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Ireland’s Credit Crunch: Our latest publication reviewed 

Reviewed by Piers Mostyn

21 January 2011

(This review was initially written for the February edition of socialist resistance. )

A century and a half ago Karl Marx warned that the English working class ignored Ireland at its peril. The economic crisis in Ireland is providing a vivid illustration. 

Despite forcing through a domestic austerity offensive throwing hundreds of thousands out of work and slashing budgets by 25%, David Cameron had no hesitation in throwing £9 billion at Ireland’s banks to help shore up the sinking economy. Remarkably this was met without a murmur of dissent from a normally rabidly anti-European Conservative right wing that would have revolted had the cash’s destination been Greece or Portugal. Even hard-line xenophobes understood that, from the perspective of capitalism, there was little choice. Ireland’s crisis is Britain’s. British banks, like the partly nationalised RBS, stand to lose billions.

The twenty six county economy, moulded by its colonial history remains significantly dominated by imperialism and particularly British capital; hundreds of thousands of Irish workers live and work here; the twenty six counties are a major export and import location; and the febrile “peace-process” in the North would easily be destabilised by upheaval in the twenty six counties. 

In short, if Dublin blows the knock-on effect on London – economically, politically and socially – would be profound. British capital’s rise to global eminence depended entirely on extracting profits from such outposts and using them to establish strategic hegemony. Rock the foundations and the building may fall.

This book analyses the causes and consequences of the Irish crash and what the Irish working class should do about it. It traces the rise and fall of the “Celtic Tiger” since the early 1990s exposing as a sham the proclamation by neo-liberal ideologues that it proved the success of free market capitalism.

As in Britain, the country’s rulers have sought to absolve themselves of responsibility, claiming that the economy was brought down by international factors beyond their control. Of course this was a major element, but domestic factors played a key role and the chronology shows that it started in Ireland prior to the sub-prime mortgage crisis blowing in the USA. The authors analyse the connectedness between the fault-lines giving rise to the crisis and the political and economic weakness of a capitalism still dominated by imperialism.

There is a detailed account of the government’s austerity offensive  –  centred on National Asset Management Agency (Nama), a state owned “bad bank” for toxic debts and a transfer of wealth from labour to capital. Job cuts, reduced wages, higher charges and dismantling the welfare state sound familiar. But this is the most savage worst in Europe and a foretaste of Britain in double dip recession. Cameron’s multi-billion pound bung to the Irish bankers is a foretaste of the serious knock on effects.

The European Union was widely touted as saviour for the Irish economy by the pro-Yes lobby in the campaign to reverse the defeat in the initial referendum on the Lisbon Treaty. But slogans like “vote yes for recovery” “vote yes for jobs” are now being replayed like a cruel joke.

The Irish Congress of Trade Union’s response has been supine – rooted in long term collaborationism through “social partnership”. The authors set out a systematic alternative, based on an internationalist perspective beginning with the expropriation of the banks. 

A sound understanding of the Irish economic collapse and its interconnections to Britain, Europe and globally is vital for socialists on this side of the water. This book provides an indispensable starting point.


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