ie-politics

Should Child Benefit be "clawed back from the wealthy"?

Yes, according to the End Child Poverty Coalition who appeared yesterday before the Joint Oireachtas Committee on Social and Family Affairs.  They claim that despite the booming economy and the unprecedented wealth enjoyed by many families, as many as one in nine children in Ireland live in poverty and go to school hungry or cannot afford warm clothes or school uniforms.  According to the brief report in this morning's Irish Independent the groups wants child benefit to "be means-tested or clawed back from the wealthy through tax to give the payment to those who need it the most".

I'm a bit puzzled by this.  Barnardos, who are part of this coalition, have advocated, in their most recent pre-budget submission and in their "Seven steps to Ending Child Poverty" document, a revised targeted child income support.  They say that Government strategy has been to increase the universal Child Benefit payment significantly to the detriment of the targeted Child Dependent Allowance (CDA) payment.  Barnardos supports the merger of the CDA with the Family Income Supplement (FIS) payment and "believes the advantage of this merger is that it would benefit two sets of children, those whose parents are on social welfare and those whose parents are in low paid employment". 

There is no mention in their policy documents about changing the existing universal Child Benefit payment.  Is the new weekly targeted payment meant to exist alongside the universal monthly child benefit payment?  Or does the child poverty lobby believe that the only way the new targeted payment can be sold is to have some kind of "clawback" on the universal monthly payment?   Maybe it's the rather abbreviated nature of the newspaper report but their position is unclear.

What are the merits of removing the universal nature of child benefit payments?  The main consideration is that the redistribution is horizontal - from people without children to people with children - rather than vertical, from rich to poor. Child Benefit may redistribute from a poor single person to a better-off family.  The arguments for retaining universality are that the payments are simpler to administer, they avoid the potential stigma of means-testing and that they avoid potential poverty and employment traps.  Personally, I believe that the best way preserve the elements of universality is to have some kind of basic or "citizens income" which would be unconditional, tax-financed and ultimately far more progressive as a redistributive measure.

Update - Ah crap!  I should have looked at Notes on the Front before I started this where Michael Taft has a very comprehensive treatment of the child poverty issue. 

It's the Enlightenment, Stupid

I'm busy reading Will Hutton's book The Writing on the Wall: China and the West in the 21st Century and it's excellent stuff.  Hutton tells us that China's GDP grew by one-third. Fixed investment has tripled in six years; exports have quintupled.  Everything that China does now effects us directly, such is the speed and scale of Chinese economic growth.  The problem is that such an economy is not sustainable if it continues to be buttressed by the corrupt and authoritarian rule of the one party state.  A collapse in Chinese growth will have upheavals for China and the world and Hutton wants to make a case about what both China and the West should do to avoid such a catastrophe.

Hence the title of one of his chapters, it's the Enlightenment, stupid.  Without what Hutton terms "Enlightenment institutions" - a free and independent press, an independent and honest judiciary, autonomous civic organizations - the party's rampant corruption cannot be controlled, despite periodic anti-corruption campaigns conducted by the party itself. Without well-founded financial institutions, low-cost crony loans from state banks to state industries encourage inefficiencies and distortions and destroy any impulse to improve accountability or transparency. The party's style of Leninist corporatism, staggeringly wasteful of raw materials and energy, is propped up by technically bankrupt state banks that use the peasants' savings, just as Mao did, to fund rapid, but not necessarily productive, industrialization and urbanization.

Without civic, political or legal controls, the party appeases its own constituency by allowing local officials, their snouts in the economic trough, to get rich at the expense of the population on whom they feed. In just 20 years, this has led to staggering inequalities of wealth, opportunity, health, education and life expectancy, as well as to environmental degradation on a terrible scale.  Hutton says that "because China must change, it will".  The question is how to avoid destabilizing the whole global trading system.

How the United States reacts is key to what might happen and a central element of his argument is that the Americans are turning their back on their own Enlightenment values by their rush to accept a hard nosed neo-liberalism and market fundamentalism that eschews global responsibilities and obligations.  The worst case scenario is two rival continental powers locked into economic war with each other and armed to the teeth, with any number of  incidents, from Taiwan to oil and gas reserves in the East China Sea, that could trigger a real casus belli. 

