Small is beautiful

     
The strength of the idea of private enterprise lies in its terrifying simplicity. It suggests that the totality of life can be reduced to one aspect - profits
Today, Thursday is the 20th anniversary of the death one of the world's best selling and possibly least regarded economists. E F Schumacher.

In 1973 Schumacher published a book titled Small is Beautiful - A study of Economics as if People Mattered. The book is easy to read and highly informative and has sold 4 million copies across the world. While Schumacher's philosophy is not socialist republican his indictment of free market economics and transnational economic unions will strike a chord with Irish republicans.

For example he writes: ``The strength of the idea of private enterprise lies in its terrifying simplicity. It suggests that the totality of life can be reduced to one aspect - profits''. He calls the idea of the market ``the institutionalisation of individualism and non-responsibility''.

On the ideology of the market Scumacher writes that ``let no-one befog the issue by asking whether a particular action is conducive to the wealth and well being of society, whether it leads to moral, aesthetic, or cultural enrichment. Simply find out whether it pays; simply investigate whether there is an alternative that pays better. If there is, choose the alternative''.

Schumacher's work offers a range of telling indictments on economics as a science, on the belief that greater size in companies, in cities and economies is the only route forward.

He also tackles the role technology and mass communications will have on society. Much of his analysis has been proven in recent years and the central core of his work - the need for autonomous independent states who control their own economic destinies has never been more relevant.

Schumacher's book is available in most stores but if you hunt around the second-hand shops you can possibly get it for a £1. It's well worth the search.

Time to invest in people

In December 1997 Patrick Mayhew increased `security' spending by £120 million. Mowlam's announcement last weekend means that at the very least this spending should be diverted to other areas.

 
It's not often that the Dublin and London governments act in tandem when dealing with the Irish economy, but both governments find themselves this autumn in a similar position. Both are preparing budgets and spending plans for the coming year.

Both governments are also in a unique position as they come to the next spending period with excess money to spend. Both governments also face the common problems of how to deal with long-term unemployment, how to tackle endemic disadvantage, inadequate housing and living standards, as well as rural underdevelopment, not to mention the pressing need for a border regions development initiative.

In the Six Counties last Friday, Mo Mowlam told the media she was accepting the bona fides of the IRA cessation. So now we are facing a scenario where the budgetary spending of the British government on its so-called `security' spending should be substantially reduced. It follows then that this spending should be used for social priorities and should not disappear back into the British exchequer.

Under the Conservative administration, it was planned that spending for 1997/98 would fall by 2%. Now the Labour Government has a chance to reverse this plan. In December 1997 Patrick Mayhew increased `security' spending by £120 million. Mowlam's announcement last weekend means that at the very least this spending should be diverted to other areas.

In the 26 Counties, official figures for tax revenue released this week showed a 14.7% growth in the tax take so far this year. The Fianna Fáil/ Progressive Democrat coalition face a scenario where they have a £736 million surplus of income over expenditure half way into the year.

Both governments have exceptional circumstances to divert spending into the social and economic priorities that have been ignored in previous years. For now though, the likelihood of this happening seems remote.

In the Six Counties there has been no comment on the prospects of diverting funds away from unnecessary military spending and in the 26 Counties the focus is only on tax cuts. It is time for both governments to move beyond the short term and think how can they best help the people of Ireland. The first step is to think of putting people first when formulating plans for economic development. They need to invest in housing, in health and education, they need to invest in people.


Low wage ghetto


What do 26-County workers have in common with their counterparts in the USA? Well the 26 Counties vies with the USA for the highest growth in wage inequality between the years 1987 and 1994. A new survey published by the Economic and Social Research Institute (ESRI) shows that the 26 Counties has the highest proportion of low paid workers in the industrialised world.

In the survey a low paid worker is someone who earns less than two thirds of the median wage. The median wage is the earnings of the people working half way between the lowest and highest paid in the state.

In 1987 21% of 26-County workers were earnings wages below this mark. In 1994 24% of workers were below the median level. Only the USA at 25% has a higher proportion of workers in this category.

ESB wage hike


ESB had to delay appointing a new chief executive this week because of a dispute between the government and the ESB over his salary.

Under agreed guidelines the new chief executive Ken O'Hara's salary package could not have topped £105,000. However the ESB board have negotiated a salary of £150,000 with him. This was on the basis of the Buckley Report on Public Sector Pay published last March, which allowed for substantially increased wages for the bosses of public sector companies. Already the bosses of Telecom and Aer Lingus earn in excess of the agreed guidelines.

The cabinet have suspended implementation of the Buckley Report because the wage increases envisaged are substantially higher than what Joe Soap workers will get under Partnership 2000. Maybe it is time to look at the wage packets of Telecom and Aer Lingus and impose some wage cuts there.

Germany rules


Who controls the 26-County economy? Last week German Bundesbank President Hans Tietmeyer showed the power he wields.

Tietmeyer proclaimed that one EU currency would need to be revalued. The punt currently at the top of the EU currency grid is the obvious candidate. His comments led to ``steady foreign buying'' of Dublin Government bonds, pushing up bond prices. This shows the Bundesbank's power and is tangible proof of how eroded our economic sovereignty is.