Neoliberalism is dead, long live neoliberalism!

By Lisbeth Latham.

Neoliberalism is a term which has entered the left lexicon over the past three decades, although in different countries it can have other analogous terms. While it is a term that the left has embraced, the right, and the advocates of what is commonly referred to as neoliberalism, deny it exists as a phenomenon, instead arguing that it reflects the conspiratorial nature of the left. 

Contrary to these positions I argue that there is a usefulness in conceptualising neoliberalism as a distinct response to the capitalist crisis, and that it is not only the hegemonic response to capitalist crisis but that its proponents use crises to deepen and strengthen its hegemony. Moreover, because significant sections of the governmental left have embraced neoliberalism, challenging neoliberalism is central to not only rebuilding left alternatives but to challenging the rise of the far-right internationally. 

Why does capitalism experience crises?

Capitalism is the only economic system in the history of humanity that is driven by a need to expand and take over pre-existing social relations. It is also the only economic system in which  economic crises are characterised by the production of too much use values (at least in the early period of the a crisis). Marx postulated that the primary underlying driver of an economic crisis is the tendency of the rate of profit to decline. Adding to this general tendency is the anarchic character of the capitalist system, where individual capitalists seek to maximise their own profits by shifting investment to areas of higher rates of profits, which leads to a series of additional crises, specifically crises of overproduction and crises of over-accumulation. 

The rate of profit is profit (or surplus value) over the sum of constant capital and variable capital. Political economists dating back to Adam Smith and David Ricardo argued that it was an undeniable fact that there was a tendency of the rate of profit to decline; however, they believed it remained unclear what the mechanism for this decline was. Marx, in Volume 3 of Capital, argued that this tendency was driven fundamentally by profit (i.e. surplus value) being derived from labour. 

Therefore, increases in constant capital (an increase in the organic composition of capital – for example, factory machinery or the value of the goods and materials required to produce a commodity) would reduce the amount of labour power involved in production and thus overtime would result in a reduction in the amount of surplus value being extracted in comparison to the total constant and variable capital involved in its production. 

Crises of overproduction 

Overproduction simply means that too many goods – of either a single category or multiple categories of goods – are being produced to be sold and generate sufficient profits. Since the earlier period of laissez faire capitalism when markets were generally expanding, this is the normal state of affairs. In the US auto-industry, for instance, the industry operated at 75.9 per cent of capacity in the first quarter of 2019. 

A crisis occurs, however, when the production and sale of goods is no longer able to produce a profit, or at the very least a sufficient profit which can lead to individual companies, or whole industries collapsing. Such collapses, while a disaster for individual capitalists or corporations and the thousands of workers who are employed by them, creates opportunities in the economy to remove excess capacity from circulation and reduce competition.

Crisis of over-accumulation

Over-accumulation crises occur when the level of capital accumulation in the system reaches such a point that there is too much capital in circulation for significant levels of capital to be profitably invested or reinvested in production, or at least increases the appeal of capital investment in financial speculation rather than in investment in new capital goods. 

Overcoming a crisis of over-accumulation requires either the destruction of significant amounts of capital, such as through war, a major recession with widespread bankruptcy, the opening of new markets to create expanded demand, or via the development of new technology – opening new avenues for capital investment. In all of these circumstances, the relief provided cannot and will not be permanent.

Throughout the history of capitalism there have been a range of responses to capitalist crises, particularly large-scale crisis such as recessions and depressions. In the wake of the 1929 stock market crash and resulting Great Depression, then US President Franklin Delano Roosevelt, along with a range of governments in advanced capitalist countries, embraced Keynesian responses, which focused on what Roosevelt referred to as “pump-priming” – i.e., public expenditure on infrastructure, much of which was subsidised by using the unemployed as a cheap labour source. 

The Great Depression

Such measures were essential in overcoming the impact of the Great Depression, and they undoubtedly ameliorated some of the worst levels of poverty unleashed by the depression. But there are two important points to remember: the first is that in many countries the Great Depression unleashed significant levels of class struggle, including both the unemployed and the employed – with this struggle resulting in the victory of fascism at the domestic level in Germany, Italy, Portugal, and Spain – and with the emergence of social democratic governments in a number of countries for the first time. 

In response to an increasingly combative US working class, exemplified by the West Coast maritime strike, the Teamster strikes in Minneapolis, and the Toledo Auto-Lite strike – all of which occurred in 1934 and are seen as key drivers of industrial unionism in the US –  Roosevelt’s second New Deal in 1935 had specific measures seeking to limit the level of violence in the class struggle with formal mechanism for union recognition (Preis, A. 1964. Labor’s giant step: Twenty years of the CIO. Monad Press, New York). 

The second point to note is that many economies did not truly recover from the Great Depression until the second world was, where the massive investment in armaments, mass conscription, and the destruction pf capital goods fed economic growth, and massive profits, this was particularly the case in the united states where the majority of unions, particularly in Stalinist lead unions, made no strike pledges to help support the war effort (ibid). 

Expansion of capitalist accumulation 

In the wake of World War II, the environment was set for the rapid expansion of capitalist accumulation. These were the massive destruction of capital goods wrought by the war, and the opening up of new markets as more and more imperial colonial powers broke up under the pressure of anti-colonial national liberation struggles. 

At the same time, the growth in confidence of the working class, along with the enhanced standing and expansion of the Soviet Bloc through its role in the defeat of fascism in World War II – placing whole swathes of Western Europe at risk of being ‘lost’ to capitalism – despite the efforts of the Soviet leadership to maintain the division of Europe as agreed between Britain, the US and the Soviet Union at the Yalta Conference. 

In this context the US government launched the Marshall Plan to massively boost the rebuilding of capital in Western Europe and Japan. In addition, there was pressure to expand social services and public welfare provisions. These steps lay the foundations for the long post-war boom in Western Europe and the US, which was also prolonged by imperialist spending on their militaries as part of Cold War and hot wars in Korea and Vietnam. 

The 1973 oil crisis

However, the long boom held within it the roots its own demise, which were exacerbated by other dimensions. These were the absolute limits of expanding markets via the collapse of European colonial empires; the rebuilding of capital in the wake of the destruction of World War II leading to greater capitalist competition and reduced opportunities productive capitalist investments; and growing US deficits due to the cost of the Vietnam war. 

In addition, more and more markets were either removed or became more restricted from access to imperialist capitalism as a consequence of national liberation struggles and attempts to build their own national economies. These developments led to a growing stagflation crisis, where both inflation and unemployment grew. This meant that the international capitalist system was vulnerable to further shocks to the economy as the long boom came to a close. Of particular importance were the 1973 OPEC strike and subsequent oil crisis and along with global decline in the demand for steel, exacerbating pressures of deindustrialisation, particularly in the US.

Insurgent neoliberalism

In response to these challenges, a wave of conservative economist and social theorists began to gain a greater hearing among governments for their alternative model for saving capitalism. These groupings, commonly referred to as neoliberals, have their origins in a serious of meetings that founded the Mont Pèlerin Society (MPS) in 1947. 

Although not having a clear economic doctrine, it represented a political project to reassert capitalist class power and defeat the growing strength of the working class and its organisations the trade unions and the social democratic and communist parties. During its early existence neoliberalism sought to construct a international thought collective represented by a range of national and international think tanks, and seeking to influence and take over university economics departments transforming their positions into increasingly common-sense and thus hegemonic responses to economic crisis.

The ‘Chicago Boys’ make their mark

The first experiments with the implementation of neoliberalism came in Indonesia and Chile following the respective coup d’etats  in those countries in 1966 and 1973. In Indonesia, following the establishment of Suharto’s New Order regime, which had been supported in its smashing and mass slaughter of the country’s communist and nationalist left, orchestrated by US intelligence services (particularly the CIA), moves were made to remove barriers to investment by capital from the US and other imperialist nations. 

In addition, the Indonesian economy was actively carved up between US corporations. Despite these changes that enabled the expanded imperialist exploitation of Indonesian natural resources and labour, investment processes were extremely corrupt, with investments requiring joint ventures – with domestic Indonesian capital generally with connections to Suharto’s family and the cronies around him. 

The extensive level of poverty within the country, exacerbated by the opening up of the economy, also meant that the state was forced to provide a significant level of subsidisation of basic goods to enable much of the population to survive – essentially state subsidies for social reproduction in order to allow the imperialist extraction of super-profits. 

In Chile, following the September 1973 coup against President Salvador Allende’s Popular Unity government – carried out by the Chilean armed forces with the backing of the US government (pictured) – there began a program of both mass repression and economic transformation.

During the coup and its aftermath tens of thousands of people were murdered and terrorised, and a further 200,000 people (six per cent of the population) were forced into exile. At the same time, the ‘Chicago Boys’ – academic and graduates from the University of Chicago’s School of Economics, including “Nobel Prize” winner Milton Friedman – were brought in to reshape the Chilean economy. The impact of this transformation saw significant reductions when comparing, wages and social spending when comparing 1970 to 1989:

  • Wages decreased by eight per cent.
  • Family allowances in 1989 were 28 per cent of what they had been in 1970. 
  • Budgets for education, health and housing had dropped by over 20 per cent on average.

At the same time, Chile was seen as an economic miracle in comparison to other parts Latin America, with consistent growth in the economy, and lower levels of unemployment than in other Latin American countries. This helped neoliberals to assert ‘common-sense’ truths that private companies are more efficient than governments in delivering services; that higher profits leads to more jobs; and thus lower wages lead to more jobs. 

Neoliberalism bites in the global south

With these ‘successes’ neoliberals were in a position to push for the application of neoliberal solutions to economic difficulties facing both economies of both the imperialist centre and the global south. These changes were pushed by both the victory of openly neoliberal politicians such as US President Ronald Reagan and British PM Margaret Thatcher, and in the case of Australia, France, and Germany social-democratic (or more accurately social-liberal) governments. 

In these countries the attacks were pitched as necessary to maintain competitiveness, the rejection of social goods, and general social responsibility for the collective good – and the assertion, in Thatcher’s words, that “there is no alternative”. In many global south countries, resistance to change came from governments, who were unwilling to go as far as demanded, then the levers of international financial institutions as such as the World Bank, International Monetary Fund (IMF), and World Trade Organisation (WTO), which sought to tie loans and bailouts to deregulation and privatisation of countries’ resources.

These institutions routinely operated on a gaslighting framework where the people whose economies had failed under the strain of neoliberal restructuring were told that the problem was not the changes that was enabling corporations to extract billions in profits from the countries for little return, but rather that that their economies had not been restructured enough and the recipe for their situation was more and more privatisation and deregulation.  

Can neoliberalism be defined?

So what is neoliberalism? There is no definitive prescription of what neoliberalism consists of, which is why its advocates can so readily dismiss its existence.

Neoliberalism began as a small intellectual society founded at Mont Pèlerin in 1947, initially heavily influenced by the ideas of Austrian economist Friedrich Hayek, but similar societies and think tanks were established globally. These organisations sought to take over and influence university, institutional, and governmental economics programs, forming what Philip Mirowski refers to as the “neoliberal thought collective”

These interlinking bodies do not so much articulate a coherent policy doctrine as seek to build and inculcate policy discussions with neoliberal ideas, which may well be at odds with each other, but have the effect of co-opting and subsuming the language of other movements, but also creating a situation where people are presented with not a choice between neoliberalism or an alternative solution, but simply varying forms of neoliberal solutions – which both, in George Lukács’ view is an articulation of the power of neoliberalism as a hegemonic discourse, but also reinforcing Thatcher’s dictum that “there is no alternative”.

Neoliberalism as a response to capitalist crisis

Neoliberalism constitutes a political project aimed at weakening the political power of the working class, asserting the political power of the capitalist class and seeking to establish profitable avenues for capital investment (Harvey, D. 2007. “A brief history of neoliberalism”. Oxford University Press, Oxford.)

Key features of neoliberal projects include:

  • Reducing barriers to the movement of capital by both removing barriers to capital investment and shattering trade barriers; 
  • Increasing barriers to the movement of workers – which results in increasingly constrained rights and marginalisation for migrant workers (this includes open calls to movement being linked to migrants’ wealth);
  • Prying open more aspects of social life for capital investment – privatisation and ownership of water, for example, exemplified by the 1999-2000 water wars in Cochabamba, Bolivia, between the community and the the Nestlé corporation;
  • Opening of government services to capitalist competition, whether through direct privatisation; corporatisation; “public-private partnerships”; access by government agencies or the introduction of “voucher systems” to enable government subsidisation of the entry of private capital into the provision of social services; and at the same time, deregulating costs. This is often articulated in terms of enhancing consumer “choice”;
  • Reduction in government spending, primarily premised on the justification of the need to reign in deficits, although this has rarely been achieved (throughout the neoliberal decades the US’s budget had regularly been in deficit). Instead reductions occur primarily as a consequence of declines in government income via the narrowing of the tax base to be more heavily reliant on working people, and a redirection of government spending away from social spending on the working class and the promotion of worker-funded retirement funds – which both reduce government responsibility and make massive levels of capital available for speculation on capital markets. For example, the Australian Superannuation Funds amounted to to $AU2.8 trillion in funds at the end of the March Quarter of 2019 .

