Ireland - A "No" to the bosses, their politicians and their crisis!

Jul/Aug 2008

The 53.4% "No" majority in the referendum held in Ireland, on 12 June, over the EU Lisbon Treaty, was described, in Britain, as a "major blow" against Europe by both pro-Europeans and Euro-sceptics. As if the endorsement or rejection of this Treaty by Irish voters had ever been likely really to alter the plans of the European ruling classes and their governments, in the first place!

Irish voters already have some experience of this. In June 2001, 54% of them rejected a constitutional amendment which enshrined the European Nice Treaty into Irish law. This Treaty was designed to protect the EU from complete paralysis as a result of its enlargement. There was no way European companies wanted anything to stand in the way of the enlargement of a market which was so vital for them. Within just over one year of its rejection, in October 2002, Irish voters were presented with a second version of the same Treaty, amended by the so-called Seville Declaration. The only difference was that, on paper at least, it recognised Ireland's right to opt out of any future European Defence Policy and required the consent of the Dail, the Irish Parliament, for Ireland's involvement in any "enhanced co-operation" within the EU - a formulation vague enough to allow Irish governments to do just about anything without going to the electorate, if they so wished. This time, after a campaign in which the "Yes" camp led voters to believe that rejection would force foreign investors out of Ireland, thereby threatening jobs, the amendment was voted in by a 63% "Yes" majority, on a much increased turnout.

In some respects, there are similarities between the Nice Treaty saga and the story behind the Lisbon Treaty. Indeed, the Lisbon Treaty was nothing but a cut-down version of the European Constitution, which had to be shelved after its rejection by the Dutch and French electorates, in 2005. In passing, it may be worth recalling that Blair, who had promised to hold a referendum on this constitution, during his 2005 election campaign, was among the very first European leaders, to raise the idea of the "plan B" which, after some protracted horse-trading, produced the Lisbon Treaty, in December 2007.

This being done, the British government used the pretext that the "treaty" was no longer a "constitution" and therefore did not need a referendum, thereby dropping Blair's promise. Its Dutch and French counter-parts, fearing a repeat of the 2006 rejections, also decided against another referendum, as did all their EU partners - except Ireland.

The Irish ruling coalition had its own problems. It was fragile, with a mere 6-seat majority in the Dail. And there was no shortage of mavericks in both the ruling and opposition parties, who might have been willing to rock the boat, had the government twisted the Irish Constitution to the point of failing to hold a referendum. The Treaty would have been passed by the Dail, but the ruling coalition would probably have come out of it with no overall majority and a host of ambitious "independents" holding the balance - an uncomfortable situation for any government. Hence the government's choice to take its chances and go ahead with a referendum, the result of which, at first, seemed to many commentators as a foregone conclusion.

However, opinion polls soon turned out to much more uncertain than expected. So much so that, in April, Fianna Fail Prime Minister Bertie Ahern announced that he was to stand down without completing the third term he had started only a year earlier. Although he did not say quite as much, it was clear that this was aimed at avoiding the referendum campaign being overshadowed by an on-going corruption investigation against Ahern over allegations dating back to the 1990s, when he was Finance minister. Already, therefore, the Irish government was anticipating a possible backlash over domestic issues.

As it happened, this referendum did backfire. But in fact, as if to stress the actual futility of such votes as far as the workings of the EU are concerned, even before its result was known, the main European powers had already began to search for yet another "plan B" in order to implement this Treaty, if not in name, at least in substance.

A "No" which had little to do with Lisbon

Given the claims and counter-claims about the meaning of the Irish rejection of the Lisbon Treaty, it is worth looking more closely at the content of the referendum campaign.

It is doubtful that even a small number of voters really knew the content of the Treaty itself, if only because there was no actual document spelling it out. In fact, this Treaty was made up of a whole series of amendments to the two main EU treaties, plus no fewer than 15 new additional annexes. Reading all this would have meant absorbing hundreds of pages of arduous, impenetrable and convoluted jargon, which was completely meaningless for anyone outside the legal profession. In fact, it took the pro "Yes" daily Irish Times no less than nine 1200-words long, full-page installments to provide its readers with a readable, albeit terse and rather indigestible, outline of the substance of the Treaty - which probably says it all!

