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Irish workers lose out as America wins big
By Joe Horgan
There was once a thriving textile industry in Donegal. Not any more. The Fruit of the Loom company, which incorporated a local family business when it began, has just announced the final closing down of its Irish operations.
The remaining 630 jobs are to be lost. They will go, these jobs, and not come back. That industry is now at an end. Perhaps that is just the way it goes. Times move on and jobs vanish as markets and countries alter. Perhaps that is the nature of things.
People have always been prey to the vagaries of the market that sustains the financial system we live under. I really believe that Bertie and Mary wish us to believe that it is no more complicated than that. Put on your cap, walk out the door and accept that it’s just the economy, stupid.
Mary Harney, the Tanaiste and Minister for Enterprise, Trade and Employment, stated simply that the end of this industry in Donegal and the wider North West was “very disappointing, but reflects the fact that the sector is no longer competitive, not just in Ireland, but in this part of the world.”
She went on to add that “retraining will be available to all those who will lose their jobs as a result of this announcement,” which should bring a wry smile to anyone who, unlike Mary Harney, actually has any experience of redundancy, unemployment and training schemes.
What is interesting though is the blithe way that politicians and their economist masters state that something is no longer competitive and therefore has to end. What exactly does that mean? Take those jobs in Donegal for instance. Where have they gone now that Ireland and apparently even Europe is no longer competitive? They have gone, where the rest of the previous job losses in this industry had already gone, to Morocco. Which is good news for Moroccans.
But quite clearly not just good news for them. It is also good news for the companies and the economists. The workers of Donegal may have lost their jobs but the people running the company have lost nothing. They have merely relocated.
And this is where we can start to see what exactly lies behind the vagaries of the market and Mary’s oft-repeated mantras about competitiveness. It wouldn’t be at all the case, would it, that Morocco is more competitive because its workers have lower wages? Would it? That, being a poorer country than Ireland, its workers can not afford to demand comparable working conditions. That perhaps its health and safety regulations are not as stringent. It is surely not the case, in the brand new world of Mary’s free market, that Morocco has the jobs and Donegal doesn’t because the Irish ask for a decent wage and decent working conditions. The business men Mary loves so much won’t put up with that if they know that some poor souls somewhere else will be so grateful that they will accept far, far less.
Maybe not. Maybe those Moroccans are being paid as much and are more competitive in a way that we cannot quite grasp. Maybe it is just the economy. Maybe Mary knows best. She might not know much but she knows about that for sure. Maybe those Donegal people should just accept it and look forward to those retraining schemes, whose purpose may be lost on them but whose content is bound to include computers. It’s technology, stupid.
But while there has been bad financial news in Ireland for those in Co. Donegal, there has been good financial news in Ireland for those in, erm, Co. Washington. An American financial magazine has just announced that the most profitable country in the whole world for American corporations is little old Ireland. Indeed profits made by US companies between 1999 and 2002 doubled and doubled in what are astronomical figures.
The report states that “in low-tax Ireland, the profits of subsidiaries of US multi-nationals have doubled from $13.4 billion to $26.8 billion.” Ireland even outstrips Bermuda (which has no taxes) as a ‘tax haven’ for US corporations. Now that should be great news for Mary and her dreams of Ireland as an offshoot of the American economy. Indeed it is perhaps just a sign of how competitive we truly are in some sections of the global economy. As Mary always says we must never cease in making ourselves attractive to foreign investors and these figures would suggest that we have tarted ourselves up very nicely indeed.
Yet, as always, another reality lies beneath that of the bare statistics. A US Treasury Department official stated that while American corporations were indeed producing large amounts of profits in Ireland it was difficult to assess how much of this was as a result of genuine economic activity and how much was as a result of manoeuvres aimed at avoiding tax rates in the USA. Which must leave even Mary feeling a little bit betrayed.
After doing all she could to entice those American businessmen she now finds that they might just be using her after all. They may well be employing a good few people here, but it also seems that they may also be employing a good few accountants. Oh, the morals of the market place. Ah well, she knew who she was mixing with. What did she expect?
So no jobs in the hills of Donegal but plenty of lucre, filthy or otherwise, in the corridors of Washington. Suddenly Mary’s market place looks a far more tawdry place than ever. Some poor people are now making cotton sweaters because the Irish stopped being so poor after all and some Americans are stashing loot around the fields of Ireland because they know Mary won’t go near their wallets.
Corrupt, rotten, wrong? The new Ireland? No, it’s just the global market, stupid.
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