Thursday, February 18, 2010
THE media frenzy about George Lee has abated. Opinion is divided whether Fine Gael could have managed him differently or he was impatient, unreasonable and egotistical.
While some argue that the "system" has failed and needs to be changed, I contend that to decline a frontbench position and promised ministry on the grounds that it was "under duress" seems to misunderstand how politics works.
Most preferment, promotion and political decisions arise from pragmatic pressures. Eight months and two days is a brief political sojourn by any standards.
My unshakeable conclusion is that George Lee made a career choice he subsequently regretted. To have done so is perfectly understandable and reasonable. Anyone is entitled to change their mind about a job decision.
People often revert to past employers — no big deal. For Lee to eliminate this factor from his declared decision-making and blame it entirely on Irish politics and Fine Gael is self-serving and disingenuous. Lee’s critics have bemoaned the fact that he did not have a substantive policy difference upon which to opt out on a point of principle. The record shows this may not be true. His expressed views require scrutiny.
A review of Lee’s McGill Summer School speech on July 21 last, radio interview on Newstalk Breakfast on November 11 and other pronouncements show he opposed the Government’s three-year budgetary strategy.
"Four billion is too much in terms of cuts". He advocated an economic government stimulus package and contemplated Ireland ditching the euro. This brand of populist economics is like soft porn. It’s pleasurable and titillating, but it’s illusory and lacks reality. He echoes a growing chorus of calls to stand apart from the euro and disown our fiscal responsibilities. The recent pressure on Greece for budget conformity has brought these issues into sharp focus for us.
The term PIGS has labelled Portugal, Ireland, Greece and Spain as the wayward eurozone member states who have not conformed to the obligations of euro membership as set out in 1999. These included a ceiling on national debt and an annual limit on the public fiscal deficit of 3% of GDP.
The immediate focus is on Greece which has a deficit of 12.7% of GPD and has promised to reduce it by 4% this year.
Public sector protests in Athens have shaken the credibility of the Greek government to deliver budget reforms. This has resulted in a perception of possible default on sovereign debt. The risk premium on Greek government bonds last week rose to more than 37% — eight times greater than similar insurance costs in Germany.
Prior to the creation of the single euro currency, the preceding three decades had a familiar pattern. German economic policy, emanating from Bonn, believed in zero inflation, high savings ratios, low interest rates and a hardening Deutsche Mark.
Over the medium term this raised living standards through economic discipline. Other currencies such as sterling and the punt had periodic devaluations to maintain competitiveness. This had come about by excessive inflation and a failure to control costs. Old habits die hard. The familiar EU states now need a further currency devaluation that is not permissible.
Those advocating an escapist policy of exiting the euro and restoring the Irish pound need to be confronted. Membership of the euro is a political decision. The disciplines of the euro are acknowledged to be tough and result in harsh cuts in public expenditure.
It is not credible to contemplate Ireland standing alone with an independent currency. Memories are too short if we have forgotten the speculative attacks on our weakened punt, resulting in colossal overnight interest rates.
Departing the euro would result in a significant hike in interest rates. Even worse is the prospect for investment and employment. More than 100,000 jobs are located here because of our membership of the euro and its trading export opportunities. Instability, vulnerability and inflation are consequences of an independent currency. The experience of Iceland and the kroner is a sobering reality.
The solo currency argument states that we could extend the period of fiscal correction to well beyond 2014. A softening of the deflationary impact would cushion us through the recession.
This means continuing with high deficits resulting in an even larger national debt. This argument ignores the debt repayment consequences. Even adhering to the Government’s tight budgetary strategy will mean interest charges between now and 2014 will be equivalent to this year’ s entire tax revenue of €32bn. The national debt is already hurtling beyond 100% of our GPD by 2015. Lee-economics would reduce Ireland to that of a basket case — worst in class in Europe.
The other theme of last week relates to the failures of our political system. The theory goes that the Dáil is an institutionalised club that is self-serving and excludes individual expertise and talent. The prevailing mood is that our politicians are collectively less desirable than something one would wipe off one’s shoe. Irish politics is perceived as a grubby, cute-hoor world of clientelism where all considerations are local. Defenders of the Oireachtas are accused of being compromised by or part of the same establishment. This too is soft porn politics. The arguments are superficial and shallow.
After 21 years’ service in the Dáil and on local councils I can verify that the mundane, repetitive constituency work grind is soul-destroying. The endless hours of attendance at meetings, clinics, funerals and parish events becomes a drudgery.
IRISH voters have inherent double standards. While publicly rebuking our TDs we reject those who don’t conform. Who isn’t flattered by and appreciative of the attendance of their public representative at a family bereavement? Who hesitates to ring their local deputy to get their water service restored or pothole filled? Who wouldn’t pressurise them to oppose a nearby travellers’ halting site or incinerator? Lack of presence and visibility on the ground leaves TDs at election time open to the accusation of "we only see you when you’re looking for a vote".
The role of a nationally elected representative is reduced to that of a social and community worker. By and large, the public get what the public vote for. The Dáil is a microcosm of the Irish voter. There are no votes in attending committee meetings, tabling amendments to legislation and researching policy.
Many TDs are happy to be glorified county councillors on a decent salary. Dáil membership is incapable of reform.
We need a blend of national and local representation. Specific expertise should be facilitated as a career path in national politics. Currently the only opportunity is as a politically appointed adviser to Government like Alan Ahearne. Instead of abolishing the Senate, perhaps the simplest political reform would be to allow its composition to be made up of party nominees through a list system of voting, determined in general elections. From this cohort of specific expertise, cabinet appointees could be made. This would be preferable to the current Senate status of nursery school or rest home.
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