Sunday 24 February 2019

We are oppressed by a state that rewards riskless employment

In a passionate polemic, Eddie Hobbs argues against the sense of entitlement of a state which takes the largest slice of our dwindling resources

Leinster House: The State will argue it has democratic legitimacy but
really what we have is power sustained by clientelism and inheritance
Leinster House: The State will argue it has democratic legitimacy but really what we have is power sustained by clientelism and inheritance

Eddie Hobbs

Know your oppressor – the butterflies in your stomach, the urge to flee, to hide, the dizziness, feeling out of control, the poor driving, the lousy concentration but it's the lack of sleep that's the worst. The staring at the ceiling, wondering how much you drank to try to get the sleep that doesn't come, pacing the house and watching junk TV at 4am. In the morning you'll try to hide it again from your family, your colleagues, everyone. Just another zombie day gripped with fear, a constant underlying sense of panic.

Know your oppressor. Failure – part of the risk-taking cycle, as common to weather as rain – is excoriated. It's little understood that it's a game of numbers, if you get more than six or seven decisions out of 10 right with a bit of luck, hard graft and savvy, you're quids in but if a mega-cycle turns nasty, banks withdraw credit or renew deals at coercive terms, the economy sharply contracts, you're bunched. The line between success and failure is razor-thin – just ask those who have made it about the number of dark nights when they were out of money to pay staff wages the next day.

All you did was try to follow the noble ambition to make your family safe, independent, standing on its own two feet. Not for you the riskless route through life where just arriving and clocking-in did the trick. You took risks, lots of them, reasoning that financial independence couldn't be achieved by saving alone, that risk and leverage were really the only way. Lots of your peers followed suit, including many in the public sector targeted by banks for credit sales and now, ironically, gripped by the anaconda of insolvency, precisely because secure employment propels the banks to play the game ugly.

Know your oppressor. You read the newspapers, listen to the radio for leadership, any leadership that gets it – that the risk-takers especially in the private sector, the owners of small businesses throughout the country, the doctors, the dentists, the shop owners, the publicans, the engineers, the IT contractors, the trades folk, the collective, are the entrepreneurs, not the fresh faces occasionally hailed with awards from Ernst & Young or praised by Enterprise Ireland for new start- ups – the existing business owners, the long-timers, are the ones with the least voice.

Know your oppressor. They grasp the hypocrisy, the call now for an entrepreneurial culture by an insider elite driven by the desire for self-preservation but quietly loathing, distrusting and squeezing the class that do so. They know that the State officer class has first dibs on any new revenues for entitlements first and anything else second. They detest the mean spirit that goes for the jugular of failure as if it was a cancer, not a natural feature of risk-taking, essential to human advancement, publicly hanging some bad examples as representative of the class.

Contrary to the favoured stereotype of low-tax right-wingers, most of the voiceless are centrists, believing in raising living standards for everyone, but only if taxes, whatever that burden may be, are passed through at speed by an efficiently run State operating to modern business standards and not an unaccountable leviathan that thrives on bloated intermediation costs between the risk-takers and those in most need. Their politics are neither complicated nor unreasonable.

Most of all they distinguish between the people and the State – the replacement administration whose principal objective appears no different to its Edwardian predecessor; self-enrichment, self-preservation and trans-generational control.

They listen for this language but no one speaks it, not one TD. The Reform Alliance ain't it. Just another conservative centrist group in new clothes that doesn't seem to grasp the essence of the problem, that Ireland isn't in need of incremental reform but in need of revolutionary change, that the real oppressor isn't on the outside, the bogeyman of markets or the Troika who temporarily replaced them – the oppressor is the State itself and the evidence is overwhelming.

1. To preserve itself, the State has crushed the link between productivity and reward by taking over half a worker's wages with top rate tax kicking in when it reaches the average wage. That's nine times faster than the US, four times faster than our nearest neighbour and nearly twice as fast as the Swedes.

2. State strategy is to oppress the productive sector instead of reforming the benefits sector, shrouding the evidence that entitlements are a mirage that cannot be funded by future tax revenues, keeping it in secrecy by desisting from annual assessments of rising unfunded pension liabilities and social insurance fund deficits – until it first bulwarks its own apartheid pensions model and then crouches behind property rights – while throwing inferior deals to young new workers.

3. The State has so deeply embedded the premium paid for riskless employment that the gap between it and risk-taking has widened, not narrowed, during the crisis years, preserving for itself most of its entitlements, taking an ever larger slice of dwindling resources.

4. The State can depend on its broadcaster, in deficit dependency, taming public opinion. Given the link between RTE salaries and public sector pay scales, it risks creating a disincentive towards challenging the status quo

5. The State continues to encroach and grow despite ceding a large proportion of its powers to the EU, the latest example being the formation of a water utility that, like the HSE's birth from the health boards, sees no learning, no streamlining, no rationalisation, just more of the State.

6. The State and all of its political parties, as is clear from their 2007 manifestoes, exercised such incompetence that economic control was surrendered to the EU Commission, ECB and IMF, adding nearly €90,000 in extra debt to every taxpayer and leaving an economy where one in every five is in mortgage arrears

7. Ten years after the onset of the crisis, Irish personal debt compared to income will arrive so far above the starting point of other distressed economies that its legacy will stretch late into the 2020s, thanks largely to regulatory failure punished, for the most part, by promoting the senior officers responsible.

8. Workers, in addition to funding the cost of saving State-owned banks, are required to finance bank variable rate home loans at up to 10 times the ECB base rate and suffer rising fees with zero competition from a highly concentrated banking market, meanwhile the life and pensions market accelerates towards ever greater concentration as a consequence.

9. The State ranks below Ethiopia, Vietnam and Cambodia for public trust in politicians, below Libya, Bolivia and Mexico for wastefulness in government spending and below Uganda and Nigeria for the burden of government regulation. But The State sits on top of the World Economic Forum ranked No. 1 out of 144 countries for Foreign Direct Investment and Technology Transfer – because, taxation four times lower than tax on workers' wages is afforded to corporates with substantially less in the effective rate for multinationals, meanwhile licences to exploit oil and gas are offered, devoid of production sharing, royalties or ambition.

10. The State continues its implicit policy of exporting its best and brightest, thinning the ranks of those most capable of regime change from its natural opposition, while importing, along with vital skilled workers, populations drawn here because of social benefits with little cultural links to this country.

The State will argue that it has democratic legitimacy but look through the model and what you will find is power sustained by inheritance of seats, clientelism, and gifting favours that has preserved political groups, networks and dynasties.

This is the crony democracy we continue to tolerate, adding continuing risks to the people from its hegemony, incompetence and conservativism recycled every time when, alone for a few seconds with a piece of paper, a pencil and a promise, we decide that reform should first begin in the neighbouring constituency. It's where the oppressor really lies and where the task must first begin in creating a real republic, not one originated by the State in a huff after a frosty dinner in Canada.

Irish Independent

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