Days Like These No 3. Will You Promise To Keep Paying The Bankers On Demand?

Guest blogger Gerry Fitzpatrick

What was it they used to say about trade Unionists and the New Labour Party? - something about there being ‘no more beer and sandwiches’ for them in Downing Street any more. What that phrase meant was that there would be an end to any cosy relationship and assumptions about improving pay and conditions.

Today it has just been announced that the chiefs of the biggest five banks‑mortgage lenders have completed a two day visit to Downing Street. This ended with the Treasury agreeing another £50 billion of public money would be given to those bankers to ‘boost their confidence’. Trade Union leaders have not been heard on the airways on the subject of this new cosy relationship, which involves the exchange of bad debts for government bonds that can be then traded on the open market. Only the venerable Vince - Mr Cable of the Liberal Democrats - was given an audience by BBC to object to this. He pointed out that government have asked for nothing in return - no agreement on future regulation, no guarantees that the behaviour the bankers themselves agreed caused the chaos in the first place - would be moderated.

The problem with the Governments’ and Mr Cable’s approach, as one commentator pointed out, was that it had a built-in flaw. Because, as she explained, the £50 billion of Government subsidy to the banks would not be enough to keep the bankers confident in their own market this year and that the whole operation could carry on indefinitely year on year.

Nationalisation of bank debts has now the only dependable source of private Bank profit as they in effect become government bond dealers. No matter this is still a short term solution that will in turn cause the value of the bonds to fall. Why? Because the government got rid of its assets 20 years ago that could have been used to halt a fall in their value on the open market. Now it has only the tax payer and arms industry left to depend on and their own borrowing.

After the debacle over the abolition of the 10p rate of tax and the fate of the Aljamai Saudi arms deal the government will itself have to borrow yet more money. That money will not be supplied by the central (American) banks. The government, like the other governments of the world, will take their place in the Beijing Dole queue to avail themselves of Communist China’s Social Security Scheme for Capitalist Ruling Classes. China will be happy to wait until land prices in Britain and the world fall by 30% and then they plan to start buying as the Japanese security houses did in the 1970s.

That might be in a year from now but by that time Chinese peasants will already have begun to die from hunger due to the doubling and trebling in the price of rice. Who then can say what will happen to the Chinese government?

Let them eat cake - water bosses party as Executive looks to private equity

Given the scandals that have surrounded NI Water, a celebration of the first anniversary of its creation would have hardly seemed appropriate. However, this did not deter the company throwing a £8,000 bash birthday bash at a luxury hotel for its senior managers. This came just days after the utility regulator had lunched an investigation into a blunder that could result in customers paying an extra £20 million a year in water bills.

The shamelessness of NI Water bosses is perhaps matched only by their lack of taste. This was revealed in a leaked draft itinerary for the birthday gathering. It refers to "party bags with sweets" being available on tables, a "birthday tea" at lunchtime with "sandwiches, cakes, jelly and ice cream" and " birthday branding" including banners and balloons. A special birthday cake was scheduled to make an appearance after a morning presentation to managers on NI Water's first year by its chief executive Katharine Bryan. The draft programme said the chief executive would be asked to stay on stage to cut the cake, as the lights dimmed, music played, and birthday imagery appeared on screen. The song snippet earmarked for the start of Bryan's talk was from the U2 hit "Pride". Other songs featured included "Praise You" by Fat Boy Slim, "Little Less Conversation" by Elvis, "Shine" by Take That and the theme tune of The Office. The last is particularly appropriate as the party scene conjures up the discomforting comedy that was the hallmark of that series. Unfortunately this isn’t a satire on reality TV, this is reality. If there is a joke it’s on the public.

The bosses of NI Water can engage in such smug and contemptuous displays because there is absolutely no pressure on them from the parties in the Executive. This is despite the fact that it is nominally a government-controlled company. While there may be huffing and puffing from some MLAs, NI Water has been given a free hand to do whatever it wants. The minister for Regional Development, Sinn Fein’s Conor Murphy, uses its status as an independent company to evade any responsibility. We therefore have a situation in which all the Executive parties claim to be against privatisation of the water service and extra water charges, while the management of NI Water moves this process on a pace.

While there may appear to be a conflict, the reality is that the Executive and the management of NI Water are actually in tune. Despite the rhetoric the whole thrust of the Executive’s programme is towards privatisation and the extension of the role of private finance within public services. The latest example of this is the agreement negotiated with the comptroller of New York City pension funds to invest around $150 million in the Emerald Infrastructure Development Fund. This fund, which will effectively act as a private equity firm, will finance projects in the north in sectors such as energy, waste management, property, healthcare and ports. Significantly, the water industry was also mentioned as a possible area of investment.