There is a strong case to be made for better global governance.  The history of globalization shows both advances and retreats and early on in the book Hutton speculates that we might see a rerun of the period up to 1914, with internal social strains and a fragmentation of the global architecture.  The key question then becomes will the major countries of the west, who are crucial to a possible re-writing of the rules of the global system, have the economic strength and the political conviction to maintain social stability and open political systems?

Power Shift:Do we need better global economic institutions? happens to be the title of a new publication from the left of centre think tank The Institute for Public Policy Research.  The author, Ngaire Woods, sees a number of "innovating forces" pushing for change in the way international institutions work, among them newly powerful countries like China, Russia, India and Brazil who are pushing to make their voices heard on the international scene.   In her conclusions she  remind us that:

The new globalisation of the late 20th century is not just economic. The rhetoric and politics of international relations have been globalised – including the case against globalisation. Spurred by a sense of inequality and injustice, people across the world are forging a new politics of resistance. Until now, multilateral institutions have failed to address this. But they now have an opportunity so to do. In the world economy, institutions exist not solely to deal with market failures. As the Great Depression of the inter-war years demonstrated, institutions are also vital for defining shared values and purposes. They can create – or erode – confidence in cooperation.

I would also want to add that "defining shared values and purposes" is something that I would want to link with the broadly based values of the Enlightenment that Hutton talks about in his book.  There are many on the left, caught up in the fragmented politics of identity, that hesitate to use such a western-centric term as the Enlightenment.  There are also those, like John Gray in his review of Hutton's book (here), who disparage the term as something akin to a religious faith, (although Norm dispatches that one quite well).  Maybe it's a sign of how far things have changed in the last twenty years or so but it seems to me that standing for open political and economic systems, and supporting global institutions that are based on legitimacy as well as effectiveness, should be central to the politics of the left. 

Keeping wages low has nothing to do with competitiveness

Over at Notes on the Front, Michael Taft describes the "issue of endemic low-pay in the economy" as "one of the biggest ‘sleeper’ issues coming up to the general election". Taft cites CSO data to show that that "nearly 30% of the workforce earned €10 an hour or less in 2003 (the last year data is available)". I hope he's right about its potential as a real election issue and it certainly won't be for the want of trying and the motion that Cllr Eric Byrne will put before Dublin City Council next Monday deserves to be fully supported.  The motion seeks to address the low pay issue by using the City Council’s procurement procedure to drive up wages. Every year the Council purchases hundreds of millions of Euros worth of goods and services from private sector companies. The motion would require that if any company wants to successfully bid for a contract, they must show that they pay all their employees a ‘Living Wage.’ This wage would be set by the Council and would, therefore, be in well in excess of the minimum wage. Thousands of workers could see their wage packets increase substantially. 

On a related matter, I came across a useful economics briefing cite called Eurointelligence, which for the moment is free.  There is a particularly useful snippet entitled "Why the European debate on competitiveness is going nowhere".  The key point of the note is that cutting costs, including wages, is meaningless for long-term competitiveness.  The definition of a competitive country is one "one that can maintain high rates of growth and employment in the medium term"

This concept focuses on the country’s ability to provide its citizens with high and rising standards of living in the medium and long run. Competitiveness in this sense depends on the quality of a country’s economic and political institutions and the extent to which they are supportive of employment, productivity growth, innovation and the ability to adjust to changing circumstances.

The public debate is often reduced to the question on how to gain competitiveness through cost and price advantages against other countries. But the best known policy strategies for gaining competitiveness - real wage cuts or exchange rate depreciation – are not consistent with the definition of competitiveness for a country as defined above. These measures reduce the standard of living in the long run in return for a comparative advantage only in the short run.

It is clear that cost cutting cannot be a recipe for a successful country-level strategy.  As the author of this briefing document prepared for the The Economic and Monetary Affairs Committee of the European Parliament makes clear "instead of cost cutting  economies of scale in production and distribution, product differentiation, technology are more efficient to compete in foreign markets for heterogeneous goods and services".  Low wages will only be associated with low skills, low motivation, low productivity and low innovation. 

