February 28, 2005

Sinn Fein economics for the provo riche

Posted in Irish Economy · 7 comments ·
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What next for Sinn F�in? There seem to be three general theories doing the rounds. The first is that the doves succumb, in their own parlance, to the hawks, and the IRA goes back to war.

The second is that Sinn F�in forces the IRA to disband, in which case Sinn F�in – the nationalist socialist party – is back at the electoral races.

The third eventuality is that they are one and the same group, and that Sinn F�in/IRA always had a peace tactic rather than commitment to a peace process, and that they have been secretly trying to hoodwink all of us as part of a long-term strategy to increase influence and ultimately to gain control in the Republic.

Whichever theory you subscribe to, what happens next will have long-term ramifications for our economy. Strangely, the economic consequences of the peace – to paraphrase the title of John Maynard Keynes’ brilliant analysis of the 1918 Versailles treaty – are often overlooked.

There can be little doubt that prosperity and peace go together. The first lesson of economic history is to avoid war at all costs. War destroys everything. Continuously successful countries have avoided wars for hundreds of years. In Europe, Switzerland and Sweden are fine examples.

Although it is hard to prove conclusively, there is an obvious overlap in terms of timing at least, between the end of the war in the North and the blooming of the economy of the Republic.

It is impossible to distinguish chicken and egg. Common sense suggests, though, that given the semi-detached nature of most of Ireland’s relationship with the North, the direct impact of no bombs in Belfast on jobs and wealth down here was probably negligible.

But there is no doubt that the ceasefire affected perceptions of Ireland internationally – the vibe, the image, the marketing spiel, the entire background noise was positively influenced by the ceasefires.

What’s next? Let’s say the doves and hawks theory is correct and Gerry Adams gets pushed aside in favour of hardliners who see fit to go back to war.

The first economic casualty will be perceptions of Ireland in America.

Times have changed, both in the White House and in corporate America, and even a low-level campaign would have serious negative effects on direct American investment.

A second direct casualty would be tourism, the biggest employer in the state. We sometimes underestimate how many people were scared to come here in the bad old days – particularly British visitors, who are our best customers by far.

A third impact would be on Ireland as a place to live. Again we are talking about perceptions here, not reality. Immigrants are attracted to countries for a variety of reasons, one of which is the received wisdom about the place. A renewed IRA campaign – with CNN pictures beamed into living rooms around the globe – would dissuade immigrants from coming here.

All these factors would undermine business, consumer and investor confidence. At the moment in Ireland, confidence is crucial to keeping the whole indebted show on the road and anything that punctures that effervescence would have dramatic consequences.

But what if there is no war and either the IRA disbands or our short memories allow a cynical peace tactic rather than process to prevail? In this situation, Sinn F�in/IRA would continue to win at the ballot boxes.

We then have to consider the financial impact of Sinn F�in’s economic policies.

But what are Sinn F�in’s economics? A look at their manifestos does not help to give a title to Sinn F�in’s economic philosophy. It is certainly not capitalism, nor is it real socialism. It’s neither liberalism nor collectivism.

Sometimes the best way to categorise policies is to examine who benefits from them. In the past decade, the main beneficiaries of Ireland’s boom have been the much-maligned nouveau riche. But if Sinn F�in’s economics were to dominate in the future, the main beneficiaries will be a new class. Let’s call them the �provo riche’.

At the moment, the provo riche are, allegedly, a bunch of money launderers and bank robbers. But in an era of Sinn F�in economics, the provo riche would proliferate.

The main problem with the provo riche manifesto is that (like its bank robbing genesis) it says very little about creating wealth, but lots about taking wealth.

Here, for example, is the provo riche policy on taxation taken from Sinn F�in’s 2005 pre-budget submission: �It is essential to reform and re-weigh the taxation system in favour of the low paid and to increase the overall tax take by targeting wealth, speculative property and corporate profits.�

Measures should include the end of tax avoidance schemes, measured increases in corporation tax and increased capital gains tax for owners of multiple properties and a 50 per cent tax band for incomes over �100,000.

So far so extortionate. So the provo riche’s policy is about taking money from the rich, but what does the manifesto say about creating money and wealth? Not a lot, frankly. But back in 2003, at a submission to the Oireachtas Committee on the Constitution, the provo riche had the following to say about your house: �Private property has been and remains an instrument of oppression of people the world over.�

There are those (maybe the 86 per cent of Irish people who own their own homes) who would argue the opposite: that private property and ownership is the very cornerstone of a civilised, law-abiding society, that with property rights come responsibilities – the sort of responsibilities that bind families and communities together.

Once a manifesto deviates from private ownership, at the very least it puts huge faith in the promise of public ownership.

And this is at the core of the provo riche economic doctrine. It believes in the state – the power of the state, the control of the state over people and the primacy of the will of the collective over the rights of the individual.

In some areas there is a benefit to this approach, and, if wealth is generated, most of us support the idea of redistribution to help others. But you need to have a view about creation not just redistribution. And central to wealth creation is the ownership of property, capital and ideas. All these seem to be anathema to the provo riche.

