Month: June 2015

KNOWN KNOWNS AND UNKNOWN UNKNOWNS

It’s almost Rumsfeld territory.

The Government, battered after its annus horribilis, is trying to pick itself up and undo the damage in the year and a bit before the election. Few give it much chance. It is eight months since Labour showed in double figures, almost a year since Fine Gael got 30%.

However, the earliest opinion poll of 2015 offered some solace with slight increases in support for both Coalition partners to 24% and 8% respectively. While any recovery has a long way to go, some Fine Gael supporters are grasping at the straw that only six months before the last election their support was similarly languishing but recovered strongly. True; but then they were in opposition, not in government with a record to defend. This applies also – in spades – to Labour, who are under sustained attack from the Left over broken election promises.

Pundits argue that the unpopularity revealed in the polls has been too long in the making and cannot be reversed in the short time available, citing the difficulty of regaining the electorate’s trust once lost. Some see a post-election scenario in which three parties (FG, FF, and SF) would each have broadly similar levels of support, in the mid-twenties, with a further twenty-odd percent going to a Macedonia of independents, new parties and those of the hard left, the balance going to a Labour party rump.

Whether this or some other new political landscape will emerge remains to be seen. A year is a very long time in politics and there are different factors at play. Strategists of both government parties are fairly clear on what must be done – or avoided – to give them a reasonable chance. First there must be an act of faith – that the pendulum will swing back, not fully but just enough. Voter disenchantment can be volatile as well as enduring, particularly if there is no readily available viable alternative on offer. This probably saved the skin of several past Fianna Fail administrations. Still to be resolved is whether and to what extent the two parties will present jointly.

Second, avoid Banana Skins – or, if slipping, minimise the damage asap. The handwringing over Irish Water, the bleating defence of the indefensible over medical cards, cost the Government dearly last year. Cop outs like trying to blame a quango, or an unelected Regulator, or whinging that legislation ties the Minister’s hands, simply will not work where the public is seized of an issue. A government is elected to govern, not deliver excuses. Tough decisions may on occasion be necessary and the electorate tends to understand; wrong decisions, or no decisions, they will not.

Third, take on the opposition on the economy. The budget deficit remains huge, even factoring out interest payments on Ireland’s bailout. Borrowing continues. We are still living way beyond our means to sustain current levels of welfare and to run the state. The opposition have been coy on alternatives, beyond soaking the rich. They should be pushed on specifics.

It is not enough to point proudly to seeing off the Troika. An achievement, certainly, but one that has already been oversold. There is speculation that a new Greek government may, as threatened, reject or seek to renegotiate with the rest of Europe the terms of Greece’s economic bailout. Merely an election promise or a nuclear option? Should the Greeks secure a favourable deal by acting tough, the Government’s Troika boast would be rubbished. While Fianna Fail can be largely discounted on this, since it negotiated the Irish bailout terms, the potential boost to Sinn Fein, the hard left and independents could be considerable at the worst possible time.

Fourth, above all: Be Alert! Known knowns like Irish Water and medical cards have been identified – painfully – and attempts to cope with them put in train. This appears to have worked for the medical card issue. However the anti – water campaign is still very much alive and two significant dates are looming. The first is the early February deadline for registration, which will demonstrate whether the disaffected middle is satisfied with the government’s compromise climb-down. The second is Easter, when the first water bills issue (and shortly after the property tax has been extracted).

The government has been playing up the tax cuts from 1 January, pointing to taxpayers having more money in their pockets. These savings, however, look set to be cancelled out by the water bills, while the estimated 40% who pay no tax will feel the charges even more. The hyped €100 for registering with Irish Water won’t arrive until much later in the year. Watch this space!

There is also what could be waiting in the long grass. After years of cutting and trimming there are several potentials and it behoves the strategists to keep an ear very close to the ground – or at least to the daily radio talk shows. The plight of the homeless flared up before Christmas and there is currently the annual waiting-on-trolley scandal in hospital emergency departments, which seems worse this year. There could be legacy issues regarding past scandals – though these could affect all parties – and it will be interesting to see how the government handles the imminent report on the direct provision regime for asylum seekers. One other unknown is the extent of the rising tide of house repossessions and what effect these will have politically. On this issue the can-kicking appears to have reached a cul de sac. None of these are critical as yet.

There ARE positive factors. One which the pundits, the population and the politicians seem to have woken up simultaneously to is the spin off from the dramatic fall in oil prices. Lower prices for petrol and home heating have provided a welcome cash boost – rivalling that of the budget and with a multiplier effect. How this will play out in terms of a general feel good factor is a big unknown. Some of the benefits could be offset by the downward drift in the exchange rate of the Euro. There could also well be public ire should the lower fuel prices not be reflected in terms of cuts in electricity and gas prices. Irish consumers pay dearly for electricity in particular and a forensic examination of the feather- bedded companies is long overdue. This one is a slow burner (ouch!).

With the most recent economic trends there is some leeway to placate public opinion, by rowing back or reversing some of the austerity measures over the next year. A start has already been signalled with for example overtures on pay to the public sector. There will definitely be at least one giveaway budget and a good chance of a second. The Spring Economic Statement may prove to be more than just words if the polls remain unfavourable.

Nothing will prevent massive seat losses for the Government parties in the next Dail. Yet the strongest card it has may well prove to be the electorate’s reluctance to endorse Sinn Fein or to court the possibility of a government in thrall to a disparate group of independents. Now that WOULD be an Unknown Unknown!

22/01/15

TEA PARTY POLITICS – IRISH STYLE ?

The very latest polls suggest that in the next election the three major centre parties would be unable to muster a majority between them, while Sinn Fein’s support continues to grow, and the strongest support is for independents of various hues (chiefly left-wing).

