Monday, March 24, 2008

The Republic's increasing the distance

Shane Harrison, the BBC's man in Dublin, argues ten years on from the Belfast Agreement for a variety of reasons the Republic and Northern Ireland have drifted apart:

1.The Republic has become more "European" (e.g with the changeover to kilometres and the introduction of the Euro).
2.The Republic has adapted much better to the global economy, as evidenced by (until recently) stellar economic performance and the increasing immigration required to sustain that growth.
3.Lack of media interest in Northern Ireland (although that’s probably a chicken and egg scenario-isn’t the ROI’s media increasingly apathetic towards NI simply because of the lack of interest on the part of their readers about what’s going on north of the border?)
4.The "disappointing" (from an Irish nationalist’s point of view) performance of "north-south" bodies.

Further to Point Three, I suppose a further confirmation of that detachment from Northern Ireland is the failure of the only "all-Ireland" party to make any kind of meaningful headway in the ROI; the truth being that the electorate in the ROI were more concerned with Sinn Fein’s economic (non)policies rather than their core "Bash the Brits" rhetoric.

And someone should really have let Sinn Féin's Dáil Leader, Caoimhghin O'Caolain in on this secret when he recently gushed:
"We have clearly to accept the logic that a single island economy that would be to the benefit of all people on the island of Ireland can only best be served through one single administration on the island of Ireland that cherishes all its children equally."

No, we don’t have to accept your "logic," basically because you have never supplied any detailed plans whatsoever to back it up that "logic".

Unlike Garret Fitzgerald who stated in the event of "Irish Unity":
"Northern Ireland would be 20% worse off which means that even the most ardent Sinn Féin supporter vote against it or, alternatively, we'd have to increase our burden of taxation by a quarter, which isn't going to happen."

"20% worse off" or 25% extra tax, sounds great, where we do we sign up?

14 comments:

Kloot said...

The Republic has become more "European" (e.g with the changeover to kilometres and the introduction of the Euro).

Driving through NI last week to get to Donegal it did seem a tad weird alright seeing those MPH signs... so 2007 ya know ! ;)

The Republic has adapted much better to the global economy, as evidenced by (until recently) stellar economic performance and the increasing immigration required to sustain that growth.
Thats been ongoing for the last 40 years.. its nothing new.

Lack of media interest in Northern Ireland (although that’s probably a chicken and egg scenario-isn’t the ROI’s media increasingly apathetic towards NI simply because of the lack of interest on the part of their readers about what’s going on north of the border?)

Im not sure where he is coming from on this one. NI news gets quite a lot of coverage. What people did get sick of was the "will they or wont they" crap over going into government. That dragged out and bored the crap out of people. Now NI coverage is normalised and covered as per any other part of the island, in otherwords now all your heading about is the road deaths, the fires etc... the milk and butter stuff.

NI does not feature in peoples daily lives in the ROI as much as the people of NI like to believe(and thats both sides)

The "disappointing" (from an Irish nationalist’s point of view) performance of "north-south" bodies.

Take those who have an interest in politics, and leave them to one side. That leaves the majority on the opposite side and that majority didnt give a fiddlers anyway.

the truth being that the electorate in the ROI were more concerned with Sinn Fein’s economic (non)policies rather than their core "Bash the Brits" rhetoric.

Agreed. Its the same force that will prevent any form of unification unless there is a strong plan to manage the economic effects of it.

Simon said...

"20% worse off" or 25% extra tax, sounds great, where we do we sign up?

It does offer an interesting conundrum though.

The reason that NI would be 20% worse off would is due to the British state massively subsidizing Northern Irelands economy. If the NI economy boomed and picked itself up. This 20% thing would cease to exist.

So therefore do you think it is in some unionist politicians minds to keep the economy dependent on Londons coffers?

O'Neill said...

Simon,
So therefore do you think it is in some unionist politicians minds to keep the economy dependent on Londons coffers?

It's in not any of the local politicians' interests to carry out the necessary restructuring of the economy- higher unemployment and the destruction of a public sector which provides such a comfortable living for so many simply wouldn't win votes.

However, there is another interesting conundrum; if by some miracle prior to any "all-Ireland" economy the N.Irish economy did independently boom, what extra economic advantages would political "unity" bring? If it ever did "boom", it would be doing so in competition not in collaberation with the ROI surely?

Simon said...

That is very true. The advantage I guess is that a smaller economy can maneuver faster then larger economy to reposition itself in the global economy.

Other things that maybe be of benefit or not would be lower corporation tax and euro membership.

Booming for NI doesn't so much make the union with Ireland stronger but union with the UK lesser ie it because a cultural tie rather then economic. Maybe if NI boomed you might get Northern Irish republicans ie not "Irish republicans" like the shinners but people wanting a separate state altogether .

O'Neill said...

Thats been ongoing for the last 40 years.. its nothing new.

Just been thinking about that Kloot, I think it is relatively new (or at least less than 20 years old) and certainly not something which has been ongoing for 40 years. But that's just me being pedantic, I think we agree on the main point, the opportunities thrown up by the global economy (eg the worldwide information and communication networks) have been exploited much better by the ROI.

Simon
Booming for NI doesn't so much make the union with Ireland stronger but union with the UK lesser ie it because a cultural tie rather then economic

I can see where you're coming from there (although I'd also argue that NI does not presently exploit anywhere to its full potential the economic links it should have with the UK, if it did then that might well prove to be a catalyst behind such a boom).
Another conundrum for you: why do Unionists in NI plead for different treatment for NI (eg corporation tax) rather than joining forces with others in the UK to make the argument for a UK-wide reduction?

