John Bruton

Opinions & Ideas

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RICHIE RYAN RIP

I would like to add a word to the many well deserved tributes that have been paid to the career of Richie Ryan, who died yesterday.

He was the most radical Minister for Finance ever. His commitment to social justice was realistic, rather than rhetorical.

 The changes he made in extending the tax base, through capital and other taxes, and his simultaneous widening of social welfare coverage, were not equalled by any other Minister for Finance.

To have undertaken such changes at a time of economic contraction due to the aftermath of the 1973 oil crisis, was truly remarkable.

 He managed to turn the economy around, and growth had returned by 1975. But the political dividend from growth was, as to be expected, delayed. It was not reflected in the result of  1977 Election. Richie Ryan did not get the credit he deserved, at the time, or since.

He was deeply loyal to his party leader, Liam Cosgrave , and was one of his most combative defenders.

He had a very serious accident later in life, and showed immense courage in the way he faced, and overcame, the challenges it brought. He did not let it stop him being a cheerful and friendly presence at party gatherings.

He will be missed. I extend heartfelt sympathy to his family.

LORD LOVAT

To get my mind off Brexit, I recently read “The Last Highlander, Scotland’s most notorious Clan Chief, Rebel and Double Agent” by Sarah Fraser.

 It is it life story of Simon Fraser, Lord Lovat, who was beheaded for treason at the age of 80 in 1746.

Fraser was a Gaelic speaking chief of the Fraser clan which occupied a huge territory in the vicinity of Inverness.

His first allegiance was to the Fraser clan, and to the Clan system.

 After that his allegiance was to Scotland.

Subject to these two primary allegiances, he switched his loyalty from the Jacobite Kings to the Hanoverians, and then back again.

 He spent time in the Jacobite Court in France, and  died a Jacobite.

 But he was on the Hanoverian side in 1715 when the first Jacobite rebellion took place in Scotland, then on the Jacobite side in 1745, when Bonnie Prince Charlies raised his standard.

At various times Lovat was gaoled by both dynasties.

 When not in gaol, he lived and entertained extravagantly, to keep up his status as a Chief. He had a complicated private life, to put it mildly.

Sarah Fraser’s book tells an exciting story well.

For an Irish reader, it shows how the Gaelic clan system survived in Scotland up til 1745, 130 years after it had been destroyed in Ireland, by the Ulster Plantation and the Flight of the Earls.

KEVIN O ROURKE ON BREXIT

I have really enjoyed reading “A Short History of Brexit, from Brentry to Brexit” by Kevin O Rourke.

O Rourke is a UK based, but Irish born and resident, academic, who also has a house in France.

His father, Andy, is a distinguished former Irish diplomat, and his mother is Danish.

He brings this varied hinterland to his aid, in probing the forces that shaped the British decisions

 first to join, and then to leave, the European Union.

Behind this inconsistency he identifies the existence of two  conflicting strands of thought, in the UK Conservative Party, and more widely.

The first is idea of “Imperial Preference”, that of giving better trade access to the UK market to the Empire than to other countries. This has deep roots in the Party.

 It was championed by leaders like the Chamberlains and Baldwin. This policy was implemented, in 1931 by Neville Chamberlain, when he became Chancellor of the Exchequer.

In contrast, Churchill, although a strong Imperialist, opposed protectionism all through his career. He advocated a “United States of Europe” in a speech in July 1945.

 Macmillan, who shed the Empire and had been wounded seven times in the First World War,, understood the need for the UK to build its future, and a structure of peace, in Europe.

 In contrast, a later Conservative Prime Minister, David Cameron is quoted as saying it was “a myth” that European integration was the result of the lessons learned from two world wars.

There is much that can be divined from this well written book.

The 2016 Referendum can be traced back to a decision, in 2010, by 81 Tory MPs to defy their Whip and vote for a Referendum on leaving the EU.

Then , when Cameron set out to renegotiate UK membership. he recklessly announced that he would not “take no for an answer” on restricting free movement of people within the EU Single Market. He was never going to win that concession.

The book also analyses the history of the Irish and European economies in the 20th century.

 Ireland was a late developer, mainly because it waited until the 1970’s, to open its market to foreign competition. Even Portugal and Greece moved faster.