Weakening the strength and power of organised labour 

The outsourcing of work occurs both within public services and in private companies, often posed as leading to cheaper costs, Outsourcing works to undermine the bargaining power both of the outsourced and non-sourced workers, but tends to have higher overall costs due to the labour hire companies’ own need to provide their own work materials. 

The tying of wage increases to productivity increases has resulted in a significant shift in the share of GDP to profits away from wages, as workers are forced to work increasingly hard to see their wages maintain pace with inflation 

The shifting the cost of the reproduction of labour onto the working class has occurred through a range of mechanism including:

Shifting the burden of paying for the state apparatus via increased taxes on workers and the reduction taxes on capital; 

Reducing spending on social services – via either total elimination of services or means-testing services.

The 2008 crisis and beyond 

The 2008 global financial crisis and subsequent Eurozone crises, with the accompanying response by governments have been seen by some as signalling the death of neoliberalism. However, as Mirowski and others would argue, the responses to these crises instead reflect a deepening of neoliberalism – in that they have resulted in the efforts of saving capitalism being carried on the back of workers, while international capital has largely been free to continue to reap massive profits and pay out dividends and bonuses even as they were receiving public subsidies to survive.  

In response to the global financial crisis (GFC), the US government bailed out banks and financial institutions to the tune of of $US4.6 trillion. This was bankrolled by US taxpayers. The US and other governments facilitated banking consolidation to “save the system” – handing billions in assets to surviving major banks. 

In response to the failure of the “big three” US auto manufacturers, the then Obama administration provided a bailout of $US80.7 billion. This bailout was premised on the tearing up of workers’ collective agreements with demands that workers make significant concessions on their working conditions in order to keep their jobs. 

In Europe, Ireland’s opening up of the purchase of non-performing loans to cheap purchase by vulture funds has driven up housing prices in Dublin at a time of acute economic decline. We also continue to see – in the face of the imminent destruction of our planet – continued refusal and obfuscation by governments and by capital to take serious action to slow and hopefully stop action to combat climate change. The US and Australian governments in particular continue to subsidise the fossil fuel industry .  

Factors behind the growth of the far right

The past three decades have seen a growth of the far right in a wide range of countries, which has coincided with a decline and weakening of the left. This shift has been partly premised on deindustrialisation of certain economies and the erosion of the welfare state, which left-wing parties have at times been responsible for, particularly when in government coalitions with right-wing forces.  

This has resulted in understandable anger and frustration among sections of the working class and the petite bourgeoisie – anger which the right has demagogically sought to direct into anger at marginalised communities, which it blames while at the same time cynically supporting many of the attacks on working people. 

In France for example, Marine Le Pen’s National Front – now National Rally – has sought to court a range of marginalised communities, including Jewish, Islamic, and Queer communities by painting itself as the only force capable of protecting them from “marriage equality” and Islamic fundamentalism respectively. 

Part of the growth of the far right can be explained by the reality that the interests of capitalist class are not homogeneous – the capitalist class is made up of fractions that reflect different interests within its own class. The far right reflect interests of capitalist class fractions that would benefit from a more nationalist framework. Moreover, the far-right in a range of countries have a long history of supporting policies that are not in the interests of working people or the petite bourgeoisie. 

This includes support for:

  • deregulation and privatisation;
  • cutting of legislation which limit pollution; 
  • cuts to social security;
  • attacks on working people.

Left demands opposing neoliberalism

Despite this record, the far-right has taken advantage of the complicity of social-democratic and other left parties in the implementation of neoliberalism to seek to present themselves as the only opponents of austerity and the dislocation of the working class. This includes seeking to cynically accuse social democracy and the left more broadly of abandoning workers for support for multiculturalism and the support of other marginalised communities – causes that the left are more likely to support, but which is totally unrelated to the implementation and support for neoliberalism. 

In response to this challenge, it is important that the left is seen as putting forward proposals that address the needs of working people without giving ground to attacks on marginalised communities. Such demands would include:

  • In the event of mass foreclosures government should protect owner-occupiers;
  • Ensuring our demands are around universal provision of services rather than accepting means-testing for access;
  • Ban redundancies in profitable companies;
  • Job creation through limiting overtime and reducing working hours with no loss in pay;
  • Support for a universal basic income – but it must be set at a level which is liveable, and there must be strict controls on rent/commodity prices to ensure that it is not simply consumed as increased profits;
  • Ending of speculation and separating retail banks from investment banks;
  • Caps on wage ratios between senior managements and the lowest-paid workers;
  • Lifting company tax and personal income tax threshold for higher-income earners to fund an expansion of social services;
  • Reabsorption of outsourced social services back into the government – to facilitate collective bargaining and improved wages for workers in these vital and essential services;
  • Legislate to require companies operating in a country to at minimum comply with that country’s standards when operating in other countries;
  • Legislate to enable workers the option of creating co-operatives in companies facing closure or sale;
  • Give workers veto rights on restructuring plans.

While such demands seem unrealistic in the context of more than 30 years of retreat and defeat globally for progressive movements, it is important for us to consistently challenge neoliberal hegemony and to always, to quote Che, “be realistic and demand the impossible”.

Lisbeth Latham is a contributing editor to Irish Broad Left. You can follow her on Twitter @grumpenprol.

Barnyard socialism revisited: Farmers are victims of market manipulation

By Niall Monaghan.

For what toil the sons of Róisín, is it pennies?

In this period of increased focus on the climate breakdown, our primary producers are often perceived as holding back progress. They are commonly viewed as another polluter that must be challenged to change their ways.

But farmers are generally not multinational corporations solely focused on selling us things that we either don’t need or are bad for us. Farmers are workers at the bottom of a supply chain, which produce the most essential things for our survival. They are price-takers not price-makers because they have very little bargaining power.

Like any other body of the Irish workforce, they deserve respect and a fair standard of living based on their labour. Even in places like Tubbercurry, County Sligo, or Glenties, County Donegal, they have not been insulated from the scourges that affect the rest of the modern economy and political thought – neoliberalism and globalisation.

A common misconception has arisen in recent years that farmers are making money hand over fist as they not only profit from their products but also are directly supplemented by EU funding. However, the reality is that these payments are not a supplement but rather a drip-feed fund to keep an industry on its knees from collapse; it is the outworking of a failed system.

Subsidies keeping farming industry from collapse

The reason farmers are supported is not EU generosity but more so that we depend on this system and cheap labour to keep food prices down. In fact, the surplus left between the prices farmers were paid for their products and their costs shrunk by 16.1 per cent in 2018, resulting in a 15 per cent drop in farm incomes.

Here is the chilling reality for the average farmer in the west of Ireland – let’s call him ‘Joe’. Joe is a beef farmer, receiving the industry average EU payment for his region, €9,881. Not unusually, this makes up about 103 per cent of his income.

Put simply, after everyone is paid Joe is making a loss consistently and depends on his EU Common Agricultural Policy (CAP) payment to cover his losses and to be able to survive. This equates to less than half of the living wage in 2019. Those on the right will assume Joe is a bad businessperson and we should not be subsiding his loses. However, since Joe earns the average salary for his sector the problem is not Joe but rather the market, right?

Supermarkets and food giants suppress prices

Let us take a closer look. Joe sells his carcasses to the beef processor who in turns sells them to the supermarket. The retail price of his product can be broken down to 51 per cent for the supermarket, 29 per cent for the processing factory and the remaining 20 per cent for Joe, who does the vast majority of the work.

The two actors above Joe in the food chain are constantly doing their upmost to ensure they pay as little as possible for his product. Supermarkets, for example, do this by below-cost selling. This involves selling Joe’s products below the purchase price. The aim of this practice is to undercut the competition. That competition is usually small, independent retailers that then pressure Joe to lower the price of his products or they will just purchase them from the nearly supermarket.

After this is achieved the objective, or fair price, of the product has been lowered and becomes the new norm, affecting the price Joe is offered in future. This practice is also designed to push competitors completely out of the market so he will have fewer options of who to sell to, thereby weakening his bargaining position further.

While the supermarket is focusing on the sale price, the food processing factory is focusing on the price they buy the product for. The food processing industry in Ireland is highly concentrated: the three biggest factory groups in Ireland had started out by owning single factories and they now control 60 per cent of the kill in Ireland and Britain, as well as further factories in Eastern Europe.

This allows them to act as a cartel and often offer farmers a price below the cost of production. The farmer has a perishable product, which leaves them little scope to negotiate. Traditionally the only weapon available to the farmer is his or her ability to negotiate in times of short supply.

Have the food processing factories been cunning enough to find a solution against this rebalancing of the scales? You can bet your bottom dollar they have. In recent years, they have established their own feedlots, which are grassless industrial factory farms where animals are grain-fed to fatten more quickly and be ready for slaughter.

Feedlots now constitute 18 per cent of the weekly kill in Ireland. These are used strategically by factories to release cows into the market when supply dwindles, thereby out-manoeuvring the farmer. The reason factories do not use these all year round is because the Irish public prefer pasture-reared animals for animal welfare reasons, and rightly so.

Government ignores cartels and market manipulation

Now that we understand how the food chain acts to squeeze the farmers, we would assume government intervention would have put in place measures to combat such exploitation. But this is wishful thinking at best.

The approach of the Irish government and the EU has been to ignore the market manipulators and plaster over the issue by subsidising the beef farmers’ losses. We all need to think long and hard about what this means: instead of putting in place measures to protect farmers from such exploitations, we have taken the approach of watching the farmers make a loss and then sending them money to cover those losses and just about survive.

EU money comes from European taxpayers; therefore the EU is facilitating a system where public EU funds are used to allow supermarkets and processors make a greater profit from paying unsustainably low amounts to farmers. This is effectively taxpayer-funded aid to multinational supermarkets.

Free trade deals will devastate Irish farmers

The European Commission is also negotiating and agreeing free trade deals to facilitate the export of things like German car parts in exchange for the import of cheap beef. The proposed EU-Mercosur free trade agreement is a perfect example of this: the EU will allow 100,000 tonnes of beef, mostly from Brazil, which will cause the price of EU beef on supermarket shelves to plummet.

Those on the neoliberal right are supporting such free trade deals and coming out against a ban on below-cost selling, when they are fully aware that such positions make deep EU intervention in the market essential, in the form of cash subsidies to protect farmers from bankruptcy.

Some have even gone as far as supporting a financial cut to the CAP. This radical position has been taken knowing that without protection, regulation or subsides, European farmers will be something you have to learn about in a museum.

The logic of this position is clear – there is an entire developing world sector just waiting to be exploited, so why waste money keeping in place a system, EU agriculture, with a higher cost base? They are quite happy to have all food imported from places where production is not burdened by animal welfare or environmental laws. For them, not only would food get cheaper but we could remove agricultural emissions and preach to the rest of the world how Europe has moved closer to our climate targets.

How can Irish farmers fight the tide?

As Clann na Talmhan emerged in 1939, farmers themselves must be at the fore of resisting this system and fighting for change. Two organisations have emerged in recent years that are fighting for those farmers on the edge of bankruptcy, the Irish Natura And Hill Farmers Association (INFHA) and, more recently, the Beef Plan Movement.

The Beef Plan Movement have now have amassed 15,000 members and hope to get to 40,000. This would be a big enough portion of the weekly kill, 50 per cent, to have a major impact on production and make a shortage unmanageable for the factories. This would allow them to create a supply crisis if the factories refuse to play ball.

Further to this, they are examining setting up cooperative processing factories to bypass the industry completely and negotiate directly with supermarkets, which would give them a significantly bigger chunk of that per euro percentage.

Whether they are conscious of this or not, these organised farmers have seen the flaws of the system they operate in and came to the same conclusion that we have come to on the left: the market needs regulation to curtail exploitation of the workers and those businesses at the bottom. Not only have they identified the problem but have realised what they can achieve if they band together. Talk of sending empty cattle trailers to the factories, as a message, sounds to me like the kind of direct action Connolly or Larkin could have got behind.

What should the government do?

In terms of legislation, we must as a matter of urgency ban below-cost selling and even look at the feasibility of banning a company offering a farmer below an agreed cost of production, outside of times of great oversupply. Fine Gael, which is committed to non-interference, has flatly rejected these ideas, which begs the question as to why such a high percentage of farmers vote for them?

