WHEN THE COMPREHENSIVE history of the Irish economic crisis that began in 2008 comes to be written, the end of 2014 will be an inflection point in the story. For the first time since the crisis began, it feels as though the next chapter will be written exclusively by the people of Ireland rather than foreign technocrats or faceless mandarins. The authority of government has been challenged directly in a way we did not see through over half a decade of collapse and austerity.
When the “seminal” election of 2011 was held, it felt for the most part like the next few chapters were already written. The IMF was leading the Troika in the door and the measures to be taken by government were broadly laid down. Fiscal targets were set and new taxes were agreed in principal to meet them. The election was more of a release of pent up anger followed by the crowning of an almost inevitable coalition of Fine Gael and Labour. The people dragged Fianna Fáil out into the electoral square and beat them to within an inch of their lives for their unmitigated failure to protect us from this calamity.
The Troika programme went off without many hitches and we saw them off at the airport without requiring a further backstop of money. The government secured several concessions on debt that will save taxpayers money over the long term. Capital markets have confidence in Ireland and we are managing to support ourselves on the world stage. This in turn makes us look a stable place to invest in. All this may be taken for granted today, but it was no certainty coming up to Christmas just four years ago when the prospect of total financial collapse was on the cards.
During this time a lot has changed in Ireland. The political and societal landscape has shifted dramatically as a result of the unbottling of the old order led by Fianna Fáil. The departure of the Troika was not the end of what will likely be marked as a period in Irish history as distinct as the Civil War, The Emergency or the Celtic Tiger. Their departure was the end of the beginning of that period.
Deeper roots
The crisis around Irish Water is not really about Irish Water. Typically, these sorts of challenges to government authority spring from an underlying problem that manifests itself in response to a tangible event. I was in Berlin last weekend, and got reading about an uprising in the east of the city in 1953 that led to a general strike, 40,000 protestors, tanks and shooting on the streets that then spread to over 40 GDR towns and cities. The whole thing was ostensibly caused by an increase in quotas for workers on a single construction site in the city. It had, of course, deeper roots.
The grossly parochial thinking of one hyperbolic Tipperary TD aside, I don’t think we’re going to have tanks on the streets anytime soon. But the next big protest about Irish Water is due on 10 December. We had 100,000 out the last time, and everyone is now waiting to see whether or not the government climb down will be accepted as an armistice or be seen as a weakness that should be pressed until total collapse is secured and an election is held.
Excitable Fianna Fáil TDs have compared the atmosphere around Dublin 2 resembling that of the end of the Cowen government. They are, perhaps, thinking wishfully in an attempt to seek equivalence to their own monumental downfall. But there is no doubt that if the movement of ‘mass protest’ envisioned by the revolutionary Marxist types of the Socialist Party and their allies comes to further fruition, the government could be forced to an election.
The protestors considering coming out on 10 December need to weigh carefully what comes next. If protests are heaped atop protests, perhaps strikes and the likes that the Paul Murphys of this world would like to egg on, the system could very well break. But what exactly will you win if that happens?
Realistic thinking
Good compromises exist when neither side gets all that they wanted, but something of what they needed. People needed a break from more taxes, and they needed to see incompetent government administration that Irish Water represents knocked down a peg. The government needs Irish Water so that investment can happen off the national debt books and we can continue to be seen to crawl back towards fiscal probity. Do not forget that between now and 2018 when the flat charge system will come up for reconsideration, Ireland will borrow another €21.4 billion more than it collects in taxes to run the country.
The protest parties at the heart of the anti-water charge campaign do not want to stop now that the bills have been slashed for years to come. Their object is always the levelling of the government in its entirety. The ordinary people who march on the streets and give them power, however, need to consider if they have got enough: a much-reduced bill, the guarantee of public ownership and the next scheduled election in 2016 being an opportunity for parties to set out what they’d do about water charges during that term.
The alternative to accepting this compromise and allowing the protests to peter out now that the government has been chastened, is to go to the country for an unscheduled and probably inconclusive election. The chances of several elections in a row are high, as many potential coalition partners won’t work together: Fianna Fáil has ruled out Sinn Fein and Fine Gael; who themselves have ruled out Sinn Fein and won’t be able to reform a coalition with Labour in all likelihood. In any event, the mood of the people doesn’t seem favourable to, for example, the return of Fianna Fáil that would be required to make many of the viable coalition combinations work.
This will be the middle part of the history of Ireland post-2008, I think. Do the Irish people take to the streets in general dissatisfaction to bring down a government with no alternative in the wings; or are people going to accept that they’ve won enough and go home?
We are still in debt
People are angry with this government, and it needs to either re-assert some vision for the future or prepare for a messy election in 2016. That might happen in any event, but with time hopefully some sort of coherent post-election picture can come into view. At the moment, it looks like our future could involve unstable governments that destabilise our fragile economic recovery as we swerve around the electoral map.
The vast bulk of sensible people should accept the substantial compromise that has been made. Diehards may hold out, saying they’ve paid plenty for water whilst ignoring the €8 billion borrowed by government this year and many billions more to come thanks to our spending far outstripping our tax take. Folks are getting a reduced bill and in some way, albeit damaged, the water infrastructure can limp on and hopefully be improved in years to come.
There is no panacea solution here. We are still in debt and our pipes still leak. These problems will need to be solved, and they cannot be solved by fictitious, dubious or often non-existent economic plans offered by the hard left.
If protestors press on, they may very well pull down the entire government. What a victory that will be, with crowds in the streets waving tricolours and singing songs late into the night. And then what? Inconclusive elections? Hard left government? Recovery smashed and instability returned.
We’ve worked too hard. Protestors need to take their win and go home.
Aaron McKenna is a businessman and a columnist for TheJournal.ie. He is also involved in activism in his local area. You can find out more at aaronmckenna.com or follow him on Twitter @aaronmckenna. To read more columns by Aaron click here.
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