O Rourke highlights the importance of the common EU VAT regime, and the sharing of information between EU states on VAT, as the means of avoiding hard borders within the EU.

As the author says,

time is money and border controls cost money

WHAT SHOULD THE EU DO AFTER BREXIT?

WHAT SHOULD IRELAND’S POLICY BE?

 The terms of Brexit are vital for Ireland.  But so also is how Ireland locates itself in the EU AFTER Brexit. President Macron has written to the Taoiseach setting out his post Brexit agenda. The Finnish government has just published an 125 page report on the implications for Finland and the EU of the changing global order. Ireland should do the same.

 Brexit could change Ireland’s geostrategic position.

SECURITY

If the US guarantee of Europe’s security through NATO were to be diminished, and/or if the UK were to become estranged from its continental European allies, Ireland would be in the geostrategic frontline.

 The UK/European/US security alliance has provided security for Ireland since 1945, at modest cost.

It will be in Ireland’s interests that this security alliance survive Brexit. A clash on security policy between the UK, and the continental members of the EU, would hit Ireland, particularly its communications, energy and cyber security.

FIVE THREATS

Stresses in European security will be caused five global forces. These are

  + A richer, but older, human race, reluctant to change, and nostalgic for a past that never really existed. The EU and the UK are part of an ageing continent, with declining population, but close to Africa which is a young and potentially dynamic.

  + The increasing vulnerability of globalization and the of norms that underpin it. The WTO is at risk.

  + Climate change and intensifying competition for scarce material resources, not just energy but water, phosphates and rare earths.

  + Distrust of political leadership, and of experts could lead to a paralysis in necessary decision making in the EU and other multinational institutions.

  + The economic rise of China and India and their associated political ambitions, and declining interest of the US in guaranteeing Europe’s defence.

 All these forces will leave Europe, and Ireland, increasingly vulnerable to outside pressures.

EASIER TO MEET THEM TOGETHER THAN SEPARATELY

Meeting them will not be the responsibility of the EU alone. Member states themselves have far more spending power than the EU has. They spend 40% of GDP whereas the EU only spends 1%. Cooperation with the UK, especially after Brexit, will help.

 If European countries want to have maximum impact on most of these huge challenges , they will need to act together, and in good time .While the absence of the UK from the EU will be a handicap,  fractious and prolonged arguments among EU states themselves could be an even greater one.

 Irish policy should be that, by acting within or through the EU, rather than on their own, EU states can do more, at less cost.

 But will that approach get the unanimous agreement among all 27 EU members? If not, smaller groups of EU states may decide to go ahead on their own, using Title IV of the Treaty, which allows for this. To the extent that a member state then declines to take part in a Title IV activity, it may find itself in an EU “slow lane”. Ireland should avoid being in any EU slow lane. Brexit has made us geographically peripheral, so we should avoid being politically so too.

TREATY CHANGE SHOULD NOT BE RULED OUT

 That said, the EU may only act within the limits of the powers given to it in the Treaties.  If necessary, pragmatic, case by case, amendments to the EU Treaty, to enhance EU competences, should be made. That would, on balance, be better than an EU of first and second class members.

  After Brexit , Ireland must concern itself with the worries of ALL its 27 EU partners, even if these are not of immediate concern to Ireland. The more Ireland does this, the more will those states be willing to support Ireland when Ireland has a problem.

 Ireland should be proactive on all the continents big problems, and should seek solutions to its own problems within the context of a wider EU interest, rather than just look for exceptions. It should avoid alignment with sub groups of states within the EU, who could be seen as divisive or negative .

COMPLETE THE UNION

 Ireland should be positive in support of Banking Union, Energy Union and the completion of the EU Single Market in services. This will sometimes involve standing up to France and Germany, but it will enlarge opportunities for all.

 We will not always get our way, and when trade offs have to be made, these should be explained fully  to the public and the Oireachtas . Ireland should learn from the UK’s mistake on Brexit, of failing  to educate its electorate on the compromises it would have to make.

MAINTAIN THE RULE OF LAW

Populism in central Europe must be confronted. Maintaining the rule of law, and an independent judiciary, are vital to the survival of the EU. EU rules are meaningless if they are not enforced by impartial courts.

