Over the last couple of weeks the Irish media has been chock-a-block with stories about the McNulty affair. There’s really no need for a recap here. But suffice to say that Fine Gael found itself mired in controversy when the story broke (and broke and broke…) that John McNulty, “a Donegal grocer and petrol retailer”, had been put on the board of the Irish Museum of Modern Art (IMMA) in what has been called an incidence of ‘stroke politics’, so as to boost his credentials to fill a vacancy on the Seanad’s cultural and education panel.

The affair was flogged by media and opposition parties as indicative of the type of cronyism and ‘jobs for the boys’ that Enda Kenny so virulently condemned during the last general election. Along with the Taoiseach, Heather Humphreys, was singled out in particular for the very public backlash – so public indeed that Fine Gael TDs John Deasy and Séan Conlan got in on the act. McNulty, for his part, kept pretty quiet – his ghostly presence mostly circulating in the form of a single photograph and soundbites from various individuals testifying to his credentials – before withdrawing his candidacy on yesterday.

While the purported abuse of the boards of semi-state bodies for purposes of political patronage is not unproblematic, the whole episode speaks to a far more troubling aspect of Irish political discourse: namely the way that issues of cronyism and ‘political reform’ are placed centre stage in political debate, while decisions about the economy, including the perpetuation of austerity, which have far wider reaching impacts on the lives of citizens, are being made politically invisible.

In a feature piece on the topic in last weekend’s Sunday Times, Fine Gael’s John Deasy, expressing his criticisms of Kenny’s handling of the affair, is quoted as saying:

“People are getting sick of the way this is being conducted and it doesn’t really strike people as being what we, as a party, phrased as new politics… The parliamentary party is very happy with the way Michael Noonan is running the economy, but I think people are becoming disgusted with the way Fine Gael is being run [by Enda Kenny]”.

For me, the crucial aspect in Deasy’s statement is the way it constructs a separation between economic policy (Noonan’s ‘management’ of the economy) and the ‘politics’ of state appointments (Kenny’s party leadership). The most significant political decisions the current Government has made have been those relating to the economy. Sweeping spending cuts in social welfare, healthcare, and education, an intensified programme to sell national assets, far-reaching reforms of working conditions and a redirection of state supports to cash-rich investors have all been features of a suite of economic policies that successive governments have implemented post-crisis. The sustained programme of austerity has woven itself deep into the lives of individuals, families, and communities. Decisions about the direction of economic policy, then, are intrinsically political.

However, these decisions are frequently viewed as issues of technocratic management, a matter of accountancy and number crunching, which precludes any real political discussion about them. Decisions about the economy are constructed responding to the objective state of ‘the markets’, and as such are outside the messy realm of politics.

This has been compounded by a recent shift in the discourse. Ireland, the Government tell us, is now in recovery, the recession is over and the austerity policies implemented over the last half a decade have proven a ‘success’. Despite ample evidence of continuing hardship (for example, a MABS study showing their clients have an average disposable income of just €8.75 a week), Fine Gael, in particular, have been keen to mobilise this story to bolster their chances of re-election.

And the media seem happy to accept the story of recovery at face value.

During the recent Prime Time debate between the candidates running in the Roscommon South-Leitrim by-election, for example, Miriam O’Callaghan put it to one of the candidates that his previous calls to “burn the bondholders” had been proven erroneous by current economic recovery. In another exchange, Independent candidate Gerry O’Boyle spoke out angrily about the considerable time given over in the debate to questioning Fine Gael’s Maura Hopkins about the McNulty affair. To O’Callaghan’s suggestion that “this was a huge national issue” he retorted: “I’m here to deal with the issue of family homes… Family homes — you don’t even think about it!”

Vincent Brown made the point on TV3 on Monday that the corporatist neoliberal economic model that has been practiced by the current Government is indicative of a much more trenchant form of cronyism (the proposed tax probe on Apple a case in point) than the McNulty affair. As indicative of a warped political system as it is, the McNulty affair pales in comparison to the destruction that the programme of austerity has brought.

In the aftermath of McNulty’s withdrawal, Fine Gael have tried to weave a careful PR narrative through the facts of the case. In the run up to the next General Election, if the John Deasy’s sentiments are shared widely within the party, one might speculate that Kenny could potentially be jettisoned as Taoiseach in an attempt to distance Fine Gael from the stigma of cronyism.

Instead the party will seek to be judged on their economic track record. And they should be – but not in the way they have in mind. Rather the political debate should be squarely focussed on the politics of economic policy – who the winners and losers have been in Ireland’s supposed recovery.

The swell of media coverage and discussion on the McNulty affair has pushed cronyism to the top of the list of burning political issues in the country. Meanwhile the politics of economic policy are pushed to the background. But as long as questions concerning the economy are depoliticised, the game stays the same – it just gets more fierce.

