The Economic Case for a United Ireland

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This is the paper that the economist Michael Burke gave at the Irish Unity Conference in London last Saturday. Some of the points made by Michael were discussed in Seumas Milne’s post in The Guardian’s Comment is Free site today. As readers may know, Michael, a former senior international economist with CityBank, is a regular contributor to the economic debate in Ireland through his articles and posts in Socialist Economic Bulletin, Progressive Economy and elsewhere.

The case for a united Ireland should not rest solely on arguments for democracy and against injustice, important as those are. The fact is there is a strong economic case for ending Partition, and one which would benefit almost the entire population of the North, across all communities.

Legacy of colonialism

The whole of Ireland was a colony of Britain. Colonies are usually characterised by a model of development which is aimed at the easiest extraction of goods and raw materials to be used by the imperial centre. Yet, long before Partition in 1922, the area around Belfast and on the North-East coast much more closely resembled an industrial area of mainland Britain. Shipping, linen and, latterly, aircraft appeared to place Belfast on the same footing as the industrial centres of Glasgow, Manchester and Liverpool with which it traded. It was wholly unlike most of the rest of Ireland, even the nearby counties in the North, which mainly rested on agriculture. Most of Ireland, it was often said, had been cleared of its people to make way for England’s cattle. As a result the majority of Ireland, the oldest capitalist colony was also an archetypal one. The relative privileges afforded the producers around Belfast formed the economic basis of the relative privileges granted to Protestants in the North. These have been cemented by sectarianism and finds its political expression in Unionism.

At the time of Partition, per capita levels of output and income in what became Northern Ireland were on a par with Britain as a whole. By contrast, output and income in what has since become the Republic of Ireland were a fraction of those in the North. Neither of those two points is true any longer. The Northern economy has sunk below that of Britain (which has itself been experiencing relative decline on a global basis). And the economy of the Republic has experienced an era of superior growth which has seen per capita incomes catch up and then surpass both the North and Britain as a whole. In the latest data, average (median) weekly earnings in the North were £357, in Britain they were £397 and in the South (after adjusting for both currency and price differentials) they were £532.

The global economy

The recent economic boom in India, some decades after Independence is testimony to the fact that independence is a necessary but insufficient condition for economic prosperity. A deepening integration with the global economy is also required. At the time of Ireland’s Partition, 98% of the South’s foreign trade was with Britain, chiefly the export of live cattle. The entirety of Irish official economic policy was for decades aimed at maintaining the dominance of the big farmers who served the British market. However, diversification was forced on Ireland, not least by Britain’s relative decline. A steady economic outperformance from the late 1960s onwards gave way to a genuine economic boom of the early 1990s as the Irish economy became properly integrated with the European and the global economy.

That path is road-blocked for the NI economy. It is not integrated into the global economy, and is becoming less so, as its traditional industrial strongholds fade away. Its ‘external sales’ amounted to just £12.5bn in 2008/09. Excluding sales to Britain, actual merchandise exports were just £5.9bn. By contrast, the Republic’s exports amounted to €86.8bn over the same period. Only 14% of those were to Britain, compared to 53% for NI. This contrast is even starker in relation to imports.

Inequality

The government of the Republic is currently engaged in a savage attack on public sector pay and provisions, drawing envious admiration from George Osborne and David Cameron in Britain. The economic gains post-independence and the prosperity that accompanied them owe nothing to the progressive or far-sighted policies of successive governments; there have been none. Economic success, with a handful of exceptions has arisen from foreign multinationals taking advantage from a well-educated workforce located in a prime conduit for trade between the two major blocs of the US and EU.

The interests represented by Fianna Fail in particular have shifted from the large farmers to their property speculating and banking successors, and indices of wealth and social inequality are unchanged since Partition. In fact income inequality both North and South are above the EU average, and on a par with Britain. The maintenance of this status quo is the economic platform of almost all the main political parties, with the notable exception of Sinn Féin. Representing a similar social base, the economic policies of Fianna Fail and the DUP are virtually identical. The viciousness of their economic policy arises from material weakness, not strength. The campaign for cuts in public sector pay and welfare payments, and now a reduction in the minimum wage is led by representatives of the fast food chains, the shopkeepers and the bookmakers.

Both economies are also leading examples of the unequal treatment of women, not only in employment and the workplace but in all aspects of social life. But the North also remains a bastion of sectarian discrimination. One of the many gains of the Good Friday Agreement was the establishment of the Equality Commission of NI. It has monitoring powers over all enterprises with more than 10 employees. The changing political climate that led to the establishment of the Commission has seen the rapid erosion of large areas of sectarian discrimination in public sector employment. Before the current economic crisis, a rising population and falling unemployment produced a situation where employment growth amongst Catholics outstripped that of Protestants. Nothing like that success has been registered in the private sector. However, the battle for equality is far from over. A Catholic is still more than twice as likely to be unemployed. Discrimination in other areas, such as housing, remains endemic.

These inequalities are part of the DNA of both societies. It is no accident that those struggling against those inequalities are confronted with the idea of transforming the political basis of both states North and South, as well as the social relations within them. That transformation would benefit the overwhelming bulk of the population, North and South.

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One Response

  1. John Paul

    March 8, 2010 12:21 pm

    A United Ireland, not only makes sense from an Irish perspective but also for the UK as well. Ireland is Ireland, together the people stand strong divided we fall, for the prosperity, peace and for the future of all the people on this Island. I think that it’s inevitable that a United Ireland will come as the gains to be obtained out-way everything else. To paraphrase the current President of the USA, A United Ireland Yes We Can.