The European Union’s statistics agency – Eurostat – released figures earlier this month demonstrate, in stark terms, how workers in the South of Ireland have been locked out of the massive wealth created here.
Eurostat showed that consumption levels in the South were below the EU average and far behind countries like Germany, France and the Scandinavian nations. What does this tell us about Ireland and the EU itself?
Low wages, high prices plague workers in Ireland
Firstly, the incessant propaganda portraying Ireland as a prosperous, wealthy, advanced country, all of which are products of EU membership, is exposed as a lie and deliberate deception. Low consumption rates are related to low wages and high costs of living. In fact, Eurostat also confirmed this week that prices for goods and services in Ireland are the second highest in the EU. Workers in the South, even those on ‘decent’ wages know that reality, all too well. The political establishment and their media friends keep pushing the falsehood of widespread prosperity. Eurostat’s figures expose that.
The second thing these figures tell us is the damaging legacy of the EU’s vicious campaign of austerity following the 2008 financial crash. All the countries exposed to EU ‘bailouts’ – Greece, Italy, Spain, Portugal, Latvia, Ireland – saw living standards fall as a result. Eurostat’s consumption figures confirm that that fall is probably permanent. Just as the capitalist class through their instruments the European Central Bank and European Commission intended.
Related to this is the third striking feature. That is the stark reality of a capitalist EU which is deliberately structured as a two-tier EU with a small number of rich ‘core’ countries and a larger number of poorer ‘periphery’ countries. Ireland is decisively stuck in the latter group. The reality of EU capitalism is the permanent underdevelopment of countries that have been member states for decades. Ireland, Greece, Portugal and Spain, for example, have been EU member states for over 40 years and yet living standards still lag behind the original member states of Germany, France and the Benelux countries. This is a conscious policy by the EU’s elite who need a periphery of highly educated but cheap labour to sustain European capitalism.
No prosperity for workers under EU capitalism
The capitalist EU is built upon lies, as these figures reveal. Despite the propaganda, there is no intention of harmonising living standards or equalising up to a decent standard for all European workers. Instead, as socialists have consistently warned since the European Economic Community (EEC), the EU’s forerunner was established, the whole project is one of brutal economic segmentation of the 500 million workers to better exploit their labour.
Out of control economic inequality is one of the multiple crises the capitalist system faces right now. In the case of the South of Ireland, this is manifest in Eurostat’s consumption figures. These contrast with Gross Domestic Product (GDP) per capita – the measure capitalist economists use to show wealth theoretically generated by each person every year. According to the OECD, the club of the richest countries in the world, the South of Ireland, is the second richest country in that club, with each woman, man and child in the South generating a massive EUR 77,000 per person in 2018!
Tax haven Ireland
How is this disparity explained? Tax haven Ireland facilitates enormous flows of speculative capital every year which generates an annual profit of at least 150 billion – yes, billion! – euro per year. While workers are told there is no money for anything, and there won’t be any money for anything in the future either, the global capitalist class fills its boots and kicks back a share to their local henchmen. All facilitated by Fine Gael, Fianna Fail, Labour and the Green Party.
The Eurostat consumption figures are a snapshot of capitalist reality in both Ireland and across Europe. They show the inherent feature of capitalism as an economic system towards permanently uneven economic development. As capitalism faces another period of turmoil, the firmly divided two-tier Europe that the capitalist class has created will worsen. The EU is not, yet, a super-state capable of independent action. Instead, it must be understood as a tool of the class rule used by existing national political and capitalist elites to cement the domination of capitalism both within member states and across the EU.
The alternative: A Socialist Europe
Militant Left, and our comrades in the Committee for a Workers’ International (CWI), believe that a socialist Europe must be consciously fought for. This would be based on genuine solidarity between workers, and have workers’ ownership and control of the economy, at its heart. Ireland, North and South, can be part of that socialist Europe. Instead of being condemned under capitalism to the permanent role as a shady tax haven, we can play our part in building a worker’s Europe where socialist cooperation based on meeting human needs, replaces a capitalist EU based on ruthless competition, exploitation and division.