The EU is the most advanced multinational, democratic, rule making body in the world. It can be made even more democratic. One way to do this would be through the direct election, by the voters of the EU, of the President of the European Commission. Another is through the Citizen’s panels advocated by President Macron.

The further enlargement of the EU should be supported on a case by case basis. It is important to the consolidation of democracy, in countries like Serbia and North Macedonia. But democratic standards must continue to be insisted upon AFTER a country has joined the EU, as well as when it is applying.

AVOID PROTECTIONISM

Ireland is the EU country with proportionately the greatest amount of US investment. If stresses arise between the US and the EU, these will be felt disproportionately in Ireland. Some of President Macron’s ideas could cause difficulty here. Skillful Irish diplomacy and foresight will be required.

As well as the terms of Brexit, these are the issues that must be discussed during the forthcoming European Elections.  The EU has strong institutions which have proven their worth. But it is the people who operate the institutions that will make the difference. That is why the choices voters will  make in choosing MEPs are so important.

Tribute to Edward Collins, former Minister of State and Dail Deputy.

I was deeply saddened to learn this morning of the death, after a long illness, of my close friend and former colleague, Eddie Collins. I extend heartfelt sympathy to his family.

Eddie was born in 1941. He served on Waterford Corporation from 1964  to 1981 and on Waterford County Council from  1979 to 1981. He was a distinguished economist and businessman.

I met Eddie Collins for the first time when I went to Waterford to campaign for him in the 1966 by election. It was an exciting old style campaign with parades and rallies on behalf of the rival parties as well as intense local canvassing. Eddie was the inheritor of the Redmondite tradition in Waterford City politics. While Eddie did not win the by election in 1966, he was elected to the Dail in the 1969 General Election and served in the Dail until 1987.

He represented Ireland on the Parliamentary Assembly of the Council of Europe for a number of years.

He was Fine Gael Spokesman on Education on the opposition benches from 1977 to 1981, and was exceptionally active in drafting new educational policies for the party. He proposed the establishment of local educational structures to give citizens more influence on education. He promoted an Adult Education Bill, which was strongly supported by Aontas, the national body for adult education.

When Fine Gael entered government in 1981, he became Minister of State for the Tanaiste, the late Michael O Leary, in the Department of Industry and Energy. This involved a very heavy work load.

In the 1982/87 government, he served as my Minister of State in the Department of Industry, Trade Commerce and Tourism. Again I found him to be an exceptionally hardworking, creative, reliable and loyal colleague.

When he lost his seat in the 1987, he continued his lifelong interest in education by becoming a lecturer in economics in the Tallaght Institute of Technology.

He was deeply affected by the death of his wife , Lelia, a few years ago.

CAN THE BREXIT IMPASSE BE RESOLVED?


This week I am speaking in the Sciences Po University in Paris at the invitation of the Dean, Enrico Letta, a former Italian Prime Minister .

A member of the Scottish Government, Fiona Hyslop will also speak and we will be discussing the dilemmas posed by Brexit with a number of academics and their students.

Later this week, I will attend the Ideas Lab, organized by the Centre for European Policy Studies (CEPS),  in Brussels. I am a member of the board of CEPS.

This meeting will consider the possibility of the trade war between China and the US going global, integrating climate and trade policies, and the vision for the EU for the next 5 years. Brexit, as such, is not on the agenda.

Interesting ideas on resolving the Brexit impasse have been put forward by Andrew Duff, a former MEP, and by Professor Kenneth Armstrong of Cambridge University.

Andrew Duff suggests a series of detailed amendments to the Political Declaration that would bring the UK closer to the EU in some respects.

Professor Armstrong suggests a new protocol that would give greater legal force to the Political Declaration.

His core idea is that there would be that a set of criteria be negotiated, as to how and when the backstop might  be implemented, or be modified or replaced.

Procedurally, his proposal would de dramatize and postpone the issue. But it would not solve it.

It remains to be seen how it could avoid a hard border,  either in Ireland or on the Irish Sea, if, at the end of the day, the UK insists on pursuing an independent trade policy.

It is also unclear whether a majority could be obtained in the House of Commons for any of this.

