Rss Feed Tweeter button Facebook button Linkedin button

Skip to content

Wednesday, Feb 22nd 2012


From the Wires

There is a passage in Adam Phillips’s most recent book On Balance where he quotes Freud biographer Ernest Jones as observing that it is not the people we hate the most that we want to kill, but the people who arouse in us the most unbearable conflict. Thinking about its media campaign around its ‘crackdown’ on welfare fraud, is there not something similar happening here with the Irish Labour Party?
Historically, the Labour Party claimed, as did its ‘sister parties‘ across Europe (those parties that comprise the Socialist International, including until recently the parties of Zine El Abidine Ben-Aliand Hosni Mubarak, though there is no reason, given the Labour Party’s intense collaboration with Fine Gael, for openly right-wing parties such as the Partido Popular in Spain or the Christian Democratic Union to be refused some sort of honorary sibling status) to represent working class voters and to protect them from the depredations of big business interests.

Now, it collaborates in a government that oversees the transfer of billions of euro of public money (€1.5bn this week alone) -which could go to schools, hospitals, social welfare payments and public works schemes-  to wealthy investors. It has set up a scheme that uses the unemployed to subsidise employers with free labour and simultaneously drive down wages. When the ECB makes the demand for more cuts to wages and social welfare payments, the Labour Party announces it will introduce bio-metric ID cards for welfare claimants, who on losing their jobs will join a new disciplinary society in which they will all be treated as potential criminals.

In seeking some sort of egalitarian response to the economic crisis, Labour Party voters may have been looking for ‘a party of Government‘, as the party ceaselessly advertised itself. As those who find themselves on the dole through no fault of their own are starting to discover, what they got was a party of governmentality that comes down hardest on the people that reminds it most of what it is supposed to be.


‘A democracy, to be sure, with open and free elections, but far from governed in the interests of its people’ is how Conor McCabe assesses the picture of Ireland that emerges in light of the bank guarantee in Sins of The Father.

The contradictory character of this picture will intensify in the weeks and months ahead, as the government presses on with its intention to continue sating wealthy bondholders while cutting vital public jobs and services, selling off public assets, harrassing welfare claimants, undermining wages and working conditions, and dumping an even greater burden onto households through regressive taxation measures, all of which is precisely what the wealthiest and most protected sector of Irish society demands.

It will claim to do all this in the name of ‘our children’s future‘. Meanwhile, in the misleadingly-titled ‘Measuring Ireland’s Progress‘ report released yesterday by the CSO, 8.2% of children under 15 were in consistent poverty in 2009, up from 6.1% in 2008, a figure set to rise even further on account of the continued austerity drive of the current government.

In his think-in speech, Eamon Gilmore spoke about the importance of looking to the Labour Party’s values, and named solidarity as one of these, when it came to casting away the ‘old manuals’ of social democratic government. His cabinet colleague Brendan Howlin recently gave a vivid illustration of the meaning of solidarity from the point of view of the Labour Party.

Nominated as ‘Business person of the month’ for July by Business and Finance, the magazine approvingly quoted Howlin on the value of solidarity:

We want to preserve the social solidarity that has been manifest in this process to date and not to have the discordant situation that you have in Greece, where people resist change that I’m afraid is inevitable.

There lies the true value of ’solidarity’ for the government politician: a handy instrument for quelling dissent so that the robbery can continue unabated.

As this translated piece by Manuel Castells, originally published in La Vanguardia, shows, the Republic of Ireland is far from the only nominally democratic European country with a government that openly and willingly prioritises the interests of people whom Richard Drayton of Imperial College London, described in a talk earlier this year as ‘a nomadic global pirate class’. The options for the residents of this country, as with Spain, Greece and elsewhere, are either to capitulate, or to recover the real meaning of words such as solidarity and democracy through dissent, collective action, and new forms of participation and mobilisation.

A couple of notes on the translation:

Acampada has been left untranslated, because it has a specific historic sense in Spanish -especially in light of the setting up of camps during the 15-M mobilisations- that ‘camp’ in English does not convey.

