Notes on the Front

The Labour Party’s new policy document, A Fair Deal: Fighting Poverty and Exclusion is truly welcome. Its publication shows why Labour continues to be the leading progressive party in the state. No other party has invested as many resources in identifying the nature and extent of poverty, inequality and social exclusion.

This comprehensive 55-page document full of detailed analysis and prescriptions deserves a close reading and several considered responses. Most of all it challenges the Left to reconfigure and reconcile anti-poverty strategies with the broader objectives of economic growth and prosperity. This is not easy. Even in the document Labour doesn’t find it easy.

While it successfully shows why poverty is not an ‘out of date’ concern, it becomes defensive:

We need to be clear about one thing from the start. Labour is not turning its back on policies of economic growth and national prosperity . . . Labour does not argue that the country has gone down the wrong road, or that we must reverse gear or change direction.

That Labour feels the need to make this statement shows a certain insecurity, as if addressing poverty somehow detracts from growth. This insecurity feeds an insistence that economic strategy will not change and presents anti-poverty programmes as somehow directed at ‘some other’, divorced from the rest of us. Thus, the battle between Labour and the Right is not about the nature of the economy but how it divides up its proceeds (e.g. tax cuts vs. anti-poverty spending).

Labour is not alone in this. It is shared by most of the Left and the trade union movement and, on a different plane, the European Left vis-à-vis ‘globalised market’ issues. The root of the problem, in this context, is our failure to develop a thoroughgoing critique of the Celtic Tiger phenomenon.

We have failed to adequately account for two things: first, why did the economy take-off in the mid-90s. In a negative way Paul Sweeney has conclusively dismissed the notion that it was somehow down to tax cuts. But we fail to see that economic growth was largely due to the tentative intervention on the part of the state through reinvigorated institutions (the IDA) to quasi-social democratic practices (social partnership) as well as new industrial / enterprise supports that constituted, however so weak, planning mechanisms. The Right portrays the story as one of ‘getting the state out of the market’s way’. The reality couldn’t be more different.

The second issue is that we fail to distinguish growth in the 90s, based on industrial expansion and export-sales, and today’s growth, which is increasingly, based on property, imported consumer goods, and private credit. The first stage of growth was fostered by developments outlined above though the lineage of the Celtic Tiger can be traced back to decisions made in the 1960s. The current stage arises out of the disastrous stewardship of Charlie McCreevey, the PDs and, the current coalition, which pretty much let market forces rip.

Around the pubs, dinner tables and sidelines of under-12 GAA matches, people are acknowledging there is a problem, that this can’t go on – property, prices, credit cards, spending – but if Labour insists it won’t ‘reverse gear’ or ‘change direction’ then people will continue whistling in the dark for lack of anyone shining even a little light.

Labour begins to acknowledge some of this, however gingerly:

In reality, the most equal of European societies are also among the most competitive, as evidenced by numerous indices of competitiveness. For example Finland, Sweden and Denmark are ranked 2, 3 and 4 respectively in the latest global competitiveness assessment of the World Economic Forum.

Absolutely. The economic and social are not different spheres but rather inextricably intertwined, indispensable to one another, inseparable. I’m amused when people state that the free-market US, too, with all its inequalities and poverty, ranks high on the global competitiveness index. The fact is that the most economically dynamic, wealthiest, highest waged, least impoverished states within that Federal Republic are characterised – at state and local levels – by relatively high degrees of economic intervention and social spending. Of the seven most prosperous states, the Democrats won all of them in their losing Presidential bid in 2004.

But, large as the task is, coming to a political understanding of the roots of recent economic growth is only the first step. The next step is to fashion specific policies that not only address poverty but encompass the wider aspects of economic insecurity that affect the vast majority of households, even the mislabeled ‘middle classes’. For if we are to bring poverty from the margins to centre-stage, it must be integrated into over-arching strategies that encompass the needs of those not poor such as healthcare, childcare, labour rights, pensions, etc.

Most of all we must, based on our critique of the Celtic Tiger, come up with new enterprise strategies that will reduce inequality and exclusion, rather than fuel it and not leave the economic levers in the hands of a few self-selected captains and their crews.

Only then can we begin to tell the people a story – which as Gerry O’Quigley rightly points out, is the keystone of political success.