I’ve skim-read yet another article in the Times which tries to explain the objective shiteness of Ireland by blaming it on a mash of vague “cultural” factors- how we see the state, how we engage as citizens, how we should be more like Scandinavia. The memorable bit of the article (which is available here: http://www.irishtimes.com/newspaper/opinion/2011/0820/1224302759014.html) is when he says if we had had a Norwegian finance minister for the past twenty years we wouldn’t be in this mess. I heard another guy on the radio this morning bemoaning the fact that we’re “on our knees”, considering we were one of the world’s most competitive countries just a few years ago.

This is what passes for commentary right now. No suspicion on the part of that second guy that there might be an intimate connection between our “competitiveness” and our failure. Being “competitive” in the capitalist market means being on your knees.

The other guy, the Scandinavian-ministers-guy, looks at our credit binge and says the Scandinavians would never have done this. That’s the same attitude which breeds articles full of lazy, spend-happy, feckless Mediterraneans and disciplined, austere Germans. At its worst it breeds the Myers brand of African, a black haze of angry incompetent irrationality.

A more sensible analysis shows us that after the Irish Gombeen class accidentally recovered from the crisis of the 1980s, the credit binge was the only option. How else to achieve prosperity in Ireland than to fake it? When world capitalism became fundamentally unprofitable in the 1970s and ’80s, this was the route taken by most of the advanced capitalist countries. The Age of Credit (c.1989-2008) was the historical blink-of-the-eye in which the weak, tiny Irish Capitalist class found conditions in which it could thrive. Never before had it provided full employment or such huge tax revenue. As a historically weak class of gombeens and chancers, not quite capitalists, the Irish ruling class naturally found its niche in an age when con artistry was seen as viable economic policy.

That age has passed. Debt mountains; rows upon rows of dead, empty houses- dramatic contributions from an apparently unpromising class. It’s all we could ever hope to get from them, even if there had been a Norwegian on Merrion Row. It’s all we ever will get from them; talk of export-led growth and our “enterprizing spirit” should be disregarded out of hand. If only this failed class had the grace to bow out now.

[ps: a short post from politics.ie on the word “gombeen”- I think I pass the test for precise usage of the term… http://www.politics.ie/forum/culture-community/166759-why-do-posters-misuse-word-gombeen.html%5D

  1. C. Flower says:

    Good post. But as well as the flattening off of average profitability, which was responded to with zero interest rates and a tsunami of credit, there was the response of globalisation, a strategy to move production to non-union cheap labour locations and depress wages in the west, and a series of costly resource wars.

    Ireland was a small country, with weak regulatory structures, and the credit bubble blew a hole through the whole thing here, as bank CEOs and developers were allowed to run a massive scam, Most of them have escaped wealthy, and the rich have got richer.

    Scamming and fraud are a norm in capitalism, particularly in finance – Bill Black, in a brilliant article, explains exactly how “control fraud” worked in Ireland and how, once it started, it was impossible for banks to stay “clean”.


    • lenihanm says:

      thanks for the contribution.
      “[D]ishonest dealings tend to drive honest dealings out of the market”- the words “race to the bottom” are applicable in so many ways when it comes to Capitalism

  2. Conor McCabe dug up some great stats over the weekend that show the foreign direct investment never provided the mass employment it is credited with – especially the “good boom” of the 90s. Sure, profitable exporting jobs exist, but its empirically proven that they are a tiny minority. Kevin McLoughlin mentioned it during his talk at the ULA National Forum that Irish capitalism cannot provide the employment neccessary through foreign investment and I think it is an analysis we should push. Basically we need 200,000 jobs immediately and these magic exporting jobs increase by only 2,000 or so a year.

    • lenihanm says:

      I think there’s something to be said as well for making a distinction between what Irish Capitalism (as in rich investors in Ireland) can do, which isn’t much, and on the other hand the role of foreign capital (ie. Imperialism). Even if FDI provided ten times as many jobs, a national strategy of making the country as soft a target as possible for exploitation by multinationals (in the hope that we get a few scraps) is not viable or sane. That strategy means low taxes on corporations with workers making up the shortfall. It means the greatest ambition of our politicians is to smash the public sector, drive down wages and sell off state assets. All these sacrifices for a situation where these companies can pack up and leave tomorrow morning anyway the moment another country subordinates itself further.

      So I think maybe there should be a two-pronged element to the argument: the FDI strategy doesn’t work; and even if it did somehow work, it still wouldn’t work.

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