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Whitaker's real legacy: not being scared to tear up the rule book


Taoiseach Enda Kenny with TK Whitaker (left) at the launch of the book ‘TK Whitaker: Portrait of a Patriot’ at the Royal Irish Academy, Dublin, in 2014. Photo: Mark Condren

Taoiseach Enda Kenny with TK Whitaker (left) at the launch of the book ‘TK Whitaker: Portrait of a Patriot’ at the Royal Irish Academy, Dublin, in 2014. Photo: Mark Condren

Taoiseach Enda Kenny with TK Whitaker (left) at the launch of the book ‘TK Whitaker: Portrait of a Patriot’ at the Royal Irish Academy, Dublin, in 2014. Photo: Mark Condren

TK Whitaker, who died this week, was a brilliant and dedicated public servant whose work in the 1950s produced an enduring legacy.

But it is a disservice to the man, his work and his overriding commitment to fostering of national prosperity to pretend that his eponymous 1958 report marked a clean break in Irish economic history.

To read some of the commentary around Mr Whitaker's contribution to Irish life, you'd be hard put not to come away with the impression that Mr Whitaker's 'First Programme for Economic Expansion' marked an end to mass emigration and ushered in an uninterrupted era of ever increasing national prosperity.

It didn't. Rapid growth in the 1960s gave way to stagnation in the 1970s. Despite decades of official policy promoting industrialisation, there were fewer people working in manufacturing in the late 1980s than there had been 10 years before.

At 40 years of age, I have lived more than half my life with unemployment in double digits.

The unemployment rate in Ireland was well over 10pc when I started primary school in 1981 and was still there when I left university. For 15 of those years, it never dropped below 12pc.

Mass immigration was regarded as a normal part of life in the 1980s, and again in recent years in the wake of the crash. Boom and bust have characterised Ireland's economic history over the past 50 years, even if the same period was equally characterised by rising living standards.

None of that is the fault of the late TK Whitaker. None of it detracts from his legacy - quite the opposite.

It's a racing certainty things would have been worse, possibly far worse, without a sharp change in policy at the end of the dismal 1950s.

The Whitaker report, rightly described by historian JJ Lee as bearing the "stamp of a first-class mind", did mark a new departure - but not just by coming up with a new plan.

That plan, in essence, was to open the economy to international trade and at the same time shift the emphasis in public spending from a bare-bones outlay on social spending to providing productive investment.

That more activist approach to economic planning and management marks the place where the Irish State gave up on the notion that if it kept balancing the financial books then at some point everything else would fall into place. It notably included the radical decision to open the Irish economy to international trade and investment, which paved the way for our later entry into an initially sceptical EEC.

The idea was to shotgun Ireland into prosperity by attracting well capitalised international industry to do what Irish business had failed to do - invest in and develop the country's productive capacity.

Inviting in foreign capital was to be a catalyst for the development of indigenous industry.

Success was mixed. Ireland became and remains a global leader in attracting foreign direct investment, but the development of native manufacturing has lagged that success for 50 years, leaving us with an unbalanced and unstable economy.

One reason for that was the hardening of an originally flexible policy into an orthodoxy.

Drawing in foreign investment became an end in itself. That was understandable given the success of the policy and the growing dependence on the high-quality jobs provided by the multinationals, but it's a policy flaw all the same, and one that persists. Official Ireland, almost uniquely in the world, is if anything more comfortable with multinationals than with native industry, as our attitude to taxation proves.

Policies that were forward looking in 1958 were allowed to atrophy into orthodoxy in official thinking that has stuck us on a pre-set policy course, even as the world around us changes beyond recognition.

The potential of the Whitaker plan was also undermined by successive governments that wanted the benefits of global capital without the pain.

So, tax breaks were deliberately targeted to bring in companies more interested in exporting from Ireland than challenging inefficient native industries. That allowed a malaise in the domestic market to persist for a long time alongside a more dynamic and outward focused multinational sector.

Only belatedly was the IDA broken up to allow what is now Enterprise Ireland to support local businesses.

If staying the course was ever an option, it is over now. The combination of Brexit and the rise of Donald Trump may well mark the end of at least a phase of globalisation. In this emerging era, Ireland's habitual policies of relying on tax breaks and low costs to attract multinationals may be approaching the end of the road.

New ideas, perhaps as radical as Mr Whitaker's own, will be needed to plot a new course. That's why the plan itself was only half of the success of the Whitaker departure.

Arguably, TK Whitaker's most radical and subversive move was to crowbar a capacity for optimism and economic activism into an Official Ireland that at the time was radically risk adverse.

At its core, Mr Whitaker's plan was a calculated act of intolerance, a rejection of official thinking because he simply didn't accept that poverty and mass emigration were an acceptable lot for the Irish.

That view was spurred on no doubt by the painful reality that confronted him as secretary general at the Department of Finance. Decades of drift after independence meant the country was approaching the point where it might no longer be able to pay for its very existence, a responsibility that fell directly on his department.

Doing nothing wasn't an option, at least for an intellectually honest, committed official.

What characterised Mr Whitaker's career was less a single idea or set of policies but his intellectual curiosity and openness to change. TK Whitaker was comfortable with ideas. During and after his career he made no bones about the interest he took in academic and practical research.

We'll do no harm to the Whitaker legacy by asking for, and supporting, that same capacity for radical renewal from our current leaders, administrators, and from among ourselves.

The real legacy of Mr Whitaker's illustrious and unique career is that we cannot as a nation be afraid to tear up the old script when circumstances demand we write a new one.

Irish Independent