But the Irish Times is not the paper of choice of the vast majority of Irish voters. And the issue which overwhelmingly dominated the campaign in the media as a whole, was the alleged need to preserve Ireland's "special status" in Europe. Both the "Yes" and "No" camps claimed that what was at stake was the country's ability to remain a tax haven for foreign companies. The threat of losing foreign investment and, therefore, "vital" tax receipts, was waved at voters endlessly, together with the resulting risk of job and public service cuts. As a corollary, both sides hailed the "achievements" of the Irish economy, whether it was thanks to its tight integration into the EU according to the "Yes" camp or, on the contrary, due to the distance it had managed to keep from Brussels, according to the "No" camp. Either way, none of these arguments was likely to be very attractive to the large proportion of Irish voters who gained little or nothing out of Ireland's so-called economic "affluence".

The "No" camp itself was a motley crowd. Its most publicised element in the media was Libertas, an ad-hoc grouping launched to oppose the Lisbon Treaty on the very day of its publication, which managed to win the support of top personalities in Irish business, in the name of defending Ireland's pro-business tax system. Even more to the right, were the far-right Catholic currents - the same ones which fought every past attempt to liberalise family planning and abortion in the country - whose main line of argument was based on scare-stories about the Lisbon Treaty allowing Brussels to legalise prostitution, euthanasia and abortion.

However, most of the "No" camp was actually formed from forces which, whether they were themselves left-minded or not, sought to address the social discontent which is widespread in the country. Among those was the all-Ireland nationalist party Sinn Fein, with its 4 MPs in the Dail. Next, came a small number of union leaders, who supported the "No" campaign as individuals or in the name of their organisations. Finally there was the entire spectrum of left groups; together with a wide array of peace and anti-privatisation campaigns. All these currents focused, to various extents, on a denunciation of the social record of Ireland's so-called "affluence" and "free" society, with a clear nationalist emphasis in the case of Sinn Fein and union officials. But what they all had in common was that they blamed the social predicaments of Ireland on Brussels' diktats, or on "globalisation" - which, either way, side-steps the need for the Irish working class to fight back against its own exploiters. As if the turn of the screw on Irish workers, the state's privatisation drive and austerity measures, were not primarily driven by the greed of Irish capital, no matter how weak it may be!

There might have been a case for the left organisations, to campaign for a "No" vote, not as an anti-European statement, but as a means for the Irish working class' to refuse its support for yet another device designed exclusively to advance the interests of European capital, while at the same time expressing its opposition to the pro-business policies of the present and past Irish governments. As far as we can make out, however, none of the Irish left organisations made such a choice unambiguously. But it must be said that, whether they had done so or not, the almost total media black-out to which they were subjected meant that they were left to their own militant devices to make their voice heard - which was bound to be an uphill struggle.

As a result, it is doubtful that the "No" campaign played a decisive role in the outcome of the referendum. On the other hand, the line-up of participants in the "Yes" camp may well have been far more decisive than any of the arguments made during the campaign. Indeed, with the exception of Sinn Fein, the leaderships of every party represented in the Dail supported the "Yes" vote. That is, those belonging to the ruling coalition - the right-wing populist Fianna Fail, with its much smaller allies, the Popular Democrats and the Greens - and those in opposition as well - the Labour Party and the right-wing Fine Gael. In the same bed with all these parties were a whole range of business organisations, including IBEC, the Irish equivalent of Britain's CBI, and the Irish Confederation of Trade Unions.

In other words, the "Yes" camp was essentially made of those political parties, business and trade-union bodies, whose "social partnership" has presided over attack after attack on working class conditions together with on-going cuts to social budgets, over the past two decades. It was certainly no coincidence that the "No" vote reached record levels in urban areas with the highest low-income density, nor that, according to exit polls conducted by Eurobarometer, part of the Gallup organisation, the "No" vote reached 74% among manual workers as opposed to only 34% among senior managers! Judging from this, one can only conclude that it was the composition of the "Yes" camp, in and of itself, which provided a whole section of Irish working class voters the opportunity of using their "No" vote to express their anger against policies which have forced so many sacrifices on them, in the name of future "affluence" whose dividends they have never seen.

In that sense, the odds are that the actual outcome of this referendum had nothing to do with Europe, but everything to do with the social discontent of a whole section of the Irish working class - and with good reason too!

From the "Celtic Tiger" to the "dotcom" crash

Since the beginning of the 1990s, Ireland has been known for its high rate of economic growth powered by foreign investment. Due to the small size of its domestic market, the Irish capitalist class had only one way of escaping from the grip of British capital - by attracting foreign capital into Ireland. The Irish capitalists could hope to benefit from this by providing services to foreign investors, building facilities for them, supplying their factories and, above all, by taking their cut from the considerably larger tax receipts that the Irish state was expected to get from this foreign presence.

