Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

I thank Deputies Maureen O'Sullivan, Richard Boyd Barrett and Joan Collins for tabling this Private Members' motion. When the issue of achieving a more equal society is discussed, the focus tends to be on the comparison between what top income earners are paid and those who are paid at lower levels. While this is important, particularly where large multiples are involved, it diverts attention away from the real inequality, the cause of which is more about the accumulation and distribution of assets and wealth. The narrative is destructive because it pitches people who often are earning quite modest incomes against other workers. What has been occurring is that people on the lowest incomes have become poorer, as evinced by the growing number of children who are living in poverty. At the same time, the incomes of a large number of those who are termed middle-class have been hollowed out. Post-crisis Ireland is much more unequal than it was before the crash, which is a disgrace.

Should one aspire to a more equal society, and if so, why? According to works such as The Spirit Level, when one considers the evidence, the more equal societies, such as the Nordic countries, produce better societal outcomes and better mental health outcomes and have lower levels of drug use. As for obesity, the term is "The wider the income gap, the wider the waist." These countries have better educational performance and lower crime rates, and the list goes on. The authors of The Spirit Level, Wilkinson and Pickett, wrote the book following 20 years of international research. It is easy to perceive why one would seek a more equal society when it delivers such good outcomes. While there is no doubt that great wealth has been created in Ireland, the problem is how that wealth is distributed. The levels of inequality that were so well demonstrated in the RTE programme recently produced by David McWilliams are not unique to Ireland. During the summer, I re-read Joseph Stiglitz's book,The Price of Inequality, and apart from the people named and the subject country, the pattern was pretty much the same internationally. Professor Joseph Stiglitz won a Nobel Prize in economics and formerly worked for the World Bank as its chief economist. In the book, he details the profound consequences of both the current financial meltdown and the previous decades of neoliberal interventions on the incomes, health and prospects of the 99%, as well as the damage done to values, fairness, trust and civic responsibility. How do the 1% accumulate the wealth? This was graphically described in the aforementioned programme. For example, when one considers NAMA and the IBRC, the Government shortened the time for the disposal of assets. As property values were rising, there was a rush to dispose of the NAMA and IBRC assets. It appears this was a factor in the bundling together of large groups of distressed assets that are being sold below par in what appears to be a fire sale. The result is that a small number of super-wealthy people are being made richer, and they are then free to sell on the same assets for a profit to others who would have paid more for them individually or in small bundles. Moreover, some of them, such as Project Arrow, contain a large quantity of residential properties, some of which are in the right locations to deal with the current housing and homelessness crisis.

The Nordic countries offer a good example because they attract a good share of foreign direct investment. They have good, stable economies with good public services, yet they have higher levels of corporate taxation, for example. As to why they attract this investment, it is because they have good public services and good educational attainment. If we take our eye off that ball, the 12.5% rate will not matter if we lack the people who will work in those multinational firms. This is possible unless we invest in third level institutions and right through the education system. Where will this tax come from? I attended a briefing by IBEC recently at which it called for significant investment in third level education while simultaneously highlighting areas in which there is inadequate ability to bring in more taxation. I raised that very point with it - namely, that the key issue is not the rate of 12.5% but the amount some companies are paying in corporation tax. This is the money society needs to invest in infrastructure, be it public transport, housing or education. This is what will sustain us into the future. I believe the key issue is bringing in the full 12.5%, rather than the actual rate of 12.5%.

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