We are publishing an extended version of a speech delivered by Gerry Ruddy at the recent Marxist Summer School in London (June 2012) attended by nearly 100 comrades, in which he outlines how Ireland came to be dominated by international capital after “independence”, confirming what James Connolly had predicted long ago, and explains how genuine national independence can only be achieved through socialism.
I will try here to briefly give an overview of the mess in which Irish capitalism has landed the people of Ireland. I will touch briefly on issues of housing, natural resources, the decline of the industrial base in the north and of course the troika. We are no different to the rest of Europe in that respect. I don’t need to elaborate to this audience the trials the people of Greece, Spain, Italy, Cyprus – the list grows – endures as austerity clamps down on the rights of the working class.
But can I make one clear point at the start, the fawning attitude of the ruling parties towards the Troika and the way in which the Irish ruling class are screwing the Irish working class, is exactly what the troika want, in order to say to the rest of Europe, “Well if the Irish can do it, so can you-get on with screwing your own working class”. Sadly Ireland is now an example for Imperialism.
At the beginning of the 20th century the struggle for national independence reached its crescendo in Ireland. Ireland struck a blow for not merely its own independence but its example inspired anti-imperialists worldwide leading to the eventual liberation of many countries from the yolk of imperialism.
However, while its political model may have been an inspiration, its economic model that developed was most certainly not. The economic doctrines of the then Sinn Fein, politically then the leading force in the nationalist movement, preached a form of economic protectionism based on ideas from Hungary. Its chief advocate was the founder of Sinn Fein, Arthur Griffin, who apart from being anti-Jewish, anti-trade unionist, was also, while an Irish nationalist, a monarchist. It was unfortunately his ideas that won out in the ensuing struggle for independence.
However there was another world view held then. Perhaps it is most aptly described as the republican socialist view best articulated by James Connolly:
“If you remove the English army to-morrow and hoist the green flag over Dublin Castle, unless you set about the organisation of the Socialist Republic your efforts would be in vain.
“England would still rule you. She would rule you through her capitalists, through her landlords, through her financiers, through the whole array of commercial and individualist institutions she has planted in this country and watered with the tears of our mothers and the blood of our martyrs.
“England would still rule you to your ruin, even while your lips offered hypocritical homage at the shrine of that Freedom whose cause you had betrayed.
“Nationalism without Socialism – without a reorganisation of society on the basis of a broader and more developed form of that common property which underlay the social structure of Ancient Erin – is only national recreancy.
“It would be tantamount to a public declaration that our oppressors had so far succeeded in inoculating us with their perverted conceptions of justice and morality that we had finally decided to accept those conceptions as our own, and no longer needed an alien army to force them upon us.
“As a Socialist I am prepared to do all one man can do to achieve for our motherland her rightful heritage - independence; but if you ask me to abate one jot or tittle of the claims of social justice, in order to conciliate the privileged classes, then I must decline. Such action would be neither honourable nor feasible.
“Let us never forget that he never reaches Heaven who marches thither in the company of the Devil. Let us openly proclaim our faith: the logic of events is with us.”
He argued that national freedom without economic freedom was not worth struggling for. I put this view forward in a stark way while recognising that Connolly’s view was much more nuanced that that. I do so because even today there are those who see national independence in a 32-county state as a goal worth fighting and dying for. I dissent from that view. It takes little or no account of the essential view of Connolly that the class struggle was in essence the critical part of the struggle for liberation. Without class freedom there can be no national freedom or indeed independence. Learning the lessons of history can be sometimes demoralising and disillusioning. But Marxist cannot afford to have illusions.
Sadly even today there are Republicans who fail to learn the lessons of history. They are in danger of repeating the failures of the past. They reject those who they claim betrayed the goals of republicanism. De Valera, Collins, Adams, McGuinness, traitors all, they claim. However, at the end of the day, those individuals chose to side with the “men of property”, because in essence their kind of republicanism was compatible with capitalism. Never at any stage did these individuals, even at the most intense periods of armed struggle, pose a threat to property relationships of the capitalist system. That is why the British Establishment could do deals with them.
