What will be said of the Irish crisis when finally it can be spoken of with hindsight? On that happy day, we may be speaking of the deregulation of the financial sector that allowed the riskiest of debts to be bundled together as if there were safety in the herd. Perhaps people will note the dramatic redistribution of income towards the richest 1%, which now has over 10% of Irish wealth. No doubt folk will be full amazed that even when bad bets were made, the financial whizz-kids kept their bonuses and passed their losses to the state.

It will perhaps be a matter of remark that the state decided that those best able to bear these costs should be cosseted from tax demands, so that the painful adjustment was instead demanded from those most deserving of state assistance. The Central Statistical Office estimates that in 2012 some 12.9% of households have had to without necessary heating of their home at some time in the year, up from 6.3% in 2008, and that 23.3% of households reported not being able to afford a morning, afternoon, or evening out in the previous fortnight, up from 11.1% in 2008.

It may be noted that all this contradicts the clear instruction of the 1937 Constitution, which directs that ‘in what pertains to the to the control of credit the constant and predominant aim shall be the welfare of the people as a whole,’ and which imposes upon the state a duty ‘to safeguard with especial care the economic interests of the weaker sections of the community.’

Unemployment map

From David Meredith and Jon Paul Faulkner, ‘The nature of uneven development in Ireland, 1991-2011,’ in Kearns, Meredith, Morrissey eds. Spatial justice and the Irish crisis (RIA, 2014) 107-127. Used with kind permission.

Now, all of this injustice takes place somewhere and when we speak of the Irish crisis we should remember its landscapes of despair. Future archaeologists may one day walk through the rubble of our crisis and bemoan the planning deficit that allowed houses without services, and new shopping centres to compete with half-empty ones. The people who camp inside houses marooned within landscapes pockmarked by the shells of abandoned constructions, the people whose local A & E services have been closed and who find that under-provision in the Ambulance Service mean that should they need timely care there is an odds-on chance they won’t get it, and the folk decanted from their community while their houses were to be repaired and who now find those repairs repeatedly deferred, all know that national averages hide the multiplying and accumulating deprivation inflicted upon themselves and their neighbours. We know that even the children of these sinks of poverty register the appalling reputation of their home area and feel less trusting of other children on their streets. We also know that stress and lack of opportunity translate into sickness, drug dependency, crime and violence.

A new geography of exclusion has been produced by the crisis. It works at multiple scales and it targets particular housing estates, particular small towns, particular parts of cities, and everywhere it corrals the poor and the disadvantaged to protect the property values and refined sensibilities of the rich. When asylum seekers are warehoused in remote places and when they self-harm or go on hunger strike to protest years spent in isolation and limbo, we get glimpses of a new geography of marginality, but we also know that the vicious asylum system is a consequence of under-funding and of a wish that Ireland not be, as so many foreign places once were for the Irish, a haven for the dispossessed and needy. Instead Ireland is once again open for investment and the property porn begins again in the weekend supplements. The government has shown foreign investors that they can bet on foolish speculation and still recover not only their bet, but also the promised winnings.

Will things be any different this time around? Well, the state sector will be carrying cuts already inflicted, and yet more already placed into the pipeline. Instead of addressing financial regulation and implementing directive planning, the predominant ideology of successive governments has been that it was the Irish state sector that over-spent the country into recession. So, we must expect further rounds of spatial injustice, further concentrations of poverty, and further marginalization of those who deserve assistance. Perhaps water charges will fund metering so that the privatization of water can be made attractive to investors. Perhaps the property tax will continue as a most regressive taxation. Perhaps the 1% will continue to milk the state for the subsidies that coax the speculation on which they thrive. Or, we just might hazard a wealth tax. We might build social housing. We might even direct government to ‘safeguard with especial care the economic interests of the weaker sections of the community.’

 

Gerry Kearns is Professor of Human Geography at Maynooth University and with David Meredith and John Morrissey has edited Spatial Justice and the Irish Crisis, published by the Royal Irish Academy, ISBN 978-1-908996-36-7, €20.00.

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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…)

One of Adam Smith’s maxims was that ‘Wherever there is great property, there is great inequality. For one very rich man, there must be at least five hundred poor, and the affluence of the few supposes the indigence of the many’. Indeed, it wasn’t only Marx and Lenin who felt that the primary function of the state was to facilitate the accumulation of capital for ‘the principal architects of policy’, as Smith termed the elite; while at the same time mediating resultant class conflict. Not often mentioned by economists is the fact that Smith, like many other Enlightenment figures, had similar things to say. In his words: ‘The acquisition of valuable land and extensive property…necessarily requires the establishment of civil government. Where there is no property, or at least none that exceeds the value of two or three days labour, civil government is not so necessary’. Clearly then, he felt that one of the central roles of the state was to mediate class conflict resulting from the disproportionate levels of ownership related to property. Should we expect then that NAMA will do anything other than serve ‘as a mechanism to transfer wealth from the general population to themselves [the financial sector]’ in the words of Joseph Stiglitz referring specifically to the proposed Irish remedies for the banking crisis?

Enda Murphy

The true forms of government are those in which the one, or the few, or the many govern with a view to the common interest; but governments which rule with a view to the private interest, whether the one, or the few, or the many, are perversions.’ (Aristotle, Politics, Book III, 7:29)

In the foundational text for modern political theory – Politics – Aristotle was very concerned with conflicts arising from private ownership of property. Although he did not state it explicitly, he was essentially broaching the question of class conflict in ancient state systems. He felt that if in a perfect democracy there were extremes of rich and poor, the poor would use their democratic right to initiate land reform and confiscate property from the rich. He considered this to be unjust on the basis that if one considered this to be just then ‘all the acts of a tyrant must of necessity be just; for he only coerces other men by superior power, just as the multitude coerce the rich’. One could debate Aristotle’s judgement about justice and injustice at length. But it is his potential solutions to the problem that are most insightful and have most contemporary relevance. In democratic states, he saw two ways of dealing with the difficulty: the first option was to reduce inequality so that the poor would not be inclined to initiate land reform; the second option was to reduce democracy so that the poor would not have the power to initiate land reform. The question then arises as to which of Aristotle’s two solutions the state is currently pursuing with regard to contemporary failings arising from private ownership of property: so, is NAMA an attempt to reduce inequality or reduce democracy?

NAMA is being implemented under a veil of secrecy with one TD referring to it as a ‘secretive, tax-funded, politically directed work-out process for 1,500 of the most powerful, well connected business people in Ireland’. This lack of transparency tends towards Aristotle’s second option. The recent news that NAMA is to be submerged into a ‘special purpose vehicle’ which is to have majority (51%) private ownership is further evidence of the pursuit of Aristotle’s second option. There are many other examples pointing towards the adoption of Aristotle’s second option which is essentially a means of preserving the existing power structure in society by reinforcing and likely deepening inequality. Bearing that in mind, it is worth noting that Aristotle favoured the first option – reducing inequality.

Moreover, the scheme is being implemented with minority support from the general public and with little regard, its seems, for the ‘common interest’. A recent Irish Times poll shows that only 26% of the population support it. In a true democracy we would educate and inform the population about the important issues and allow them to make an informed decision on that basis; not here however, because that is not the position favoured by the current system of private power.

Enda Murphy