The system we deserve?

There's a lot of weary cynicism emanating from the political columns in this weekend's papers.  Dealing with the Tony Kileen affair Diarmuid Doyle in the Sunday Tribune believes that the junior minister was only doing what he was elected to do and that we get the TDs and the political system we deserve.  Doyle goes into the familiar story about the thousands of pointless items of correspondence that are sent out from the offices of politicians every week which is based on the need to keep priming the parish pump.  I agree that it's all a terrible waste of time and resources but I suspect that he is exaggerating when he claims that voters expect politicians to be at their constant beck and call.  He seem to think that just because the electorate twice rejected attempts to change the electoral system that voters are to blame for this. 

I would like to see reform of the voting system back on the political agenda.  The alternative to PR-STV does not have to be a British-style first past the post.  I would favour a mixed system where there are lists as well as geographical representation, like the German system.  I admit that I grit my teeth when I hear the cliché "all politics is local" and  that other old chestnut about elections being all about 43 separate campaigns in each constituency.  But of course as things stand there's a lot of truth in both of those propositions.

Also in the Sunday Tribune, Shane Coleman muses on similar issues when he wonders "why should parties waste time on the big, national issues when people vote only on local matters anyway?"  Coleman concludes that although parties have policies aplenty, they are irrelevant because nobody is interested in them, hence the title of the article "Personalities, not policies, win elections". 

John Edwards for 2008

Let's just forget about Irish politics for a moment, especially in view of the latest poll.  If I lived in the United States I would be an enthusiastic campaigner for the former Senator for North Carolina, John Edwards.  Forget about cautious Hilary and the Obama phenomenon, Edwards is the the one candidate that any European social democrat would support.  I also believe that as a southerner and a man of humble origins, notwithstanding the trial lawyer tag, he is highly electable. He is a conviction-driven populist who has made poverty his number one issue.  When in the Senate he voted for the war in Iraq but now admits he was wrong.

Were it not for the quirks and irregularities in Ohio in 2004 he would be Vice-President.  Al Gore had Edwards on a shortlist of candidates to be his running mate in 2000 but he chose the awful Lieberman instead.  Edwards has been carrying on a grass roots campaign since the 2004 defeat and is probably better placed among registered Democrats likely to vote in primaries or turn up to caucuses than some of the more prominent candidates. 

I would be happy for any Democrat to win next year but I'd love Edwards to be the candidate because it would be the first time that I would have witnessed an insurgent Democrat campaigning on issues that wouldn't look out of place in the Labour Party's manifesto, mutatis mutandis of course.  There's a very good profile of Edwards here and there's a very well made point about the mistake people can make about failing to distinguish between sincerity and spontaneity. 

Kenny's Celtic Fantasies

Enda Kenny recently claimed that as "a Celtic and Christian people, we understand better than most the special challenges of immigration and integrating new communities".  The Fine Gael leader was trying to stimulate a debate on immigration.  Fair enough.  But it doesn't bode well if the picture of the Irish today is based on a myth.  It's surprising to find a speech by a political leader of the twenty-first century whose basic premises are so fundamentally ahistorical.  The idea of a Celtic people was an invention by nineteenth century nationalists and which in turn was based on an arbitrary classification by philologists of certain European languages as 'Celtic' and from which certain racial characteristic were inferred. 

There's an excellent little book in the Very Short Intoduction series by Oxford University Press by Barry Cunliffe called The Celts.  I read this last year and it really ought to be read by anyone interested in how racial or nationalist myths are propagated.  Cunliffe cautions against "two comfortable old myths". The first is that that there was a "coming of the Celts" - either to Britain or Ireland. The assumption that culture must arise from invasions comes from mindsets laid down during the 18th and 19th centuries, when imperial and colonial experience, together with the dominance of classical studies within the educational system, saw invasion and colonisation as the sole begetters of change. "Invasionism" has since given way to a diffusionism based on economic, migratory and cultural communication as the best way to explain these commonalities.

