Ireland: After the Yes vote: FG sharpens the knives

The flurry of articles in the Irish press over the last few days attacking the Croke Park Deal should not come as any surprise. However, it is noteworthy that these ladies and gentlemen chose the days after the referendum vote to start putting the boot in. After all, it would have been highly inconvenient and counterproductive to attack a large section of the voters who might draw the conclusion that the government parties Yes campaign was merely trying to set the austerity programme of the last few years into stone.

All of the countries in the euro zone are being squeezed in the same vice. The austerity is being driven by the ECB, the IMF and the EU, the same Troika that is trying to drive the Greek working class into the ground and to which Michael Noonan, Enda Kenny and Eamon Gilmore send their reports. Without the option of devaluing their currencies against each other the rival European capitalist classes are seeking to devalue by smashing the standards of living and the public sector in their own countries.

For sure Croke Park is a major obstacle to the plans of Fine Gael, the Labour leaders , IBEC and the Multi Nationals to make public sector workers pay a huge part of the bill for bailing out the banks, cutting the state budget deficit and appeasing the bond market speculators. It is clear that one of the major reasons that there is so much aggravation and dissatisfaction among the Irish bourgeois, is that the so called “reforms” of the public sector which were agreed as part of the deal have proved difficult to implement and have not in their opinion gone as far as they would like. Colm McCarthy the author of An Bord Snip report has now joined the call for the agreement to be “revisited” which is the new word for “torn to shreds”.

Of course in the forefront of the minds of the Irish ruling class (and their masters in New York and London), is the result of the referendum. In other words; if the turkeys have voted for Christmas, we had better sharpen the knives. But is Fightback exaggerating? Here’s what Daniel McConnell says in the Sunday Independent:

“WITH the referendum now passed, governance in Ireland can return to its normal dysfunctionality. Countless issues have been sidelined, deferred, suppressed for the duration of the campaign, but now they are back on the agenda.Top of that list is the controversial and divisive Croke Park deal.

Created at the insistence of then-Taoiseach Brian Cowen in 2010, in return for delivering reforms and efficiencies, public-sector workers were guaranteed that their pay would not be cut and their jobs were safe from compulsory redundancy.

To many, the deal Cowen offered was a betrayal of the far greater majority who either work in the private sector or are out of work. It was an exercise in economic treason.” The referendum may be won but the Croke Park problem remains 3/6/2012

By 2010 Cowen and Lenihan as well as the ICTU leaders were desperate to strike a deal. The government was in freefall and they were trying to limit the damage, particularly given the volatility in the European bond markets. 2009 witnessed some of the biggest strikes and demonstrations in the history of the state. There were huge yes votes in strike ballots and monster demonstrations most notably in February and towards the end of the year. The talks about talks about talks dragged on for months.  Neither the government nor ICTU wanted an escalation of industrial action, which potentially neither of them could control.

After the deal was struck in 2010 the government quickly became immersed in the AIB crisis and the bailout. FF and the Greens were on the ropes and were unable to do very much about implementing the terms of the Croke Park Agreement other than to put in place their four year budget. However, there have been savage cuts since 2010, for example:

“Just under 8,000 people retired before the end of March, a move the Government says will save €3.3bn by 2015. Total numbers in the public sector will drop from a peak level of 320,000 to 290,000 by the end of this year.” – (In other words about 10% Fightback).

However, the impact and the credibility of the savings have been offset somewhat by the rehiring of retiring workers in many sectors on "temporary contracts". There was also the upfront cost of paying the lump-sum pension to those who left.

There has also been deep public disgust at the series of multi-million pension package pay-offs to politicians such Bertie Ahern, Brian Cowen and their ministers and senior civil servants who had a direct role in the country's economic demise.

The total cost to the taxpayer of providing pensions to the former Cabinet has been estimated at more than €50m.

Some of the most controversial cuts have been made in schools across the country. Since 2010, Howlin claims there has been a reduction of 6,000 teaching posts in schools, a saving of €36m annually.

Redeployment at primary level has realised full-year savings of €50m.” The referendum may be won but the Croke Park problem remains 3/6/2012

We criticized the deal at the time on the grounds that it represented a step backwards for the public sector workers and that more could have been achieved through generalized industrial action. We pointed out also that the deal would come under pressure from the ruling class. The same banks and big industry that are, after all, desperate to make working people pay for the crisis. Here are some of the figures used by the Sunday Independent to back up their call:

“The need for reform is reflected in the Government's spending and income figures, shown in the table. Spending soared from €45bn in 2005 to a peak of €63bn in 2009, but has fallen back to €55bn this year.

However, tax income has also plummeted to a low of €31bn in 2010, and the budget deficit was €23bn last year despite cuts of €24bn since 2008.” The referendum may be won but the Croke Park problem remains 3/6/2012

Of course there is no mention of the €63 billion (€14k per head of population), that was used to bail out the banks. Irish workers have already paid an enormous price for the crisis. The Sunday Independent reports also that the question of the Croke Park Agreement is creating stresses and strains between the two coalition parties. Fine Gael TD’s have been howling with rage over the deal for months. As we reported in February 2012:

“There will be enormous pressure over the next couple of years on the Croke Park Deal from the government wanting to attack wages and from workers defending services and conditions. That pressure will be most noticeable at the top of the Trade union movement. We already saw a similar process develop during the “talks about talks about talks” during 2009 and early 2010. This situation today is not fundamentally different. That is of course in spite of Eamon Gilmore’s much vaunted defence of the interests of working class people, the old the young and the sick in the aftermath of the General Election.”  Croke Park Deal faces new attacks defend jobs and services 9/2/2012

We have no reason to alter that prognosis. We would have to say that if there is disquiet between the coalition parties, then it’s about time. The role of the labour leaders in the government has provoked much hostility from working people, and rightly so. Workers voted Labour in their droves at the last election looking for a way out of the crisis. They didn’t vote for austerity.

