to do any better – a damning indictment of Kenny’s leadership and failure to captailise on the explosion of the Irish economy, after years of mismangament and greed coupled with a chronic inability to make decisions, and with it the implosion of FF support.  Indeed, what is amazing is that “support for Fine Gael has retreated further, down four points to 28 per cent, still ahead of Fianna Fáil but behind Labour for the first time since polling began in 1982”.

Things are so bad, not only for FF but now it seems that more and more people have almost no support for FG either. What is interesting here is that “Trends in leader satisfaction and party support do not always mirror one another, but in today’s poll the parallels are unavoidable”. So, after months, perhaps years in truth, Richard Bruton acted or failed to act fast enough and was fired by Kenny.

The ensuing leadership challenge is messy and will run and run for the next days. The assumption is that, get rid of Kenny and the polls will reflect that.

What is less clear however, is the rise of Labour, “It may have been the recent HSE miscarriage misdiagnosis revelations, which were prominent in the media when interviewing for this latest poll last Tuesday and Wednesday, or perhaps talk of cuts in the old-age pension and other welfare benefits has thrown voters into the arms of Labour.What is clear, however, is that the electorate has a significant appetite for change.An examination of how the parties perform among the various demographic cohorts also highlights the changes in party loyalty in recent years”.

Certainly, Gilmore’s more stirring and wholly justified attacks on FF and Cowen, I hope this and not other things, have raised his profile and his support in an country angry with politicans and bankers. His attempts to talk himself up seem to have worked, for now.

What no one seems to be asking is, is this a new lasting trend where people are attracted to Labour’s quasi-leftish policies and want the old political order to be destroyed, or will things return to normal in three or four years time with a return to the two and a half party system that is currently in place? Some have said that Labour have only managed this rise in popularity by attacking the government but not putting forward any alternative policies.

What I hope will happen is that a political system based on something that happened ninety years ago and once divided a country and lead to a civil war, is no way to run a party system in this day and age. I hope these new polls will lead to the death of the system as it is currently construced, however, the stupidity of the Irish electorate never cease to amaze me, so anything is possible.

Human rationality and the economic system

29/05/2010

In a recent interview given by Dr Nouriel Roubini who despite the naysayers predicted the global collapse of capitalism that is continuing to happen around us.

In an interview given recently the the Daily Telegraph, Dr Roubini, says that there is more to come. He says quite accurately, that the next wave will be  that of governments. He told the paper that ” The crisis is not over; we are just at the next stage. This is where we move from a private to a public debt problem”.

He contiuned saying that “We socialised part of the private losses by bailing out financial institutions and providing fiscal stimulus to avoid the great recession from turning into a depression. But rising public debt is never a free lunch, eventually you have to pay for it”. So, all those critics that said that the banks were too big to fail and the whole financial system was based on them was well maybe just an understatment.  Now governments the world over are going to pay, both literally and figuratively for their (i.e. our) “generousity”.

Crucially, he believes Greece’s problems will see it, among others, leave the euro, as was mentioned on a post here recently. Roubini insists major reform is necessary, “We are still in the middle of this crisis and there is more trouble ahead of us, even if there is a recovery. During the great depression the economy contracted between 1929 and 1933, there was the beginning of a recovery, but then a second recession from 1937 to 1939. If you don’t address the issues, you risk having a double-dip recession and one which is at least as severe as the first one.”

Governments all over the world, but particularly in Europe and North America are going to have to make cuts that affect the way their very societies think about themselves. It will also be a huge challenge, perhaps the biggest challenge to democracy itself. Can governments get elected and stay in power when there are no tax cuts and spending increases every few years? What will happen when the extremes look increasingly effective, which over time they will? Worringly, what will happen when a country with a de facto one party state despite having many formal parties have to make tough choices? Where will the voters turn when they are faced with a real choice, will they be able to chose at all? 

Can democracy with its trust in the rationality and supremacy of the individual face the test that is fast approaching?

The state of Irish politics

15/05/2010

At last, Bertie Ahern apoligised for the havoc he and his “party” wrecked in Ireland. what Ahern actually said was that, “We probably should have closed those [ tax incentives] down a good bit earlier but there were always fierce pressures, there was endless pressures to keep them. There was endless pressures to extend them”

Really, pressure, while running Ireland, next he’ll be saying that he had to make decisions! If this is the natural governing party of Ireland, I would hate to see what the other lot are like.

It is time for the political party system of Ireland to collapse and start again. Any notion that organising a society on a disagreement over a Treaty that was signed eighty years ago is laughable. It is a testminony to FF that they have clung on to this system so long and been so successful. After all they are the ultimate catch all party, although what they actually believe, if they are capable of believing in anything is anyone’s guess. Maybe that’s what’s needed or required to rise up the cursus honorum of parties like it? So, it’ll be more of the same when the other lot get in I suppose.

What was that Machiavelli quote about people expecting their new rulers to be better than the ones they replace and being sorely disappointed………