It was after Ireland's entry in the forerunner of the EU, in 1973, that this policy began to have some chance of succeeding. While the Irish government was beginning to receive a sizeable chunk of European development funds, the Republic became much more attractive to foreign manufacturers as a possible production platform and gateway into Europe. From the late 70s onwards, every Irish government devoted large amounts of public funds to entice foreign companies into coming onboard. The corporation tax paid by all exporting companies was reduced to 10% - the lowest by far in Europe. Under the auspices of the IDA (Industrial Development agency), the country was covered with a maze of ready-to-use industrial estates with all the requisite facilities. By the same token, in the name of "fair competition", Irish-owned businesses were granted the same kind of tax privileges and subsidies, though they did not need to be "attracted".

Within a decade, the Irish economy experienced above-average economic growth, to the extent that it was nicknamed the "Celtic Tiger" or the "Singapore of Europe". This period of growth lasted throughout the 1990s. By the second-half of this decade, foreign-owned firms accounted for 30% of Ireland's total output and 40% of its exports, while these figures were even higher in manufacturing, at 50% and 75% respectively. Most of these foreign-owned firms were high-tech, high value-added industries involved in electronics, pharmaceuticals and chemicals.

The flow of investment, went way beyond manufacturing, since at the same time, from the early 1990s, the setting up of Dublin's International Financial Services Centre, attracted 400 foreign banks and finance companies by offering all modern facilities for financial dealings, with the additional incentive of a low 10% tax on profit, cheap business facilities and lots of ways of hiding their real profits from their national governments. By 1997, Dublin had become Britain's largest offshore fund management centre, with 600 funds whose value was equivalent to over half of the country's entire national income.

Of course, most of the wealth piled up by foreign companies operating in Ireland was either stashed away in discreet speculative funds locally, or returned to the companies' shareholders abroad. However, the small proportion of their income which was spent in taxes and supplies was more than enough to line the pockets of the small Irish capitalist class quite comfortably.

But for all the talk about the "success story" of the "Celtic Tigers", it never brought any improvement in the conditions of the working class, though its labour was the main engine behind the economy's growth. Ironical as it may seem, the era of the "Celtic Tigers" was one of high unemployment, with an official headcount which only went down somewhat because of punitive measures against the jobless, and it was one of low wages, except for a thin layer of better-paid skilled white-collar workers.

In fact, these low wages were always one of the main selling points of the Irish IDA to attract foreign companies, together with the "social peace" that was supposed to dominate Ireland. On both accounts, the governments' "Social Partnership" policy played a major role. Between 1987 and 2000, four national agreements were signed in this framework, involving the state, the bosses' organisation IBEC and the ICTU, the Irish TUC, which provided for low wage increases and a system of compulsory arbitration designed to avoid strikes. It was the policing of the working class by the ICTU, coupled with an array of anti-strike laws comparable to those introduced by Thatcher in the 1980s, which maintained a degree of social peace, despite the lousy conditions imposed on workers.

As it happened, by the late 1990s, the "Celtic Tiger" began to lose some of its teeth, following the successive financial crises of 1997-98, before collapsing as a result of the "dotcom" stock market crash, in 2001. Over that period, many of the US ventures which had set up shop in Ireland cut their losses by cutting jobs, closing down operations and, in some cases, withdrawing altogether.

The Tiger revived on speculative steroids

The "dotcom" crash virtually dried up the inflow of manufacturing investment. After the peak reached in 2001, employment in production industries went down steadily year after year, while the overall employment figure more or less followed the increase of the population.

However, as a result of this crash, huge amounts of capital were divested from shares and other similar risky securities by their owners, who began to search for new ways of making a quick buck. This was a worldwide phenomenon. But it was particularly spectacular in Ireland for two reasons. First, because of the vast amounts of capital which were stashed away and stuck in the Republic for tax reasons and second, because being a tax haven right at the heart of the EU, Ireland was a place of choice for floating capital to settle, while waiting for better times. This resulted in another large inflow of capital into the Republic, this time with no other purpose than to speculate in a low-tax environment, and a new dawn for Dublin's financial centre.

The same phenomenon which took place in most industrialised countries, took place in Ireland as well - the build up of a huge speculative bubble, both in housing and commercial building, fuelled by the provision of an apparently endless flow of cheap credit. Only, in the case of Ireland, the mass of capital involved was much larger than in any other industrialised country compared to the size of its population and the real size of its economy.

