Economic agendas

Kerby, Peadar

IRISH ELECTION ECONOMIC AGENDAS JOBS, TAXES, & VOTES During the four-week campaign for the Irish general election on February 17, the Irish Times ran a front-page cartoon that summed up the...

...IRISH ELECTION ECONOMIC AGENDAS JOBS, TAXES, & VOTES During the four-week campaign for the Irish general election on February 17, the Irish Times ran a front-page cartoon that summed up the single issue which dominated the campaign and which now faces the incoming Fianna Fail administration...
...Like Latin American debtors, the Irish government has to borrow more simply to meet its annual payments, which approach $3 billion...
...Instead the government party, which usually characterizes itself as Christian Democrat, but which some commentators described as "monetarist" due to its policy on this occasion, offered nothing less than the proverbial hairshirt...
...However, in a rare electoral gamble, the Fine Gael party of Taoiseach (Prime Minster) Garret FitzGerald presented a draft budget incorporating harsh public spending cuts as their effective election manifesto before formally setting the election date...
...PEADAR KIRBY (Peadar Kirby is an Irish journalist who reported in Commonweal last November 7 on the church in Paraguay...
...It clearly provided the key issue to which all other parties had to respond...
...FitzGerald's often emphasized "constitutional crusade" to delete from Irish law elements seen as being too Catholic such as the constitutional prohibition on divorce were hardly mentioned...
...FitzGerald was widely perceived to have scored points, but with opinion polls showing little public interest in the issue, observers felt it had not significantly swung voters in Fine Gael's favor...
...In opting to face the electorate with this stark outline of the government's options, Dr...
...This alternative focused on two issues...
...In this Dr...
...FitzGerald broke with a long electoral tradition...
...Where their position in the past on issues like Northern Ireland or divorce and contraception made them indistinguishable from some of the more conservative parties, on this occasion they presented a forceful alternative position...
...In this regard, this election was probably the first in Irish political history in which a coherent left-wing alternative was put forward to the electorate...
...It finally won 46 percent of the vote, almost exactly the same showing it had in the last general election in 1982...
...The party's emergence into active electoral politics also highlighted the anomaly created by the government's controversial Section 31 under which state radio and television are not allowed to interview representatives of a number of organizations advocating the use of violence, including Sinn Fein...
...We've a good idea who's responsible...
...After an early 52 percent in the opinion polls, the party dropped steadily during the campaign...
...But it has also highlighted that these alone will not lead to economic growth...
...If this election showed the emergence of an important new force on the right of the Irish political spectrum, it also showed a significant realignment on the left...
...Central to the government's position was Ireland's huge national debt of 24 billion IR pounds, or 148 percent of GNP...
...Other factors undermined what should have been an easy Fianna Fail victory...
...Hence the harsh cuts, many of which hit social spending...
...Its vote has fallen from a peak of 17 percent in 1969 to around 6 percent now...
...Haughey's lack of commitment to the historic Anglo-Irish Agreement, one of the major successes of the outgoing government...
...Fianna Fail, Ireland's largest party, sought to highlight the economic legacy of the Fine Gael government...
...Replacing it, however, is a party far more ideologically leftist than Labor and unashamedly pro-Soviet, the Workers party...
...Taxes on income and on expenditure net 95 percent of the government's total tax revenue...
...They won their first parliamentary seat in 1981 and have steadily increased since then...
...Fianna Fail spokespersons were almost constantly on the defensive when faced with the governing party's specific questions about what cuts in government expenditure a Fianna Fail government would introduce...
...The record of Irish private enterprise has been very poor in this regard, they contended, and the state should play a far more directive role in investing for industrial development...
...FitzGerald's stated hope that Northern Ireland would not become an election issue, he made it one himself by attacking Mr...
...Though the national economic crisis was widely debated during the election campaign, it is the new government taking office which has to solve it...
...The government's conclusion, which became Fine Gael's almost exclusive election message, was that to bring down interest rates and thereby stimulate productive investment, government spending had to be reduced by some $450 million this year...
