The incredible hamfistedness of the government in the implementation of savage cuts in Health spending most notably seen in the plan to cut back on personal assistants for disabled people, speaks volumes about the depth of the crisis that faces our society arising from the intractable failures in Irish and European capitalism. Yes there was arrogance and a divorce from any feel for the reality of life for very many people suffering vulnerabilities in many different ways in the original plans for these cuts. But fundamentally the problem is that the government is utterly incapable of transforming the crisis mired economy into one which delivers growth in wealth creation and therefore in the taxes and resources that are desperately needed to fund crucial public services.
The roots of the government’s failure is its decision on assuming office to follow the same line as its Fianna Fail/Green Party predecessor in continuing to salvage the private banking and markets system through diverting massive resources from elsewhere in society for this bailout. Put simply that is what the austerity agenda is about.
Once that decision was made and acted on, it was inevitable that stagnation would follow. Private investment had already collapsed. To follow that with sharp cuts in public investment was only going to intensify the effects. But to mount a wholesale attack on the purchasing ability of ordinary working people and those depending on pensions and social payments was always going to be a recipe for an ongoing slump in economic activity in the domestic economy. Hence the persistence of mass unemployment and forced emigration and weak taxation returns.
The public wails of opposition to the most recent cuts from members of the Labour and Fine Gael parliamentary parties do not impress. The fact is that when they voted in the 2012 austerity Budget last December they were voting for measures such as those announced, and now partially withdrawn, in response to the utterly justifiable publicly demonstrated anger of those affected. The implication of their position is that the cuts should have been made in an area that would provoke less outrage or perhaps affect people with less capacity and ability to publicly protest.
Unfortunately the debate in this State on the current round of cuts, on the threatened wholesale privatisation of public services and on the certainty of an even more savage Budget in December is so narrowly framed as to be meaningless. It focuses on the narrow parameters of the debt crisis and the diktats of the troika that ordinary Irish people must be fleeced to safeguard European bankers and speculators. The only choice on this particular menu is between cuts, different cuts and/or tax increases on working people. Attempt to go beyond this narrow focus and broaden the debate into the need for radical taxation measures on super wealth and for a targeted infusion of public investment into major job creation will, in most radio or television studios, result in derision and calls for ‘realism’.
However, a broader and deeper debate is just what is desperately needed now as to the radical changes needed to overcome the present crisis. A stunning report published in the British Guardian in July would be essential background material. Titled, ‘The Price of Offshore’ and compiled for campaign group Tax Justice Network by James Henry, a former chief economist at McKinsey consultancy, it gives a shocking picture of massive resources in the hands of a super wealthy global elite but which are siphoned into international tax havens and speculation rather than into productive investment, job creation and public services.
Using a wide range of sources, Henry calculates that an unimaginable amount of €16.4 trillion is involved which is equal to the entire Gross National Products of the United States and Japan combined. A significant amount is managed by the world’s top ten banks including Goldman Sachs.
These funds have been corruptly looted from national economies or salted away by super wealthy entities using tax exile and related schemes. It would be only logical to assume that the resources of super wealthy Irish people are involved. Nick Webb for the Sunday Independent established that the net assets of the richest 300 Irish people increased by €4.9 billion in 2011 to a new high of €62 billion.
There should be immediate and substantial taxation on this wealth. Nationally and internationally the huge resources salted away by the global super wealthy should be taken into public ownership and turned into investment that would employ the millions of unemployed, create the wealth and services that society needs. The alternative is to continue to rely on the speculators in the financial markets whose legacy to date is 25 million unemployed in the European Union and the turning of countries like Greece, and potentially Ireland if this strategy continues to be followed, into poverty stricken societies.
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