A desalambrar means, literally, get rid of the wires. This is an allusion to the song of the same title, written by Uruguayan singer-songwriter Daniel Viglietti

Viglietti

but also sung by Victor Jara, the Chilean folk singer who was arrested, tortured and murdered when the US-backed forces of General Augusto Pinochet launched a coup against the government of Salvador Allende on September 11, 1973.

Jara

Viglietti wrote the song in response to heavy repression of a demonstration by refrigeration and meat workers in Uruguay, in which pro-government forces tortured workers with estaqueo - using stakes driven into the ground to maintain the body of the victim in the form of an X- in working-class neighbourhoods.

Estaqueo

The land referred to in the song is both the land used to torture the workers, and the ground for the demand for agrarian reform. A desalambrar in Viglietti’s song suggests the removal of any ties -whether physical in the form of fences or instruments of torture, or institutional, or mental- that may bind the exercise of freedom.

Citizens and markets

Manuel Castells

Castells

Zapatero will go down in history as the worst president of Spanish democracy to date (Aznar at least had ideological coherence). The pantomime of constitutional reform, treacherously perpetrated under cover of night by the two big parties acting in cahoots, affects the root of democracy and the autonomy of the State. It has been a decision imposed by Merkel and Sarkozy, resuming a proposal from the PP. It is reasoned that it was necessary in order to calm the distrust of the markets about the Spanish debt which could precipitate a crisis in European debt, in particular that of Italy, thereby sinking the Euro. To refloat Greece, Portugal and Spain is difficult. To save Spain from bankruptcy is unviable for German and French finances. Hence the pressure on the Spanish government, which some time back abandoned any pretence to economic sovereignty. All this in the name of prophecies about the behaviour of the markets, that supreme and mysterious power that must be appeased with human sacrifices: the cutbacks in social spending affect health, education and pensions, or in other words, life.

But who are the markets? Do you know any market personally? In reality one can put names and surnames to them: they are the investors (perhaps you yourself) represented by financial intermediaries. But what do these investors and their intermediaries want? Balanced budgets? The capacity to pay debts long term? All these are strategic calculations to get to another end, to what really motivates investment: hard profit in the short term. This is how financial firms operate, it is on this that shareholder dividends depend and, above all, the commissions and profits of financiers. And this short term profit is obtained through multiple means, among these through betting on changes in valuation on financial assets, including treasury bonds and foreign exchange. Therefore, for some, the devaluation of Spanish sovereign debt and the increase in risk premiums can be juicy business. It is precisely in a situation of financial turbulence that the big profits are made.

By contrast what the investors (called markets) take into account is the outlook for business in each economy. Because recession and a rise in unemployment are bad business for everyone. Precisely because of this, when in spring of 2010 Spain decreed austerity measures the ratings agency Fitch lowered the rating of our public debt. What will these investors stop at now, knowing that even if in the long term Spanish debt can be paid, in the short term the country has been parched of possible fiscal stimulus in a situation in which private investment cannot get out of the employment and demand crisis on its own? Economic slowdown is the darkest outlook for the markets.

And this is why on the same day that the yes-sirs of the Courts of the Kingdom voted to bind the hands and feet of the State by removing its capacity to acquire funds whenever the need arose, Spain’s sovereign debt-risk premium rose and stock markets of the world fell in reaction to the negative jobs data in the United States. In contrast, there was an upward reaction by the stock markets when the agreement was reached so that the United States could get into more debt. And they have sunk again after the IMF made the announcement about the possibility of the recession despite (or because of) the cutbacks. It is for these reasons that Spain and the euro can go to the wall, not because we got into debt.

It is not about saving the Spanish economy but rather of taking advantage of the crisis to tie the hands of the representatives of citizens in case they get the temptation to follow their voters instead of the markets as interpreted by Merkel, Sarkozy and all those who save their political hide in their own countries at the cost of other Europeans: a clear case of European (dis)Union.