Clearly the events of the past four years have shown that both the parties of De Valera and Collins, Fianna Fail and Fine Gael, ably assisted by the class traitors in the leadership of the Labour Party, have sold out any semblance of social, economic or political freedom to the troika, the European Commission, the European Central Bank and the IMF. Similarly the leadership of Sinn Fein are now working in a cross coalition with pro-capitalist parties slavishly following the economic policies of the Tory /Liberal Democrat coalition in Britain.
How did this come about?
Briefly the uneven development of capitalism on the island of Ireland saw the North initially compare favourably with Britain, Belgium and Germany in terms of industrial orientation at the time of the setting up of the Northern state.
The traditional sources for work for the Protestant proletariat in the North was in the heavy industry of ship building, aircraft manufacturing, engineering, and the textiles industry. In the North West there were many mills employing, in the main, cheap female labour and during the Second World War the area prospered relatively speaking as a result of army contracts.
But after the war there was a slow decline. The largest employers were in ship building and linen. Both sectors went into decline in the fifties. In the North there was a slow transition from dependency on the traditional heavy industries, a transition that continued during the 50’s, 60’s and 70’s. For example, in 1960 7,000 workers were paid off in Harland And Wolff and the company started to make losses from 1964 until the late 1980’s with one exception.
Between 1979 and 1982 international firms like Grundig, ICI, Michelin and Gallagher’s all closed major plants in the North. By the 1980’s it was essentially a “post-industrial” society or a “workhouse economy”. The “reserve army of labour, i.e. the unemployed, actually exceeded the numbers involved in manufacturing during this period.
The South was mainly agricultural. In the 18th century the high demand for grain from Britain in the early years of the industrial revolution, plus the exclusion of cheap continental grain during the French wars, lead to relative prosperity in Ireland .The mass of people fed themselves on potatoes, paid the landlords’ rent in corn and fed a pig or two on leftover potato scraps. The high demand for labour enabled people to marry young leading to the population expansion.
However, following the end of the Napoleonic Wars there was a gradual drop in the price of grain as compared to a rise in meat prices. There was shift from labour intensive corn growing to land intensive cattle production. What occurred was well summed up in the phrase“ the land for the bullock and the people for the road”.
The Famine or the “Great Hunger” only speeded up the clearing of the land. It did not cause it. Irish agriculture’s main function was to export cattle to feed the industrial cities of Britain. The main beneficiaries of this were called Graziers. Even during the famine “The graziers lived at ease and the poverty in the district is a disgrace to human nature”. The population fell from a figure of 8.5 million in the 1840’s to 4.3 million in the 1960’s.
Following the struggles of the Land league in the later part of the 19th century a series of Land Acts replaced 10,000 landlords with 500,000 owner occupier farmers. However, 20,000 graziers owned half the land. Many of the rest of the farmers only subsisted. For example smallholders particularly in the west of Ireland reared the young calves and bullocks then sold them on to the graziers between 1 and 2 years. After another period they were then sold on to the fatteners “who grazed them on the rich grazing fields of counties Kildare Meath and Westmeath.” After another period they were then sold to the shipper who exported them to England and Scotland.
That was the pattern both before the Land Acts and after them. Despite deep class antagonisms best expressed in the Ranch War of 1904-08 the small holders depended on the graziers to buy their cattle to pay the rent. The profits of the Glaziers were invested in banks that used the money to help in the industrialisation of Britain.
At the time of independence they numbered about 25,000 and strongly resisted any attempt at industrialisation. Nothing was to interfere with the export of live cattle to Britain. In this they were assisted by the newly independent Government of the Irish Free State which saw national development “synonymous with agricultural development”. All other economic activities took second place to the status quo-export of cattle to Britain.