Housing prices went through the roof. According to the IMF, the part of Ireland's housing inflation that must be attributed to speculation topped the league of the industrialised countries, far ahead of the Netherlands and Britain, which came second and third in this sorry hit parade. At the same time, personal debt rocketed, reaching the highest level in the whole of the euro-zone, both per head of population and as a proportion of GDP.

None of this has stopped the successive Fianna Fail governments of the past years from boasting about their "remarkable" management of the economy. Even this year, the government's annual "Measuring Ireland's Progress" report still hails the "fact" that the country's GDP per head is the second highest in the EU, behind that of Luxemburg (another tax haven, but with a much smaller population). Never mind the fact that this GDP figure is grossly inflated by the profits of Ireland's foreign guests, which will never benefit its economy; by housing and real estate which are still hugely over-priced, and by economic activity which is still partly boosted, artificially, by an unsustainable credit bubble! Significantly, none of the glossy tables featured in this report displays the level of personal indebtedness in the country - obviously, government officials thought it was better to err on the safe side, lest someone started pointing out how delusional all these figures are!

For several years, the real state of the economy has been concealed by this artificial boost financed by the credit bubble. Commercial buildings were developed and fitted long before any buyer or tenant had expressed any interest. Entire upmarket housing projects were built without anyone knowing whether there would be buyers. The whole construction industry has thus seen a boom, which is best illustrated by the fact that its workforce increased by 55% between 2001 and 2007, to the point where, in 2007, it employed almost as many workers as all production industries put together!

The same phenomenon took place in the retail trade, where rival companies embarked on cut-throat competition in order to capture consumers' credit-card euros. There again, this phenomenon is best illustrated by the fact that the workforce in retail increased by 20% over the 2001-07 period, overtaking production industries in 2007 - a progression which is all the more spectacular as there have been drastic job cuts in retail companies throughout this period.

The parasitism of foreign investors

Meanwhile, following the drying up of manufacturing investment, after 2001, there was a resumption of such investment, albeit on a much smaller level, in the following years. But despite all the tax privileges and other carrots waved in front of foreign companies by the IDA in order to attract them, these investments were only productive on paper and hardly generated any jobs, when they did at all.

For instance, multinational Shire Pharmaceuticals, which is the third largest British pharmaceutical company, with annual sales estimated to be worth over £1bn, announced last April that it was planning to move to Ireland. What this really means is that Shire intends to set itself up as a Jersey-incorporated company (one of Britain's very own tax havens), while setting up a holding company in Ireland, through which all its profits will transit, for tax purposes, of course. Shire was quick to point out to the media that this would change nothing to the situation of its employees. There would be no job losses in Britain, and no recruit would be added to the 55 employees of its Dublin office. However, according to a Shire spokesperson interviewed by the Irish Times, one of the differences, will be that the company will hold its board meetings in Ireland - of course, since it is a precondition for a holding company to benefit from the highest possible level of tax rebates, particularly on the dividends and profits earned from foreign subsidiaries!

Shortly after Shire's announcement, United Business Media, a group comprising dozens of media businesses across the world, published almost identical plans, with the same absence of new jobs for Ireland.

As to the old suspects, those which had set shop in Ireland during the "Celtic Tiger" era, the richest have remained there, even if they employ fewer people. And because they had so much cash to play with in Ireland, they have been a significant factor in the speculative bubble.

Probably one of the most ludicrous cases of all, among these rich companies, is that of Microsoft. Compared to other foreign investors in Ireland, Microsoft is a relatively large employer, with around 1,700 people working directly or indirectly for it in the Republic. Its main operation in the Republic is MIOL (Microsoft Ireland Operations Ltd). It runs a centre, which provides various services to Microsoft's operations in Europe, the Middle East and Africa. In 2007, MIOL made a profit of £1.85bn but paid only 10% of this in corporation tax (instead of the standard 12.5%) thanks to some smart tax tricks.

But MIOL is only the tip of Microsoft's Irish iceberg. Its direct parent company is MIR (Microsoft Ireland Research), also Irish-registered. MIR does nothing apart from receiving dividends from MIOL as well as from a number of Microsoft's foreign operations - thereby benefiting from the very favourable tax regime applicable to foreign dividends. MIR itself, has only two shareholders. One is a Bermuda-registered entity whose accounts are hidden by Bermuda's secrecy laws. The other is an Irish shelf-company, called Round Island One, whose address is that of a Dublin law firm. But since Round Island One is an unlimited company (i.e. it has the status of a privately-owned business) it is not required by law to publish its accounts. So, there stops the buck. Beyond this, what MIOL/MIR do with their profits in Ireland or elsewhere is totally hidden, including to the tax man, not to mention the public!