Despite the claim from Martin McGuinness that the fund represents “the ordinary people of the United States investing in the ordinary people of the North", this is certainly not charity or an act of solidarity. It is actually a form of financial speculation. New York city comptroller William Thompson was clear about the purpose of this fund when he declared that was "optimistic about the opportunities for potential strong returns" from the north.

Investment of this type is also a driver of privatisation as whole areas of the public sector are opened up to private capital. This is what is behind the massive expansion of PFI schemes in the north. Under these public assets such as schools and hospitals have been transferred into private ownership and taxpayers forced to pay for their maintenance. This racket has run up hundreds of millions of pounds in public liabilities. Despite the rhetoric about additional investment, private finance actually extracts money from the public purse. And it is workers who bear the cost of the “strong returns” for the likes of Emerald Fund, whether directly through jobs losses and deteriorating working conditions if they are employed in the public sector, or through having to pay charges and higher taxes for public services. No wonder the bosses of NI Water are celebrating!

Dublin Palestine march: Socialists supply the bodies, liberalism supplies the politics

An Ireland-Palestine Solidarity Committee (IPSC) march of around 300 people was held in Dublin on Saturday April 12^th. The demonstration was part of a series of IPSC events to commemorate the Nakba – the ethnic cleansing of Palestine which led to the establishment of the colonial-settler and apartheid state of Israel. It linked the most infamous massacre of 1948 – Deir Yassin where around 120 people were killed, and the ethic cleansing on which Israel is founded established, with the ‘collective punishment’ endured by the people of Gaza today.

It was an issue worthy of protest, but one could only blink at the role of the Dublin left. The socialist movement, along with Palestinian émigrés, made up the whole of the demonstration, hosting a platform largely dominated by forces far to their right. The most glaring example was the keynote speech by David Norris in which he indicated his support for the state of Israel, qualified with a call for more humane treatment of Palestinians. He was followed by bluster from Michael D Higgins of the Labour party and blather from SIPTU bureaucrat Mags O'Brien and Sinn Fein apparatchik Mary Lou McDonald. The only figure who could be definitely identified with socialism was Eamonn McCann.

Socialists have been holding demonstrations throughout the lifetime of the modern working class. They have hosted non-socialist speakers with very distinct ground rules. One – an attempt to broaden the movement by engaging with new forces the speakers bring with them, two – to debate issues and win workers away from liberalism, nationalism and social democracy.

These ground rules no longer apply. The grandees never bring anyone but themselves. Michael D could claim to have brought Labour youth – but they would have come anyway. Norris had no-one to bring. Sinn Fein will keep their own supporters as far away from the left as they can. As for debate – the fact that Norris can support Israel without facing anyone protesting and pointing out that that state can only survive by maintaining ethnic cleansing and apartheid is a sign of the deep demoralisation of the left.

This behaviour is clearly suicidal, Sinn Fein in particular are clearly using the issue of Palestine to re-establish a little of the leftist glitter that tarnished so quickly in the last election. If they succeed they will obliterate the left’s own pretensions to electoral success. How can we explain it?

The answer seemed to be summed up in the platform calls for the EU to suspend the Euro-med agreement that gives Israel special status. This is nothing but another call for the ‘international community’ to act. The EU is clearly with the other imperialist powers in supporting Israel. The job of the socialist movement is to try and convince workers to intervene on the side of Palestine. It appears that the left have given up trying to climb that particular mountain and are willing to allow liberalism to set the agenda.

Bertie Boy bows out

While Bertie Ahern may have claimed the announcement of his resignation as Taoiseach was made voluntarily and at a time of his own choosing, there is no doubt that the continuing revelations at the Mahon Tribunal hastened his departure. Up until last week he was showing every indication that he was set to brazen it out, even going on the offensive with his own legal challenges.

What really did for him was the admission from his former secretary that he had given her pounds sterling to exchange and deposit in his bank accounts. This was a charge that he had vehemently denied. But he had now been caught telling a blatant lie. With another appearance at the tribunal looming in May, where he would be questioned about this, he chose to resign.

Of course this was dressed up as being in the interests of the country rather than a desperate attempt to salvage some dignity from a precarious position. Not that Ahern could muster much dignity in his resignation announcement. It was a long whine about how he had been hard done by, the innocent victim of a relentless media campaign. This was a complete distortion. It was not the media that brought him down (in fact he had gotten a relatively easy ride for a long time), but all his lies and dodgy dealings. He was a corrupt politician whose luck had finally run out.

