Brian O'Boyle considers the growing militant anti-austerity movement in Ireland
The Irish economic crash has been almost without parallel in Western Europe. Having previously been held up as a poster boy for neoliberalism Irish capitalism went into freefall in late 2008, as hundreds of thousands lost their jobs and the banking system rapidly disintegrated. The Celtic Tiger "miracle" turned out to be a mirage and it was the particular rhythm of Irish neoliberalism that can best account for the boom, the bubble and the disastrous bust.
Neoliberalism had been the order of the day for over two decades as successive Irish governments put their faith in tight fiscal policy, foreign direct investment, deregulated finance and European markets. A combination of European Union membership, cheap wages and low corporate taxes originally allowed Ireland to attract a disproportionate amount of foreign investment.
The plan was to market the country as a staging-post for US capital and for a time the strategy seemed to be working. During the 1990s the economy was booming. But as wages and inflation began to increase Ireland lost its cost advantages.
Germany in particular was successful at driving down wages. As multinationals began to look elsewhere, the Irish elites turned towards finance. Restrictions established by the EU Economic and Monetary Union meant that Ireland chose to meet the potential slowdown with a slew of supports for its banking and construction industries. Instead of state spending (outlawed by the Stability and Growth Pact) the Irish ruling class propped up the economy with a property bonanza.
Tax breaks for developers were combined with light-touch regulation. Between them the Irish banks borrowed upwards of €500 billion. This was obviously unsustainable in an economy worth little over €150 billion and when the crash came the Irish elites were left with monumental difficulties.
Their solution was to foist the costs onto the population, in a process that began with a blanket guarantee for all Irish banking debt. So far this has cost the Irish taxpayer around €87 billion in direct payouts. This has obviously to be paid for. And over the last four years the Irish elites have worked alongside the "Troika" (IMF/ECB/EU) to perpetrate a brutal class attack on the population.
On average workers have taken pay cuts of around 15 percent, seen their working lives extended by three years and had their terms and conditions severely undermined. Successive governments have also dragged hundreds of thousands back into the tax net, slashed essential services and attacked the most vulnerable with taxes and benefit reductions.
In total the government has cut around €24 billion from its yearly budgets, or a cumulative total of €70 billion. The effects of this have predictably been devastating. According to the Central Statistics Office, absolute poverty has increased by 50 percent since 2009, deprivation levels are at 23 percent, and one in five children now go to school hungry.
While the top 10 percent of the income earners have increased their disposable income by eight percent, the bottom 10 percent have lost 26 percent and this has contributed to the growing anger of the population. Government ministers love to insist that Irish people are not like Greeks. But the reality is that the majority of the Irish population are absolutely raging.
Since the turn of the year there has been a significant upturn in struggle. In the vanguard has been the campaign against household and water taxes which has seen over one million households (50 percent) refusing to pay and tens of thousands engaged in protests around the country. Both of the ruling parties faced determined opposition from thousands of protesters at their national conferences and the campaign is actively building a network of left wing fighters.
Alongside this, single parents, rural schools, disadvantaged schools and numerous grassroots and community groups have begun to mobilise. In the end the battle will come down to working class confidence and those of us in the Irish SWP will be fighting determinedly to ensure that our side continues to grow in confidence, aspirations and organisational capacity.