Paul Murphy (Dublin South West, Solidarity) | Oireachtas source

It is appropriate to start with the fact that it is ten years since the start of the great recession, a crisis of the neoliberal capitalist system which the establishment parties in the House defend. The crisis resulted in literally tens of trillions in output being lost on a world scale. It is a crisis to which capitalism responded by embedding further the inequality and neoliberal policies which were at least partly responsible for it in the first place. The consequence is weak growth globally of less than half the post-war rate. What growth exists is incredibly and unprecedentedly unequal. I note the striking fact from Oxfam that 82% of the wealth generated in the world last year went to the richest 1% while the bottom 50% got none of it. The same is happening in this country where profits have doubled, the personal wealth of the richest 300 has tripled and wages have remained barely more than stagnant over the course of the crisis. The impact continues to be felt in people's lives. It has been galling for people to hear talk of a rainy day fund. People have the sense that if the Government and Fianna Fáil are talking about a rainy day some day in the future, they must have no idea of what life is like for ordinary people now. It is monsoon season right now for the 10,000 people who are homeless, the 100,000 in at-work poverty, the half of all young women who cannot afford to buy sanitary products as reported in the media this week and the 7% of workers on temporary contracts. We need action.

Again and again, the Government statement claims we are nearing full employment. We are quite a distance from that. In any event, what is the nature of the employment being created? It is low-wage and precarious. That there are 100,000 fewer workers in full-time employment now than in 2008 is a striking illustration of the changed nature of the labour market. What is also striking in the Government's discussion of the summer economic statement is the changed rhetoric around the fiscal space. We have always disagreed with the fiscal rules, which is a neoliberal straitjacket out of which we must break. We said there was a primary surplus which could be used to invest in the economy but the Government said we could not use that because we had to stick to the fiscal rules. As such, there was a continuation of austerity. Now that the fiscal rules mean there is more fiscal space than before, the Government says we should forget about the fiscal rules as they are not good for the economy in its current situation. As such, we cannot spend. The conclusion is, therefore, permanent austerity. Whether the fiscal space is there or not, the Government says it cannot spend the money. In reality, the State was shrunk as a percentage of GDP in the course of the crisis and the Government is determined to keep it that way and to leave the public sector on rations.

One of the honest and interesting aspects of the document is the quote on page 1 to the effect that studies show aggregate levels of productivity in Ireland are heavily distorted by exceptionally high levels of productivity in a relatively small number of foreign-owned firms. A key policy challenge is therefore stated to be a need to enhance the productivity of indigenous firms. That is a euphemism if ever I heard one. If it is correct, it points to two key weaknesses in the economy. First, multinational firms are exceptionally productive, not because their workers are working 15 times harder than workers in indigenous firms, but because Ireland is a tax-haven conduit and the money is being funnelled through it. Second, it points to the ongoing weakness of the indigenous economy. That was illustrated graphically in the study published a couple of weeks ago, namely "The Missing Profit of Nations", which found that on a profit-per-wage basis, workers in the multinational sector were 16 times more productive than in non-tax havens. It is obvious what is happening. The vulnerability to external shocks which goes with that situation is the result of the development strategy of the Government and Fianna Fáil, which is about Ireland being a tax haven. The answer is to break from that and to use the €13 billion plus interest when it becomes available. The answer is a socialist industrial policy based on massive public investment to resolve social crises, public ownership and planning to build economically sustainable growth and, crucially, a transition to a green economy.

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