The Fianna Fail Government of De Valera in the 30’s introduced a policy of protectionism from foreign imports and an attempt to develop a native capitalist class. It was a dismal failure. In the 1950’s over 40,000 people emigrating each year and employment in industry fell by 38,000 or 14% of the industrial labour force.
The North was relatively better off then as these figures show
Modern industrialisation only came to the South in the 1960’s following the publication of the Whittaker Report which formed the basis for the first experiment in economic planning by the Irish state. It encouraged direct foreign investment and recommended that Irish industry should be exposed to the force of international competition-which began after the signing of the Anglo Irish Free Trade Agreement 1965. With that signing Ireland became a prime site for foreign capital. Irish based German and American companies gained access to British markets, tariff free and generous tax allowances for expenditures and repatriated profits.
At the same time, in the South many of the smaller companies that had developed under protectionism swiftly abandoned any pretence towards “patriotism”. Under the pressure of competition, they merged and began to invest abroad with minimal input into exports or employment. The Irish bourgeoisie made conscious decisions to become part of economic imperialism.
This of course should surprise no one. The ruling classes rarely took any notice of the plight of the marginalised. As early as 1924 the Free State government faced with a massive housing crisis, took a conscious decision to divert funds from municipal public authorities and through grants and tax breaks give the money to private builders. The leader of the Labour Party, Thomas Johnson protested saying “the policy of laissez-faire in house-building should not be allowed to continue”. But this was in vain. The Government was not interested in providing housing for the working class, only for the middle classes.
Since then the links between the builders and the politicians have become even stronger. There then developed a long love affair with the property market in Ireland. In The Irish Times of February 1973 the chair of the Irish Permanent Building Society wrote: “for the saver and the investor in the housing market as it is and will be for the for-see-able future a hefty profit is made by the seller at each point in the cycle”. And in September of the same year the Irish Times wrote that property was the perfect, “hedge against falling money values”.
Fast forward today and one can see how wrong they were. Most of what occurred in the housing bubble happened under Fianna Fail Governments. Once it called itself “the Republican Party ”having originally been a breakaway from Sinn Fein in 1925, but nowadays is better known as the “Builders Party”. Tax relief concessions were granted to speculators even during a time of high economic activity and “the majority of the beneficiaries of property tax relief schemes are high, net worth individuals or corporate investors”. (Dept of Finance strategy Group)
The result was overproduction, the bursting of the housing bubble, the collapse of the “Celtic Tiger” and the bailout of the bond holders which Irish workers are now paying for. It is really ironic that the day of the Provo ceasefire in 1994 was also the day that Morgan Stanley, investment banking group produced a review of the Irish economy called “The Irish Economy – a Celtic Tiger”.
The roots for that tiger were laid in 1956 when the Government passed an act granting tax exemptions on new mining activity. Over the next few years large deposits of lead, zinc, silver, copper and mercury were discovered and mined. But the impact on the Irish economy was minimal .The minerals were shipped out immediately and processed elsewhere. Indeed from 1961to1971 the number of mining and quarry jobs decreased by 149.
The 1967 Finance Act said no tax was due on profits earned for the first 20 years of any mining operation begun before 1986. Most mines have a life span of less than 20 years so draw your own conclusions!!
Tara mines paid no royalties in 13 years of operations, nor did they build a smelter to process the largest zinc production in Europe. Licences for oil and gas exploration were sold off for the princely sum of £610. Marathon Oil having secured rights to 1/3 of oil or gas discovered, sold the gas back to Ireland at an estimated cost (1977) of £700million.
The lesson from this is that the Irish state saw itself as servicing exporters rather than the production of exports – natural resources, Irish cattle, Irish workers, all for export. Native Irish capitalism was incapable of building a strong economy. Hence the mess the country is in. And what a mess!