Most worrying is that the trend in the polls evident throughout 2014 resembles the melt down in Fianna Fail’s support before 2011. One or two polls could be dismissed but not the last half dozen which have seen support for Labour collapse and support for Fine Gael also decline sharply. As I write there is nothing to suggest, beyond pious hopes, that this will change. And, where public opinion has actually been tested – in the local and European elections in mid-year and in subsequent by elections – the poll figures have been, ominously, validated.

The Government must be asking itself “Where did it all go wrong?” The most secure government in the country’s history has imploded so severely in 2014 that its chances of being returned to power seem slim.

Nobody said it would be easy – three years of unremitting austerity with tax increases and benefit cuts had severely dented the Government’s popularity. However, in the absence of any credible alternative, with the economic corner turning, and with the political kudos for successfully seeing off the Troika, 2014 promised much. Factoring in the gradual waning of mid-term unpopularity and two possibly favourable giveaway budgets before a 2016 election, the prospects last January seemed reasonably positive.

That at least was the theory. And, in the macro sense, things went according to plan. The economy bounced back big time and at a surprising pace. It appeared the Government had got it right – austerity worked. Debt targets were met, austerity seemed to be ending and there was talk of a billion to play around with in October’s budget with the promise of more to come. Twelve months on, the Government is in a shambles, with support for both coalition parties seriously degraded.

In retrospect, in political terms, the Troika Era was an extended honeymoon period for the Government. All the nasty cuts and new taxes could be blamed on the Troika and Fianna Fail, which had let them in. A type of Dunkirk spirit obtained in which the public, by and large, put up and shut up. People did not take to the streets. However, once the Troika departed, it was end of honeymoon and back to the kitchen sink.

While national bankruptcy had been averted, the country’s finances repaired, and “core” welfare benefits preserved, aspects of the cutbacks, and the scattergun approach to economising, particularly in the small print of measures taken, proved toxic. Cuts yielding little in savings emasculated many small services and programmes which helped the sick, disadvantaged and politically powerless. The monies could have been saved elsewhere by targeting some of those “core” heavy hitters through, e.g. means testing child benefit or even slightly raising income tax and blaming the Troika. It might have worked, though try explaining that to people losing out on a carer or a respite or other grant . The resulting drip feed of public disillusionment and simmering anger was not perceived officially at the time.

This was compounded by a succession of tactical and strategic blunders by the Government during 2014, culminating in the fiasco over Irish Water, an issue that rumbled on throughout the year before coming to a head in November. The blunders had a cumulative effect. Just about every issue and crisis during the year was mishandled, exploding the myth of government competence.

Early on a furore over the level of salaries paid to the top executives of some state funded charities brought down Fine Gael’s ablest political strategist Frank Flannery .The Garda Whistle-blower controversy, complemented by allegations of bugging the Garda Ombudsman’s office, morphed into a major crisis that saw the removal of the Justice Minister, his Department’s top official, and the Garda Commissioner.

Soon after, an obvious populist proposal to give free GP care to the under sixes ran foul of public outrage at a parallel attempt to save money by reviewing – and withdrawing – thousands of discretionary medical cards issued to genuinely sick people. The official protestation that the under-sixes proposal was the first stage of a roll out of universal free GP access fooled no one, with medical experts pointing out that this was to prioritise the healthiest ahead of those in greater medical need. The medical card fiasco was in part responsible for the Government’s lamentable showing in the mid-year elections, which prompted the resignation of Labour leader Gilmore and the kicking sideways of accident prone Health Minister Reilly.

An attempt to relaunch the Government’s Programme in July briefly held promise, with Ministers talking up the state of the economy and generating expectations of a giveaway October budget. In the event they oversold, with the budget’s modest provisions satisfying nobody. But even before that the Government’s credibility was further shredded by the McNulty Affair in which the Fine Gael candidate for a Senate vacancy lost after revelations that he had been nominated to a state board at the last minute in order to boost his election credentials. Small potatoes stuff but many saw it as the type of stroke politics and political sleaze associated with Fianna Fail.

Next came the revelation that the junior Environment Minister was employing, as his driver, a fellow party member who was also a government appointed director of the new Irish Water quango. Stroke politics with a vengeance. A hasty Government announcement of a new system ( a “portal”) governing public appointments to state boards – long a traditional form of patronage for rewarding loyal supporters – was greeted with derision.

Cue Irish Water – a slow burner. The Troika proposed in 2010 that Ireland join the rest of her EU partners ( and help bridge the budget deficit) by charging for water. Fianna Fail, outgoing, had bought into this, and the new Government did likewise. A simple flat-rate charge would have sufficed while all aspects of the matter were examined, the issue complicated by the legacy factor – the existing infrastructure is inadequate, antique (some pipes date from the Nineteenth Century) and defective (with up to 40% of water lost through leakage).

In a catastrophic political misjudgement Irish Water was established, with start-up costs of several hundred million dollars, much of this for consultants, an acknowledged level of over manning from the start and with some contractual systems locked into place until 2027. Public anger was compounded by the revelation of a bonus culture in salaries, including those underperforming. When the likely hefty scale of the charges became known, the issue boiled over. Street protests culminated in a massive demonstration by over 100, 000 in November. The left had a field day.

The issue became a lightning rod for discontent, with the middle classes joining in. The Government blustered, then caved in, slashing and deferring the proposed charges. Those opposed remain adamant. Right now the Government is hunkering down and keeping fingers crossed but such is the degree of public disenchantment that all the mainstream parties are running for cover. Is this the beginning of tea-party politics, Irish –style?

18/12/14