Austerity and corporate welfare has failed! Fight for public investment!

The recent flood of job losses announced by manufacturing companies in Northern Ireland further demonstrates the utter failure of the local governing Assembly’s economic strategy. The decision by Michelin to shut its factory in Ballymena, directly resulting in 860 job losses, triggered a coordinated wave of announcements by firms. Within a matter of hours, Caterpillar announced 100 job losses, Schrader Electronics 42 and textile maker Invista 48.

Corporate handouts no solution

Following the Michelin announcement, Democratic Unionist Party (DUP) Enterprise Minister Johnathan Bell stated, “We have to reduce our corporation tax, set the date that we are going to do that; and attract those 30,000-plus new jobs that are available to Northern Ireland.”

This is pure fantasy under conditions where corporate investment across Western Europe has collapsed, with big business shifting east in search of ever lower wages and ever higher profits. Only last year, fellow Ballymena-based tobacco firm JP Gallagher’s admitted that corporation tax cuts would not have impacted in the slightest on their decision to close with the result of 900 job losses.

The Assembly parties’ strategy of giving handouts to big business has only attracted precarious, low-paid jobs, typically in call-centres. These fly-by-night investors often up sticks and leave as soon as the subsidies dry up. A cut in corporation tax would be no different. Meanwhile, the effect of the Assembly’s austerity on small businesses will be more job losses, particularly in the service sector, and will drive the Northern Ireland economy further downwards.

Austerity acts as a weight on the economy

The mantra of “recovery” does not apply to Northern Ireland, with the local economy still lagging 8% below 2007 levels. Northern Ireland has the highest percentage of UK workers on the minimum wage. According to PricewaterhouseCoopers, housing and utility costs will account on average for more than 25% of household spending by 2020.

A social crisis is looming with respect to the impact of unemployment and under-employment. According to the latest Northern Ireland Labour Force Survey economic, inactivity has reached a six year high, with 323,000 people now either unemployed or unavailable for work due to illness, studies, or retirement. Unemployment among 18-to-24-year-olds is now at 18.1% compared to the UK average rate of 13.3% . At nearly 61%, the proportion of long-term unemployment is comparable with that found in the austerity-decimated economies of Portugal and Greece.

We cannot accept the bleak future offered by the austerity policies of the politicians. There were hundreds of billions to bail out the bankers, yet communities facing devastation by huge job losses are told there is nothing to be done! Trade unionists, young people and working class communities must organise to fight for massive investment in jobs, housing and public services, paid for out of the coffers of the fat cats and bankers who created the crisis.

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