Our sovereignty is gone, never to return
The Government’s confidence that a second bailout will not be necessary is far-fetched. By Vincent Browne.
28 November, 'Dependence Day', should be commemorated each year as the most crucial date in the calendar of the Irish state since independence.
It is the anniversary of the surrender of the substance of Irish sovereignty in 2010, a surrender that will not be undone perhaps for a century or more. The living representation of that surrender is at present in one of Dublin's most expensive hotels, the Merrion, in the person of the people from the troika - the International Monetary Fund, the EU Commission and the ECB - across the road from Government Buildings.
They are here, not just to check up on Ireland's progress on deficit reduction, but on how we have fared on 'reforms' of our public service, 'reforms' of our social protection arrangements and 'reforms' of our labour markets, all of which are transforming, and will transform, this society. It is the troika - not those in Government Buildings, still less those in our national parliament or the Irish people - that will take all the substantive decisions on these transformations.
Enda Kenny and Michael Noonan, dismissing last week the prospect of a second bailout for Ireland and a second surrender, seem to think we are on track to meet the targets the troika dictated in November 2010 - which, theoretically, were devised in the Department of Finance, but shaped by the agenda the troika had established.
Michael Taft, economist with trade union Unite, has said that, in every crucial respect, this was just not true. The National Recovery Plan projected a growth in gross domestic product (GDP) over the period 2010-2014 of 10.75%.
The latest government projections are 7.7% - and few believe that will be achieved. The plan projected consumer spending to rise by 4.25%; the latest government projection is a fall of 2.8%. It projected investment to rise by 9.5%; the latest projection is that investment will fall by 4.2%.
The plan projected employment to rise by 4.25%; the latest projection is for employment to fall by 0.1%. It projected the unemployment rate would be 9.75%; now the projection is 12.9%.
The projection was that the national debt would be 100% of GDP by 2014; now the projection is 115%.
So the confidence of Kenny and Noonan that a second bailout will not be necessary is far-fetched. Anyway, since the only advantage in avoiding a second bailout was that the troika would no longer be running our affairs, this is no longer so. They will be running our affairs forever, no matter how we fare in reducing the deficit, achieving growth or increasing employment.
This is because of the Merkel-Sarkozy fiscal union plan. Whether this is within or without the structures of the EU, the idea is that we will be forced to accept outside determination of our economic, budgetary and social policies. Our social policies are the programmes on social protection and, crucially, on labour markets.
This fiscal union thing presumably will be made coherent before it comes up for ratification in March, and I assume that efforts will be made to get Britain to drop its objections so that it can all be done within the ambit of the EU. If not, it is difficult to see how this can be legal.
But, one way or another, we are headed towards the surrender of our substantive sovereignty in a way never envisaged when we joined the European project in 1973.
I assume this will have to be put to a referendum here, and I also assume that the Irish people will be frightened into ratifying it. The insidiousness of all this is best exemplified at present by what is happening in Vita Cortex in Cork and in La Senza around the country.
Complicated and half-clever legal devices have been devised to take advantage of the 'reformed' labour markets to deny workers redundancy payments or to annul employment contracts unilaterally.
What the troika wants is even more 'flexible' labour markets, where there is even less job security, fewer protections in employment and less entitlement for those put out of work.
The 'reform' of the joint labour committees (JLCs) is part of that agenda. The troika also wants more privatisation and the sale of State assets, although the experience of that has been disastrous. It also wants weaker social protection, so that workers will be encouraged to take jobs they don't want and which are systematically insecure.
Isn't it extraordinary that, at the very time when worldwide experience has proved the deregulation of markets to be calamitous, the policy response is to intensify the drive towards free markets? This has caused the collapse of much of the world's financial infrastructure, at enormous cost to ordinary people, and has driven societies to become more unequal and cruel. And yet the drive persists.
We may have a chance in a few months to slow down that momentum a little by refusing to ratify this new fiscal union, though I suspect we will pass on that one, as we have done before.
Image top: Eadaoin O'Sullivan.