A Failing Model

Irish capitalism has failed most Irish people. The economy is characterised by levels of inequality and insecurity that are unacceptable in a democratic society. According to the International Monetary Fund, Ireland is now the fourth richest country in the world in terms of GDP per capita. Despite this, 1.2 million people experience ongoing deprivation, making up 25% of the population. There are also half a million people living in consistent poverty. The economy should work for all but on these figures it is failing badly.

Irish capitalism is also deeply unstable. The crash of 2008 caused untold damage to our economic and social infrastructure. This should have been the wakeup call needed to move away from neoliberal policy making. Instead, successive governments forced the costs of the crisis onto working people. This has resulted in deep inequality as well as the worst housing and homelessness crisis in the history of the state.

As if this was not bad enough, Ireland now rests of a tax dodging model that is under pressure. The decision of the British electorate to leave the EU, coupled with the decision of the EU to pursue a common consolidated corporate tax base, has left the Irish tax dodging model in real peril. Increasingly it looks like the Irish elite will be faced with a Hobson’s choice – continue to support global tax dodging outside the EU or remain inside the EU and sign up to common corporation tax rules. Neither strategy is compatible with the current model of Irish capitalism.

Below is a summary of the problems associated with Tax Haven Ireland.

  • A reliance on tax dodging in the Irish Financial Services Centre and by multinationals such as Google, Starbucks and Apple.
  • A reliance on Foreign Direct Investment that has failed to create a manufacturing base in Ireland.
  • A severe lack of fixed capital investment
  • Regional imbalances and the development of a two-tier economy both economically and spatially.
  • The proliferation of unpaid internships such as JobPath and Gateway.
  • The proliferation of low paid and precarious employment, including bogus self-employment.
  • Working conditions that are undermined by periodic crises in the global capitalist economy.

Deep inequality in terms of income, wealth and power.