Farmers cannot continue to vote against their interests if they are to survive. Voting for Fine Gael because they are seen as the traditional party of rural Ireland is like taking up smoking because Benson and Hedges sponsor the local GAA team.

Finally, if we fail and agriculture is fully shifted to the developing world to be exploited, it is not only Joe that will be out of business but the town that depends on him. This was confirmed by a recent study, which stated every €1 of direct support for cattle and sheep farmers underpins over €4 of aggregate output in the rural economy.

The health, housing and homelessness crises should give you an indication of how likely it is that the neoliberal Fine Gael would be wading in to replace that output in the rural economy.

Niall Monaghan is a Sinn Féin policy advisor in the European Parliament, working on the Agriculture and Rural Development Committee.

Trade unionists can bring class politics to debate about united Ireland

By Ruairí Creaney.

Irish unity is on the agenda. Across Ireland, it is being discussed in the media, at dinner tables and workplaces on a daily basis. While the endless calamity of a Brexit led by hard-right Tories, and the possibility of a hard border being imposed on our country against our will, has ensured that the debate on Irish unity has largely centred on our membership of the European Union, there is much more at stake.

The debate has begun, but it has struggled to move beyond questions of national identity and what Irish unity would mean for businesses and trade. Little attention has been paid to what it would mean for the working people who make up the majority of this island.

To broaden this debate, a group of us in the Irish labour movement recently launched Trade Unionists for a New and United Ireland (TUNUI), an initiative aimed at shifting this debate to the left and at putting economic and social justice at the heart of the discussion, rather than just focusing on what it would mean for the business classes. We want to articulate a specifically trade union-led vision for Irish unity and why this issue is one that should be a concern of workers.

So far, we have secured the public support of 150 trade union officials and senior activists, including two veterans of the famous 1984 Dunnes Stores anti-Apartheid strike. To properly initiate the debate on constitutional change within the labour movement, we will be hosting a conference, entitled ‘Uniting Ireland – Uniting Workers’ in Dublin this summer. We are inviting trade unionists and progressive activists from across Ireland to attend this conference and take part in this historic and exciting debate.

Bringing class politics to this debate

The trade union movement is uniquely positioned to offer three important contributions to the discussion on reunification.

Firstly, TUNUI want to bring class politics into the debate. The partition of Ireland not only divided our country geographically; it divided the labour movement and it divided working people along sectarian lines in the North. This product of the counter-revolution benefited only the wealthy establishment on both sides of Britain’s border in Ireland.

The trade union movement represents the interests of the mass of working people who create society’s wealth as opposed to the wealthy minority who control it. We recognise that the interests of working people are in direct conflict with the bosses. When workers seek better pay, the bosses seek ‘efficiency savings’ in order to boost profits.

No such thing as a ‘national interest’

Consequently, we recognise that while class conflict exists, there can be no such thing as an Irish ‘national interest’, as if we all seek the same thing. Nations are made up of classes with competing economic interests. The economic interests of Michael O’Leary, for instance, are very different from those of the Ryanair baggage handler. The interests of the tax-dodging corporations and the lawyers and accountants who facilitate them are not the same as an overworked nurse or a primary school teacher.

An opportunity for a new beginning

Irish reunification will be a chance for our country to have a new beginning, and will present an opportunity for progressives to ensure that the mistakes of the last century are not repeated. Constitutional change will mean that we could steer our economy from serving the interests of multinational corporations and towards serving the needs of working people. That means ending the scandalous tax haven system in the south, establishing universal free health care and introducing proper trade union rights for every worker.

Throughout the debate on Irish unity, much of the focus of civic nationalism has understandably been placed on protecting the rights of Irish citizens in the North that are under threat as a result of Brexit.

Little focus, however, has been put on advancing the economic and material conditions of working people. The whole discussion up to now has been contained strictly within the realms of what Mark Fisher described as ‘capitalist realism’.

The ownership of industry and our natural resources is not up for debate. The imbalance of power between capital and labour will not change. The harsh rule of the market is seen as an inevitability. As with so much else in our neoliberal age, ‘there is no alternative’.
We seek to challenge this narrative. We want to ensure that constitutional change will lead to a massive social transformation that will improve the lives of working people.

More that unites than divides us

Secondly, the trade union movement is Ireland’s largest civic society organisation, encompassing people from every ethnic background. There is a colonial myth that working people in the North are bloodthirsty tribes that despise each other and are incapable of having a civilised debate about our collective future.

Furthermore, there is an insidious and snobbish narrative that unionist workers are afraid of having a debate about Irish unity. This is offensive, patronising and dismissive to an entire section of society and ultimately displays an underlying prejudice against working-class people.

Trade unionists have the ability to break down racial, ethnic and sectarian barriers and organise working people based on their class interests. We want to ensure that this debate moves beyond the issues of identity of ‘unionist’ and ‘nationalist’ and towards broader issues of who gets to own our natural resources and how the wealth of this country is distributed. We know that there is more that unites us than divides us, and class politics is how we achieve that unity.

Independent advocacy of working-class interests

Thirdly, and most importantly, we want to empower working people to advance their own rights. Some in civic nationalism have called on the Irish Tories of Fine Gael to protect the rights of nationalists in the North. Again, these rights have not included economic rights.

No mention has been made of the fact that Fine Gael has always opposed the basic right of workers to collectively bargain; that they are opposed to the right to housing; and actively undermine the public health system in order to promote the private for-profit health sector. Why would anyone seriously believe that these people are suited to protect the rights of people in the North when they are undermining basic rights in the south?

Organise for real change in trade unions

Rather than appealing to Tories like Leo Varadkar or the institutionally neoliberal European Union, the most effective way for working people to protect and advance their rights is by organising into strong trade unions and fighting for those rights. This is how we won the 8-hour working day, the weekend, paid annual leave and every other right many of us take for granted.

For those of us involved with Trade Unionists for a New and United Ireland, reunification is not about nationalism. It is about democracy and participation.

We are not nationalists; we are trade unionists, democrats, socialists and internationalists. The debate on Irish unity has already begun, and it is vital that trade unionists step up and articulate our vision for society.

If we fail to do so, we will abandon that ground to corporate interests and they will mould a new society in their interests. This would be a continuation of the tax haven status of Ireland, the crumbling public health system and mass homelessness. Trade unionists avoid this debate at our peril.

Ruairí Creaney is a spokesperson for Trade Unionists for a New and United Ireland. Follow him on Twitter @RuairiCreaney.

Image above : Trade Unionists for a New and United Ireland at their Linen Hall Library launch in February. Pictured from left are former Siptu division organiser Christy McQuillan, Debbie Coyle of Unison, Mick Halpenny of Siptu and spokesman Ruairí Creaney. Picture: Mal McCann.

Climate Emergency Manifesto launched by the European Left

By Damien Thomson.

On Tuesday 16 April, Swedish teenage climate activist Greta Thunberg addressed the Environment Committee in the European Parliament in Strasbourg, calling for “Cathedral Thinking” on climate action – a reference to the huge and immediate mobilisation of empathy, panic and money at the sight of the Notre Dame in flames. The real panic, she said, should be about the “house on fire” – the planet – leading to a mobilisation of funds, emergency emissions reductions and state-led direction of the transition.

Today in Strasbourg, the Left group in the European Parliament GUE/NGL (European United Left/Nordic Green Left), has launched a Climate Emergency Manifesto ahead of the European elections taking place at the end of next month, firmly marking Just Climate Action as the group’s number one priority.

The manifesto, which explores six overarching demands for effective climate action, comes off the back of two recent developments: the United Nations’ Intergovernmental Panel on Climate Change (IPCC) Special Report from October 2018 strongly pushing for policymakers to limit global warming to 1.5°; and the global social movement known as ‘Fridays for Future’. These two developments have shaken the political foundations of the European Union (EU) in particular, and called into question its climate credentials. 

Climate emergency demands emergency response

The latest IPCC report paints a dark picture of the current pathway we are on. It gives us less than 12 years to enact “rapid, far-reaching and unprecedented changes” to every aspect of the economy to stay below 1.5° of global warming. We are already at 1° of warming above pre-industrial levels, and at 1.5° the chain reaction of climate catastrophe will be unleashed as we surpass the tipping point. We are already in climate chaos at cliff-edge: the emergency brakes need to be activated now.

At the 24th UN Climate Conference held in 2018 in Poland (COP24), Miguel Arias Cañete, European Commissioner for Energy and Climate Action, stood up on a platform with the Canadian environment minister and other posing ministers to hold a big banner stating ‘High Ambition Coalition’. This was their way of trying to affirm that they are the leading parties at these high-level climate negotiations – leading for higher climate ambition. Needless to say, no-one was really convinced. 

The EU’s feeble attempt to promote itself as a global climate leader looks even more pathetic now in the context of over one million students across the globe coordinating a world-wide strike on 15 March 2019.

These young people are clearly not impressed with the self-congratulating Commissioner Arias Cañete’s level of ambition, nor of any state that claims it is doing enough. After all, the CV which qualified him for the portfolio he runs is based on his family ties to the oil industry itself. The next global strike scheduled for 24 May 2019 will set the tone for the European elections, demanding that radical climate action is on the agenda. 

As students gathered last month with their placards and chanted in more than 1,000 locations in over 100 countries worldwide, there wasn’t any rallying to congratulate the EU or the ‘High Ambition Coalition’ Ministers. Nor did young people chant “Carbon Tax Now” or “Secure the Rulebook!” They demanded climate justice.

The manifesto presented today by GUE/NGL is a response to this call and is commensurate to the demands of the striking youth.  A central demand to the global movement is a declaration of climate emergency – to effect an emergency response to an emergency situation. This manifesto is the Left’s way of hitting the panic button and declaring a climate emergency, as well as putting its climate commitments out there before the elections for all voters to see. 

Left approach rejects the market’s pseudo-solutions

The anti-capitalist Left has a nuanced approach to climate action – one that is clearly distinct from the Greens and Social Democrats, and of course, the Liberals and beyond who always appropriate the language of climate action to cover up their prioritisation of profits.

The Greens and Social Democrats prize the market and economic growth just as much as Conservatives, and consistently vote for the liberalisation of the EU energy market for instance, withdrawing the directional control of the energy sector away from elected governments.

Any real Leftist would reject this. We demand that governments are behind the wheel on the transition rather than watching markets fluctuate, and crucially, we are the only ones that reject the perpetual growth mode – the root cause of the climate crisis.

By removing the responsibility of climate action from governments and lawmakers and placing it in the invisible hands of the market, the Greens and Social Democrats have actively played an important role in this climate disaster.

While their intentions may well-motivated, the Greens have been the driving force in pushing climate responsibility off the desks of world leaders, by pushing for the EU emissions trading scheme (ETS) carbon market, commercialised energy markets, the monetisation of pollution and carbon pricing – all policy recommendations from the fossil fuel industry itself. 

Climate crisis requires anti-capitalist action

The conclusion here is clear – only by being anti-capitalist can one be a climate activist. Anything less than this is the preservation of the status quo. Greening capitalism is indeed the most sinister form of climate action delaying. 

The manifesto launched by the Left goes to the very heart of the economic model that has created climate change. Overturning global capitalism may not be realistic within the next 11 years, given how it morphs and self-replicates in the search of commodities, but the forces of capitalism can be resisted. It is precisely here – in counteracting capitalist forces – where an effective response to the climate crisis lies. 

Keep fossil fuels in the ground

The solutions to climate change must come from outside the capitalist framework, beyond the logic of a market transition.  This is why this manifesto is about directly regulating the fossil fuel industry – keeping fossil fuels in the ground and phasing out their use altogether with strict time-bound targets.

It is about massive public investment, matching the financial responses already seen at times of war, responding to terrorism, or saving the banks. It is about regulating sectors to ensure sustainable practices, stopping the wild flurry of extraction and environmental abuses produced by capitalism. The Left is the only group bringing forward this critique and this response.  

Core to this manifesto, and a prism used throughout it, is that of the principles of climate justice. For the Left, these are not just pretty words to speckle our manifesto – they are guiding tools and tests. We stand for climate policies that empower communities, not debilitate them. We stand for a rights-based approach to climate action, including a right to renewable energy. We want an integrated sustainable development approach to climate action – ensuring the fight against climate change interlinks with the struggles against poverty, gender inequity and socio-economic inequalities. 

Just and effective climate action is our number one priority, and anything less than this is a climate crime. 

A copy of the manifesto in English can be found here. Other language versions can be found on the GUE/NGL website

Damien Thomson is a contributing editor of Irish Broad Left and the climate campaign coordinator for the GUE/NGL group in the European Parliament. Follow him on Twitter @dmacthomais.

