Ireland and the presidency of the EU - Instability, unemployment, recession

The Irish political establishment will no doubt use its presidency of the EU to paint a rosy picture of a ‘social' European Union. But such a picture will jar dramatically with the reality of an EU that is the driving force in the austerity destroying lives in Ireland and elsewhere in Europe. By Paul Murphy and Kevin Henry.

The beginning of Ireland's six month EU Presidency was marked by Eamon Gilmore boasting in the European press that, "Ireland can help lead Europe's recovery". With 2012 marking the fifth year of domestic recession in Ireland and a return to recession in the Eurozone, working class people will rightly see this as empty rhetoric. The official slogan of the Presidency, "Stability, Jobs and Growth" fits into the same category, as well as being simply a rehash of the slogan used by the political establishment during the Austerity Treaty referendum.

The Government's real priority continues to be to protect the bondholders at the expense of working people. In Ireland, Michael Taft has demonstrated how figures from Eurostat indicate we are paying an incredible 42% of the total cost of the European banking crisis. The government is reduced to begging for what are, relatively speaking, crumbs from the table of the European Central Bank on the Promissory Note, while funnelling over €26 billion in taxpayers' funds to bondholders this year alone.

Institutionalising austerity

The Presidency's programme commits the Irish government to helping the Commission in co-ordinating the continuation of the failed policies of austerity across Europe. The Government is proud that their Presidency will coincide with the first full year of the 'European Semester' which comes into force now. What this means is that national budgets across Europe will be co-ordinated and draft budgets will be presented to the European Commission and Council before any discussion in national parliaments. The purpose of these discussions is clear - to undermine democratic rights further and put significant political pressure at an early stage on national governments to implement the austerity deemed necessary by the high priests of austerity in Europe.

The President of the Commission, Jose Manuel Barroso has also said it is an "urgent priority" to gain an agreement around the 'two-pack' to complement its bigger brother the ‘six-pack'. The 'six-pack' has already meant the creation of a budgetary policeman that can impose heavy sanctions on countries if they do not meet the Commission's targets. The 'two-pack' will further strengthen the hand of the Commission to 'monitor budgetary plans' by placing government into effective administration, reducing them to semi-colonial status.

EU budget

The Presidency is already hampered by the lack of a deal on the EU multi-annual budget. This was supposed to be agreed during the Cypriot Presidency but differences between the governments and the Commission meant there was no deal, with a €30 billion difference between different proposals. The current proposals for the budget will see cuts to vital funding for cohesion, development and social goals, while protecting funding for militarisation and border protection.

The Irish government in particular want this agreed so that it can pursue a deal on the Common Agricultural Policy. However, even if a deal on CAP can be cobbled together, it will be to the benefit of big farmers and agri-business and not small farmers, agricultural workers and the rural communities which have been devastated by the crisis.


Similarly, the research framework, Horizon 2020, is linked to an agreement around the multi-annual framework budget. There are important aspects to Horizon 2020 which provide necessary funds to develop technology. However since the previous research framework programme, the water has been consciously muddied between civilian and miltary funding.

The previous framework programme for research created a separate budget of €1.4 billion for security and an advisory body which gave hand outs to the armaments industry behind closed doors, free from the scrutiny of the public. Ministers have boasted of the importance of Horizon 2020, yet they remain silent on the proposals that could see this 'security' funding increase to €2 billion.

A report from a Policy Committee in the European Parliament concluded "It is mostly large defence companies... which are the main beneficiaries" and that 57% of the funding went to these companies. Recipients include Elbit Systems and Israel Aerospace Industries which are involved in the construction of Israel's apartheid wall and supply the drones and warplanes used to terrorise the Palestinian people. So much for claims by Eammon Gilmore that the Presidency would be used advance the interests of the Palestinian people!

This is part of a broader drive toward militarisation which is a hidden feature of a Presidency whose government is suppose to be neutral. The programme commits the Irish government to working with Catherine Ashton in developing "deployable military capacities" and supports the development of an EU battle group - an essential part of the drive towards the full militarisation of the EU since the Lisbon Treaty.  This is despite the fact that in referendum after referendum, we were told by the Labour Party and others that Ireland's supposed 'neutrality' would be defended.

