The billionaire Collison brothers, founders and owners of Stripe—one of Ireland’s most successful companies—are no strangers to political-economic interjections. Previously they have criticised Government inadequacy in the areas of housing, transport and core infrastructure. This time, a report funded by them, authored by Professor Alan Ahearne, takes aim at Ireland’s reliance on FDI, calling it a structural vulnerability in the economy, as reported by RTÉ, needing to be addressed through Government policy.
Now, saying Ireland lacks critical infrastructure and is too reliant on FDI leading to a skewed economy is fairly standard Communist critique going back decades. However, emphasising that “the level of productivity at foreign firms is around six times the level of productivity of domestic firms” is worthy of observation and unpicking, as it reveals a fundamental feature of imperialism and Ireland’s ‘conduit’ position within it.
Ahearne highlights the massive “productivity” gap between FDI operating in Ireland and domestic firms and goes on to call for more support and focus on Ireland’s start-up ecosystem and the encouragement of much greater productivity by using tax policy to retain and attract human capital. It is effectively a call for more Irish companies to become part of this “productivity” wave that FDI rides.
Samir Amin theorised that the higher “productivity” of the global North versus the South was a result of a number of features of the imperialist capitalist system, including unequal exchange and transfer values, imperialist rent and monopoly power, resource ownership, globalised production and, of course, labour exploitation (or super-exploitation where it is below subsistence levels).
John Smith, author of Imperialism in the Twenty-First Century—a book studied by Party comrades—tackled the idea that higher wages in the global North were primarily a result of higher productivity and instead linked it to the retention of patents, the booking of sales, marketing, design and brand work, R&D, etc., in the “North”, which provides for higher wages at the expense of low wages elsewhere and a “value” transfer from South to North which shows up in higher “productivity” stats.
Back to Ireland: while Ireland often ranks very high in productivity, this is skewed by the so-called productivity of FDI. So on this the Collison report is right. But if we understand the real nature of that productivity as being value transfer, profit shifting from South to North, and the holding of intellectual property rights here, this is the real reason productivity per employee in this sector appears much higher. A small number of workers holding massive legal contracts for IP makes their gross value added per employee extraordinarily high—artificially high.
And so, in effect, the Collison brothers—notwithstanding the legitimacy of some of their critiques—are calling for Irish companies to become more deeply embedded in imperialism and the transfer of productivity from the global South. That is a position we utterly reject.