But companies which choose Ireland for its business-friendly tax environment are not necessarily thankful for the benefits they have enjoyed. As the problems facing the Irish economy became more obvious, Irish-based foreign companies began to increase the amount of capital they were sending abroad. By 2005, they were divesting the equivalent of 15% of Ireland's GDP, while exporting nearly half as much worth of profits. In other words, in that year, more than 1/5th of Ireland's GDP left the country for good. This was the largest capital flight out of any European country in that year.

"Affluence"? What affluence?

Within the limits of the artificial economic boom fuelled by the Irish credit bubble, jobs were created. Not in very great numbers, though. In fact just about enough to make up for the increase in the potential working population, but not enough to reduce unemployment, nor to cut the number of part-time jobs which, in fact, increased during that period. As far as non-skilled workers were concerned, all they could choose from were low-paid jobs in retail, catering and other services, in construction or in ancillary health services.

Construction was the largest single source of jobs, by far. Conditions in this industry were highlighted by the scandal surrounding the Gama strike, in 2005. Gama Construction Ireland was a subsidiary of a big construction company based in Turkey and operating across the Middle East. It had undertaken small and large projects, both industrial and civilian. In April 2005, 300 Turkish workers who had been brought into Ireland by Gama to work on a Dublin site rebelled. It turned out that they were forced to work up to 80 hours a week by Gama, for wages as low as £1.30 to £2/hour, or about one third the minimum wage. Not only were they paid no overtime, but, in fact, they had no access to even the totality of their wages, since part of them were "kept for them" in accounts with a bank located in Holland. Obviously this was a device for Gama to impose its conditions while preventing workers from just walking away. However, this time, it backfired on the scrooges. After a seven-week strike, with the active support of Irish builders working on the same site, the workers finally won an indemnity of no less than £1,300 plus a bonus whenever they chose to go back to Turkey.

Gama was probably neither worse nor better than many construction companies in most respects. And it was certainly not a cowboy contractor. But such methods were, and remain widespread in the construction industry, especially when dealing with immigrant workers, who are more often than not treated like cattle. Nor has this strike shamed Gama out of Ireland. It still has a book-full of contracts, including with a number of local authorities.

In the economy as a whole, the artificial boom had gone together with an above-average inflation. By British standards, wages were relatively high. Even the minimum wage was higher, at £4.70/hr in 2004 - although this applied only to over-18s after at least two years of employment. But direct and indirect taxes were high and the cost of living was higher than in Britain, including for basic things like food and clothes. In fact, taking all taxes into account, the actual cost of living for waged consumers was the second highest in Europe, just after Denmark. So, in reality, wages were sorely inadequate for most people.

This boom concealed, just as in the previous decade, deep inequalities. While the 1% richest in the population owned 20% of the overall wealth, 45% of the workforce worked in casual employment of some sort and had no occupational pension of any kind. And, given the ridiculous level of the state pension, this meant certain poverty for them after retirement. Official figures reckoned that 20% of the population was "at risk of poverty", and this in a country whose government dared to boast of having "achieved" the second highest GDP per head in Europe!

By 2007, it was estimated that over 5,000 people died every year for no reason other than the fact that they were at the bottom of the social ladder. In and of itself, this was a damning condemnation of the pro-business policies pursued by all the parties in office since the beginning of the 1990s. In addition to reflecting acute social inequalities, this figure illustrated the scandalous choice of all governments to starve public services, and particularly the health service, of funds, in order to line the pockets of foreign and Irish capitalists. In fact, when it came to social expenditure as a proportion of GDP, Ireland was, this time, in 8th position from the bottom of the EU-27 league, somewhere between Cyprus and Malta!

By the end of this short period of 6 full years, from the end of 2001 to the end of 2006, Irish workers could have filled suitcases with the paper promises they had been made of a blossoming future - of course all given with the proviso that they had first to tighten their belts! But they had still seen nothing of it. And worse was about to happen.