Until that is clearer, it is hard to say whether the EU has a credible interlocutor in London with whom it can negotiate. The UK Parliament has yet to reconcile its desires, with the essential needs of the European Union. It has to accept the tradeoffs involved.

Professor Armstrong’s approach would avoid a No Deal crash out on 29 March.

I have no doubt that customs controls will have to be introduced by Ireland, as a continuing EU member, in the event of a No Deal crash out.

I feel that public opinion has not been prepared for that legal reality.

Being in the EU has been very advantageous for Ireland in every way, especially in attracting investment and jobs.

So Ireland must implement EU law. The EU is a system of rules, and if its rules are not respected, it ceases to exist.

“NO DEAL”, AND FARMING…WHERE ARE THE CREATIVE SOLUTIONS?

The shocking consequences for Irish farming of a No Deal Brexit have been spelled out in graphic detail by Phelim O Neill in successive editions of the Irish Farmers Journal.

The beef sector will be worst hit, with a 350kg Irish beef carcass, worth 1295 euros, facing a 780 euro tariff on the UK market, if the UK applies WTO terms.

If, instead, the UK adopts a zero tariff approach, Irish beef would face unlimited Brazilian competition.

The emergency support measures, that the EU might introduce to deal with a No Deal crisis, would buy time for the sheep, pig and dairy sectors. This would allow them to develop alternatives to the UK market.

But alternative markets for Irish beef, at anything near the returns to be found on the British market, do not exist.

A No Deal has become increasingly likely because Mrs May has decided that her priority is to avoid a split in the Conservative Party.  She has calculated that, if she tried to get her Deal through with Labour support, in return for modifications that would satisfy Labour, such as staying the Customs Union or softening her stance on EU immigration, her Party would break up. She would lose 50 or 100 MPs, and would cease to be Prime Minister.

Should, or could, the EU make concessions that would help out Mrs May?

Even if the EU side wanted to make concessions to the UK on the terms of its Withdrawal, it has no way of knowing if Mrs May would have the political authority to get any such modified deal through the House of Commons.

When one contrasts what leading Brexiteers, like David Davis, were saying a few years ago about what might be acceptable, with what they are insisting on now, it appears that nothing will satisfy them, and that every concession will be met by a new demand. It is catharsis, rather than compromise, they are after.

This is the point that needs to be addressed by those in the Irish media who are already laying the ground work for blaming “brinkmanship “ by the EU, and  particularly by Ireland, if the UK crashes out of the EU on 29 March.

What guarantee can these critics offer that any conceivable “alternative” to the backstop would pass in the House of Commons?

These critics, and the UK government itself, have so far been shy in coming forward with practical ideas that would get a majority in Westminster, and also respect the integrity of the EU market.

One person who has come forward with ideas to break the deadlock is the UCD economist, Karl Whelan.

He says that one of the reasons advanced by the DUP for rejecting the backstop, namely that the backstop would place a barrier in the way of Northern Irish exports the Britain, is without foundation.

 He says that under the backstop, exports originating in Northern Ireland would go through a Green channel at Belfast port with no checks or controls. Only goods originating in the Republic of Ireland , or further afield, would have to go through a red channel where there might be checks.

And, at the same time, NI exporters would have free access to the EU across the open land border in Ireland… They would have the best of both worlds.

Karl Whelan goes on to suggest that, to get the Withdrawal Deal across the line in the House of Commons, the EU side might consider two extra concessions.

 The first is an option that, at some future point after the end of the transition period, Britain could leave the joint Customs Union with the EU, on condition that Northern Ireland  remained in the Customs Union and aligned with EU goods regulations. This would deal with the Brexiteer fear that the EU is trying to “trap” Britain in the Customs Union, which is not the case.

The second part of his proposal is that voters in Northern Ireland try out the backstop for a few years, but that, after (say) five or more years, they could have a referendum, in which Northern voters could decide to opt out of the backstop.

He thinks they would opt to stay in it because by then they would , over the five years , have experienced the “best of both worlds”  that the backstop gives the Northern Irish economy.

There are two problems with this idea. The suggested referendum could further deepen the Orange/Green split, and the very possibility of a referendum would introduce a new element of uncertainty for business. Referendums are inherently risky and influenced by extraneous issues. But the delay would allow time for the supposed technological fixes for a hard border to be road tested.

