Friday, 2 December 2011

Budget 2012: Where's the substance?

Peadar Kirby: Amid all the kite flying, the scaremongering and the testing of the electorate’s pain threshold, the central lesson of the preparations for Budget 2012 has been lost. For more clearly than anything that the FG/Labour coalition has done since taking office, the way Budget 2012 was prepared shows that we are back to politics as usual Irish-style.

Two aspects invite attention. The first is the process and the second the content. Budgets should be seen as opportunities to debate national choices for expenditure and taxation, choices that ultimately involve values about the sort of society we want in the future. New left governments in Latin America have over recent decades experimented with forms of participatory budgetary processes that draw wide sections of the population into deliberating on these choices and, in the case of Brazil at least, having a real say in what choices are made. Instead, in Ireland we have a process made behind closed doors with various options floated to gauge public reaction but with final decisions made only by cabinet. We take this for granted but it is an appallingly undemocratic and irrational way of doing things. We might have expected that, with so much emphasis on political reform, the opportunity would be taken to open up the process on this occasion.

Inevitably, such a process undermines any prospect that preparing the budget might at least begin to address the major questions about expenditure and taxation that face this society. We urgently need a public debate on the balance between expenditure and tax increases that should characterise our adjustment and, much more importantly, about the sort of taxation system we need if we are to achieve greater resources for national development and greater equity and fairness in where we get these from. This is perhaps the single most urgent reform we need as a society and, judging from the preparations for Budget 2012, we are not going to get it.

One might be forgiven for drawing the conclusion that our political and economic leaders see a value on so distracting and frightening the citizens, that no one dares raise these wider issues. It is yet another sign, if one is needed, that we badly need the sort of vibrant citizens’ movement that is beginning to emerge in other societies. One issue at the top of its agenda should be the right to have a say in preparing the national budget.


Robert Barrett said...

A well crafted piece by Peadar that hints at the link between the growing democratic deficit within Ireland to a broader and more general crisis of legitimacy around our current institutional frames of governance.

Perhaps it is time to consider an overhaul of the Irish political system and to create one which aims to deliver on that radical idea of democracy. We might consider adopting a participative model along the lines of what Peadar suggested regarding budgetary participation. To go further, we could consider reducing the size of the Dail and establish a permanent citizens' assembly to advise government directly, creating a structure that allowed people to speak for themselves about what they feel is important with the additional hope that this might raise the level of political and social debate within the public sphere overall.

We need a political system that is responsive to the needs of all and not simply those with the power and connections to influence government.

Ireland is in desperate need of an ideal. The continuation of the current representative model of democracy, with the expectation of a real and lasting solution is the definition of madness.

Thank you Peadar for a thought-provoking piece.

Paul Hunt said...

I've made this point elsewehere, but it seems quite relevant here. The biggest problem I see is that whatever resolution of the Euro crisis which will emerge next week - and of which Ireland's budget is a subsidiary part - is being driven mainly by centre-right governments – with a keen eye on their chances of re-election. Constituencies that are unable to enforce effective collective action or lack economic power and influence – and which form part of the core support of the centre-left – will be hammered. However, those that can apply collective action and enjoy some economic power and influence – even if they nominally form part of the core support of the centre-left – are likely to get a free ride.

And we can see this clearly in Ireland (as well as throughout the EU). Those who are organised, or who are able to exercise economic power and influence, are being cosseted; those who are not are being, and will be, hammered. And while the centre-left purports to represent the interests of quite a few of the well-organised and the interests of almost all of those who are not, the centre-right can divide and conquer to protect the interests of its supporters. When confronted with a requirement for some structural reform, the centre-left is loth, and probably unable, to accept some trade-off between the interests of the well-organised and the interests of those who are not. And so we end up with a stalemate with the centre-right imposing some cosmetic reforms on the alleged ‘fat cats’ among its supporters – to deflect the righteous anger of the centre-left, the well-organised on the centre-left being protected and the least organised and poorest getting hammered. And it proves impossible to implement sensible structural reforms that would benefit the majority of citizens and the economy.