Photo: Former IMF Chief Economist Simon Johnson: 'a nation in a financial death spiral'

Has Europe Saved Ireland?

By Patrick McKenna

Of all the positive thinking wheezes sponsored by
ruling elites to bring an end to Ireland's economic crisis, none was as crisp
as the one adorning lampposts last autumn: Vote Yes For Jobs.

With 17,000 more people joining the dole queues
since Lisbon 2, Voting Yes For Jobs sure looks like a beaten docket, but who
knows? It might still turn up as a proposal on Mary McAleese’s Your Country
Your Call website.

Seriously though, what happened? Has the European
Union refused to heed Ireland's call?

If you’re out of work, the answer may be a
resounding Yes.

For the government however, and the banks whose
interests it serves, voting Yes for Lisbon was one small element of a broader
plan in which the EU is playing its full part.

We know the rest of the plan: cutting funding for
social welfare, health and education, ploughing untold billions into zombie
banks, and slashing workers' wages.

The result is what former IMF Chief Economist Simon
Johnson describes as 'a nation in a financial death spiral'. But it’s a death
spiral both demanded and supported by the EU, because the government’s brutal
assault on workers is its way of meeting the EU’s Stability and Growth Pact
target.

More positive thinking came in the idea that a Yes
to Lisbon meant Ireland would “remain at the heart of Europe, where our future
belongs”, as a jubilant Brian Cowen announced when the rerun delivered the
right result.

Cowen was right in a sense: Irish workers will
indeed “remain at the heart of Europe”, but as debt slaves.

Some say that if not for the EU, Ireland would be much worse off, pointing to Iceland, which was not an EU member when its coffers
ran bare, but whose membership is now being fast-tracked.

Yet Ireland’s EU membership has allowed it to rack
up a mind-blowing €174 billion debt with German banks: a far greater burden per
capita than that of Iceland.

If you’d been listening to official propaganda, you
might think the European Central Bank is a sort of benevolent uncle, lending
the wayward Irish a dig-out, not least by allowing Irish banks to exchange
their NAMA bonds for ECB cash.

More positive thinking. The EU-backed financial
death spiral means deep depression will persist in Ireland when the economies
of bigger states return to higher rates of growth, because the ECB will hike
interest rates in response.

When that happens – as it certainly will - Irish workers
will be plunged into even deeper depths and the economy will shrink even
further, with even higher levels of unemployment.

And as even the dogs in the street know, the ECB
cash supplied to Irish banks conjured through NAMA will do nothing to stimulate
the economy. As the boss of AIB admitted, they intend hanging onto the money to
boost their share price. 

Claiming things would be worse in Ireland if not for the EU is rather like the child chimney sweep in the William Blake poem
who says getting your head shaved means you don’t get your hair dirty: an
absurd consolation borne of an intolerably nasty situation.

But it’s not enough to claim (more positive
thinking) that the solution to all this is simple withdrawal from the EU or
from the Euro. Irish workers would still be enmeshed in an exploitative
capitalist system, at the mercy of the same crooks who currently run the
country.

The only solution, as demonstrated from Greece to Green Isle, is for workers across EU states to confront the local ruling class
with strikes and mass resistance. It is only by this route, and not spurious ‘positive
thinking’, that the European Union’s vast apparatus of class domination can be
conclusively dismantled.