Not that you would have gained this impression from the tributes paid to him. To go by them you would have thought Bertie Ahern was a saint. The biggest claims made for him were as the architect of the peace process and social partnership. Sinn Fein President Gerry Adams said he “brought about the Good Friday Agreement and he deserves our thanks for that." SIPTU General President Jack O'Connor said Ahern's time in office had seen “the most dramatic enhancement of economic prosperity in our entire history”. But it really says more about the state of trade unions and the republicanism movement than Ahern that their representatives should praise the two greatest triumphs of imperialism and capitalism in Ireland.

The claims for Ahern as the architect of these is also dubious. While he may have been around, the figure most associated with social partnership was Charles Haughey. The peace process also predated his period as Fianna Fail leader and Taoiseach. The real drive for this came form the political collapse of the republican movement. The role of Irish Government was to copper fasten this by going along with the British and dropping any gestures (such as articles 2 & 3) towards democracy.

There is also an attempt to present Ahern as a symbol of the “new Ireland”. But this is a myth as well, ignoring the political milieu that created him. He attempted to spin this myth himself in his resignation speech when referring to his admiration for former Fianna Fail leaders. However, his list had one glaring omission - Charles Haughey. This is even more glaring in the case of Bertie Ahern as Haughey was his political mentor. He was part of Haughey’s inner circle and the monumental corruption of that period. It was Ahern who singed the black cheques that aided Haughey’s pilfering of the public purse.

Despite his man of the people image Ahern, like Huaghey and his other predecessors, was only concerned with looking after the interests of the rich in Ireland – from tax amnesties to low taxes on profits and privatisation. He presided over a period when inequality grew massively and billions were transferred from Ireland’s workers to the wealthy. He had done his bit to create a rich man’s paradise and expected to get his due. This is the real story behind Ahern’s “unusual” financial arrangements.

Bertie Ahern claimed that one of the reasons for delaying his resignation to the 6 May was so he could take up his invitation to address a joint sitting of the US Congress. That such an “honour” should be performed by someone leaving office because of corruption may appear unseemly. But what better representative of the Irish political class could there be?

The Levellers and Optimists

By guest blogger Gerry Fitzpatrick

The ticker tape that runs across the top of my computer has just informed me that American government and the Federal Bank is in the process of changing the economic system once more. Now we are finally backed to the saner system of a failing bank being able to avail itself of extensive funds on demand. What this will mean I can only paraphrase in the style of a fellow columnist who contributes and occasional column to a UK liberal daily:

“Government Announcement: ‘Capitalism - it is a complex system and every now again the state needs to take your money, and the money from the weak, the poor, the disabled and the sick and give it to very rich people. These very rich people are like you and me – they are people who have failed to keep themselves very rich. We all depend on these people – they have committed no crime (other than acting like criminals). We owe them all a great deal and over the next few years you will see how much we are in their debt. If you are in receipt of tax allowances or pensions however small or Social Security payments how ever large, please donate to this worthwhile cause and give generously.”

I suppose any liberal or liberal comedian columnist could have written that as those who publish such broadsides believe that they are close to making a comeback. It would be glib to call them ‘Keynesians’ as they have only ever existed in theory. No, I’m actually talking about the good citizens at Goldman Sachs, CNN international, Granada Television, The London Independent, The Guardian, The Observer, and Melvin Bragg (Inc). For if there is one thing that unites them all, here and abroad, it is the belief that the state can be a great democratic leveller correcting the errors of the free market with power of regulation – once that is done they argue, society would then be both greater and more equal. Unlike the free marketers who tend to be Right Wing Populists they are Principled Democrats. Everywhere they and their ideas are poised for a comeback. From now on, we will all be reminded of the state Will Hutton is in.

But what if we had an example of a state where these notions had been the official ideology for over thirty years? Commentators used to joke that the state of Northern Ireland was the last bastion of communism in Europe. They were not of course referring to Northern Ireland’s annual security bill or the cost of replacing its slums after sixty years. They were referring to the state and its official ideology of bureaucratic optimism.

This policy was recently on more dramatic display at the launch of the consultative document on Human Rights which produced no agreement on what was a human right and who should be entitled to them. This was at the end of a ten year process of consultation. The cheerleaders of the process such as Sinn Fein and the Communist Party – the local official optimists who say they believe in the power of the state to level – were of course not downhearted.

For they have become like those who they supposedly oppose. Institutionalised liberals all, who believe in the state as a benign force that is supporting and guiding them because, as they say to whoever will listen – the process. It is the only progress that is available to them to believe in. And who could blame them, their needs as believers have been satisfied.