In Putting People First, a serious, wide-ranging and interesting Sinn F�in policy document, the party outlines its views on multinationals, which are crucial to our economy. It states: �Sinn F�in believes there needs to be a fundamental rethink around the role of foreign investment and trans-national corporations in the Irish economy.�

It goes on to suggest that we should be managing trade and investment and increasing tax on these companies. It fails to see the positive side to multinationals and their contribution to our economic health. Throughout its economic publications, Sinn F�in displays �national socialist’ thinking. This means everything national, small and local is good, and everything, international, big and cosmopolitan is bad.

High tax seems to be an end rather than a means, and the philosophy is predicated on an all-knowing, all-powerful state taking our money and spending it for us in areas the state – that is Sinn F�in – sees fit.

At best, this is the economics of a 1970s student bedsit. If the manifesto were introduced to the letter, the country would risk bankruptcy. All would suffer – except maybe the provo riche.


  1. adrian

    Its all too easy to say these days

    Kick a shinner when he’s down,
    make sure and finish him off,
    because he just wont go away you know!

    It wont be necessary to do any kicking any more because
    while the Republican movement are running empty on enemies
    they will no longer have anything to unite against!

    The freedom fighters of old just loved the
    old ‘marxist’ideological mumbo jumbo, to rebell the rebels
    needed a scapegoat upon which the volunteers could be
    rallied against.

    There was a definite injustice on the sectarian front and
    1970s shinners could ‘rock against the RUC’ et alia but
    nowadays the PSNI are as about sectarian as the ambulance
    service.

    Having succesful economic enemies against whom to rebell
    is the only tactic left for the shinners. Bang bin lids
    against bin charges, Rock against water rates, all helps
    rally the troops – but does this serve the troops well?

    Nopedy doh it does not. This kind of activity only
    solidifies an underclass and any self respecting provo
    riche would be seen nowhere near!

    In your article, wealth creation is seen as the Holy
    Grail: the capitalist way and property ownership are
    indeed delivering.

    Christian and the Eco Boys will tell you capitalism (like
    the provos of old) is delivering a time bomb ! of an
    environmental persuasion of course – no semtex required.

    Lets mention an issue or 3, No fish in the sea, Global
    warming, Can’t get from A to B in dublin, Can’t get from A
    to B across a childs bedroom because of toy clutter,
    Millions of children currently starving to death.

    The blinkered pursuit of profit just might be the
    finishing of us – much as its good crack!

    Its great to see that an organisation called ‘Fair Trade’
    is growing very succesfully, spectacular growth figures
    released today, – the idea is that capitalism gives its
    profits back to where its most needed – the impoverished
    producer.

    Fair trade are not in private ownership, nor are they
    state owned. They’re a kind of capitalist charity.
    Consumers love the idea and the coffee is palatable so
    they tell us!
    Taking this concept to the nth degree, unowned competing
    productive entities may compete with one another to
    provide environmental solutions.(e.g. If Greenpeace were
    to sell oil alongside exxon, the motorists would buy
    greenpeace oil and Greenpeace could pump profit into
    environmental transport solutions.)

    They might even spread the idea that you will be just as
    happy consuming what you require. Profit seeking marketing
    men are currently charged with this environmental
    responsibility! and I’m tripping over unrequired toys.

    Get printing T shirts, forget Che Guevara, lets put
    Christian on the front and Heh Shinners the t shirts are
    green!

  2. JP

    Brilliant article, as always.

  3. Éamonn

    Hello Gerry, Goodbye JOBS !!!

  4. fintanr

    Thankfully someone in the media is highlighting the economic
    folly that allowing Sinn Fein into government would be. Good
    article.

  5. Natalie

    Completely agree with Adrian.
    About time we start listen to courageous alternative
    economic model to the one we are living in. It is a
    timebomb, not just environmentally but socially as well.
    Also time to realise that traditional parties are by no
    means answering the questions of younger generations and
    people that find utterly impossible to vote because nobody
    credibly grasp their concerns and real struggle. Too easy
    to shun those who think differently, particularly if
    nothing solid is offered instead.
    Since you have proven very successful at whatever you had
    set your mind so far, maybe your next career step should be
    launching into politics. Instead to critising, we could
    listen to your solid alternatives in addressing debts,
    political and social problems.

  6. adrian

    Please Natalie, dont frighten me off with talk of
    a ‘career in politics’ – i’m far too nervous for that!
    I agree that it could become interesting if we all start
    adjusting our economic activity.
    Current corporate power can fund and lobby political
    parties and we suffer the symptoms, toll bridges and
    traffic jams, wars where there is oil etc… Voters
    interests are edged out of the political equation.
    Consumer power may emerge as an alternative. If St Vincent
    de Paul were selling us our bread and butter with Friends
    of the Earth competing who knows where it might end up.
    Thanks for the praise, I feel its important to make our
    voices heard in some small way otherwise we’re complicit
    in the consumerist acceleration.
    p.s cheers to david for providing the soap box!

  7. tok

    although sinn fein have taken this very 1970s socialist
    approach one has to remember that many nationlists in the
    north may not be as radical as sf voters in south. many
    nationlists are upwardly mobile , catholics/nationlists
    have also bennefitted from trans national corporations as
    these are much more merotocratic rather than old industrry
    and family firms who tended to discriminate more . Although
    bombs in the north were very detrimental to njorthern
    economy as garret fitzgerald has argued the reliance on
    british subsidies and old industries was also dtrimental
    as well as wide scale discrimination which precvented 40%
    of the population from using there talents in the society

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