The credit crisis hits the working class

Having seen the most acute speculative bubble, there was some logic in the fact that Ireland should be first to feel the present crisis coming. In fact it did come, earlier than anywhere else, even before the US subprime lenders started showing signs of weakness, in the Spring of 2007. By that time already, Irish housing prices had begun a slow but visible slide down. The oversupply of houses built compared to solvable demand, had finally begun to be felt. It was not brutal at first, and in so far as personal credit remained available, households which faced difficulties resorted to unsecured loans instead of borrowing on their mortgages. This has helped to soften the blow for the relatively better-off layer of homeowners - for the time being at least. But judging from the sharp increases in interest rates which have been applied by some mortgage lenders, this may not last for very long, especially if the banks follow suit.

Very early on, the construction industry was hit by contract cancellations. By September 2007, companies started to lay off workers. By April this year, 39,000 jobs had already disappeared in construction alone over the previous 12 months. By the end of May, the number of houses built since January showed a 33% drop over the previous year. This led to speculation that an earlier estimate of 79,000 for the number of jobs which will have disappeared in construction by the end of 2008, may well have proved "over-optimistic". But even at that level of 79,000 this would mean already that almost 30% of the industry's jobs would have been lost, or 4% of the total number of jobs in the economy.

But construction is not the only area affected by the crisis. According to a report published at the end of June, the number of companies going into receivership increased by 71% over the past six months alone. In the meantime, between January and May, the number of redundancies rose by 27% across the economy, while the number of claimants receiving unemployment-related benefits increased by 31%.

The response of the state has not been long in coming, although prime minister Brian Cowen was careful not to take the risk of being too explicit before the Lisbon referendum. But today, all the knives are out to slash whichever budget can be slashed. Due to reduced domestic consumption over the past four months, the state's VAT tax receipts have been well below expected levels and the government wants to increase its receipts from elsewhere. As Cowen explained to an IBEC assembly on 26 June, "painful corrective action to deal the deteriorating economy will be taken promptly to avoid even more painful measures in the future." Since everyone knows that Cowen would never do anything that might hurt the bosses, "painful" means, of necessity, painful for the working class.

In fact, anyone could see this coming. For months now, the government has been preparing for massive cuts in the HSE (Ireland's NHS), including some ridiculous plans, such as "opening certain hospital beds only during certain hours". Although one can only wonder how the government plans to get rid of the patient in a bed due to be closed - put him in the mortuary? Meanwhile, nurses and hospital staff are on a collision course with the government over a programme which includes job cuts and the non-replacement of retiring staff. The HSE wage bill is obviously in the process of being cut to the bare bone and other social budgets will probably follow.

The other thing that workers have seen coming is a wage freeze. The phrase has not been pronounced, but the idea has been all over the papers for several months now. And Cowen made no bones about it in front of the IBEC assembly by calling for wage "restraint".

So after all these years of workers being told that they should endure their fate and keep quiet, no matter how difficult things might have been for them, so as to prepare a much better future for themselves, they are now supposed to foot the bill for the capitalists' financial crisis. Moreover, they are meant to do so in order to ensure that British accounting giant KPMG can keep producing glossy brochures for potential foreign investors, in which it celebrates the "Irish political parties" which "all support the market economy" and their "pro business, low tax policies aimed at promotion of economic development, and (..) attraction of inward investment"! And there are people who doubt that these workers might have used their ballot paper on 12 June, to express their anger against all these politicians and their pro-business policies by telling them to go and jump in the lake, with a "No" vote?

Pay negotiations are about to start between IBEC, the ICTU and the government, within the framework of the "Towards 2016" social partnership agreement signed in June 2006. The first section of workers concerned are public sector workers whose next pay rise is due on 1st September this year. Whatever is agreed by these workers is likely to serve as a benchmark for the rest of the economy. While making all due noise to indicate that they object in advance to anything that could be interpreted as a wage freeze, the ICTU leaders will not rock the boat of social partnership, for fear that the union bureaucracy might lose the social status and perks it has enjoyed in this framework over the past two decades. Nor, as a corollary, will they rock the boat of a policy aimed at enticing foreign investors, that is so dear to the hearts of the government and Irish capitalists. So the odds are, that, one way or another, the union machineries will, once again, agree to police a turn of the screw on workers.

Unless, of course, the Irish working class decides to say "No", once again, not by using a ballot paper, this time, but by using the weapons of the class struggle. And in order to make its "No" heard loud and clear, it will have to do what its union leaders have always feared over the past two decades - throw a spanner in the works of "social partnership" and use its collective strength in order to make the capitalist class pay for this crisis of its own making.