Gerard Howlin: Economic sacred cows sacrificed on altar of political expediency

If, after yesterday’s publication of the Fianna Fáil–Fine Gael response to the Green’s 17 questions, detailed talks on government formation follow, the politics of cattle will make the tussle over the brown bull seem tame, writes Gerard Howlin

Gerard Howlin: Economic sacred cows sacrificed on altar of political expediency
Micheál Martin with Fianna Fáil’s newly elected TDs outside Leinster House in February. Martin has said that the proposed rise in the pension age will not take place, a move that will cost billions of euro. Picture: PA

‘O woman of the Three Cows, agra! Don’t let your tongue thus rattle!

O, don’t be saucy, don’t be stiff, because you may have cattle.’

The importance of cattle in Irish politics will soon equal the Táin Bó Cúailnge, when Queen Maeve set off after the Brown Bull of Cooley.

The culture and lustre of cattle captured in the translation of the Irish satire of the woman of the three cows by James Clarence Mangan, published in an Irish Penny Journal of 1840, captures two recurring themes.

Of well-known neighbours, the question was what they were wearing at Mass. Of the less familiar, whose credentials had to be established, especially if there was any inkling of romantic interest, was how many cows did they have. The better dressed had more cows, and social standing was inextricably linked.

Denis Naughten and Verona Murphy, important independent TDs, have scarified the demands of the Green Party for an annual reduction in carbon emissions of 7%. A mass slaughter of national herd is predicted. Methane gas from cattle is incense in rural Ireland. The Hindu tendency from the Greens is being resisted and a gathering political bandwagon about the immolation of sacred cows.

If, after yesterday’s publication of the Fianna Fáil–Fine Gael response to the Green’s 17 questions, detailed talks on government formation follow, the politics of cattle will make the tussle over the brown bull seem tame.

This issue is a clear battle line in rural constituencies.

That matters in a mainly rural party such as Fianna Fáil. It would have once mattered more in Fine Gael, when its farming vote and rural base was more important. It matters intensely too for independent TDs in rural constituencies.

An insight from the Covid-19 lockdown is a better sense of how we are so much a product of our manufactured desires. We are in so many ways over-provided, but under-nourished. There is something of a test of character for everyone now. A sense of community may be the great loss of modernity.

There would seem to be a basic font of goodwill in human nature. There is more kindness than expected. But charity from the surplus of which we have plenty now — namely time — should not be confused with willingness to compromise what we see as our vested interest.

It is thus with cows, and so it is with taxation and public spending. There is less poetry here, but it is the fundamental way in which we share what is scarce, as distinct from offering generously from that of which we enjoy a surplus.

Goodwill and a sense of community diminish rapidly, and the atmosphere of the cattle raid pervades.

The Social Democrats’ unseasonably chilly response to the Fianna Fáil–Fine Gael document, itself bottled smoke, was to ask bluntly what the financial basis of it all is. How exactly is the bigger state, accomplished post-Covid, in light of last week’s stability programme update from the Department of Finance. Health, housing and climate policies which looked ambitious in times of plenty, simply cannot all be accommodated now.

Gerard Howlin: Economic sacred cows sacrificed on altar of political expediency
Leo Varadkar at Government Buildings, Dublin, (Leon Farrell/Photocall Ireland/PA Wire)

The status quo on public spending can be accommodated now only with enormous borrowing. That is a bet on interest rates remaining low and Ireland not being caught again, as it was in the last crash by unaffordable costs of borrowing.

Borrowing on a massive scale, required just to sustain spending, is in any event a tax on the future. So much then for solidarity, fairness and other preferred blandishments.

Our lifestyle for two generations has been based on polluting the planet to the point of irretrievable damage.

Solidarity between generations is not something we do, nor is it likely we will adapt to.

Ours is a society dependent on splurge, and borrowing against the future.

An essential fulcrum of solidarity is the social insurance fund. It’s the pot for our PRSI and the source of old age pensions, unemployment benefit, free schemes for pensioners and more.

It is the ultimate safety net for those who because of circumstances or age can’t support themselves. It is what we pay into in the expectation it will pay out when needed.

Before Covid happened, an actuarial analysis in 2015 predicted a shortfall in the fund of €3.3bn in 2030 and €22.2bn in 2071.

I will be 60 in 2030 so that matters. If you are under 30, you will probably see 2071.

Pensions will increase as a proportion of Social Insurance Fund expenditure in our aging society from 70% in 2016 to 80% in 2071.

In 2015, 12% of us were pensioners. In 2035, that number is 17%. In 2055, 23% of those still lingering will be OAPs.

Providing now for the inevitability of old age is solidarity at its most basic. The underlying trend means that Mary Lou McDonald’s election assertion that the “the demographics will look after themselves” is nonsense.

But as part of a general plagiarism of Sinn Féin policy, Micheál Martin has jumped in to trump that.

There won’t be, as planned by Fianna Fáil since 2011, a move on in the age of eligibility for an old age pension to 67 next January. And it seems there will be, if he has his way, a row-back from the current eligibility age of 66, to 65 with some finagle of a payment.

The cost of retaining the pension age at 66 from 2021 to 2027 would likely be in excess of €1.5bn. The cost of reducing to 65 is estimated at €435m net in a year. If subsequently the increase to 68 in 2028 doesn’t happen, then the cost from then on escalates to at least around €1.3bn -gross- or €652.5m net per annum from that date.

Gerard Howlin: Economic sacred cows sacrificed on altar of political expediency
Leader of Fianna Fáil Micheál Martin TD, outside Leinster House in Dublin.PIC: MAXWELLPHOTOGRAPHY.IE

FROM today, some sort of conversation on the actuality of government formation may commence.

The premise seems to be disbelief in the reality that has dawned, and an absolute unwillingness to address it.

The idea of a pain-free economic exit where an already unsustainable normal can be resumed, is hardly worth considering.

Except it is being put forward as the basis for a programme for government.

An era of instant gratification is giving way to a myth of eternal youth, where reality is suspended, no one grows old and the feasting and jousting continues.

Many good learnings happened because of the crash.

One was that unsustainable levels of public expenditure had to be cut. Another was that we have to wait longer for a pension which we would then live longer to enjoy. Another was that we would never, ever again, live beyond our means and repeat the mistakes of the past.

But that was then, and this is now. It’s not exactly the brown bull of Cooley, but it’s enough bull for me.

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