...Only last year the party reversed its traditional stance of abstention from electoral politics since it refused to recognize the Dail as the parliament of the Irish Republic (as it has no jurisdiction over part of the island...
...In per capita terms, Ireland's foreign debt' some 40 percent of the total national debt is far higher than those of Latin America's large debtors...
...The more important impact of Northern Ireland on this election was the active participation of Sinn Fein, the political wing of the Provisional IRA...
...Fianna Fail's promises to create 57,000 new jobs through exploiting neglected natural resources in the fields of forestry, mariculture, and food processing proved vague...
...In this their position was supported by evidence that taxes on capital and property have fallen from around 17 percent of total tax revenue in the 1970s to some 7 percent now...
...The so-called Haughey factor the controversial political record and disputed trustworthiness of party leader and former Taoiseach, Mr...
...But on election day, many of the seats they won were seats that otherwise would have gone to Fianna Fail...
...Labor, the traditional occupant of that space, even if its leftist credentials are rather mild by Western European standards, failed to halt its continuing decline...
...Furthermore, little immediate relief was offered for the hard-pressed wage-earning sector...
...The back door swings off one of its hinges while a policeman says: "Almost everything's gone...
...The result: sluggish growth rates and historically high unemployment levels...
...From the moment the four ministers of the minority Labor party resigned from the government last January, in opposition to social welfare budget cuts proposed by their majority Fine Gael coalition partners, the agenda for the election was set...
...According to FitzGerald and his government, this borrowing, much of it domestic, some of it foreign, has driven up interest rates at home and acted as a disincentive to economic investment...
...Significantly, its links to the IRA seemed of no interest to most voters, and while it failed to gain a seat, it demonstrated that is has a foothold in some working-class Dublin constituencies...
...Labor and Workers party spokespersons also questioned the assumption that lowering interest rates will automatically lead to economic recovery...
...Thus their consistent 15 percent support in the opinion polls was almost entirely at the expense of Fine Gael and the small social democratic Labor party, than of Fianna 136: Commonweal Fail...
...Whether that need will be tackled is far less certain...
...Opinion polls consistently showed that unemployment and taxation were the two issues most on the mind of the electorate, far ahead of traditional election issues such as Northern Ireland or crime, and Dr...
...The Irish electorate had grown used to being wooed by parties offering ever more appealing tax cuts, subsidies, and welfare increases...
...A new strategy for industrial development is urgently needed...
...We should catch up with some of them on February 17th...
...Even where they have not won seats this year, their vote assures them of substantially increasing their number of seats in future elections...
...FitzGerald and doggedly adhered to by Fine Gael throughout the election may have cost the party dearly in electoral support...
...But perhaps more important in costing the party a comfortable majority in the Dail (parliament) was the emergence of the Progressive Democrats, a breakaway party from Fianna Fail set up at the end of 1985 The PDs, under their charismatic leader, Mr...
...The campaign has prepared the electorate for some harsh measures...
...Charles Haughey was much emphasized by his opponents...
...With an election fought entirely on economic issues, both Labor and the Workers party made a far more significant impact on the pre-election debate than ever before...
...The agenda set by Dr...
...13 March 1987: 137...
...Despite Dr...
...Following a $2.2 million raid on a security van in downtown Dublin, the cartoon showed a decaying van bearing the national coat of arms and the name "Ireland" on the side...
...They challenged the government's insistence that spending cuts were necessary to reduce the state's borrowing requirement by arguing for higher capital taxation...
...Every Irish person owes $2,820 to foreign creditors whereas the equivalent figure for Argentina is $1,570, for Mexico, $1,220, and for Brazil, $732...
...Desmond O'Malley, a former Fianna Fail industry and justice minister, occupy a place on the political spectrum closer to Fine Gael, with conservative economic policies allied to liberal attitudes on social issues...

Vol. 114 • March 1987 • No. 5


 
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