The second myth is that there was a pan-Celtic Europe counterposed to the dominant Mediterranean Greek and Roman cultures at the time. That there might have been such a commonly recognised civilisation arises from the way in which the classicals' use of the word Celts to describe peripheral barbarians was taken up by philologists studying European languages, also in the 18th and 19th centuries. They classified them into a single family tree of Indo-European languages.  Since then Irish nationalists have embedded their vision of national identity within a distinctly Celtic setting, making this essentialist notion the basis of all things Irish and embodying all manner of national, or more accurately, racial, characteristics.  All sorts of things from artistic creativity to fondness for alcohol can thus be attributed to the Celtic genes that reside in all of us. 

Does this really matter?  Doesn't everyone have their national myths and invented traditions?  Of course they do but not every political leader would make an important speech on immigration by encapsulating such a stereotype.  There's a danger in seeing immigrants as an undifferentiated alien 'other'.  By seeing 'ourselves' as having a lineage stretching back so far into history is just the obverse of this.  It's important to be clear about our past and not romanticise it, and we should not project certain characteristics onto ourselves just because we might find it comforting in some way.  The overwhelming archaeological evidence points to the fact that no racial or ethnic group in Ireland in the ancient or medieval period was known or identified as Celtic.

Browne's disappointment is just not convincing

Vincent Browne claims that "Pat Rabbitte has been a disappointment as leader of the Labour Party, but a disappointment in a way we should have anticipated".  Browne believes that this is because Rabbitte emerged from the "Stickies", whose politics were essentially a "con job", based on secrecy and manipulation.  He's not entirely wrong about elements of the WP culture (I've dealt with this before here) but if he believes that culture to have been so contaminated, then he cannot credibly claim to be "disappointed". 

Combining a maximalist radical stance with utter cynicism about the possibilities of reform, Browne is a familiar figure among columnists whose criticism is anything but constructive.  The logic of his position would seem to indicate that we should simply give up. 

Office without that change of mindsets is powerless. Sure, some marginal improvements can be made, sure the system can be cleaned up a bit here and there. We can give back some teeth to the Freedom of Information Act, we can strengthen the anti-corruption laws, maybe improve the health system a bit and do a bit about illiteracy and maybe about housing. But the show will continue to be run by the big boys, and the big boys will hog a vastly disproportionate share of the wealth, will corner the prize bits of the educational and health systems, will continue to set the political agenda, rigged in their own interests - and in that latter task will be enthusiastically aided and abetted by media workers. Did you notice how gushingly media reporters and commentators were over the latest Government con-trick on the National Development Plan?

While Browne can develop a powerful critique of the present and recent past, we will never get any idea from him about how to advance to a more desirable future.  Apart from "campaigning on issues of unfairness and inequality, persuading people there is a gross injustice at the heart of society and that a fair society can come about only by a change in power-relations...", Browne has nothing to say about nothing to say about how to build a political movement based on conviction that has a chance of taking power in the medium term.  For him, politics is all about "persuasion" and "changing mindsets", nothing about the mechanisms to bring this about.  And of course not a mention of  how parties should organize and communicate.

Browne isn't alone in his clueless state.  There is very little strategic thinking within the mainstream European left on how to bring about shifts in the balance of social, economic and political forces that are structural in nature, likely to endure and that could create the conditions for further transformation.  Rabbitte is no more ill-equipped than any other leader of the European left and Brown's "disappointment" is simply cover to bash the ex-Stickies.  Regardless of what happens after the next election, progressive forces in Ireland, especially those of us in and around the Labour Party, need to begin a serious conversation about what our medium term goals should be and how we might conceivably arrive at them.

Power, Principle and the Labour Party

I'm trying to steer clear of mentioning the Labour Party for a few days but Fergus Finlay's column in the Irish Examiner this morning caught my attention because it deals with something that has bugged me for years.   The gist of his argument is that the best way to counter any political advances the party might make is to question its commitment to its values.  Finlay is an old and battle-scarred Labour warhorse and knows all about the internal battles about coalition when he was a vigorous opponent of Labour Left and anti-coalitionism generally.  This explains why he says that "for years, Labour Party members seemed to value moral victories more than actual victories". 

