Gene Kerrigan: Anger may not be a policy, but greed is
We are preserving the structure of inequality that got us into this mess in the first place, writes Gene Kerrigan
That's what desperation looks like. For months, Mr Cowen and Mr Lenihan have stood in front of the cameras, trying to look calm and in control. After last week's panicky debacle, the mask is off -- the two Brians have all the credibility of a couple of sweaty salesmen caught trying to shift some dodgy product.
The Government and its media cheerleaders have successfully kept the focus on €1.3bn in public service pay cuts, as though that's what this is about. That €1.3bn is a fleabite in the context of the trouble we're in. Context matters -- and without it, last week's debacle doesn't make sense.
When the roof caved in, back in 2008, we were told we mustn't "play the blame game". The big mouth high-flyers had crashed the economy, but we mustn't let anger distract us from the urgent task ahead, we were told. Because, "anger is not a policy".
The Cabinet, most of the opposition and the media's reliable team players were onside with Cowen's strategy. Lots of differences of detail, but broad agreement on where this is taking us. First, prop up the insolvent banks. The purpose of this, we were assured, was to "get credit flowing" to allow business thrive again.
Second, they must drive down the budget deficit. To reassure foreign investors that we're responsible people. In the process, they split the public and private sectors and set them at each other's throats.
Third, let unemployment rip. Unlike in most developed countries, there has been no attempt here to save or create jobs, even as hundreds of thousands were dumped on the dole. This wasn't because ministers are cruel or unfeeling -- it's an economic strategy. Mass unemployment drives down wages. They believe that will make the economy "more competitive" (they think competitiveness is all about wages -- it's about a lot more than that, but these are crude people).
So, rising unemployment suits them in the short term. As for the long term -- oh, well, they'll think of that when it gets here (I tell you, these are crude people).
The fourth aim is not economic but political -- to preserve the structure of inequality that got us
into trouble in the first place. Excessive profits, bonuses and salaries are not to be hit with high taxes. The politicians and the top of the civil service, who aped the private sector high-flyers (resulting in the politicians' expenses scandals and the Fas embarrassments) have a personal interest in preserving the inequality.
So, the strategy seeks savage cuts at one level, and the continuation of obscene multiples of the average wage at another. The idea is to ensure that the Ireland that emerges from this disaster will look pretty much like the Ireland that caused it -- a bunch of very highly paid incompetents at the top, a legion of middle-class working stiffs in the middle, and a few regiments of the working class doing the heavy lifting, along with several battalions of minimum-wage coolies.
Anger is not a policy, you see -- but greed is.
This strategy required co-opting the trade union leaders. That's never very hard. Remember the infamous occasion on which Bertie Ahern sneered at those who warned that the economy was built on debt? His audience laughed and applauded when he suggested his critics commit suicide. That was an Ictu affair, with union leaders cheering Mr Sterling Deposits and his reckless policies.
While the media team players were painting the trade union leaders as fearsome radicals, this column pointed out that they "are not driving the protests, they are responding to rank-and-file anger. They lead the protests in order to control them". Having allowed workers vent their anger in a one-day strike, they went into talks to cut wages. (By the way, did any of the media team-players who prattle about democratic standards think of asking where the union leaders got the mandate to go into wage-cut negotiations?)
Cowen faced a nightmare of seeking to force wage cuts on angry public service workers who have already had their wages cut and their conditions worsened. He needed to make concessions to the union leaders to get them to sell the further cuts to their members -- so he flipped on the immediate €1.3bn target. The union leaders came up with a convoluted and questionable formula that would dilute the pain -- and that's where the excrement hit the fan.
The reason the union leaders needed a convoluted scheme was that offering straight cuts to their members would invite open revolt. They were about to emerge claiming a great success -- "Look, folks, we've managed to get you a convoluted wage cut!"
But the Government and their media team-players have been too successful in zeroing in on that puny €1.3bn. Too successful in portraying the public service as a "bloated" entity, overpaid and lazy. OECD figures might show the public service as too small for purpose, statistics might show its workers (apart from the top layer of mandarins) to be on low to fair to okay wages. Doesn't matter.
The campaign of demonisation was too successful. The Fianna Fail backbenchers are okay with deflating the economy, with ever-lengthening dole queues. They're cool with pissing away €11bn (and counting) to the insolvent banks. They shrug when the bankers tell Lenihan to get stuffed, they'll hire insiders on half a million a year to run the banks if they want to.
They happily vote €54bn for Nama, knowing they're overpaying for dud assets. They don't mind that the promise of "getting credit flowing" in return for coddling the bankers was pure bullshit -- even the bankers admit it was never going to happen. And viable businesses continue to go to the wall for want of normal banking facilities.
All that's okay by the backbenchers. But, by God, they wouldn't stand for not getting clear, immediate pay cuts of €1.3bn from those avaricious nurses and gardai and train drivers and librarians and clerks. For this, they threatened Cowen's leadership. And, like the backbencher at heart that he is, Cowen panicked and flipped again.
His people leak the fact that they were "highly sceptical all along" about the convoluted cuts formula. The man has no shame.
The Irish Times wants €1.3bn pay cuts "so that we can start believing in ourselves again". (What!!?) The soft-pedalling union leaders have been dismissed. Now the Government and media team players can get down to putting the boot in. Getting that €1.3bn pay cut, and achieving the other €2.7bn or so in public service cuts, risks blood on the walls, but at least they won't be playing the blame game by taxing the people who caused the economic collapse.
Then, they get to go through it all again to get another €4bn in cuts the following year. And the year after.
Anger is not a policy -- but, apparently, hope is.
So €54bn for Nama; €11bn already lost, gone, squandered by the insolvent banks. Because, that's not real money -- oh, it's borrowed and we have to pay interest and we have to pay it back and it affects our credit standing, but it's not like the real money we pay those nurses and librarians.
The 1,400 who earn over €2m a year have their position unimpeached. The tens of thousands earning up to a million -- God go with ye. The tax reliefs of the rich continue. But, by Jayzus, with the FF backbenchers on one side and the editorial writer of the Irish Times on the other, we're coming for ye, in yer bloated public service, and yer 40-grand-a-year jobs, we're coming for ye.
Anger is not a policy -- desperation is.