The eurozone’s ‘soulless market’ and its thuggish enforcers

By Emma Clancy.

In his open letter to Europeans last month, French President Emmanuel Macron revealed that he feared Europe “has become a soulless market” in the eyes of its citizens. Twenty years after the introduction of the common currency, and more than a decade after the global financial crisis, the soulless market is in trouble – again.

The eurozone has experienced a period of anaemic GDP growth over the past five years, during which a peak of 2.4 per cent growth in 2017 – the highest in a decade, but a rate that pre-crisis would have been considered to be very low – was celebrated as heralding the final end of the crisis, and christened with the hashtag #euroboom.

After a dramatic fall in growth in 2018 in which growth slumped to 0.2 per cent in the third quarter, the European Central Bank (ECB) and the European Commission have both sharply revised downwards their growth projections for the eurozone in 2019. In its February Winter Forecast, the European Commission said it expects eurozone growth to slow from 1.9 per cent in 2018 to 1.3 per cent this year and 1.6 per cent next year.

The ECB followed in March with a gloomier quarterly forecast, projecting growth to slow to 1.1 per cent in 2019 and 1.6 per cent in 2020. This announcement was followed by several ECB policymakers anonymously briefing Bloomberg that they thought the projections were still too optimistic. Apparently abandoning all pretence of hope of achieving its target of “close to 2 per cent” inflation at any point in the near future, the ECB also cut its inflation projections to 1.4 per cent for this year, 1.5 per cent in 2020 and 1.6 per cent in 2021.

In Italy, growth was negative for two consecutive quarters in the second half of 2018, meaning the country has officially fallen into its third recession in a decade. The grim surprise came from the export-led manufacturing powerhouse of the eurozone: Germany avoided the recession label by the skin of its teeth, recording negative growth of -0.2 per cent in the third quarter and zero growth in the fourth. Data released last week showed that German industrial production and manufacturing orders and fell in February, with a survey this week reporting “both total new orders and export sales are now falling at rates not seen since the global financial crisis”.

Constitutional austerity

Addressing a bankers’ convention in Frankfurt in November, ECB President Mario Draghi outlined the weak and fragile nature of the eurozone’s recovery: “Since 1975 there have been five periods of rising GDP in the euro area. The average duration from trough to peak is 31 quarters, with GDP increasing by 21per cent over that period. The current expansion in the euro area, however, has lasted just 22 quarters and GDP is only around 10 per cent above the trough. In contrast, the expansion in the United States has lasted 37 quarters, and GDP has risen by 21 per cent.”

What can explain the brief period that saw eurozone growth reach the dizzying height of 2.4 per cent in 2017? In a word – a massive fiscal expansion. But the expansion did not take place in the eurozone; it was a result of the fiscal policies implemented in the US, Japan and China, in the latter two cases funded by their respective central banks. Such an expansion could not possibly take place in EU member states, which must stick to the absurd, arbitrary and stifling debt and deficit limits laid down as gospel in the Stability and Growth Pact (SGP) and Fiscal Compact.

The slow growth and grinding recovery in the eurozone can be partially explained by the post-crisis austerity shock treatment applied to the periphery by the Troika, but the architecture of the common currency has acted as a brake on sustainable growth and convergence since day one. The euro has been built on an enduring effort to constitutionalise austerity, an effort that continues today despite all of the evidence demonstrating that it causes economic contraction.

‘Purely ideological and economically unsound’

The Maastricht Treaty of 1992 enshrined the so-called ‘convergence criteria’ – a set of rules members and potential members of the common currency were obliged to follow. To join the euro, states had to pledge to control inflation, and government debt and deficits, and commit to exchange rate stability and the convergence of interest rates. As the ECB was preparing to begin operating to control inflation and interest rates, Germany pushed for the adoption of an EU-wide SGP in 1997, including non-eurozone members, to enshrine the fiscal control aspects of Maastricht, and more generally to increase EU surveillance and control over member states’ national budgets.

The convergence criteria are purely ideological and economically unsound. When a eurozone member state experienced a downturn, its deficit would inevitably rise as a result of lower tax revenue and higher expenditure on social security. But when the convergence criteria kicked in, causing governments to cut spending or raise taxes, it would invariably worsen the downturn by dampening demand. Even French neoliberal Pascal Lamy, formerly the Director-General of the World Trade Organisation, called the SGP “crude and medieval” when he was EU trade commissioner.

The blanket, one-size-fits-all fiscal rules in the criteria – that member states must keep public debt limited to 60 per cent of GDP and annual deficits to below 3 per cent of GDP – were proposed by Germany, based on its own national SGP structure. In 2010, Germany proposed the reform of the Pact to make it stricter and more enforceable through the adoption of the so-called ‘six-pack’ and ‘two-pack’. Despite the vast evidence by this stage that the SGP was counterproductive and unenforceable, Germany pushed for the fiscal rules to be tightened yet again in 2012 through the Fiscal Compact Treaty, which created the obligation for the convergence criteria targets to be inserted into the national law of the ratifying states.

Fiscal straitjacket

The Fiscal Compact Treaty, signed by all EU Member States with the exception of Britain, the Czech Republic and Croatia, enshrines the rule that members in excess of the limit are obliged to reduce their debt level above 60 per cent at an average of at least 5 per cent per year. The structural deficit rule – called the “balanced budget rule” – must be incorporated into the national law of signatory states under the Fiscal Compact.

Not satisfied with the Fiscal Compact being an intergovernmental treaty, the Commission proposed last year that it be permanently enshrined into EU law. The Commission wanted the Fiscal Compact’s automatic correction mechanism to be integrated into national budgetary processes so that deviations would immediately lead to a reduction in public expenditure.

On 27 November 2018, this proposal was rejected in a tied vote of the European Parliament’s Economic and Monetary Affairs Committee. Fortunately for the Commission, it had anticipated such a possibility and had made its proposal on a dubious legal basis that provides for a decision to be taken solely by the Council of member states, and under which the Parliament only has an ‘opinion’ – despite the fact that several EU laws on the same issues have been adopted using the normal process whereby the Parliament and Council are co-legislators.

Despite the opposition of the Parliament, the Fiscal Compact is likely to be enshrined into EU law permanently – with its automatic correction mechanism, designed to remove the power to make a political decision on spending from national governments and put it in the hands of technocrats, beyond the reach of politics.

Surveillance and enforcement

Since Maastricht, the Commission has taken every possible opportunity to impose structural reforms that will exert downward pressure on wages in the belief that this ‘flexibility’ will act to increase convergence of the eurozone’s diverse economies and absorb shocks. The eurozone elites believe (or claim to believe) that if only ‘wage rigidities’ in the member states were overcome, both unemployment and trade imbalances would disappear. If only a country’s population could be forced to work for poverty wages, there would be a job for everyone; and the resulting stagnation in domestic demand would mean prices would fall and this country’s real exchange rate, which had become misaligned and risen too high, could regain its balance.

This view underpins the repeated attacks on the rights and wages of French workers, which has intensified under President Macron, as well as underpinning the EU’s overall agenda and forcing structural reforms in the member states in order to increase productivity, competitiveness and profit. The austerity imposed by the Troika was not only designed to regain market ‘confidence’ in peripheral governments, but also to facilitate internal devaluations in member states by a form of shock therapy. Of course, this adjustment facilitates not only the reduction of trade imbalances but also a sharp increase in the amount of wealth transferred from labour to capital.

The European Semester process – a yearly cycle of policy coordination between member states and the Commission – monitors the ‘progress’ of member states in implementing structural reforms that will facilitate downward movement on wages. In spring each year, EU member states submit their plans for managing public finances, including keeping debt and deficits within the SGP limits, and their National Reform Programmes, to the Commission. These plans are then assessed by the Commission, which proposes country-specific recommendations to member states, that are discussed and adopted by the Council. Then each autumn member state governments are graciously permitted to present their draft national budgets to their respective parliaments.

The next step in the drive to constitutionalise austerity is to establish a European Monetary Fund (EMF) that would replace the existing bailout fund, the intergovernmental European Stability Mechanism (ESM). An EMF could provide emergency funding for member states in a crisis, in return for strict budgetary discipline and invasive surveillance and control.

Accompanying the drive to enshrine austerity in EU law is a relentless push by the Commission to impose ‘conditionality’ over every aspect of its relationships with member states. Just one example of this is that in the EU’s next long-term budget (the multi-annual framework) for 2021-2027, the Commission has proposed to divert €25 billion away from existing ‘cohesion’ funds towards implementing austerity measures in member states. This funding stream will be targeted towards ensuring member states implement structural reforms – such as the privatisation of public services, reduction of spending on pensions, and labour reform aimed at reducing workers’ collective bargaining power – instead of being used unconditionally for direct cohesion policy: to provide support to rural and coastal communities, and support for employment, research, education and the environment.

Winners and losers

It will come as little surprise that a system designed to promote the German model of wage suppression, low inflation and export-led growth, propped up by a currency modelled on the Deutschmark, has benefited one country more than all other members of the eurozone.

In February, a German ordoliberal think tank affiliated with the ruling Christian Democrats, the Centre for European Policy, published an empirical study of the “winners and losers” from the euro 20 years after its introduction. It found that Germany was the big winner, having benefited by €1.9 trillion from the euro between 1999 and 2017, or around €23,000 per person. The Netherlands was the only other state that gained substantial benefits from the common currency. France had lost €3.6 trillion or €56,000 per person; while Italy had lost more than any other state, at €4.3 trillion or €74,000 per person.

Germany’s massive and consistent trade surplus has meant that its biggest export to the rest of the eurozone has been stagnation. But as a result of European fiscal discipline in the wake of the recession, there is not enough internal demand in the eurozone to sustain German industry. Now that a global slowdown has taken hold, and growth is slowing in China due to US trade tariffs and a debt crisis, the dangers of this economic model are exposed. If China’s latest stimulus package fails to boost demand, the German economy will certainly enter recession.

Italy, the euro’s big loser, is there already. The Italian economy is one of just two in the OECD in which GDP has failed to return to pre-crisis levels; the other is Greece. The Italian governing coalition between the anti-establishment Five Star Movement and the far-right Lega Nord faced its first test of eurozone fiscal discipline last year through the European Semester process. When it presented its draft budget for 2019, including a 2.4 per cent deficit, the Commission rejected it and threatened to enact the ‘excessive deficit procedure’ under the SGP, which consists of deadlines to comply, followed by substantial fines.

Open bias

The proposed deficit did not even cross the SGP’s 3 per cent limit. But using dubious mathematics to measure the structural deficit – what the deficit would be if the economy was at full employment – described here by Thomas Fazi, the Commission argued that the Italian economy – in recession – would be at risk of overheating if a fiscal deficit of 2.4 per cent was reached.

Instead of being technocratic, the budgetary surveillance and enforcement process is overtly political. When Macron’s government announced €10 billion in additional spending in December to defuse the gilets jaunes protests, taking France’s projected deficit for 2019 up to 3.4 per cent, EU economic commissioner Pierre Moscovici gave the thumbs-up.

“The comparison with Italy is tempting but wrong,” he said. “The situations are totally different. The European Commission has been monitoring the Italian debt for several years; we have never done that for France.” This is despite the fact that it was only in 2017 that France emerged from a long period with a deficit breaching the SGP rules.

A French treasury official agreed with Moscovici: “The situations are not comparable. Contrary to Italy, we do not question European rules. We agree that having public finances in order and reducing public debt are the right thing to do.”

Thuggishness dressed up as technocracy

The Commission is not the only enforcer policing the public spending of EU member states. The ECB has played an even more important role, throughout the crisis and in the latest clash with Italy. Its role during the crisis as part of the Troika enforcing austerity shock therapy under the bailout programmes is well known; its role in manufacturing the sovereign debt crisis between 2009-2012 as a means to force governments to capitulate on their budgetary plans, less so.

Adam Tooze refers to the ‘bond market vigilantes’ behind the massive capital flight from the periphery to the core during this period, and adds: “The role of bond markets in relation to the ECB and the dominant German government was less that of a freewheeling vigilante, than of state-sanctioned paramilitaries delivering a punishment beating whilst the police looked on.”

In May last year, during the political and market crisis in Italy arising from the temporary collapse of the coalition after the effort to appoint a eurosceptic finance minister by Five Star, EU budget commissioner Günther Oettinger openly hoped that the market turmoil “could be so drastic that this could be a possible signal to voters not to choose populists from left and right”.

The ECB’s new role, self-proclaimed in 2012, in the context of a mass sell-off of government bonds of a member of the eurozone – the situation that caused the sovereign debt crisis in 2010-2011 – is to support the state’s economy though purchasing the bonds though its quantitative easing (QE) programme. But instead of buying more Italian government bonds during this crisis in May last year, the ECB was buying less, and diverting its investment to German bonds instead.

