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The Irish state in Europe: a fairytale ending?

12 January 2021

The final deal on Brexit has led to an enormous burst of complacency on the part of Irish political parties. It seems that the state has fallen into a cesspit and arisen smelling of roses.

The claim is that a far-sighted administration, with careful strategic planning, has avoided most negative consequences. New routes have opened to Europe, giving direct access to Irish hauliers and avoiding the congestion in Britain. The Irish economy has been booming and is expected to continue growth despite a Brexit hit.

Taoiseach Micheál Martin said; "I believe the agreement reached today is the least bad version of Brexit possible, given current circumstances." Tánaiste Leo Varadkar added; "we have "the best deal possible". Sinn Féin President Mary Lou McDonald said that there would be relief that a trade deal has been agreed, but on the other hand there is no good Brexit for Ireland, north or south.

Many saw the last ditch retreat by the British on plans to tear up the legal agreement and institute a hard border between North and South as assuring progress towards a United Ireland.

These views are a perfect illustration of the tension between ideology and reality in Ireland.

The economic illusions reach into the past. At one stage the Irish economy was supposed to have grown by over 25% in one quarter, leading to the widespread use of the term leprechaun economics. It rebounded sharply in the third quarter of 2020, growing by a near record 11.1 per cent, and claiming the highest growth on the globe. The Irish employers’ organisation, IBEC, claims growth of over 5% for 2021.

But many economists view the figures not with excitement, but with incredulity.  How can an economy that went bankrupt, that is unable to provide adequate health and housing services, and that still has high levels of sovereign debt, perform so well? The difference between the traditional measures of GDP and GNP are so sharp that another measure, Adjusted Gross National Income, or GNI*, is used instead.

The answer is readily available. It is openly admitted that there are two Irish economies. The booming economy, based on transnational companies subsidised by the state and aimed at Europe, is roaring ahead. The native economy and the public sector, with a large low paid workforce and starved of funds in order to pay sovereign debt and subsidise the transnationals, is largely dependent on the British market, as is the agricultural sector.

This is not sustainable. The economy depends on corporation tax. The rate is much lower than the European rate and is under increasing threat from other EU countries. In the mass of capital influx that produces revenue. In any case the tax now draws financial rather than industrial capital. This creates few jobs and exert unending pressure on the government and the legal system to ensure that society is run for the benefit of imperialism rather than that of the native population.

Brexit means extra costs that will be borne by Irish workers. The costs of Brexit and of the pandemic are being met by cheap money from the European Central Bank. The debt will have to be repaid and the circumstances that would allow this, a genuine capital fund for European expansion, has been rejected by the central power.

The claims that the current debacle is a step towards Irish unity at first sight seem to have more credibility.  The border in the Irish sea is clearly a blow to Unionism, as is the majority vote in the North against Brexit. However, the new arrangement is accompanied by non-tariff changes in movement between North and South, such as the need for a green card driving into the South that throws partition into sharp relief.  It should be remembered that the British were more than willing to tear up the legal agreement with Europe regarding the border as part of a no-deal Brexit and had to retreat following the Trump defeat in the US. The fantasy of an Irish sea border rests on the final Brexit deal, which continued to be highly unstable.

The problem for Sinn Fein is that they put forward every circumstance as an advance towards a United Ireland. They have to do this because the reality, administration of partition, can never be admitted to. British membership of Europe was an advance towards a United Ireland, but the opposite condition - Brexit, is also a step forward. Aspirational memes are constantly put forward involving a border poll and other shiny objects.

In reality, every concrete situation, the party holds grimly to partition. The Covid-19 crisis is a good example. The case for an All-island approach to the virus was overwhelming, but Sinn Fein deferred to DUP resistance and avoided leading medical figures such as epidemiologist Gabriel Scally, who was pressing for such an approach. They now have the chutzpah to call for an all-island health service in the sweet by and by, while failing completely to put forward concrete measures today. The same propaganda campaign puts as their number one priority support for the EU. Is this the same body that put the Irish state under the control of the troika and insisted on payment of an ongoing sovereign debt?

The Brexit crisis is not to be resolved by picking sides between the imperialist power Britain or the imperialist powers of Europe. Rather it will involve workers opposing the capitalist structure in its entirety and embracing a socialist alternative.

Sinn Fein have already picked their side. The socialist groups are buried in a fog of opportunism.  Irish exit from Europe, a left government led by Sinn Fein? They are smothered in confusion.

However, the capitalist forces are also wrapped in chaos. Let us not forget that it was Leo Varadkar that opened the way for Johnson's victory when he threw away the European backstop guarantee. Their vision of Ireland as an aircraft carrier for US penetration of Europe has no place for working class prosperity or for Irish unity.  The preferred capitalist model is for a shared island, indefinitely partitioned.

A fundamental understanding of Marxism is that history is made by people and in struggle rather than by the fortuitous outcome of events.  The shock of divergence of the two states in Ireland can foster a drive for Irish unity, as can the anti-Brexit majority in the North and the increased fragility of the British state. However, change will not come automatically, it has to be fought for and the main instrument of struggle lies in building an independent party of the working class.

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