And here we have the crux of the matter: in the name of the markets (whose judgment remains to be seen), a constitutional reform is imposed on the citizens, without consulting them and by taking advantage of a parliamentary majority that may dissolve in three months. And in so doing, it delegitimizes a Constitution of convenience, which is untouchable for some things and is manipulated in a few days to suit those politicians circumstantially in power. There would never, in this way, have been approval for the 1978 Constitution, which however imperfect it might be, allowed the organisation of a political coexistence based on an evolving consensus which has now been broken with no imperative need and without informing the citizens just why such urgency apart from the dark references to the perception of the markets. But the citizens have a right to make mistakes because that too is popular sovereignty. What they do not accept is the invocation of democracy as a source of legitimacy only to then act on such important matters by using the parliamentary bulldozer as though the country belonged to the politicians. The Icelandic example returns to mind: after months of social agitation a referendum on crisis policies brought about financial regulation, sacking and prosecution of politicians guilty for the crisis and to the non-payment of banking debt. And things were solved for people.

If there was already a deep crisis of legitimacy in Spanish democracy, a source of outrage that the great majority of the population shares, this shameful reform of the Constitution dynamites any credibility held by the politicians who voted for it. And in passing it makes things very difficult for Rubalcaba, who tried to save some respect for his party and for politics by extending bridges to the feelings of society. If the source of the Constitution is the markets, let the bankers call the shots directly. But if the citizens think that they are the constituents, perhaps they should re-found democracy peacefully and clean out the institutions of majoritarian parties who camp out in the Courts as if it were their ranch and we were their peons. Acampada versus acampada. Political cynicism against citizen hope. A desalambrar.

A desalambrar (Victor Jara)

I ask of those present

If they have never stopped to think

That this land belongs to us all

And not to whoever has the most

I ask if on the land

You have never thought to yourself

That if the hands are ours

Whatever they give us is ours

Tear it down, tear it down

The land is ours

Yours and his

Pedro’s and Maria’s

Juan’s and Jose’s

If my song should bother

Someone who happens to hear

I say he is a gringo

Or an owner of this country

Tear it down, tear it down

The land is ours

Yours and his

Pedro’s and Maria’s

Juan’s and Jose’s

Discussion

We welcome and encourage lively discussion from the public about articles on Irish Left Review. You can leave a comment using the form at the bottom of the page. Please read through the existing comments before posting your own.

  1. Comment by: krupskaya

    Sep 14th 2011 at 15:09

    I think its even worse than this, in some ways.

    Some of the instincts of PSOE government were very positive. In 2009 they had a sharp increase in government spending on infrastructure which is much more effective than tax breaks for firms in generating investment. To address the fall in demand and boost confidence, they raised the miminum wage. I’m not sure any other European govt which did that.

    But then they were caught by a three-pronged attack from the ratings agencies, bond markets and the ECB. In a mirror image of Ireland, almost everyone in Spain is a Euro-enthusiast. PSOE could not imagine a circumstance in which they sided with their own population against the EU institutions and the capitulation to calls for austerity was pitiful to watch.

    As a result of the earlier measures, the economy is still growing, but at 0.7% growth in Q2 fom a year earlier. A double-dip beckons, courtesy of austerity.

    The end of the road for moderately Leftist social democracy in Spain.

Leave a Comment

(required)

(required, will not be published)

Sins of the Father

Sins of the Father:

Tracing the Decisions

That Shaped the Irish Economy,

by Conor McCabe

from The History Press

Now Available as an e-Book.

Subscribe by Email

Enter your email address:

Delivered by FeedBurner



Irish Left Review on Facebook

Best of the Web

  • EU Should Admit Greece is Bankrupt | Christian Rickens

    The unvarnished truth - the second Greek Bailout should not have happened.

    The mistake isn’t the size, but the construction of the bailout package. It isn’t geared to the requirements of the people of Greece but to the needs of the international financial markets, meaning the banks.