Cian O’Callaghan

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Outside is warmer than the air-conditioned car and my feet begin to thaw as I cross the dirt-road with camera in hand.  The sign reading ‘wedding’, a wooden plank shaped into an arrow and adorned by a glass bottle dangling from a nail, points to a ramshackle barn with rusted corrugated iron roof standing next to some scattered trees.  Behind this I can just make out the substantially more salubrious premises within which, presumably, said weddings are to take place.  My companion has pulled over the car so that I can get a shot of what she assures me is a pretty regular sight in this part of Australia.  We have been driving around the Hunter Region of New South Wales, an area that extends from 120 km to 310 km north of Sydney.  The Hunter Valley is famed for, amongst other things, horse breeding and wine production, and we are currently on a stretch dominated by the latter.  While many notable Australian wine brands are still produced in the region, since the 1990s a co-dependent tourist industry has been developed around the vineyards, attracting streams of Sydneysiders north for weekend breaks that encompass wine tasting in carefully sculpted landscapes of rolling hills, winding dirt roads, and miles of vines housing upmarket hotels, along with faux-rustic venues like the one that I have stopped to photograph.

The Australian summer has been tentatively announcing its presence this year and today is cloudy but warm.  I finish photographing and we resume our journey, the air-conditioner summarily resuming to freeze my feet. We’ve been driving through ‘blink and you miss it’ towns filled with detached houses, convenience stores that have seen better days, and oddly ubiquitous hotels that all look like replicas of Wild West Saloons.   We pass through the sanitised vineyard territory into the slightly less manicured landscape of smaller growers.  These too peel away to reveal a stretch of highway through the bush, upon which road-kill kangaroo carcases are strewn every hundred meters of so, and we are marveling at the levels of carnage when the Hunter’s other defining feature creeps up on us unawares: as we turn a bend on the road an open-cut coal mine comes into view. (more…)

In the clouds

Ahead of what is sure to be another harsh budget tomorrow, there have been a number of news stories announcing the creation of new jobs in Ireland.  The timing of this is of course strategic, offering a glimmer of hope in what promises to be another bleak winter of public service cuts and tax hikes.  The unstated message here is that austerity policy is working; that if we can weather the long winter of discontent the coming spring will be blooming with the new economic opportunities that are slowly beginning to grow again through the permafrost left by the Celtic Tiger’s collapse.

Leaving aside the pertinent issue of the crippling debt that Ireland carries, this message is still deeply problematic and the economic policy that it valorises is rather depressing.

But first: what of the jobs themselves?

The first of these stories was the announcement by the Government that Shannon Airport will be separated from the Dublin Airport Authority by the end of the year and merged with the landbank of Shannon Development next year to form a new State-owned company “NewCo”.  As the Irish Times report, “it was announced that two Shannon-based companies had signed memorandums of understanding to create 1,000 jobs within three to five years in the area on the basis that Shannon would be separated from the DAA” and that up to 3,500 new jobs are expected to be created through the venture.  According to a statement by Fine Gael TD for Clare, Joe Carey, “NewCo… will drive the development of a world-class aviation industry at Shannon, as well as working with tourism and enterprise agencies locally to the benefit of the wider region”.  This all strikes me as more than a little opaque and I’m at pains to see the evidence that splitting Shannon Airport from the DAA will have a decisive impact on its economic prospects in the absence of other market factors that have little to do with economic policy.

The second story, that US cloud computing company Dropbox are to set up their international headquarters in Dublin, was a little more conclusive.  The company’s decision will initially bring in just over 40 jobs, but this number is expected to increase once the company gets up and running in Ireland.  Part of the media allure of this story is that U2 front-man Bono, who was an early investor in the company, was instrumental in persuading Dropbox to come to Ireland.  Dropbox’s Sujay Jaswa is quoted in the Independent as saying: “Bono has been a great investor for us, and he and the Edge were very persuasive in their arguments for setting up in Ireland”.  Meanwhile, Bono himself suggests that “This smart and innovative company will find a smart and innovative workforce here in Ireland, with a creativity and commitment second to none. The Irish Government worked hard on this, and the IDA played a blinder”.

Bono’s comments are particularly telling.  In his rather patronising spiel, the Irish Government comes across as a sales team with the IDA as their star player.  But I can’t help but get a vague sense of an aura of incredulity emanating from Bono; it’s as if this was a game he had expected his team to lose, but by sheer guile and tenacity they pulled off the unforeseen victory.