In October the ECB announced it planned to change the ‘capital key’ it used in its €2.5 trillion QE programme from January this year. Though the ECB announced it would stop buying government bonds from the end of 2018, it is not the end of QE. The ECB is continuing to reinvest the maturing debt it holds – an estimated €117 billion in the first nine months of 2019 – back into eurozone government bonds. How much it spends, and where, is determined by the capital key.

The adjustment to the capital key will reduce the shares of 12 member states including Italy, Spain and Greece, while increasing the shares of 16, including Germany, France and Austria. One economist estimates that the change will result in about €28 billion less in reinvestment in Italian bonds, and €19 billion less in Spanish bonds than would have been the case if the change had not been made. Like the Commission’s bizarre calculation of the structural deficit as potentially causing runaway inflation in Italy’s clearly stagnating economy, the ECB’s capital key adjustment is another example of politicised thuggishness dressed up as ‘technocracy’.

Italy approaches the cliff-edge

This long stagnation caused by the SGP rules, Italy’s inability to recover economic activity to pre-crisis levels, double-digit unemployment and still massive youth unemployment have created the conditions for the election of the racist Lega Nord and the anti-establishment Five Star Movement. Following the Commission’s budgetary clash with Rome, support for Five Star has been strongly overtaken by support for the Lega. The actions of Commission and the ECB have directly contributed to the ongoing rise of the far right in Italy. It is no mystery if Italians, and Europeans, see Europe as a “soulless market”.

The threat of an economic collapse in Italy, precipitated by an inter-related banking and sovereign debt crisis, remains very real. It is exacerbated daily by the Commission and ECB. The Italian government needs to issue around €400 billion a year in public debt in order to stay afloat, which domestic banks are pushed into buying. This means Italy’s shaky bond market is highly exposed to its vulnerable banking sector, and vice versa. Banks in other EU states hold more than €425 billion euros of sovereign and private Italian debt. French banks are most exposed, holding €285 billion of this.

None of the much-touted reforms put in place in the EU after the crisis will rein in the bond market vigilantes; free movement of capital is sacrosanct. The proposal to end the ‘too-big-to-fail’ problem in Europe’s banks by structurally separating the commercial and investment activists of the banks – the so-called Bank Structural Reform – was officially withdrawn in 2017 after conservatives blocked its progress in the European Parliament and Council.

It is little wonder that there are winners and losers in the eurozone when the game is rigged and the referee is openly biased. Fears of economic collapse in Italy that peaked in May last year receded later in the year. But the country’s recession, combined with the broader global slowdown and a high likelihood of a eurozone-wide recession in the near future will push Italy closer to the cliff-edge. The deficit fetishism of the ECB and the Commission may push them off.

Emma Clancy is an economics advisor for the European United Left/Nordic Green Left group in the European Parliament, and editor of Irish Broad Left.

A shorter version of this article first appeared on the ICTU Trademark/Rosa Luxemburg Foundation blog, Brexit, Europe and the Left, on 12 April 2019.

The Left and the EU: Steering a course of principled resistance to neoliberalism

By Andy Storey.

Trawling through the website of the Irish Freedom Party (IFP) – the group calling for Irish exit (Irexit) from the European Union (EU) – is a strange experience. Amidst the xenophobia and often crude and puerile attacks on left-wingers, there are moments where those same left-wingers might find themselves nodding in agreement.

IFP support for Ireland’s “meaningful military neutrality”, for example, would raise few hackles on the Left.

Another reason for IFP opposition to the EU is that it, allegedly, “forbids state aid”. In fact, it does not, but it does seek to strictly limit such aid as a tool that governments can use to boost economic activity and equality. The potential in being freed from that restriction, and the other elements of neoliberal EU economic governance, is a point grasped by left-wing supporters of Brexit in the UK.

But the apparent enthusiasm for state aid sits uneasily with simultaneous IFP support for “slimming the state” and cutting taxes. They even endorse the widely discredited ‘Laffer Curve’, which claimed to show that tax reductions, counter-intuitively, boosted a state’s overall tax take, a proposition that is now considered bogus in the vast majority of cases.

The IFP does, implicitly at least, concede that the state might have a role in resolving issues like the housing crisis, but here their approach is overshadowed by their visceral hostility to immigration – they claim that unless free movement of people within the EU is ended then the demand-side pressure on housing will make the crisis intractable.

Which rather begs the question of how other EU countries seem to have dealt with their housing problems while remaining open to free migration across the EU. Vienna’s much-admired public housing model, to take just one example, has not depended for its success on keeping foreigners out of the city.

There is much more that could be said about the IFP. Its stance on climate change is confused and probably disingenuous. And its nativism is sometimes close to comic, such as the pledge to “support all efforts to strengthen the Irishness of Ireland”, whatever that might mean.

But let’s stick with economic policy for now. One of the billboards it has recently erected claims that a “normal self-governing state… can trade globally”, while the website bemoans the fact that Ireland (within the EU) “cannot make bilateral trade agreements”. You might have thought that the Tory Brexit pantomime would have given the IFP some pause for thought regarding the difficulties of maintaining (existing) and establishing (new) trade relationships while exiting the EU.

Economic consequences of exit

In reality, Ireland leaving the EU alongside the UK, as Irexiters urge, would be economically damaging to this country, as a recent study by Davies and Francois indicates. They argue convincingly that any Irexit would generate even worse economic outcomes than Brexit alone (which will be bad enough for Ireland) – while trade with the UK would be less disrupted by Ireland following the UK out the exit door, trade between Ireland and the EU (which is more important than that with the UK alone) would be damaged to a much greater extent.

Davies and Francois conclude that “Irexit in any form is likely to make a bad situation worse” on the grounds that “erecting barriers to trade with the continent would have a massive impact on Irish global economic integration”, with low-skill and low-income workers (the very people whose interests the Left should be prioritising) hardest hit.

And this is only considering trade effects. In all likelihood, Irexit would also see a downturn in foreign (especially US) investment into Ireland on the grounds that we would no longer constitute an uncomplicated bridgehead into the EU market. By way of precedent, foreign investment in the UK has already been negatively affected by Brexit.

Ireland, as many commentators have long argued, is overly dependent (to a much greater extent than is the UK) on such multinational investment but, as the cliché goes, we are where we are, and the Left cannot now afford to be blasé about this. IFP leaders might have no problem telling the workers who depend on those multinationals that their jobs can be sacrificed in order to “strengthen the Irishness of Ireland”, but it is not a task I would relish myself.

It is worth noting that the immigration restrictions the IFP wants to see implemented would also have negative economic consequences. The (partial and uneven) Irish economic recovery after the 2008 crash was, as my colleagues Sam Brazys and Aidan Regan have shown, largely due to foreign investment from, especially, US tech companies, and those companies would not have come to Ireland had they been unable to freely recruit the skilled, specialised labour they needed from elsewhere in Europe.

Those economic considerations doubtless go a long way towards explaining generally positive Irish attitudes towards the EU, as revealed by the most recent Eurobarometer survey data (collected in November 2018). The data show that 64% of Irish people hold a positive view of the EU (the EU average is 43%) and only 8% hold a negative image of it. Seventy five per cent of respondents express satisfaction with how democracy works in the EU, and 76% feel Irish interests are taken into account by the EU. Seventy per cent of those sampled in Ireland do not believe that the country’s future would be brighter outside the EU.


But there are some important qualifications to be taken into account concerning these survey results. The first, as the survey managers themselves point out, is that the views are often ‘soft’ – for example, people’s image of the EU tends to be somewhat rather than strongly positive.

Secondly, and relatedly, these views can change pretty dramatically within a short period of time. Only 8% view the EU negatively now, but that proportion was 31% in 2012 (when the figure for those with a positive attitude was just 35%). Back in 2011, just 38% thought the EU took Irish interests into account, compared to 76% at present.

Thirdly, views of the EU may be broadly positive, but trust is a scarcer commodity – 50% proclaim trust in the EU (up from 24% in 2011) but 38% are still distrustful. Given the EU’s outrageous insistence on Ireland repaying the socialised debts of private banks, that distrust is entirely legitimate and understandable.

A summary paraphrase of what the survey respondents are saying to the EU might read as follows: “we like you, now, and we think we are better off, for now, being a member, but we don’t trust you as much as you might think”.

The relatively high level of distrust may help explain why 25% of people think Ireland’s future prospects would be better outside the EU, a sizeable constituency that could rise if circumstances changed (such as the EU being seen to insist on a post-Brexit hard border on this island) and one which is not currently represented by any major Irish political party. That is the constituency that the IFP (and its allies) is pitching to.

The argument about sizeable sections of the electorate being unrepresented by the current parties is not, of course, confined to stances towards the EU: 38% of voters were against same sex marriage in 2015, 34% were against the legalisation of women’s reproductive rights in 2018. No substantial political party speaks for the No voters on those issues.

The newly formed Aontú party (led by former Sinn Féin TD Peadar Tóibín) is clearly aiming to hoover up that socially conservative vote, and its recent launch saw its leader make a play for the anti-immigrant vote also, albeit under the dog-whistle guise of calling for a “debate” on immigration that would reflect people’s supposed “growing unease and concern” on the issue. Aontú’s position vis-à-vis the EU is not yet known.

Left’s orientation

So where should the Left go in this context? Well, obviously, not towards social conservatism: that would be wrong in principle but also in practical terms – opposition to LGBTQ+ rights and to a woman’s right to choose is a minority stance, and one that seems set for long-term secular decline in Ireland. Hostility to immigration may, sadly, not be similarly destined for the dustbin of history.

More specifically, how should the Left approach EU issues? The points made above – that Ireland leaving the EU would be economically damaging at present, and that the vast majority of people support (for now) Ireland’s continued membership of the EU – are important, but at the same time they do not invalidate the serious criticisms left-wingers are obliged to make about EU policies and practices.

Those criticisms include a neoliberal economic governance framework that is hostile to state intervention in the economy and to the pursuit of economic justice on the part of progressive governments, trade unions and others. The crushing of Syriza’s short-lived (and only ever limited) Greek defiance of that mode of governance should represent a defining moment for all those on the Left who ever harboured illusions about a ‘social’ or ‘progressive’ Europe.

Subsumed under this left-wing economic critique should be the signing by the EU of trade and investment agreements with other countries and regions that lock in the rights of corporations at the (potential or actual) expense of the public good – of Europeans and non-Europeans alike.

The growing drive towards the adoption of a coordinated and beefed-up EU military capacity should represent another red line issue for the Left.

And just as we can make no common cause with the anti-immigrant politics of the IFP and (it seems) Aontú, so also do we have to condemn the EU for cynical deals with Turkey,  Libya and elsewhere that deny many asylum seekers the ability to access Europe at all, and consign them to locations of egregious and horrifying abuse. The EU has also engaged in militarised policing actions against migrants that have turned the Mediterranean in particular into a watery grave for many thousands, even before the Union’s recent outrageous decision to abandon the vestiges of a naval rescue operation for some.

A programme for challenging neoliberalism

In practical, political terms, what all this might translate into is a willingness on the part of the Left to be very EU-critical, but not to call, as a matter of preordained principle, for withdrawal from the EU. What would such an approach look like in terms of a programme for government? Here are a few points that such a programme might contain.

  • We will not be bound by economic rules that prevent us solving crises such as those besetting the housing and health sectors – if we have to breach EU deficit, debt, state aid and other regulations in order to abolish homelessness or fix the health service then that is what we will do. This does not put us out of line with other EU states: Portugal and Spain have breached the EU Fiscal treaty provisions and not been penalised for it, while Macron in France has made tax and spending concessions to the ‘yellow vest’ protests that will likely see France also miss EU fiscal targets. What is sauce for the Iberian and French goose is sauce for the Irish gander.
  • We will not endorse trade and investment agreements that privilege investor profits over the public interest and the fight against climate change; in this, we share, for example, the current reservations of the French government, and of large swathes of European civil society, over the proposed reopening of talks on a trade agreement with the US.
  • We will not sign up to Permanent Structured Cooperation (PESCO) that would see Ireland be pushed to raise military spending and to boost the profits of arms manufacturers – our resources will instead be devoted to lifting Irish military families out of poverty and contributing to genuine peacekeeping operations on the international stage. Again, this does not put us at odds with other EU member states – neither Malta nor Denmark has joined PESCO.
  • We will not participate in inhumane and deadly actions at the European level that prevent refugees claiming protection in Europe, in the same way that we will defend and enhance the rights of migrants and asylum-seekers in Ireland through the abolition of, in particular, the brutal and indefensible system of ‘direct provision’. Our opposition to racism and violence directed against migrants will be as clear and unambiguous on the European as it will be on the Irish stage.