But while there are signs of divisions in the Dáil it would be wrong to assume that there has been a Damascean conversion in the Parliamentary Labour Party. As explained in the same Sunday Independent article:

“However, fresh concern is being expressed from within the coalition this weekend over the viability of the divisive deal, and time is running out for Mr Howlin to show that it is worth keeping. Deep divisions still remain between Labour and Fine Gael over its merits.

Labour TD and PAC member Derek Nolan said: "Of course I support the retention of the Croke Park deal; we are getting the reforms across the public sector."

Party colleague Michael McCarthy agrees. "Croke Park is Government policy. If Labour wasn't in Government, Croke Park would be a thing of the past. Industrial peace and the reforms being achieved mean it is worth it," he said.

Labour TD Gerald Nash added: "We have to reform the public sector. We are doing it but it can't be done by confrontation. Industrial peace is the big success of Croke Park."

And again...

"Other European politicians regularly ask us how has Ireland managed to reduce public sector numbers and pension entitlements without riots in the streets. Maintaining industrial peace has been very important, not only for stability but also for the country's reputation," The referendum may be won but the Croke Park problem remains 3/6/2012

In other words, the outlook of Labour TD’s is how to manage the crisis, not to fight for an alternative. As we have explained previously however, the central contradiction for the coalition lies in the different social bases of Fine Gael and Labour. Already Labour support has dropped to 15% according to the latest Red C poll, falling behind SF and even FF whose vote remains more or less flat since the general election.  The drop in Labour support reflects opposition to the austerity, as demonstrated in the No vote in the referendum, but it also reflects apathy.

 Labour ministers are presiding over the public spending cuts and attacks on the welfare system. They may hold office, but the real power lies with Fine Gael and their big business backers. Labour will pay a high price for tying itself to a pro capitalist policy. Previous coalitions have resulted in the Labour leadership being discredited for failing to deliver for working people. This time because of the depth of the crisis the risk is far greater.

Fightback has argued consistently against coalition. Instead we have argued that Labour needs to offer a socialist alternative to the austerity. Capitalism on a world scale is in an organic crisis, this isn’t just a blip. In Ireland the crisis of overproduction which triggered the world financial crisis was made far worse by the orgy of speculation that had followed the credit bubble. Even now there are thousands of unsold houses on the ghost estates. While the Irish ruling class and their kept press argue that we can’t afford the Croke Park Deal, we would argue that on the contrary, we can’t afford capitalism, it has to go.

Over the next months the issue of the Croke Park Deal will become more and more prominent. The pressure exerted on the Labour leaders by the bosses and the press will increase daily. Particularly in the event of a Greek default, which would place Ireland together with Spain, Italy and Portugal four square in the firing line for the parasitic bond market speculators.

Already the trade union leaders have been pushed into some activity. Brendan Howlin is set to report on the future of 800 premium payments and allowances within the public sector. The trade unions have responded by publishing a letter from the government that gave assurances that allowances would not be touched under the terms of the agreement as they represented part of workers core pay. Sections of the trade union leadership have also called for a new agreement.

It is entirely possible that the Fine Gael led coalition will blunder into a confrontation with the unions. At the same time a Greek default would place further pressures on the banks and would plunge Europe further into deep recession. Whatever the spark, it is likely that the pressure on the public sector workers and particularly on the Croke Park Agreement will only increase. This is a recipe for class struggle in the state.

The role of leadership under conditions of economic and political crisis is of enormous importance. The trade union leaders will come under enormous pressure to give ground. The labour leaders have tied themselves to the austerity programme. Already they are under huge pressure to drop their commitment to Croke Park.

One writer Marc Coleman of the Irish Independent has even tried cynically to invoke James Connolly against the Croke Park deal. Coleman argues that Labour must ditch their commitment to the deal on the grounds that it defends the higher paid sections of the public sector. The Irish Independent of course was the paper that bayed for Connolly’s execution after the Rising demanding in its lead article of May 10th 1916 that “the worst of the ringleaders be singled out and dealt with as they deserve.” The problem for Marc Coleman is that James Connolly maintained a class position. He would never support this cynical attempt to divide working people.

But the strength of the public sector trade unions is a defence for the whole of the Irish working class. If Fine Gael get their way within the coalition and were to tear up the agreement, that would be the green light for all the Gombeen Men in every town and village to follow suit. The example of the TEEU strike in 2009 over the attempt by the employers of the REA was a prime example of that process. As such the Croke Park deal goes much further than the 290,000 public sector workers. It affects every single worker in the private as well as the public sector in every workplace in the state.

There is no brick wall between the Public and Private sector workers. They live in the same streets and are part of the same families. The bosses and their kept press have attempted to divide and rule the working class throughout the whole of this crisis. As the example of Vita Cortex and previously of Waterford Crystal demonstrates, trade union and working class solidarity can break through the bosses lies. Any attempt to smash up the agreement and enforce wage cuts on the public sector workers should be met by a 24 hour general strike across the public and the private sectors.

There is a deep crisis in society, Capitalism offers no solution, across the whole world the same austerity is eating away the reforms that workers have won in health, education and welfare over decades. But there is one power that can prevail. That is the unity of the working class.

  • No wage cuts
  • Defend jobs and services
  • Break the coalition
  • For a 24 hour general strike
  • For a 32 County Socialist United Ireland as part of a Socialist United States of Europe