Free trade agenda

Another central feature of this Presidency will be negotiations on a EU-US free trade deal which, according to the Government, will result in a 2% increase in the GDP across Europe with Ireland gaining even more. Lucinda Creighton, Minister of State for European Affairs wrote in the Parliament Magazine that "As an open economy, Ireland understands the benefits of free unhindered borders and will focus on promoting an external trade agenda as a vital source of growth and jobs."

This free trade agenda fits in perfectly with the plans of the European Commission which - as trade is an exclusive EU competence - is conducting trade talks on behalf of the European Union. The arch neoliberal trade Commissioner De Gucht explained "my job description is ‘Open new markets for the European Industry and the European Services Sector.’" This blunt and aggressive approach by the European Commission has been translated into free trade agreements with countries like Colombia, renowned for its continuous human rights violations and murder of trade union activists.

Upgrading trade relations with the state of Israel and tolerating products from illegal Israeli settlements into the EU are part and parcel of the hypocritical reality of trade for profit which is ridicules the fine sounding statement of Catherine Ashton, Vice President of the European Commission, that "Human rights, democracy and the rule of law are the basic values on which EU foreign policy is built. They are a silver thread running through all that we do."

With poorer countries, the EU is often in a position to simply dictate its policy, to the detriment of small farmers and working class people. Negotiations and Free Trade Agreements with more developed countries, such as Korea, Canada and now Japan and potentially the US mean that similar industries and sectors go into direct and ferocious competition with each other. All sides claim that those deals will be win - win situations, boosting the economy and GDP growth.

With the implementation of brutal austerity policies that undermine domestic demand and a general slow down in the world economy, the majority of governments and big businesses have only one strategy to offer: Increase exports and competitiveness as a way out of the crises. The experience of this approach in Ireland shows the results: Increased profits for big business, attacks on the wages and conditions of workers, and a race to the bottom when it comes to taxes paid by big business.

It is true that trade has accelerated under capitalism and has created wealth and development - for some. Under today's conditions, it comes with the massive exploitation of the working class and huge environmental damage. In order for trade to become a powerful driver for prosperity and sustainable human development, it must be based on relations of solidarity between peoples and not on profit.

Youth unemployment

The youth guarantee scheme is one of the flagships of this Presidency, which claims its central concern is to deal with the crisis of youth unemployment. This is supposedly a commitment that no young person would be out of work or education for longer than four months. In reality it is an empty promise. It is an attempt to be seen to do something about this massive crisis, which sees youth unemployment of 30% in Ireland and over 50% in Greece and Spain and with the rate of youth employment in 2011 at the lowest point ever in the history of the EU.

Worse still, this scheme can be used as a push for a Europe-wide introduction of workfare programmes like JobBridge, which push unemployed people into low paid jobs. These programmes in reality do not create real employment, but create a source of cheap labour built on the backs of working people. They displace real jobs, and create a race to the bottom, driving down wages and destroying working conditions.

A real youth guarantee needs significant funding to create real jobs, and access to free further education for all. It needs to come with guarantees of decent wages and conditions and full trade union rights.

Radical alternative needed for Europe

The Irish political establishment will no doubt use the Presidency and 40th anniversary of Ireland's entry into the EU to paint a rosy picture of a ‘social' European Union. Such a picture will jar dramatically with people's real experience, which is of an ‘Austerity Union', with the EU being a driving force in the austerity destroying lives in Ireland and elsewhere in Europe.

The Socialist Party's priority for this Presidency is to assist workers and young people fighting back to co-ordinate struggle across Europe. A glimpse of the potential was seen on 14 November last year with general strikes across southern Europe. We will also present our alternative to the Austerity Union of the EU, which is a socialist Europe free from the dictatorship of the markets.

As a contribution to this discussion, I am hosting a countersummit in Liberty Hall from 15-17 February with speakers and activists from across Europe. for more info.

Paul Murphy is Socialist Party and United Left Alliance MEP for Dublin.