I suspect that critics will respond to such positions by saying that, whatever about individual acts of resistance, the cumulative impact of this suite of measures would put us on a collision course with the EU. And I think we will have to answer honestly: it may well do. And, again in all honesty, it may generate at least the prospect of punitive action against us if we were ever in government – the ECB might, for example, threaten to cut liquidity to the Irish financial sector as a form of leverage against a real left-wing challenge (they have done so in the past to other countries, most notably Greece).

Justice and realism

So there are risks here, and a need for contingency planning (including for exit from the Eurozone) if likely EU threats are followed through on – one of Syriza’s many tragedies was its failure to prepare for what they would do if the EU powers rejected their modest proposals for reform. But this type of resistance on the part of a Left government would have a massive advantage in terms of mobilising potential public support: it would be clearly identified as a last resort that the Left, as it sought to defend the interests of people living in Ireland, had been driven to by a recalcitrant EU.

In other words, the starting position would not be a reflexive Euroscepticism (that can be left to the likes of the IFP) but, rather, a willingness to stand up to bullying and to do what it right by people here (and indeed elsewhere also) – through negotiation and constructive engagement by preference, and working closely with like-minded groups across the continent, but through principled resistance if necessary. That would provide a context in which already changeable public opinion might be more readily brought along to EU-critical positions, even while remaining cognisant of economic risks being run. Tax policy, which I have not discussed here for reasons of space, would inevitably loom large in that context also.

There is no point pretending this is not going to be a difficult balancing act, but nor can we wish away the choices we will have to make. In making those choices, we need to see the Irish-EU relationship as a dynamic and changing one, and one we ourselves can help change, not as static and fixed.

To commit to the EU come what may is to collude in the neoliberal attenuation of democracy and economic oppression of the many in Europe, to militarisation and to the violation of the human rights of migrants and others. Equally, to commit, as the IFP does, to leaving the EU come what may is to gamble recklessly with the welfare of people living in Ireland and to endorse a reactionary right-wing Euroscepticism.

The Left needs to steer a course between these opposite poles, one that is based on both justice and realism and that is willing to seek to change the terms of the debate at the same time as it is willing to adapt to changing circumstances. It will not be easy, but not to try is to cede the field to either the EU’s neoliberal autocrats or to right-wing xenophobes at home, or to some unholy combination of the two.

Andy Storey teaches political economy in the School of Politics and International Relations, University College Dublin, and is on the board of the justice and human rights NGO Action from Ireland (Afri). The views contained in this article are expressed in a personal capacity.

Brussels’ plan for bad loans is a second bailout for the banks

By Emma Clancy.

Barely a word has been said in the Irish media to date about an extremely important new proposal from the European Union (EU) Commission – to develop a so-called ‘secondary market’ for non-performing loans. If implemented, this package of policies will directly cause an increase in evictions and homelessness, enable the harassment of mortgage-holders by debt collectors, and generate massive new risks to financial stability.

This proposed EU Directive on credit servicers, credit purchasers and the recovery of collateral will jettison even the (extremely) limited progress the Irish state has made on regulating vulture funds.

“Credit purchasers” refers to vulture funds and securitisation institutions, “credit servicers” means debt collection agencies, and the proposal for the “recovery of collateral” is for accelerated out-of-court enforcement of loans secured by collateral – meaning banks will be able to seize their customers’ property without going through the courts.

In short, it will let the EU’s banks carry out a mass sell-off of bad loans to US vulture funds; shift almost a trillion euros of bad debt off the banks’ balance sheets into the opaque and unregulated shadow banking sector through the same instruments that caused the 2008 crisis; implement rules that mean the vultures cannot be regulated in any way within the EU and can operate across borders without any restrictions; and add nothing whatsoever to the existing level of consumer protection to borrowers and homeowners in the EU.

A toxic debt mountain

Non-performing loans (NPLs) are bank loans that are subject to late repayment or are unlikely to be repaid by the borrower. EU standards now generally require banks to classify loans as non-performing if they are more than 90 days in arrears. The ability of borrowers to pay back their loans deteriorated significantly during the financial crisis and the subsequent double-dip recession. As a result, many banks saw a build-up of NPLs on their books, particularly in the countries worst affected by the crisis.

Euro-area banks held just over €1 trillion in NPLs in 2016, the equivalent of around nine per cent of the Eurozone’s GDP, and amounting to around 6.4 per cent of total loans in the Eurozone. The level of NPLs differs dramatically across the euro area, with almost half bank loans in Greece and Cyprus classified as NPLs, and Italy, Ireland, Portugal and Slovenia all holding NPLs at rates of 10-20 per cent. While the average ratio of NPLs in the EU has decreased by more than one-third since 2014, the total volume of NPLs remains high, at around €820 billion as of December 2018.

The proposed EU Directive is touted by the Commission as having one main aim: to free up banks to lend to consumers and small businesses again by reducing the high levels of bad loans on their balance sheets.

But even a cursory glance at the lending statistics across the Eurozone and the EU demonstrate clearly that the lower level of lending by banks is not caused by a lack of willingness by banks to provide credit, but rather by a lack of demand for credit from SMEs, companies and households.

In reality the proposal has three key aims:

  • To encourage EU banks to reduce their stocks of sour loans by any means necessary so they can return to pre-crisis profitability levels and compete once more with US banks;
  • To take away the right of EU member states to place regulations and restrictions on vulture funds and debt collectors that may impede their ability to enter the EU and operate freely across borders; and
  • To give the banks and vulture funds new powers to seize their customers property if they fall behind in repayments of debt – without having to bother with the irritating process of actually claiming this collateral through a court in which the judge is legally obliged to consider the rights of the consumer.

Replicating the Irish model across the EU

The European Commission has looked at the post-crisis process in the Irish state where banks have reduced their stocks of non-performing loans significantly, decided it is a glorious success story, and resolved to replicate this process across the entire EU.

The key components of this ‘success’ story in Ireland were the creation of the National Asset Management Agency (NAMA), which used public funds to take bad loans off the balance sheets of the bailed-out Irish banks; the grovelling invitation to US vulture funds to enter the Irish market by former Finance Minister Michael Noonan; and the eagerness of the Irish banks to engage in the mass sell-off of their customers’ mortgages and loans to these debt vultures at a fraction of their value.

Following this logic of trying to replicate the Irish model across the EU, the Commission made a legislative proposal in March 2018 based on four key aspects:

  • Provisioning by banks – a Regulation to require banks to put aside their own capital to cover the loss of a bad loan;
  • A Directive on developing a secondary market for NPLs – promoting the sale of bad loans to vulture funds, and promoting securitisation;
  • The same Directive to cover debt recovery – giving banks more power to enforce the collection of collateral through out of court recovery; and
  • Non-binding guidance for Member States on how to establish a national Asset Management Company – a NAMA-style bad bank, including possibly using public funds.

In fact, the Commission has proposed that all credit agreements – i.e., even performing loan agreements in which the customer has fulfilled every obligation required of them – should be within the scope of this Directive and therefore able to be sold on to a third party.

ECB Guidance on reducing non-performing loans (2017)

The Commission proposal of March 2018 was preceded by rules issued by the ECB, which published its Guidance to banks on NPLs in March 2017, setting out the manner in which it expected banks to reduce their existing stocks of NPLs. This Guidance is non-binding but subject to a comply-or-explain type system in which supervised banks must explain deviations upon supervisory request, and in which non-compliance may trigger supervisory measures.

The Guidance only applies to the largest banks in the EU, which are supervised by the ECB’s Single Supervisory Mechanism. It states that each bank with elevated levels of NPLs is expected to develop portfolio-level reduction targets with a view to reducing the level of non-performing exposures on its balance sheet in a timely manner. The Addendum to the Guidelines calls for these banks to enact a reduction plan if their level of NPLs passes a threshold of five per cent of their overall balance sheet.

This Guidance has been used by banks in several member states – and particularly by Irish banks – to prompt and justify their mass sell-offs of mortgages to vulture funds. Irish banks constantly point the finger at the ECB when selling mortgages to vulture funds, claiming the ECB forced them to. But this is simply not true.

The ECB “has not expressed a preference for certain NPL reduction tools over others” in its non-binding Guidance, and has clearly stated that the combination of tools or strategy reduction drivers for a given bank is the responsibility of, and chosen at the discretion of, its management, which could include debt restructuring, debt forgiveness and many other measures that don’t involve vulture sales.

No doubt the ECB has applied pressure to banks to reduce their bad debt levels, but it has no legal mechanism to force banks to sell loans to vultures and it explicitly denies doing so.

Having said this, the role of the ECB has been one of consistently undermining the rights of homeowners and borrowers, to the benefit of the banks and vulture funds. Every attempt to regulate the debt vultures that we have seen in the Irish state in recent years – every draft piece of domestic legislation – has been referred to the ECB for its ‘opinion’. The ECB’s opinion always seems to be that the banks should be allowed to get rid of their bad loans by any means necessary.

The Commission’s proposed Regulation on banks covering NPL losses is similar to the ECB Guidance except it applies only to future NPLs and not the existing stock; it provides a slightly more lenient time frame for banks to set aside their own funds to cover future NPL losses; it is legally binding; and it applies to all banks and not only the largest ones that are under the direct supervision of the ECB.

In theory, the proposal for a Regulation to require banks to put aside their own capital to cover the loss of future NPLs is sensible from a financial stability point of view in that it will encourage banks to engage in more responsible lending behaviour, and reduce the likelihood of the need for public bailouts of banks in future.

The Commission’s proposal could have encouraged banks to work through future non-performing loans with their customers on a case-by-base basis; and provide concessions to their customers including extensions of repayment periods, lower interest rates, debt forgiveness or many other options.

But taken in combination with the Directive on developing a ‘secondary market’ for bad debt, in reality it instead encourages the banks to take no responsibility for their predatory lending practices and dump their toxic debt into the shadow banking sector, or worse, taxpayer-funded ‘bad banks’.

We cannot apply a one-size-fits-all reduction target that will incentivise banks to offload their loans onto the secondary market. Banks should be required to keep their NPLs on their book and to work through them with their customers by writing down, restructuring or forgiving the debt, particularly in cases of residential loans.

Promoting securitisation

As well as giving free rein to debt vultures, this Directive also aims to promote the use of securitisation vehicles to ‘refinance’ bad loans, or to move this bad debt off the banks’ balance sheets and into opaque and unregulated hedge funds.

Mortgage-backed securitisation vehicles are created when individual mortgages are sliced up and bundled together into packages that can be traded on – gambled on – by investors. The idea is that betting on the return of the bundled, securitised vehicle is supposedly less risky than betting on a single mortgage.

The main investment vehicles that held mortgage-backed securities in the 2000s were collateralised debt obligations (CDOs). CDOs were instruments that included slices of different bank loans, each with a different level of risk and a different interest rate. The rationale behind CDOs was that by pooling together risky loans with less risky assets, the overall risk profile would be lowered – the CDO would be able to gain a higher credit rating – and they would be more profitable for investors. But if one slice defaulted, it increased the risk of a default by the next slice in the bundle. The bad loans infected the rest of the sector until major investment banks could no longer put a price on certain securitisation vehicles.

The moment that marked the onset of the global financial crisis was not actually the collapse of Lehman Brothers in September 2008, but rather the moment in July 2007 when Bear Stearns found that it couldn’t put a value on a number of hedge funds that were contaminated with CDOs that included subprime mortgages in them. One of these hedge funds lost 90 per cent of its value overnight; another lost its entire value.

It is almost beyond comprehension that, just a decade on from the global financial crisis, mortgage-backed securities – and non-performing ones at that – are being posed by the Commission as a solution to a toxic debt crisis that is the legacy of the 2007-08 crisis, which these instruments literally caused.

Moving almost a trillion euros out of the regulated and relatively transparent banking sector into the opaque and almost totally unregulated shadow banking sector (by the existing ECB Guidance alone) is incredibly misguided and will pose massive new risks to financial stability in the EU and internationally. Expanding this process under the Directive for all future bad debt is incomphrehensible. How exactly does moving billions of euros of bad debt into the wild west of finance improve financial stability?

‘Buy when there’s blood in the streets’: enter the vultures

The Commission wants to move the toxic debt off the balance sheets of the EU’s banks so they appear healthy and well-functioning, and can compete internationally, particularly with US banks.

An 18th century banker is credited with coining the phrase that best defines the “contrarian” investor’s guide to make a killing in a financial crisis: “The time to buy is when there’s blood in the streets.” This principle underpins the strategy of the private equity funds referred to as vulture funds. You buy when the price is at rock-bottom and make a profit in the shortest possible time frame by any means necessary.

