What now for Ireland?

Noel Coghlan

Issue 391, vol.98, Autumn 2009

By the early 2000s, our economy had ceased to be export-driven; instead, property speculation and consumer spending were the driving force. This trend had been facilitated by unsecured borrowing from the banks (particularly by property developers and construction firms) – until the financial sector was brought up short by the effects of the 2008 implosion of the U.S. markets.

Meanwhile, our policy-makers had placed too much trust in the good offices of corporate elites in far-away lands – relying on these multi-nationals for the welfare and future of their work-force in Ireland. Also, in an era of globalisation, the possibility had been overlooked that multi-nationals which had out-sourced operations to Ireland, might one day further out-source to even cheaper locales such as India.

Because of the cost of accommodation, long commutes to and from work became the order of the day for many of our people – isolating them from their community and even from their family. Because of factors like these, the country’s fund of social capital has been diminishing.

What is needed now is the revival of the notion of solidarity – of a shared destiny, in quest of the common good. There has to be a change from a consideration of ‘means’ : “Which methods will best achieve economic growth ?” – to ‘ends’ : “To whose advantage are the fruits of that growth going to be directed ?” (and, “Who stands in greatest need ?”). [This derives from the ‘capability’ paradigm of Amaryta Sen].

Ireland’s public finances have to be brought into balance and our credit rating restored. Job-creation strategies have to be put in place which harness the skills of our people. Effective safety-nets have to be devised for those at risk of deprivation. All these will require sacrifices : higher (and new forms of) taxation; more rigorous enforcement of (stricter) codes of corporate governance; recapitalisation, if not nationalisation, of the banks – with more robust regulation; an end to the ‘bonus culture’. The sacrifices, however, are ones which our people will insist must be borne by everybody proportionately : the future of the nation should not be pawned to redeem the bankers and the property developers; nor should those of modest means have to pay for the errors of a corporate elite.