Finlay is evidently frustrated by the way entering into government is always framed as trading principle for the perks of office:

Ask the leader of any political party in any democracy in the western world what he or she wants to achieve, and the answer will be, “I want to put my party in power, so that we can begin to deliver on the things we believe in”. Straightforward question, simple answer. It never raises an eyebrow. But if the leader of the Irish Labour Party were ever to say such a thing, in as straightforward a way as that, he or she would be drowned under the weight of political commentary predicting that the Labour Party was about to sell out its most fundamental values. Uniquely, the Labour Party is the only one in these islands, or anywhere else I can think of, for whom power and principle are not allowed to be compatible.

Socialists are always admired for their great ideals, once there is no chance of actually getting their hands on power, or even a share of power.  Well, I would prefer Labour to risk contamination in government and implement at least some of its programme even if it risked opprobrium from the likes of Vincent Browne.  All political parties have to make strategic trade offs between office, votes and policy so careful consideration has to be given to under what circumstances a party enters office, with which parties and on the basis of what programme.  The level and quality of internal party communication would greatly effect the context here and this would have to go beyond the top-down vertical mode of message delivery.

Labour Party leaders, as is well known, do not have complete autonomy to put the pursuit of office over (future) votes and policy.  In the past Labour has negotiated coalition agreements where some key policies were part of the programme for government.  Actual performance in government didn't always deliver them, especially during the Fine Gael-Labour coalitions in the 1980s.  In any case leaders know that they have to take their followers with them, so to speak, and must pay due regard to the ideological and symbolic aspects of the wider party culture if they are to retain any credibility with the extra-parliamentary party.  This is why I just cannot see Rabbitte blithely proposing a deal with FF after the next election. 

Process triumphs over policy in media agenda

In yesterday's Sunday Business Post Pat Leahy blames Pat Rabbitte for steering himself into a pickle last week for being unclear about post-election intentions.  In doing so "he has allowed another week to pass in which the opposition has been too busy talking about political process to concentrate on the issues voters actually care about".  Leahy then goes on to rehash and analyse the process elements of the story for the entire article.  In his penultimate sentence he mentioned that Rabbitte really wanted to talk about childcare, "which voters care about - but ended up talking about electoral strategy, which they don’t".  Labour had just announced the first of its five "commitments for change" which was precisely about childcare. 

Leahy is engaging in what philosophers would call a "performative contradiction", which occurs when there is a discrepancy between act and content, between performance and proposition.  The truth about Leahy's claim that politicians should deal with the issues voters care about is belied by his own performance in contributing to the coverage of the process  issue and almost entirely ignoring an important issue of policy.  In Saturday's Irish Times Noel Whelan Whelan observed:

The 2007 election is still some months away but already there are signs that the issues are not going to get a look in. This week has set a bad precedent for how this election is going to be covered. Much of the space which should be given to a pre-election debate about the issues, has instead been filled with coverage about post-election scenarios for government formation.

He adds that the "most significant thing which Rabbitte had to say last week wasn't about government formation but about pre-school education", and, to his credit, the rest of the article is a searching analysis of Labour's proposal.  Whelan doesn't ignore the political context of such a policy but that article would be a far better guide to an undecided voter than almost anything else that has appeared recently.

What happens after a deadlocked election result?

I have no intention of revisiting the topic of the previous post in terms of possible coalition partners.  Rather I would like to focus on the mechanics or 'modalities' of government formation.  In majoritarian, two-party systems there is no problem.  The electorate decides the winner and the loser.  In countries where no single party controls a majority of seats the situation is more complex and there can be a number of different outcomes.  In some European countries this post-election uncertainty can drag on for weeks, even months.  This hasn't happened in Ireland but, as we now have a multi-party system and coalition politics are now the norm, it could happen some day. 

We have no regulations or accepted written procedures to deal with potential deadlock.  The Constitution, Bunreacht na h-Éireann, simply states "The President shall, on the nomination of Dáil Éireann, appoint the Taoiseach, that is, the head of the Government or Prime Minister" (Article 13.1.1).  So the Dáil elects a taoiseach and and everything else follows.  Ireland is unusual in this regard in that every other parliamentary democracy that I can think of the head of state, monarch or president, asks somebody to form a government and only then is a vote taken by the legislature.  Why are we so different?