Economic Crisis in Ireland

“THIS BUDGET was tough,” wrote the Taoiseach (Prime Minister) Brian Cowen, in an article for the Irish Times. Savage would be a more apt description for the emergency budget announced on April 8th in terms of the impact it will have on the lives of working class people in Ireland. 

by Sinéad Daly 

In real terms this will mean a family with a single income of €50,000 will be down €4,400.  And if you are a public sector worker you can throw an extra €2,500 on top of that because of the impact of the increase on the pension contributions in the last budget.  

What the attacks mean

• A doubling of income levies (taxes).
• A doubling of health levies.
• A halving of early childhood supplement (help for nursery costs) from €1,000 to €500 and it’s scrapping next year.
• Jobseekers’ allowance halved from €200 to €100 for people under 20.
• 5% increase in pension contributions for all public sector workers.
• 5c on a litre of diesel.

The reaction from working class people is one of real fear for what this will mean for them.  In the context of families paying off huge mortgages and rapidly increasing numbers of people joining the dole queues; this budget could mean that people literally go under.   One woman whose husband had a good income was interviewed in the Irish Independent commented that “They survived by relentless cost-cutting. The child benefit goes towards the mortgage. Her husband’s salary goes into a Garda budgeting scheme, which deducts and pays the bills. This leaves them with €120 a week to feed and clothe a family of six. There was a time when she donated to the St Vincent de Paul shop in Blanchardstown; she now gets her clothes there.”  She went on to say that she worries if any of them get sick because it costs them €100 per person just to see the GP and €100 if they need A&E. My own family are counting up the costs of the budget on them. 

My mother lost her job a few months ago with little prospect of finding another.  My dad has 2 jobs one within the public sector, they reckon they are down €100 a week.  They have been trying to support my brother in university with rent etc.   They are sacrificing things like going to see the GP (it costs €60 to see a doctor and that’s before they even pay for prescriptions) for non emergencies – which isn’t good because my mother has had cancer and needs to keep an eye on her health. Their income has reduced so much and their outgoings are so high they are hoping to qualify for a medical card which will mean they can wont have to pay for a GP! 

Mass Unemployment Returns 

The Irish ‘Celtic Tiger’ that saw  growth rates of 9% are no more.  Instead the government predict the economy will contract by 8% this year.  The Irish economy is on the verge of bankruptcy. The banking system is in absolute crisis and the markets haven’t responded well to the budget, fearing it hasn’t gone far enough. They wanted to see much more severe cuts in public sector spending; one commentator suggested a 20% cut in the greedy public sector pay was needed. Unemployment currently stands at 9.2%. This is continuing to rise at an alarming rate – 300 jobs have been lost every day since the beginning of January. Goodbody Stockbrokers estimate that 150,000 will join the live register this year, with another 80,000 in 2010. That would put unemployment way beyond 500,000, an incredible 25% of the workforce. That would actually be higher than the highest level unemployment reached in the United States during the Great Depression – 24.9% in 1933! In Ennis a hotel announced it had 50 jobs – 1,500 applied.  There are stories of lawyers, accountants, etc applying for work at McDonalds such is their desperation and also the lack of ‘decent’ jobs. Many songs have been written about the plight of young people having to take to the seas and skies to escape unemployment and poverty.  But today where could they go?  The UK or the US – not likely – there are no jobs there either.    

Workers Fight back begins 

The scale and speed of the economic crisis is staggering. People are still coming to terms with how this will impact on them.  But there have been the beginnings of some serious movements against the unjust, unfair and hypocritical way that the Irish government have acted. In October we saw the movement of the ‘Grey Panthers’ against proposals to withdraw the medical cards.  We’ve had tens of thousands of teachers and students protesting against attacks on education and also movements against the withdrawal of the cervical smear vaccination for 12 year old girls. We’ve even had the Garda (police) and the PDFORRA (Irish army federation) take to the streets. PDFORRA have also issued a warning that they will not be used as strike breakers! 

The 21st of February saw 150,000 public sector workers take to the streets, the biggest protest in 30 years, against the attacks of their wages and conditions. Public sector workers were balloted for a 24 hour general strike on 30th of March. Waterford Crystal Workers occupied their factory after its closure was announced. However, the militancy that has been demonstrated on the ground by working class people is not being matched at the top.  The reality is that the Irish Congress of Trade Unions have been ‘in bed’ with the government and big business for generations through so called ‘social partnership’.  They see their role as assisting the government and employers through the recession, not in pointing out that the rich, have made billions in profits throughout the boom and have created this crisis and it is they alone who should pay for it. 

The Socialist Party (The International Socialists sister party in Ireland) is campaigning for a one day general strike to resist these attacks as well as the nationalisation of all major companies threatening closure or redundancies, to be run under democratic working class control.  Nationalisation of all of the banks and financial institutions – but not the state capitalist style nationalisations that just saddle us with the debts of the rich, instead full nationalisation whereby these institutions would be democratically controlled to serve the needs of society, providing cheap credit and resources to help create jobs and fund public services. 

The Socialist Party is also campaigning within the unions for this type of radical change. We need a fighting leadership that always puts the interests of the working class first, that recognises that the capitalist system is at the heart of the problems facing workers and that a struggle for a socialist society is central to delivering decent jobs, wages and a future for the working class. 

Ninety years ago, in his seminal pamphlet called Socialism Made Easy, James Connolly said, ‘The time for patching up the capitalist system is past, it must go.’  James Connolly would certainly have found plenty of evidence in today’s Ireland to back up that view.