by Frank Schnittger
Wed Jun 6th, 2012 at 10:08:02 AM EST
So Fear triumphed over Anger and the Irish referendum on the Stability Treaty was passed by a "resounding" 60:40 margin on a 50% poll - more or less as predicted by the opinion polls and close to the average turnout for similar stand alone referenda in the past. Not much of interest here; time to move on to the Greek elections and Spanish banking crisis if the MSM are to be believed.
The government has been quick to spin the result as an endorsement for its austerity strategy and as a positive message to send to the rest of Europe (and the global investment community) of Ireland's unequivocal commitment to the Euro. Sure, there have been the usual noises about the need to promote a growth strategy for Europe and to revisit the "sovereigntising" of private banking debt and the hope that any new strategy devised for Spain involving more direct European bailing out of Spanish banks will be retrospectively made available to Ireland.
Quite how a YES vote was meant to advance that agenda is less than clear. German responses to Irish pleas have already been dismissive: Revisiting the sovereigntising of Irish banking debt would send out a "negative signal" apparently...
Kenny admits immediate bank debt deal unlikely
...but senior German officials dispute Mr Kenny’s interpretation of Ireland’s fiscal treaty vote as a “message to European Union leaders” for a “just” debt deal. “We see no need for movement at the moment,” said Martin Kotthaus, spokesman for finance minister Wolfgang Schäuble.
Indeed. The German Government clearly knows what the Irish people are thinking better than the Irish Government itself...
front-paged at last by afew
When you consider that, of the major parties, only Sinn Fein (with an historical max of 10% of the national vote at the last election) advocated a NO vote, then the 40% NO vote can be put into more perspective. Essentially almost 30% of the electorate abandoned the party line of the parties they generally support and voted NO. Little wonder that Sinn Fein more than doubled it's support (to 24%) in opinion polls taken after the referendum.
However it would be a mistake to regard Sinn Fein as Ireland's answer to the Greek Syriza party. Sinn Fein didn't advocate tearing up the Troika agreement or defaulting on national debt. Their line, as usual, was that the Government had failed to negotiate a good deal, and that any agreement to the Stability Treaty should only be done in the wake of agreement to a more comprehensive European growth and bank recapitalisation plan. As a negotiating ploy, it is hard to fault the strategy, and even conservative independent TD (Member of Parliament) Shane Ross argued for a postponement of the referendum pending a more compressive agreement on bank recapitalisation and growth for Europe as a whole (and Anglo Irish bank promissory notes in particular).
Even the yes side is agreed that most of their voters voted yes "through gritted teeth" acknowledging that "certainty" over access to ESM funding and the safeguarding of FDI to Ireland were essential to Ireland's national interest even if the Stabity Treaty was clearly a bad Treaty when viewed from the perspective of Europe as a whole. As my own local (independent) TD, Stephen Donnelly put it: The Treaty is clearly an economic nonsense, and Ireland would be doing Europe a favour if we rejected it. But Ireland's own narrow national interest is that we pass it so as to reinforce certainty of access to ESM funding, confidence in Ireland's commitment to the Euro, and continued FDI inflows into Ireland which appear to be enabling a very fragile stabilisation of Ireland's economy despite drastic government austerity measures and collapsing consumer confidence.
And so the European house continues to be built on sand, and with an increasingly reluctant and cynical attitude to the European project. The Irish elite, as exemplified by Irish Times editorials was rabidly in favour of the Treaty: How else would we continue to pay Doctors, Nurses, Teachers, Gardai and social welfare benefits if we didn't have access to the ESM? Little mention was made of the fact that our problems in this regard would be much less had we not first bailed out foreign creditors to private Irish banks. Or even of the fact that it makes little sense to refer to "Irish Banks" in an integrated single European market for financial services where light touch regulation was a feature at BOTH Irish and European levels.
I will leave the last few words to Fintan O'Toole:Yes vote an expression of grim fatalism
Here we see the deep strangeness of contemporary Irish politics. In a normal world, if people don't believe the Government, they vote against it. But in the topsy-turvy world we currently inhabit, people voted for the Government line precisely because they don't believe the Government. If people did believe what Michael Noonan had told us - that a second bailout is a ludicrous and inconceivable notion - the main argument for a Yes vote would have collapsed.
The Yes campaign had effectively stopped trying to argue that the treaty, as a response to the euro zone crisis, had any intrinsic merits. The only real issue was, as one voter quoted in a vox pop put it so succinctly, "I am going to vote Yes because we need the money and I don't see us getting it anywhere else". This is the surreal state we're in: people voted Yes not in spite of their belief that Government is bullshitting when it says a second bailout is ludicrous but because they believe it is bullshitting.
This is not "a loud expression of confidence in the Irish economy", it is a loud expression of the belief that the Irish economy is likely to be on life-support for at least the rest of the decade. It is not "another reminder that Ireland is dealing effectively with its problems", but an expression of grim fatalism. People, by and large, do not believe the policy of austerity for the poor and lavishness for dead banks (what should we call it - banksterity? austravagence?) is leading either to economic growth or to a restoration of sovereignty.
And there is a clear reason for this: people are not eejits. They know that the EU expects Gross National Income to decline by a further 1.3 per cent this year, with private and public consumption continuing to fall. They can read the figures that show that long-term unemployment (the really toxic kind) increased by 7 per cent in the last year.
They know that only large-scale emigration is keeping youth unemployment from reaching catastrophic levels. They know that the domestic economy, on which the vast majority of Irish employees depend for their jobs, is still shrinking. They know the Government is still committed to burning almost as much money every year on promissory notes for Anglo Irish Bank and Irish Nationwide as it is taking out of the economy in cuts and extra taxes. They know that the political and governance systems that created this mess remain largely unreformed. If this is evidence "Ireland is dealing effectively with its problems", it is difficult to imagine what ineffective policies might look like.
This delusional talking-up of the state of the country wouldn't matter so much if we could put a cordon of silence around the island. But what are our European partners to make of our pleas for help when we keep saying "ah but sure we're doing grand really"? Or is it that the Government feels there's no danger because it knows that no one believes what it says anyway?