Writing in the Irish Times on 17 April, the Spanish academic Javier Cercas described the EU’s response to the covid-19 pandemic as having been slow, stingy, and fearful. It is a view shared by many, especially those in southern Europe. Indeed the Italian prime minister, Giuseppe Conte, went so far as to suggest that the response was so inadequate that it posed a question over the bloc’s future.
Such sentiments are hardly surprising, given the fact that in those early days China and Cuba provided more practical assistance to hard-hit Italy than any of their EU neighbours.
Worried by mounting criticism, the EU Commission made a belated, almost begrudging attempt to address the issue. It did so not by converting industry for the manufacture of personal protective equipment and safe accommodation for the elderly but by offering incentives to the private sector, and promising an economic recovery fund. Even at that, and five months after the first cases were identified on the Continent, the nature of the recovery fund and its introduction is still causing dissent among member-states. The response, nevertheless, neatly captures the essence of the European Union, an organisation designed to promote and safeguard the interests of capital, regardless of the need of the masses.
Two factors in particular assist EU power-brokers in maintaining influence over the southern part of Ireland, even as we experience an acute health crisis. In the first instance, too many people have been led to believe that economics is an esoteric and difficult-to-grasp science. This misconception, coupled with the self-interest of our native comprador bourgeoisie, supported intellectually and politically by centrist social democrats, helps the system continue.
Just as in mediaeval Europe, when the clergy held sway, thanks in large part to widespread illiteracy, modern Europe’s rulers depend on misleading the populace into believing that they alone are able to understand and manage the workings of the economy. A well-practised routine is to speak gravely of seemingly huge sums. The European Union’s promise of a covid-19 recovery fund of €750 billion is a good example of this and how it is playing out in this country.
However, let’s just put this into context. The promised fund is less than 5½ per cent of the European Union’s GDP for 2019.* Moreover, only a portion (66 per cent) of the amount will be available as grants and the rest distributed as loans, to be repaid. At present, Ireland has been promised €3 billion, or 0.4 per cent of the total amount. Even if the Dublin government were to have this doubled it would still be less than 1 per cent of what is available. Bear in mind that the Irish restaurant sector alone is asking for €1.8 billion to stave off major redundancies.
In passing, we might also remind ourselves that in 2010 the Republic was forced by the European Union to pay 42 per cent of the total cost of the European banking crisis, at a cost of close to €9,000 per person in the state. Solidarity, how are you!
What, therefore, are we to make of assurances from the Irish Troika of Varadkar, Martin and Ryan that there will be no return to austerity? It is difficult to see how they intend to restore the economy to a pre-pandemic status, which itself was far from ideal. Every indicator is pointing to a recession of alarming proportions. The tourist industry is not going to recover any time soon. Agriculture will be affected detrimentally by a Tory Brexit as Johnston and Cummings strive frantically to appease US trade negotiators by accepting cheap, dubiously produced poultry and beef. Every service outlet, from dentist to hairdresser, will have increased virus preventive costs to meet from a restricted number of customers. Add to this the cost of additional pandemic-related social welfare payments, now running at more than €30 billion, and you get the picture.
The only area where there is a reasonable prospect of raising the revenue required to rejuvenate the economy is from taxing large transnational corporations and especially those in the high-tech and pharmaceutical sectors. Yet this is one path that Fine Gael has set its face firmly against, putting it even to the right of the neo-liberal EU Commission. RTE recently reported that Leo Vardkar will resist the EU’s mooted proposal to introduce a digital tax, tax for large corporations, and a one-off tax for transnationals.
Of course austerity is not inevitable, but it would require an entirely different economic system from that presided over by our Leinster House Troika and as evidenced by their proposed programme for government. The fact is that, notwithstanding the fatuous talk of addressing housing, health, and child care, there will be no significant improvement in these areas for working people. This so-called economic recovery is predicated on a low-wage economy, reinforced by unemployment and a depressing of the social wage. As with all other crises in the past, working people will be expected to pay for this pandemic with poorly paid employment, cutbacks in public services, and reduced expenditure on social and physical infrastructure.
Adherence to EU regulations will be cited as a convenient explanation for retaining or even expanding the private sector. Membership of the European Union entails submitting to stringent neoliberal economics, demanding free-market dominance throughout society. We are now familiar with this in areas once the prerogative of the state; electricity, telecommunications, public transport and tolled roads are now profit-making investments for the wealthy. The same applies to housing, health, child care, and nursing homes for the elderly.
While this harsh economic regime is welcomed by Ireland’s ruthless and greedy bourgeoisie, it raises a question over the political trajectory of our social democrats—not that we should confine our definition of social democrat to the party led by Róisín Shortall TD: it applies to all those parties committed to remaining within the ideological, political and economic parameters dictated by the European Union, in other words those parties that remain wedded to the capitalist mode of production, albeit with some tinkering at the edges.
So, for all their demands for change, their programmes will change nothing of significance, as, in the words of Lenin, they are “loth to cast off the dear old soiled shirt” they have worn for so long.
There is a programme that will bring about change that allows us to pay for a people’s recovery from covid-19 and other setbacks. We’ve known about it for a long time; and it’s called socialism. After all, it is well past time to cast off the soiled shirt and to put on clean linen and tell us which side you’re on.
*Eurostat, “Which EU countries had the highest GDP in 2019?” (https://tinyurl.com/yajs8mpg).