BUDGET 2008: What we need is new economics with new politics

A radical break with old economics

BY JIM MONAGHAN 

BOTH Declan Kearney and Mícheál Mac Donncha raised interesting ideas on the theme ‘A Signpost Towards Modern Ireland’ but both missed the real point: the future will not be a steady evolution of the past; the future will be a radical break with the politics and economics that we are used to.
The era of cheap oil is coming to an end and with it the consumer society. A new era of long-term rising oil and food prices and increasing climate change is gradually replacing the economic, political and social world we knew.
The recession due to the ‘credit crunch’ is part of the normal working of capitalism - of boom and bust - but it is worsened by the growing problem of ‘peak oil’ and rising food prices as well as the slowly mounting economic costs of damage due to climate change. Economically and politically, the world has become very volatile. For instance, look at how suddenly the recession hit, how unexpectedly the prices of food and oil rose to record heights, how many wars are going on.
This is the big picture - the world context in which Ireland now exists. We have to frame our political, economic and social plans for the future within this reality.
We all have our own well-developed ways of thinking about the politics of the North of Ireland and of the South of Ireland, and we often see the world differently, but in the face of the huge changes those ideas are becoming less central. In the future, we don’t want to have our children ask us: “Did you not see what was coming?”
Politically we need to decide whether food and energy supply can best be dealt with in an EU context or whether we need to develop them primarily within this country. The answer to that has profound implications either way because, among other things, it depends on an assessment of what the economic conditions will be in 20 years from now under the stress of peak oil and climate change.
If world growth rates do not keep pace with the economic losses due to rising food, oil and climate costs, then living standards will fall. There is a real question about whether living standards can be protected at all in a free market economy. The Stern Review Report on the Economics of Climate Change predicts that climate change alone could lead to world recession due to continual economic losses from floods, storms, rising sea levels and droughts.
Economically, there are both positives and negatives for Ireland. Some of the negatives have already been touched on: recession, rising oil and food prices, economic damage due to climate change. We also have a divided country with British colonial interference making decision-making and adaptation measures more difficult. The positives are an ideal location for wind and wave energy, good land with plentiful rainfall, an educated population capable of adapting to the new situation and relative wealth in the country. Our economic policy should be largely about how to maximise the positives and minimise the negatives.
It would be necessary to use government planning and direction of resources to make the huge economic changes required in the time available. Climate change and peak oil have to be anticipated and the necessary infrastructure built before the situation requires them. A market-led economy is inefficient for this as it only responds to the present, not the future. We would have to confront the political supporters of the free market on this reality.
With a good economic development plan, Ireland could become a net exporter of electrical energy from wind, wave and sea current generators, as well as a major exporter of food in a world where demand is high. We would need to put the infrastructure in place, including a huge system to capture and store rainwater for the agriculture industry. Other industries would use the relatively cheap electrical energy and agricultural inputs to make liquid fuels, gases and chemicals, as well as high value foods. Forestry would not only supply timber but also woodchip to replace heating oil and the raw material for bio-fuel. Transport would need to be largely run on electric batteries and electric trains. The education system would allow us to become world leaders in technologies aimed at adoption to the new climate and expensive oil.
Wealth is generated by selling goods and services, and we could become very good at that using our natural advantages. Part of the wealth generated would go on providing the infrastructure so that we could minimise the losses due to climate change - flooding, sea level rise, storms and droughts. If that is not done then there would be continuous and growing losses in repairing damage.
Our political task is to organise all this and get public support for it. We have to do it in such a way as to involve the people in real decision-making at all levels, both in the party and in society.
The history of Irish republicanism made it necessary to develop organisational methods based on military hierarchy which served us well during the years of war. These methods are very good at performing mechanical tasks such as postering and canvassing but they are counter-productive in organising mass support in modern society. People are not content to just follow instructions. They want genuine involvement in decision-making. Many, especially women, who join us, are disappointed and leave us again.
People outside Sinn Féin are unsure about what we stand for besides a united Ireland and a left-of-centre politics similar to Labour or the Greens. We need to be selling them a vision of the future; something that they can believe is really necessary and they can be inspired by. If we can do that, then recruits will stream to us. 
Finally, the election of Sinn Féin representatives is not an end in itself - it is only a step towards implementing our vision of the future. First we must agree what the vision is and argue for it in every available forum until it has the support of the people.