That said, his proposal would be far less divisive than an outright border poll, which could flow from a “No Deal” Brexit.

Opinion polls in NI suggest that a  majority there would opt to stay in the UK if the UK were to remain in the EU, opinion would be equally split under the backstop, but would spring dramatically against staying in the UK if the there was a No Deal Brexit.  In those circumstances a border poll would be hard to resist. Brexiteer “Unionists” in Britain are foolishly playing with fire.

Another idea for breaking the deadlock has come from the German Ifo Institute, in a paper published only last month.

This proposal would involve dumping the entire EU negotiating approach so far, and instead offering the UK membership of a newly constituted European Customs Association, through which the UK would have influence on EU trade policy and vice versa. It suggests that Turkey might also be invited to join this European Customs Association. The Customs Association idea might mitigate the “vassal state” objection to the UK joining the EU Customs Union as a simple rule taker.

But  I would question the wisdom, and perhaps the motivation, of bringing forward such a proposal at this impossibly late stage, as a possible solution to the present crisis.

It  might have been helpful, if it had been published when Theresa May wrote her original Article 50 letter in 2017, but it has little value, as a way of averting a No Deal crash out on 29 March.

 If the UK accepts the Withdrawal Treaty, or if it decides to withdraw its Article 50 letter, the Ifo proposal might be considered then. But to have any traction, it is an idea that would have to come from the UK side.

Both the Whelan and Ifo proposals are designed to help the UK clarify what it wants.

The problem is that UK opinion on Brexit has become so polarised, and so tied up with questions of identity, and political party discipline has been so damaged, that it is hard to see the House of Commons assembling a political will to deliver anything, except slipping into a chaotic No Deal.  I hope I will be proven wrong.

Brexit Conviction Is “Fragile”, Says Former Irish Prime Minister

A former Taoiseach said that conviction to leave the European Union is “fragile” and that fears of a second referendum show ‘distrust’ in support for Brexit.

NO DEAL AND THE UNION….DO BREXIT SUPPORTERS KNOW WHERE THEY ARE GOING?

We seem to be sliding inexorably toward a “No Deal” Brexit.

Mrs May’s decision to prioritize a deal with the Brexiteers in her own party, over a possible deal with the Opposition, and the time limits imposed on all of us by Article 50, make a No Deal much more likely than it was a week ago.

The EU is a rule based organisation, and it cannot afford to break its own rules if it wants to maintain its moral and political authority. The technical fixes, advocated by the Tory Brexiteers, cannot be worked through between now and 29 March.

At this late stage, Mrs May can afford to gamble, because, politically, she has little left to lose.

The EU cannot do so.

Its credibility is vital to its trade agreements with the rest of the world. Its internal cohesion depends on consistent application of common rules.
Where will a No Deal leave Ireland?

On the 1 April, the UK will be a non EU country. By law, the EU will have to treat it as such.

Ireland has opted to stay in the EU, and will have to continue to apply EU law, including the EU Customs Code, in all its dealings with non EU states, including the UK and Northern Ireland. That is a clear general principle.
The detail of how this might be applied at Irish ports and land boundaries, on traffic arriving from the UK, should now be clarified in minute detail.
There is no negotiating advantage now in withholding this information at this late stage, in light of Mrs. May’s choice to prioritize a deal with the Conservative Brexiteers over a deal with Labour.

In an article last month, the UK journalist Quentin Peel quoted a recent opinion survey in Northern Ireland on how people might vote in a referendum on leaving the UK adjoining a United Ireland.

I have to say I found the results he highlights to be quite surprising.
The opinion poll, conducted in early December by the Belfast-based pollster Lucid Talk, asked respondents how they would vote in a border poll in three different circumstances:

  • If there were a “no deal” Brexit crash-out of the EU: 55 %  said they would either certainly or probably vote for a united Ireland, against 42 % certainly or probably opting to stay in the UK.
  • If there were a Brexit based on Theresa May’s withdrawal agreement: the outcome would be wide open, with 48 % opting to stay in the Union, and 48 % wanting Irish unification.
  • Only if Brexit doesn’t happen, and the UK stays an EU member, is there a clear majority for remaining part of the UK: 60 % in favour, against 29 per cent for a united Ireland.