In the Ireland of today this means buying non-performing loans from banks at a fraction of their worth, and securing the underlying asset (usually people’s homes) as quickly as possible through making some sort of dodgy deal with the person who owes the debt, or simply throwing them out on the street.

The red-carpet treatment the Fine Gael-led government has provided to the vulture funds over the past five years – through open-door lobbying access, a virtually tax-free environment for most of the past five years, and consistent government opposition to attempts to rein them in through regulation – has made Dublin a favoured spot for US vulture funds to set up shop in.

Under the proposed EU Directive virtually all restrictions on “credit purchasers” (vulture funds) registered within the EU to operate across borders will be removed, and the fund will be bound only by the regulations of the EU member state in which it is registered. So the light-touch regulation of the Central Bank of Ireland may soon be the only line of defence against vulture funds preying on millions of indebted and impoverished borrowers across the EU.

Third-country credit purchasers – say a US vulture fund that has not set up a subsidiary in an EU member state at all – will simply have to designate a “credit servicer” (a debt collector) to enforce the credit agreement and not even bother with registering in the EU. Only the credit servicer and not the vulture fund itself will be regulated in any way under EU law.

This is precisely the political debate that has played out in the Irish state over the past three or four years. The owners of the credit agreement – the vulture funds – are the ones who make the key decisions regarding the distressed loan, including the setting of interest rates, whether to restructure a loan, and the enforcement of the loan. So it is crucial that the credit purchaser – and not only the credit servicer that acts as an intermediary – is authorised and regulated in the EU, and subject to supervision, investigation and sanctions by the national competent authorities in the member state in which it operates,.

Jettisoning the minor progress made in Ireland

In an Irish context, we have made only limited progress to date in terms of regulating vulture funds and protecting consumers and mortgage-holders. Yet even this modest progress made in the Dáil – usually in spite of Fine Gael opposition – will now be under threat by this EU Directive.

For years Irish campaigners for the rights of mortgage-holders have demanded that the vulture funds themselves, and not only the middlemen must be directly regulated by the Central Bank. Ireland’s Consumer Protection (Regulation of Credit Servicing Firms) Act 2018, which came into effect in January, is a positive step forward in that it allows the Central Bank for the first time to regulate, investigate and sanction the owners of the credit agreements and not just their designated debt collectors.
This modest but significant step forward in our framework for regulating vulture funds is now under threat by the EU Directive, as described above. The Irish government must defend our right to maintain this important piece of legislation in the European Council when negotiating this Directive, and all Irish MEPs in the European Parliament must also defend this position.
The second substantial potential piece of Irish legislation that must be defended from the EU is TD Pearse Doherty’s ‘no consent, no sale’ bill requiring banks to gain the written consent of their customers before selling their mortgage to a vulture fund; if this bill becomes law based on the will of our elected representatives in Dáil, it will be simply overruled by the EU through this Directive.

Campaigning for the Directive to be withdrawn

Leftists in the European Parliament have tabled amendments to the Parliament’s report on the Directive demanding the direct regulation of the vulture funds and not only their intermediaries; the need for banks to obtain the written consent of their customer before selling their loans on to a third party; a debt buy-back scheme for customers to have the right to purchase their own debt at the same reduced price that their bank would sell the loan to a vulture for; and for a range of additional consumer protection improvements to the Directive.
But these amendments are not enough. This Directive is a second bailout for the banks that gives free rein to the vultures and allows the banks to throw their customers under the bus. Minor improvements here and there won’t cut it. It needs to be scrapped in its entirety – and consumer rights groups, housing campaigners, human rights organisations and a range of political forces from across the EU will be organising a campaign in the coming weeks and months demanding this Directive be withdrawn .

Emma Clancy is editor of Irish Broad Left. Follow her on Twitter @emmaclancy123.

Rights denied: The implications of Brexit for Irish citizens

By Niall Muprhy.

On 23 June 2016, 56 per cent of people in the North voted to remain in the European Union (EU). They did so because it is in our best interests politically and economically. The reckless and irresponsible rhetoric that has conditioned the British government’s approach to effecting the party-political intention of the British Conservative Party has thrust the entire viability of the United Kingdom into terminal constitutional decline.

It has heralded the inevitability of a second independence referendum in Scotland and also paralysed our own society with a constitutional convulsion, which in the early part of 2016 was not on the immediate horizon of anyone – Protestant, Catholic or dissenter.

The vast majority of people in Ireland do not want Brexit. No-one in Ireland sought a Brexit referendum. The overwhelming decision of the referendum in this jurisdiction was that we want to remain in the European Union. Brexit is being forced upon us against our will.

Notwithstanding this clear democratic mandate, we as a society and a people are being dragged out of the EU against our will. We are expected to silently comply as the British government plays Russian roulette with our economic and constitutional futures and our rights as citizens. Our EU rights are being ripped from us.

Brexit is one part of a sustained attack on the concept and the practice of human rights, and one further contribution to the attempted erosion of the core constitutional values of our peace/political process.

It was therefore in the spirit of a legal, policy and political challenge and a constitutional confrontation that a group of pro-EU Irish nationalist people from disparate sectors of society – education, health, business, law, the arts, academia, the community and voluntary sector, and sports – came together to articulate our serious concerns.

We collectively invested our future hopes and aspirations in the Good Friday Agreement (GFA) and it being implemented and thereby opening up a new chapter in the history of Ireland.

The conviction of wider nationalist, democratic and progressive opinion in 1998 was that the GFA would ensure a break with the past and guarantee us and future generations peace, guaranteed rights, equality and respect in an Ireland which continued to democratically transform itself.

Nearly 21 years on, the GFA has still not been fully implemented. Some sections of political unionism still oppose its very existence. Many of the political fault lines within our politics and society remain unresolved. Our hard-won peace process and its political architecture have too often been taken for granted. We may have peace, but we have not seen enough progress, and Brexit does not occur in a vacuum.

When more than 200 Irish citizens from the North signed an open letter to An Taoiseach Leo Varadkar in December 2017 it came at the end of a tumultuous and politically defining year.

That January the GFA political institutions collapsed amidst the political and financial scandal of the Renewable Heat Incentive. It served to confirm the growing view of northern nationalists that political unionism was not committed to proper power-sharing through the denial and refusal of equality, rights and respect towards the section of the community to which we belong, rights such as the following:

Access to justice

All victims of the conflict had the right to avail of mechanisms in accordance with European defined laws, to have access to justice.
Compliance with Article 2 of the European Convention on Human Rights (ECHR) is not an issue for Stormont. Stormont is not a sovereign entity, but Westminster is, and it is Westminster that signed the ECHR.

That Westminster sought to then derogate from its ECHR duties by alleging that its compliance with the ECHR is somehow a matter for political consensus at Stormont is a deft sleight of hand of Machiavellian proportions.

Marriage equality

Leo Varadkar and indeed the Irish government rightly speak with pride in respect of the referendum vote in 2016 which brought same-sex marriage equality to the south.

Marriage equality was promoted by the Irish government as a fundamental rights issue in the referendum, yet it is relegated to a matter of political consensus here.  Rights are not negotiable or a matter of consensus.

Many Americans voted for slavery but thankfully it was considered to be an abomination and was ended. Why is it that citizens of England, Scotland, Wales and the south all benefit from marriage equality but it is a right denied to citizens of our micro-jurisdiction?

Language rights

A clear example of the DUP’s rejection of the concept of parity of esteem is the party’s sneering contempt for Acht na Gaeilge. Our language is an intrinsic part of all of our identity as citizens, yet we endure contemptuous taunts, such as “Curry My Yoghurt” and “Crocodiles” and the cancellation of microscopic bursaries for the Donegal Gaeltacht.

The fact is that this jurisdiction is the only region in Britain or Ireland that makes no statutory provision for the protection of a minority language in accordance with the European Charter for Regional or Minority Languages.

Irish is an official language in the Republic of Ireland, with Welsh given statutory protection under the Welsh Language Act 1993, with Scots Gaelic protected under the Achd na Gàidhlig (Alba) 2005.

Again – why is it that citizens of Scotland, Wales and the south all benefit from statutory protection for an indigenous language but it is a right denied to citizens of our micro-jurisdiction?

It would seem that there can be no regulatory alignment on this island, and Bangor must be as British as Finchley, unless you are gay and want to be married, or seek to live a life through the medium of Irish with statutory protection.

Rights are not British or Irish. Rights are for everyone. Everyone benefits with a strong framework for the protection of rights, and everyone loses when rights are denied.

This contempt mobilised the nationalist and republican electorate: in turn the unionist political majority in the Assembly was ended in the elections of March 2017. Increased unionist belligerence continued, and then the nationalist constituency sent a stark message during the subsequent Westminster election held in June that year, that it was turning its back on Westminster.

It has been confirmed in a parliamentary response by EU Commission President Juncker to a question posed by MEP Martina Anderson that the North would no longer be considered to be in an EU member state, and that whilst Irish citizens would remain EU citizens, benefits from UK participation in EU programmes would end with Brexit.

This position would leave Irish citizens here with access to almost none of the following EU rights, rendering us, in effect, second-class citizens, in our own country:

  • The political right to stand as and vote for MEPs. The right to vote for an MEP is normally tied into the member state of residency.
  • Continued use of the European Health Insurance Card (EHIC). Access to an EHIC normally involves billing the health authorities in the EU member state of residence – for example, the NHS.
  • Studying elsewhere and being able to avail of EU student fee rates. Access to EU student fees rates normally requires residency in an EU member state for three of the previous five years.

So without special arrangements, access in practice to these EU rights would be lost to Irish citizens resident here – unless of course they left and went to live somewhere else in the EU.

Practical Scenarios

In reality this means:

We will be disenfranchised. The democratic rights of us Irish and EU citizens in the north, including the right to direct representation in the European Parliament, need to be protected. We must continue to lobby the Irish government to ensure that right is protected by creating a mechanism for people in the North to continue to elect an MEP, i.e. by means of a single constituency.

If you are on holiday in France and fall, you will not be able to access their health service without paying or having medical insurance. An elderly person requiring medical assistance such as dialysis will in effect be grounded, as they will not be able to obtain insurance.

If you have a child wanting to study in Trinity or UCD, you will have to pay. For example QUB undergraduate annual tuition fees for NI domiciled students are £3,925; the same figure is applied for EU students – whereas the figure for international students is between £13k (classroom-based courses) and up to £34k for clinical medical courses. If you have a child aged under 16 today, who hopes to study in the south, as things stand they will be treated as a non-EU national and will be charged accordingly as you must be resident in an EU state for three of the preceding five years. So if Brexit happens in March 2019, a child now aged 16 will not have the requisite three of five years to attend Trinity or UCD.

Other rights denied include the fact that the ability to take up work is dependent on mutual qualification recognition, which will end with Brexit. The right to be joined by family members (who are not EU/EEA nationals) are an inherent part of EU treaty rights to work and study, which also end with Brexit.

On 2 November 2018, more than 1,000 citizens endorsed a direct appeal to An Taoiseach and his government to act in defence of the GFA and citizens’ rights. Individuals with varied political affiliations and none made a direct public appeal to the Taoiseach to stand by his government’s stated commitment that no Irish citizen living in the north would ever be left behind by an Irish government.

The letter was signed by 323 business people, the employers of tens of thousands of people; 115 senior educationalists including more than 30 school principals, along with prominent figures from third-level institutions and teachers from all parts of the North; 82 lawyers; 75 healthcare professionals, including more than 20 doctors and consultants; 30 senior All Ireland medallists; doyens of our arts sector and the leaders of our communities. It was signed by dozens of senior journalists and trade unionists, seven university professors, three Olympic medallists, three Oscar winners, two men who lifted the Sam Maguire, and one man who climbed Everest.

In total, the letter was signed by over a thousand leaders from the nationalist community. This is testament to an evolving earthquake in terms of an awakening of nationalist confidence. The 1012 names are symbolic – the letter was not a petition, but a representative sample of the views of hundreds of thousands of people across the North, and indeed across the entire island.

Beyond Brexit conference

That correspondence was then followed up with a truly unique conference on Saturday 26 January 2019 [pictured above], when more than 1,500 people filled the Waterfront Hall in Belfast to attend what the Irish News described as the most significant constitutional event in a century, as the leaders of the SDLP and Sinn Féin and senior figures from the Irish government and Fianna Fáil attended to give their respective views on Brexit.

Constitutional law experts, legacy and language activists, environmentalists, economic experts and political commentators all spoke to the topic of the viability of a new constitutional arrangement.

Conversations about the future, and future constitutional change, are happening in unexpected places. In recent weeks the trade union movement and senior figures from the GAA have spoken publicly about new constitutional arrangements. Ireland has changed dramatically over the course of the past 20 years.