There is something unsettling here that takes us back to problematic nature of Ireland’s economic policy.  The image that Ireland presents to the world is of a confident, creative, educated and innovative place, “the best small country in the world in which to do business”The hope is that by projecting this image, companies like Dropbox will come and invest here and, by virtue of the employment they create (if not the taxes they pay), Ireland can grow itself out of recession.  Meanwhile at home the budget does the dirty work of austerity hidden from the global spotlight, further eroding public services in areas such as Health and Education, and with them any substantive basis underlying the image of Ireland that the Government likes to project to the world.  And as the structural foundations of the state become weaker, the nation continues to practice the increasingly precarious policy of reliance on foreign direct investment.  The fact that in 2006 U2 moved part of its business to Holland to avail of a lower tax rate makes Bono’s ambassadorial role in brokering the deal with Dropbox seem all the more apt.  He makes a suitable figurehead for the casual indifference the Irish Government gives to the incongruity between its external image and internal policies.  When weighed against the deadening barrage of cuts that the last few budgets have brought, the small victories that these stories highlight, rather than signalling new growth from the ground up, seem more like small kites floating through the clouds, oblivious to the frosty landscape of despair below.

Cian O’Callaghan

As announced on the Irish Economy blog.  Conference registration is free and anyone can attend.

Details of the fourth in the series of conferences on the Irish economy are below. Further details of talks will be posted here in advance.

Conference on Irish Economic Policy

Dublin

January 27th

Clarion Hotel IFSC

On January 27th 2012, the Geary Institute will run an event on the future of Irish economy policy in Dublin. An era of unprecedented growth followed by a dramatic economic collapse is giving way to several years of sluggish growth. The main theme of the conference will be the development of more intelligent economic policy that enables substantial development even in the context of a tightened fiscal and monetary environment. The conference will take place over the course of the full day, with parallel sessions addressing employment, innovation, education and related themes. The conference aims to provide a forum for new ideas on the conduct of Irish economic policy, including the extent to which academic economics and related disciplines can make a bigger contribution to the conduct of economic policy in Ireland, and the extent to which policy can be designed more effectively.  The conference organisers are Liam Delaney, Colm Harmon and Stephen Kinsella. Please email to register attendance: emma.barron@ucd.ie There is no registration charge.

9.00 – 9.15

Registration and Opening

9.15-10.45

Unemployment

Housing

Chair: Minister Joan Burton

David Bell (Stirling)

P O’Connell/S McGuiness (ESRI)

Aedin Doris (Maynooth)

Chair: Stephen Kinsella (UL)

Ronan Lyons (Oxford)

Michelle Norris (UCD)

Rob Kitchin (NUIM)

10.45-11.15

Coffee

11.15-12.45

Economics and Evaluation

Demography

Chair: Donal De Butleir

Robert Watt (D. PER)

Colm Harmon (UCD)

Third Speaker TBC

 

Chair: Kevin Denny (UCD)

Orla Doyle (UCD)

Alan Barrett (ESRI)

Brendan Walsh (UCD)

12.45-2.00

Lunch

2.00-3.30

Fiscal Policy

Competition and Sectoral Policy

Chair: Dan O’Brien

Philip Lane (TCD)

John McHale (NUIG)

Seamus Coffey(UCC)

Chair: Cathal Guiomard

Richard Tol, (Sussex)

John Fingleton (Office of Fair Trading)

Doug Andrew (former London airport regulator)

3.30 – 4pm

Coffee

4pm-5.30pm

Banking and Euro

Chair: Constantin Gurdgiev (TCD)

Brian Lucey (TCD)

Colm McCarthy (UCD)

Frank Barry (TCD)

Rob Kitchin


Gary, Indiana in the USA has a population around 100,000 and practically no jobs or services. It is the recipient of Obama’s stimulus package to resuscitate the economy. A report on BBC 2 last night looked at the city to examine the impacts of recent economic policy in the US. Watch an excerpt and read more here.

Gary is one third poor, 84% African American, and has seen its population halve over the past three decades. If crime, as the official figures suggest, has recently dropped off then – say the critics – that is because population flight from the city is bigger than the census figures show.

In Ireland, we don’t have ghost towns like Gary yet. If we get out-migration then we might do in a few places as oversupply decay and other buildings are vacated as people leave. However the size of the country will probably mitigate the stark neglect experienced in many areas of the US (the Ozark Mountain region depicted in Debra Granik’s recently released film Winter’s Bone offers another example). Nevertheless, Gary is a bleak vision of uneven development under capitalism.

Cian O’ Callaghan

In a recent post I alluded to the deep philosophical problems associated with NAMA.  The aim here was to highlight the relationship between democracy and inequality when discussing the role of the state in modern democratic systems. The problems alluded to can also be applied to the recent budgetary announcements; particularly the lack of concern with reducing inequality. On the contrary, it seems that the government is intent on the reverse. The welfare cuts announced in the budget reinforce and deepen rather than reduce inequality. Strikingly, this is referred to as ‘making hard decisions’ in the ‘national interest’. Clearly then, ‘making hard decisions’ is more or less analogous to reinforcing and deepening inequality. (more…)