On the whole, the vote splits clearly on ethno/religious lines:

80 % of self described unionists would opt for the UK even with a no-deal Brexit.

93 % of nationalist/republicans would opt for Irish reunification.

What makes the difference in the poll is the crucial swing vote of the “neutrals”, who are neither self described unionists nor self described nationalist/republicans.

  • If there is no deal, ONLY 14 % of these “neutrals” would vote to remain in the UK!
  • If there is Brexit on May’s terms, that rises to 29 % choosing to remain in the UK.
  • Only if the UK as a whole opts to stay in the EU, do 58 % of the “neutrals” (Alliance, Greens, etc) vote in favour of the Union.

This poll should be read by the MPs of the Conservative Party who stress their support for the “Union” as one of their reasons for opposing the Irish Backstop.
According to a study by University College London, support for the Union of Northern Ireland with Britain is given by many Conservative MPs as the reason for their opposition to the Withdrawal Agreement, and their willingness to contemplate a “No Deal” Brexit. This is perverse.

If this poll is to be believed, in the name of support for the Union, these Conservative MPs are opening the way to a No Deal Brexit, the very outcome that would make a breakup of the Union most likely.

By backing Brexit at all costs, including a no-deal Brexit, the Democratic Unionist Party has enhanced the likelihood of a border poll that would end the Union. This is not a wise course for a “unionist” party to have followed. It plays into the hands of Sinn Fein.

This DUP approach shows how the politics of identity can lead sensible people to adopt policies that lead to the very outcome that they do not want.

The poll data also raises questions about how the vast UK Exchequer subsidy towards public services in Northern Ireland could be met from the much smaller Irish Exchequer, in the event of a United Ireland being chosen by voters in a referendum in Northern Ireland. The implications for tax, and for public services and pay, in both parts of Ireland would be substantial.

There is also the question of how Loyalists, who passionately support the Union and who have a record of violence, might react to a referendum decision that did not go the way they wanted, and how the Garda Siochana and the Irish Army could  cope with this.

Neither of these points is addressed by those, who refuse to take their seats where they could do some good, and who are instead constantly demanding a border poll. As Brexit shows, making a big decision on the basis on the basis of a 58/48% vote can have dire consequences.

Mrs May, by prioritizing Conservative Party unity over a cross party approach, is leading these two islands into constitutional and emotional territory that has not been mapped, and that is highly dangerous.

The problem is Brexit itself, not the backstop.

Brexit, of its nature, means hard barriers between the UK and the EU.

This is because it means the UK having different standards, and, sooner or later, different trade arrangements and tariffs than the EU.  

Whether these barriers are at the geographic boundary, or a few miles away, makes little difference.

These new barriers will bring delays, extra bureaucracy, and eventually bankruptcies, in their wake.

This is what Brexit means, and was always going to mean. Taking back control, by its nature, means more controls

The UK Government says it wants to impose these controls for two reasons.

The first is to be able to control immigration to the UK from the EU.

The truth is that the bulk of the immigration to the UK is not from the EU, but from outside it. EU immigration to the UK will fall off anyway because the population of the EU countries, from whom immigrants have come to the UK, is set to decline.

The second is to be able to make its own trade deals with non EU countries.

This argument is unconvincing. On leaving the EU the UK will lose the trade agreements it ALREADY HAS with the EU, and through the EU, with other countries.

In fact, leaving the EU will mean the UK losing trade agreements with countries that account for 70% of all UK trade. It will need a lot of new agreement to make up for this sudden and dramatic loss!

The backstop would reduce the effect of this, but not remove it altogether, especially if the UK opts for a different VAT regime to the EU.

No Deal

If there is no deal, and no backstop, the European Commission said in a paper published in November, that ;

“Member States, including national authorities, will play a key role in implementing and enforcing EU law vis-à-vis the United Kingdom as a third country. This includes performing the necessary border checks and controls and processing the necessary authorisations and licences.”

The paper does not exempt any of the EU Member State from this requirement.

Indeed if the EU Customs Union and Single Market were to deliberately fail to control any of its borders, it would soon cease to exist, as a Customs Union and a Single Market.

This would not be in Ireland’s interest, to put it mildly.

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