Catalyst for unity

The roadmap for the journey from Brexit Britain to Little England is being led by the blind, the ignorant and the reckless. Mark Twain once said that you should never argue with stupid people, as they would drag you down to their level and beat you with their experience.

Michael Gove, Boris Johnson, Jacob Rees Mogg and their ERG colleagues are indeed experienced; however we cannot stand idly by. We must avoid a hard border at all costs and as reported in the Irish Times recently, preparations are being made as we speak.

Motorists from the south who plan to drive across the Border from the end of next month will have to start applying for a so-called Green Card or risk penalties for driving without insurance. The Motor Insurers’ Bureau of Ireland has issued about one million Green Card forms, as well as electronic application templates, to insurance companies and insurance brokers in case there is a no-deal Brexit. As the realities of Brexit press home in the coming weeks, the tolerance for it will radically diminish.

On a visit to Ireland in December 2017, EU Council President Donald Tusk ruled out a hard border, saying: “Ní neart go cur le chéile” – there is no strength without unity. Our initiatives – at the Waterfront, our correspondence to the Taoiseach, and our ongoing lobbying in Europe and the US – has demonstrated a unity of confidence and purpose, and may become a catalyst for a unity not envisaged by the proponents and architects of Brexit.

Niall Murphy is a Belfast solicitor with human rights law firm KRW Law and an organiser of the ‘Beyond Brexit: The Future of Ireland’ conference.

Emma De Souza: British government refuses to recognise Irish citizenship

By Emma de Souza.

The Good Friday Agreement was overwhelming supported in referenda both North and South – yet a core principle and the very integrity of the treaty itself is currently being questioned and undermined. I am an Irish citizen born in Northern Ireland, whose Good Friday Agreement right to identify as such has been persistently denied by the British Home Office. 

In 2015 when I married my American husband Jake, I discovered that my lifelong Irish identity is evidently considered secondary to an unclaimed British identity. I have always believed throughout my life that I was Irish; it’s not a choice, it’s not a decision – it is simply who I am. 

I haven’t held a British passport or claimed British citizenship – yet there I was, in an unprecedented situation where this additional and entirely imposed citizenship was stripping me of my EU right to family life. Our application for an EEA [European Economic Area] Residence Card was met with a letter of refusal, accompanied by a deportation order. 

The British Home Office rejected Jake’s application for an EEA residence card in the north of Ireland, for complex reasons. Although I was born in Derry, and have a right under the Good Friday Agreement to identify as either Irish or British or both, Britian has classified me as being British.

In its refusal letter, the Home Office wrote: “…your spouse is entitled to renounce her status as a British citizen and rely on her Irish citizenship, but until that status is renounced she is as a matter of fact a British citizen”.

The British government effectively argued that I am a British citizen until I revoke it in favour of my Irish citizenship. As they therefore class me as a British citizen, but I am an Irish passport-holder, the British government had classified me as having dual-citizenship, and cannot go through the British immigration system as an EU national. On this basis, my husband’s application for a residence card was refused.

This presupposition goes against my understanding of not just the Belfast/Good Friday Agreement, but my identity as a whole.

We appealed against the Home Office’s decision on the grounds that the Good Friday Agreement explicitly allows the people of the north of Ireland to chose their nationality – be that Irish or British or both – and were successful at the first hurdle.

Judge S Gillespie ruled: “The constitutional changes effected by the Good Friday Agreement with its annexed British-Irish Agreement, the latter amounting to an international treaty between sovereign governments, supersede the British Nationality Act 1981 insofar as the people of Northern Ireland are concerned. He or she is permitted to choose their nationality as a birth right. Nationality cannot therefore be imposed on them at birth.”

Two years later, and the British Home Office are still seeking to have this ruling set aside. Worryingly, the Secretary of State has lodged grounds of appeal, stating “A treaty HMG is a party to, does not alter the laws of the United Kingdom”. 

Devastatingly for us, the British government has pursued us tirelessly through the courts – for the duration of our marriage – because I hold Irish citizenship and will not accept a government-imposed British citizenship. The Home Office’s appeal is based on arguing that the judge’s interpretation of the law was flawed, and that the Good Friday Agreement has less authority than British immigration law.

This legal wrangle is now entering its fourth year. For the first two years, we lost our freedom of movement. The British Home Office retained Jake’s passport with no legislative authority or policy to do so. With these restrictions, Jake was unable to leave the country and had to turn down opportunities for work. 

The highest price, however, was losing the last two years of his grandmother’s life. Every request to see Jake’s grandmother in her progressively deteriorating condition was denied. When she passed away at home in Los Angeles, Jake’s request to attend the funeral was denied.

It was only after increased media pressure that the Home Office eventually relented – couriering Jake’s passport back to us and allowing him a belated farewell to his late grandmother; a bittersweet farewell mired in remorse for not having been afforded an opportunity to say goodbye. By this point, the personal cost and loss resulting from the Home Office and their decisions was becoming overwhelming. 

A price on Irish identity

Most troubling though is that our experience is not unique, but rather a window into a much deeper and wider issue occurring across our society. The reality being felt by myself and many in our community is that there is a price on Irish identity – a personal price that leaves many questioning what our identity is truly worth. 

A process referred to as Renunciation of British Citizenship is offered by the British Home Office as a solution, but what does it really entail? 

Firstly, the form is a legal document that begins with a declaration: “I am a British citizen”.

It also requires substantial evidence to prove you have British citizenship. Birth in the north of Ireland constitutes automatic British citizenship for those seeking to realize their EU rights. For those renouncing, it is considered insufficient evidence of British citizenship. Considering that many individuals choosing this route do not consider themselves British in the first place, it can be an emotionally arduous process. 

In addition, the process also costs £372. No small fee for renouncing a citizenship which under the Good Friday Agreement should be entirely optional.  There should be no levy on an Irish person to be recognised as Irish to live on our island!  Anyone taking this route will also lose freedom of movement for up to six months while the Home Office processes their application.

Then there is the uncertainty: nobody knows what the ramifications of renouncing are. In a recent case, the Home Office went so far as to question the residency rights of a citizen who had renounced their British citizenship. There is a very real possibility that going forward, anyone else choosing to renounce may be exposed to further impediments on their right to remain in their home. There is also concern about the rights of the wider family as a whole, and the effect renouncing may have on them. 

This, in my opinion, is not a reasonable solution.

The basis of the Good Friday Agreement is founded on equality of treatment and respect for the two communities of the north of Ireland.  This is a commitment the British government agreed to, and in the Brexit negotiations, has promised to uphold.

However, Immigration Minister Caroline Nokes has raised grave concerns as to the British Government’s intentions stating:“Our view is that an international agreement such as the Belfast Agreement cannot supersede domestic legislation… as a matter of law, people in Northern Ireland are British by birth”.

My assertion calls into question the British government’s interpretation and dedication to the Good Friday Agreement. The effect of this interpretation are far-reaching, and are causing immense personal strain and hardship on families across the north of Ireland.

For many, identity is something which cannot be taken away, or even questioned. It has long been accepted by many as the most fundamental of rights. It is of paramount importance to the integrity of the Good Friday Agreement.  If the British government can arbitrarily disregard rights guaranteed to the people of the north of Ireland under an internationally binding peace treaty, what safeguards are in place to prevent further diminution of rights?

The uncertainty and lack of legal protections seems certain to get worse with the onset of Brexit. For us, 2019 will mark another court hearing on the right to have my identity recognised, respected and accepted as Irish. 

Emma De Souza is an immigration and citizens’ rights campaigner. Follow her on Twitter @EmmandJDeSouza. The open letter above was sent to political representatives including MEPs this week, and has been reprinted here with the author’s permission. (Photo supplied.)

Youth rise up for climate, demanding revolutionary change

By Damien Thomson.

Today is the day where hundreds of thousands of young people are expected to strike from school and take to the streets to demands immediate and radical climate action. Thousands have taken part in 37 different actions across Ireland, including an estimated 10,000 protesting outside the Dáil in Dublin.

It seems like we are all cheering them on, but who really has their backs? Who actually supports their demands?

The demands of the youth movement on climate can only be described as revolutionary. The young strikers do not tread lightly on making their point. They want the emergency button to be pressed immediately on climate change and the panic response to kick off.

They do not want to hear excuses. They want swift and unprecedented action on climate, in order to have any chance of saving their futures. The fact that children and young people are leading on this is noteworthy – they see no future with the current rate of progress.

And they are absolutely spot on. Even considering all the climate commitments made under the UN Paris Agreement to stop global warming, supported by the majority of the establishment internationally, global warming is still projected to reach an increase of 3.2° Celsius by the end of the century.

Given that the latest special report from the Intergovernmental Panel on Climate Change (IPCC) from October 2018 warns of the disastrous ecological and human cost of a 2°C rise, one can only imagine what future we face on the current path of 3°+ degrees. We are talking about hitting the tipping point – the point of no return – when the effects of global warming will multiply and we will have no ability to rein it in.

Children born today have a life expectancy beyond the year 2100. Young people are not taking to the streets because it is the latest craze; rather, it is because it is the last chance. We have 12 years to make the “rapid, far-reaching and unprecedented changes to our economy” demanded by science: these striking young people do not expect anything less than that. They are not on the streets calling for moderate liberal demands such as a carbon tax, or carbon market reform – they want a climate revolution.

More than 150,000 young people have already gathered in Australia, and throughout the day, young people in cities and towns across the world – in more than 100 countries – are getting their homemade placards out and meeting in their local areas to come together as part of a massive global movement to make their message heard loud and clear.

Politicians who accept the science and the need for an emergency response, you would think, would agree with these demands. However, in Ireland, what we have to date are three main political responses to this global movement: 1) genuine support from left political parties, including agreement with their demands; 2) odd interpretations of the movement from liberal greens who are fixated on using the movement to railroad through carbon tax increases as the ‘radical solution’; and 3) patronising head-nodding from conservative groups, including the government.

Taoiseach Leo Varadkar stated that he endorses the students strike today on March 15, while at the same time he leads a government that has greenwashed climate inaction and is failing to make inroads on all climate targets.

Saoi O’Connor, 16-year-old Cork-based climate striker, put it frankly: “If you are not supporting immediate radical climate action, then you can’t be supporting the students walking out”. Saoi makes an excellent point – it’s not enough to support the young people striking today, you need to be supporting their demands, and willing to put them into action.

Yesterday, the European Parliament adopted an important resolution on climate change, the last one it will approve before EU parliamentary elections in May. An amendment tabled by the left group recognising the youth movement and calling for their demands to be heard was passed. It was, of course, resisted by the right-wing of the Parliament, but also accepted by some conservatives and liberals, getting it over the line. Many of the liberals and conservatives who helped approve this amendment, however, went on to vote down crucial amendments that were actionable on climate change.

In their typical contradictory style on climate matters, Fine Gael’s four MEPs voted against the most progressive demands while claiming to support the climate strikers. Most notably, amendments from the left to boost the EU’s 2030 climate ambition on emissions reduction targets from 40 per cent to 55 per cent succeeded – but with no thanks from Deirdre Clune, Sean Kelly, Brian Hayes and Mairead McGuinness, who voted against.

The four conservative MEPs also voted against the EU divesting from fossil fuels – a bizarre move given that Ireland is the first state to do so globally. It doesn’t stop there: they voted against a proposal for a 100 per cent renewable-based 2050 energy strategy and against making climate justice a fundamental value of the EU.

So can Fine Gael, or conservatives in general, honestly say they support the youth strikers, or are they really just offering a patronising pat on the head? It seems like the neoliberal force of trivialising social movements is at play.

Earlier this week, 60 young climate activists were invited to the European Parliament to view the debate on climate change in the chamber from the gallery, among them Ireland’s Saoi O’Connor. The action to invite this big group of young climate activists was an initiative from the left wing of the Parliament, given that the centre and right wing blocked a proposal to invite Swedish climate activist Greta Thunberg to address the plenary session.

In a very symbolic way, the 60 activists could only look down on the politicians as they debated, literally excluded from participating thanks to liberals and conservatives. What was revealed from the debate, and the vote record on the climate resolution, is the answer to who is really in support of the climate strikers.

It comes down to political ideology. Liberal and conservative ideologies simply cannot meet the demands of the youth movement on climate. Their interests are skewed, their priorities backwards. For liberals and conservatives, ensuring a commercialised energy market is more important than phasing out fossil fuels;  protecting the status quo of private profiteering is more important than protecting the environment; the appearance of climate action is more important than taking the necessary bold steps.

So climate strikers, the left is fully behind you. Your demands are our demands and today we will strike with you for the genuine, radical and revolutionary climate action we need.

Damien Thomson is a contributing editor of Irish Broad Left. Follow him on Twitter @dmacthomais.