'We've screwed up - that's the truth'

Slí Eile04/05/2009

Sli Eile: ‘We’ve screwed up – that’s the truth’ – so writes Professor Ray Kinsella of the UCD Smurfit Graduate Business School in the Irish Times on 23 April. This is a declaration one would search in vain to find on the lips of Economists or Government or Banks or Political Parties or Churches even if President Obama recently acknowledged that ‘I screwed up’ on the Daschle appointment to Government.

It is refreshing if at least one economist is prepared to use the ‘we’ word in describing a collective, societal and shared failure to ensure a fair and sustainable economic and social order. The analysis offered by Ray Kinsella is enticing even if the solutions and programmatic way forward is much less clear (but then who is offering a clear-cut and well thought out exodus from this present impasse?) Kinsella has been following Alasdair MacIntyre in arguing for a new ethic in politics. MacIntyre’s website says that it is committed to ‘provide a forum within which contemporary Aristotelians, Thomists, Marxists and others can explore the grounds for a common project’. It aims to do this ‘in a spirit of friendship and communal dialogue, whilst also engaging in dialogue with rival traditions.’

In an earlier piece in the Irish Times on 5 March, Kinsella argued that:

The sense of “right” and “wrong” at the heart of ethics, resonates the public’s perception of an intrinsic “unfairness” with various aspects of the economic crisis and its consequences. Regulation, to take one example, is a necessary but not sufficient condition, for a restoration of financial stability. Individuals, no less than corporates or countries, cannot be regulated to do the “right” or “moral” thing. Ethics is, by its nature “obedience to the unenforceable” and the ultimate guarantor of trust. This fact is at the heart of the seeming dichotomy. “It may be legal, but surely it can’t be right . . . ”

Kinsella’s analysis of 23 April may be boiled down to the following:

1 ‘There is a quiet desperation among individuals and families and businesses’

2 ‘We are looking at a fracturing and realignment of political institutions which do not speak to the sensibilities of a young generation they have beggared’

3 ‘The roots of this latent political crisis are – like those of the global financial crisis – starkly ethical in nature.’

What ethical issues arise then? Kinsella suggests the following inherent problems:
    • ‘The defining characteristics of the system as a whole is a culture of power instead of service to the person’

    • Systemic lack of political, values-led leadership (and vision)

    • Politics should be about service to the people and to their common good (the res publica of civic republicanism)

His solution? More cuts in public spending and wages across all sectors? More public asset-striping? More bail-outs? Not a word in this article, anyway. Instead, Kinsella calls for this:

We need a realignment of politics in Ireland – we need democratic choices that mean something to contemporary society. We need a sense of right and wrong. We need a whole new political ethic premised on values-based leadership.We need to engage individuals who have little interest in power as such, who have a commitment as well as a widely acknowledged expertise that is capable of restoring trust, confidence and a sense of direction.

Tellingly, Ray Kinsella comments (in the context of the pending Taxation Commission Report) that ‘the Government will commission external agencies to prepare detailed reports when all the knowledge necessary is already within their own departments. There is an acute lack of confidence in our own expertise and in our own resources.’ A less benign interpretation is that Government is well aware of these resources but does not want to use them effectively or listen to advice it does not want to hear.

Finally, in a piece that could have come straight from CORI, ICTU or the INTO:

We are spending undreamt of sums of money – which we do not have – to support utilities which are skewed in favour of shareholders (and that is the supreme irony, since their interests have been entirely subverted by a malign business model) – while we continue to have a fragmented, unfair and multi-tiered healthcare system.

I think that it is possible – from a progressive standpoint – to agree with much if not most of what Ray Kinsella is saying. The problems he identifies are part personal/spiritual, part structural/societal and part ethical/legal in nature. An inclusive analysis and, therefore, an inclusive solution needs to take account of the complex layers. Hence, responses along the lines that all we need is just a clean sweep of the tops of financial institutions as well as a new set of faces, names and parties in Government will utterly fail unless there is, also, fundamental change in the content and ethics of public policy and leadership. Calls for the resignation of such and such a Minister miss the point. The health system is the way it is because ‘we screwed up’ by investing in a fragmented three-tier health system where people could buy their way to skip the queue. At the same time, unelected groups along with vested interests in the health service benefited from the status quo. Beginning with Noel Browne’s reforms in the 1940s/1950s, every attempt to make health a public good and right over a commodity or private sphere has met with opposition from the predictable sources, backed by political (and, in the 1950s, religious) ideology.

‘We cannot build a new capitalism on old politics’ says Kinsella. Indeed. Perhaps a New Deal economically and internationally calls for a New Deal politically. In the 1930s, the New Political Deal found expressions in ‘Popular Front Governments’ among a small number of democratic nations (France and Spain). Is it now time for a new political dispensation along the lines of ‘Progressive Alliance’ Governments in as many EU Member States as possible to shift the tide? Iceland led the way in terms of European economic meltdown. They seem to be leading the way, now, in terms of political re-building. Such a new alliance would focus in immediate order of priority on:

  • Effective action to address climate change;

  • Cooperation to address the causes of world poverty and oppression;

  • Measures to defend and advance public services;

  • Measures to redistribute income, wealth and political power in favour of disadvantaged individuals and communities

  • Reforms of democracy and public institutions to make them more accountable and to encourage the widest possible participation.

What about the state of the public finances and competitiveness on global markets? The best way to tackle that is to build a fair society where talent is liberated and a sense of social solidarity is promoted. We should never waste a crisis. This could be our unique market selling point. Economics needs to get political, and politics needs a new economics.

Posted in: Democratic accountabilityEconomicsEconomicsEconomics

Tagged with: Political Economyethicspublic financesMacIntyre



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