    How else can one explain the fact that around a quarter of the package won’t even arrive in Athens but will flow directly to the country’s international creditors? The holders of Greek government bonds are to get some €30 billion as an incentive to convert their old paper into new bonds. The aim is to keep alive the illusion that Greece isn’t bankrupt — after all, the creditors are voluntarily forgiving part of the debt. The financial sector is cleverly manipulating the fear that a Greek bankruptcy would trigger a fatal chain reaction.

    That leaves €100 billion. But that too isn’t geared to what Greece needs in order to get back on its feet. It’s linked to an estimate of how much debt the Greek economy can bear without collapsing. International technocrats agree that with debts amounting to 120 percent of gross domestic product, the country can just about go on servicing its debt. That’s the level at which the cow can go on supplying milk without dying of exhaustion. So 120 percent became the goal.

    No comments »
  • Collaboration, with our European partners | Cunning Hired Knaves

    The European project was supposed to be a bulwark against the dangers of fascist ambition, but now it is the instrument used to dismantle European democracy in the interest of the risk adverse looking for a steady income stream from the provision of the social net by those who cite the words and actions of old fascists while doing so.

    The post Collaboration, with our European partners by Richard of Cunning Hired Knaves summed up in one sentence. For much better sentences and many more urgent points read the post.

    On Sunday there were massive demonstrations throughout the Spanish state, with half a million people on the streets of Madrid and 450,000 in Barcelona, protesting against the labour ‘reform’ planned by the Partido Popular, the right-wing party that most closely represents the interests of the power elites that conserved their position when the transition from dictatorship to democracy was undertaken.

    No comments »
  • S.P.A.R.K. protest at cuts to lone parents, Dublin 18th February 2012

    Many families were cut in the last budget but lone parent families were particularly hit by the Fine Gael/Labour Party government.

    The key elements are that single parents can’t take advantage of training such as Community Employment (CE) Schemes and when the youngest child turns 7 years old, the parent is declassed as a lone parent but treated as an ordinary worker even though there are few affordable creche places. There is a bill coming up in March which will copper fasten some of the worst elements of government plans.

    There is particular anger directed at the Labour Party because they are associated with women’s rights and a more progressive society.

    Please share the link to this video

    No comments »
  • Exiting the euro | Michael Roberts

    Michael Roberts argues that those in Greece who cite the example of Argentina when suggesting that Greece should leave the Euro are not necessarily looking at the whole picture. The situations are not the same, Roberts points out, citing Argentina’s former central bank governor at the time, Mario Blejer and his recent piece in the Financial Times. He also points to research based on the the experience of five recent devaluations of economies in crisis (including that of Argentina) which “shows that they lead to a 10-20% fall in real GDP and take five to ten years to recover to previous real GDP levels. But that is not to say that there is no alternative to “lowering wages, privatising the state sector, reducing taxes for the corporate sector (especially big business) and ‘deregulating’ labour markets i.e. the super-exploitation of the Greek people to raise profitability.”

    But the left could also find an alternative policy to exiting the euro where Greece negotiates a full default on its debt to private and foreign bondholders; takes over the banks; and uses the savings from bond and interest repayments (€17-20bn a year) to start state directed investment in jobs, technology and funding small businesses, while staying in the euro to protect the savings of the people from destruction, keeping down inflation and avoiding a rise in foreign debt.  The question of exiting the euro then becomes an issue for the Euro leaders to impose (and to be resisted by a campaign within Europe), not as the main policy plank of the left.

    No comments »
  • Corporate tax avoidance: where are the worst offenders?

    This table comes via  the Tax Justice Network (and Richard Murphy). It’s from a table produced by U.S. researcher Kimberly Clausing and as TJN notes “demonstrates which countries are working hardest to wage economic warfare on the United States (and, by extension, on other countries,) via the global tax system”.