It was 30th September 2008 when the Irish Government guaranteed “to safeguard all deposits (retail, commercial, institutional and interbank) covered bonds, senior debt and dated subordinated debt with the following banks, AIB, Bank of Ireland, Anglo Irish Bank, Irish Life, and Permanent Irish Nationwide Building Society and the Irish Educational Society” up to a total of €400 Billion. In the subsequent vote Labour voted against, Sinn Fein abstained, 124 for 18 against.
Of course this was a disaster for the ordinary working men and women of Ireland. And yet like others around Europe they continued to vote for those parties who supported the austerity measures and carry out the bidding of the 1% rich.
The people of the Irish Republic have just voted Yes, 6 to 4, for the Fiscal Union Treaty. What does this mean? There is a new 0.5% structural deficit rule, “permanent and binding” and power is transferred from the Dáil to the EC and the European Court of Justice to enforce the new deficit rules. In essence the troika now have taken over the Irish Ministry of Finance.
Why did people vote yes? Not through any enthusiasm, but through fear, fear of what might happen if they defied the political establishments of Europe. Many of the working class voted no or boycotted. They did so because they know what is coming.
In 2009 in the debate on the Lisbon treaty those who advocated yes sloganised as follows: “Vote Yes For Jobs, Yes for Recovery”. Since then thousands have lost their jobs, many workers have taken pay cuts of 20% in real wages, pension money has been taken by the state, social welfare cut and taxation increased. Already the Government has introduced as a temporary measure a Household charge of €100, as a prelude to the introduction of separate Property and Water Taxes which could cost €1000 or more.
The Budget of 2012 is the most regressive budget in many years, proportionately targeting low income households more than four times as much as the most affluent households.
A drive around the once ‘Celtic Tiger’ reveals empty shopping centres, main streets with boarded up shop fronts and few shoppers. Pubs are empty or closed. G.A.A. clubs once the centre of social life are losing many of their best young footballers to emigration. One Irish university has over 40% of its graduates headed for Australia.
An aura of despair almost fills the air and the economy sinks even more into depression. Primary schools are daily dealing with undernourished children and already one child has collapsed in a classroom with hunger. When social workers contacted the mother she had no food at all in the house and was waiting for her social welfare money to feed her children.
Ghost housing estates all around the country from Cork to Donegal and all in-between stand idle as monuments to the greed and avarice of the banks, the builders and their buddies in Government; this when we are only into the second year of a 4-year plan of austerity.
And all this to pay for the debts run up not by the Irish people but by the bankers and developers who created the mess originally. The bankers continue to pay themselves bonuses. There is an unholy alliance between big business, the Government and the official leadership of the trade union movement who failed to provide the kind of leadership that the working class need.
Remember all of this is to pay the bond holders who nobody seems to know who they are. What little we know is that HSBC, Barclays, Credit Suisse, BNP Paribas, Goldman Sachs and Deutsche AM were among the original bondholders. But speculators – i.e. unsecured bondholders who bought debts at knockdown prices and for whom there is no law that says what should be paid – were given €3billion in January, while Anglo Irish Bank’s bondholders were given euro €1.25 Billion in the same month.
So to sum up Comrades, what does the Irish experience teach us? For me it confirms the analysis of James Connolly, who I mentioned at the start of this talk. His analysis is as relevant now as it was then. The limited freedom achieved by the stalled revolution of 1916-21 has been eroded, sold out and bartered for by the political descendants of the pro-capitalist republicans.
In an increasingly interlinked and interlocking world the idea of a free independent and sovereign state with responsibility for control of its own affairs is a myth, a chimera and an illusion. Economic or political nationalism are the roads to exploitation and only pave the way for integration into the world capitalist system. Socialism is the only forward for the people of the world.
Some References and Reading:
“Sin of the Father” Conor Mc Cabe
“Socialism And Nationalism” James Connolly
“New perspectives on Ireland-Colonialism and identity” Ed. Dalton O’ Ceallaigh
“The modern Industrialisation of Ireland 1940-1988” Liam Kennedy
[Published originally in the Red Plough]