    No comments »
  • Solidarity campaign to support the people of Greece

    Mikis Theodorakis, famous Greek composer of Zorba’s Dance, and Manolis Glezos, veteran resistance fighter against the Nazi occupation, have issued a call for a European Front to defend the people of Greece and all those facing austerity. We have decided to support this call and work with trade unions, campaigns and parties across Europe to establish a European Solidarity Campaign to defend the people of Greece. We will organise solidarity and raise practical support for the people of Greece; they cannot be made to pay for a crisis for which they are not responsible.

    1 comment »
  • Chris Dillow | Capitalism against freedom

    [...]

    During the Cold War, opponents of communism routinely, and not entirely wrongly, claimed to be champions of liberty. Freedom for capitalists and freedom of speech and thought go together, it was claimed. “Freedom is indivisible” wrote Bruce Winton Knight in 1952. “Economic freedom is…an indispensable means toward the achievement of political freedom“ wrote Milton Friedman in Capitalism and Freedom. And back in 1944 Friedrich Hayek complained that “We have progressively abandoned that freedom in economic affairs without which personal and political freedom has never existed in the past.”

    Today, though, this seems wrong. Many threats to freedom come from capitalists. The story is no longer capitalism and freedom, but capitalism against freedom.

    No comments »
  • Ian Stewart | The mathematical equation that caused the banks to crash

    In The Observer, Sunday 12 February 2012

    Anyone who has followed the crisis will understand that the real economy of businesses and commodities is being upstaged by complicated financial instruments known as derivatives. These are not money or goods. They are investments in investments, bets about bets. Derivatives created a booming global economy, but they also led to turbulent markets, the credit crunch, the near collapse of the banking system and the economic slump. And it was the Black-Scholes equation that opened up the world of derivatives.

    The equation itself wasn’t the real problem. It was useful, it was precise, and its limitations were clearly stated. It provided an industry-standard method to assess the likely value of a financial derivative. So derivatives could be traded before they matured. The formula was fine if you used it sensibly and abandoned it when market conditions weren’t appropriate. The trouble was its potential for abuse. It allowed derivatives to become commodities that could be traded in their own right. The financial sector called it the Midas Formula and saw it as a recipe for making everything turn to gold. But the markets forgot how the story of King Midas ended.

    No comments »
  • Greece: a Sisyphean task | Michael Roberts

    In a Eurozone that is unwilling to share its surplus with weaker, hardest hit economies there is no other option for those economies but default. Despite the agreement of Greek politicians to shorten their political life and accept the deal all that they have done is simply postpone this eventuality once again. However, even that postponement might be shortened by the Greek elections in April where the smaller leftist parties outside the coalition currently have 40% of the vote. Or so says Michael Roberts:

    Whatever the Greek coalition leaders agree to and try to implement, such is the weakness of Greek capitalism, it will not be able to meet its fiscal targets or get its debt down to reasonable levels.  Before the end of the year, the Troika will have to report that Greece is not delivering.  Then the EU leaders will have to decide whether they ‘let Greece go’ or not.  The EU leaders have agreed to more money for Greece  (or more accurately its bondholders and banks) in return for draconian cuts in living standards in order to provide more time to try and ‘ring-fence’ other vulnerable Eurozone states like Portugal and Ireland (where they are preparing extra funding).  So when Greece goes down, it will not affect the rest (or so the EU leaders hope).  Of course, the Greek people may force the issue earlier if they vote in an anti-Troika government in April.

    No comments »
  • As Greece stares into the abyss, Europe must choose | Maria Margaronis

    Do we really want to live in an economic union that must destroy the future of millions in order to just tick along? Maria Margaronis points out that the situation in Greece today says little about Greece and everything about the EU.

    The trouble with historical metaphors is that they can obscure the present: what’s really at stake here is not Greece’s identity but Europe’s. All eyes are fixed on Athens, but the way out of the crisis requires a choice about what kind of Europe we want. The one we have now, with its deep structural inequalities and its rigid adherence to a failed economic ideology, protects neither democracy nor human rights. Stiff-necked and punitive, it prefers to eat its children.

    No comments »

Link Archives »

Authors