Answer, those "Northern Ireland republicans" (aka Ulster Nationalists)already exist and they're called the DUP- for many in that party "Britishness" is just another convenient badge of sectarian identity.

Simon said...

I guess they would say that it would benefit NI more to be special. I.e in the way ireland came the US offshored in Europe NI would come to NI to offshore from the UK.

Why put a bank headquaters in NI if you are paying the same in London? While if the tax rate in Belfast was 3 times less watch them move. Irelands low corporation works more due to being competitive rather then it being low

Kloot said...


Just been thinking about that Kloot, I think it is relatively new (or at least less than 20 years old) and certainly not something which has been ongoing for 40 years.


While the benefits have been seen over the past 10/12 years, the ground work was very much set back in the late 60's when policy changes were put in place to attract investment from abroad and to make Ireland attractive for this purpose. EU membership meant that these policies could then be exploited to their full.

I think we agree on the main point, the opportunities thrown up by the global economy (eg the worldwide information and communication networks) have been exploited much better by the ROI.

Completely. The ROI, largely through the IDA, was well poised to exploit the benefits of a global economy and hence was able to take many other countries by surprise.

O'Neill said...

I guess they would say that it would benefit NI more to be special.

But if they were real Unionists, then they'd be looking to integrate NI further economically and politically into the rest of the UK not trying to build further divisions.

Why put a bank headquaters in NI if you are paying the same in London?

Salary and office rental costs would be two reasons!!

Also, I'm not sure how a lower corporation tax would work in the event of such multinationals as banks who'd be presumably repatriating their profits anyway?

Kloot said...

Here's my attempt at proposing some reasons as to why the ROI and NI have become much closer since the BFA/GFA

1) Political Tension between the ROI and NI has greatly decreased since 1998. More and more NI politicians feel comfortable interacting with ROI politicians, appearing in debates on Irish TV and offering comment on ROI problems.

2) Tension and suspicion of communities on both sides of the border has decreased to a certain extent. People from the ROI and vice versa can and do interact with people from NI more frequently. Travel into NI from the ROI and vice versa is now much more common. Through medium such as this very blog, people find similar views with people across these islands, while still managing to hold strong to their core beliefs and not feeling threatened.

3) Economically there are much closer ties between NI and the ROI. NI now attracts quite alot of tourists from the ROI, which is good for the Economy. NI companies have also made good use of the opportunities offered by the celtic tiger, by offering services useful to the ROI economy.

4) Cross border cooperation. While not the large North/South bodies that some may have wished for, there has been definite cooperation in areas such as waterways, tourism, health.

5) Security. The PSNI and Gardai are now on excellent terms. Cooperation is the order of the day.

Just a few areas off the top of my head.

Simon said...

Also, I'm not sure how a lower corporation tax would work in the event of such multinationals as banks who'd be presumably repatriating their profits anyway?

Yes but by declaring the profits in NI they pay tax in NI thus the NI exchequer benefits. Allowing the reduction in money needed to come from London.

Salary and office rental costs would be two reasons!!

Generally very small parts of the costs of most businesses. Tax far far greater. Also these people are employing people on mega bucks they are not going to pay them much less then normal.

But if they were real Unionists, then they'd be looking to integrate NI further economically and politically into the rest of the UK not trying to build further divisions.

Not at all. The North of England is also looking for corporation tax drops and no one is doubting whether Newcastle is part of the UK. You maybe part of the UK but you are still competing with the south east, midlands, scotland etc etc.

South, East and West compete in Ireland

O'Neill said...

Nothing I can argue with there Kloot, just a few additional thoughts on your points:

Point 1) What you really mean is that Unionist politicians are much more comfortable talking with their counterparts and through the media in the ROI. It’s obviously a good thing the Unionist pov is now being heard in ROI,. But do they really offer comment on ROI problems? The only N.Irish politicians doing that are surely SF and they’re apretty marginal part of the ROI’s political landscape.

Point 2) To large extent is this not a return to the situation pre 1969?
Unionists are often accused of looking at that period with rose-tinted spectacles, but my father has told me that many unionists of his generation had a much more benign approach to the ROI than those of us who were born during and brought up during the Troubles; eg his church often organized their weekends in places like Bray and in the border region people of both religions enjoyed dances and social events on both sides of the border.

3) Economically, yes, there’s more mutually beneficial cooperation but as the Aer Lingus saga showed, we also remain competitors. Also the gap in productivity remains, we use a different currency and I think of all Harrison’s arguments about the increasing gap, this is the strongest one. An all-Ireland economy tomorrow would be a disaster in financial and political terms for both sides of the border.

4) A bit like point 1), the fact that Unionists engage at all on occasion with this is the important one. However, they are still pretty wary about how close to take it.

5) Closer liason between police forces and intelligence agencies is the order of the day throughout Europe, in the kind of world we live in it’s a must. So I don’t think what has happened between the PSNI and gardai is that special, it has merely rectified what was a pretty ropey relationship before… it certainly hasn’t brought an all-Ireland police force any closer

O'Neill said...

Simon,

Yes but by declaring the profits in NI they pay tax in NI thus the NI exchequer benefits. Allowing the reduction in money needed to come from London.

That would be only important in the unlikely event that NI gets its own tax raising powers, any tax received in NI still does to Westminster.

Generally very small parts of the costs of most businesses. Tax far far greater. Also these people are employing people on mega bucks they are not going to pay them much less then normal.

Slovakia has operated a very low corporate tax over the last 5 years or so, it's attracted business because of that, but only at the lower end of the market- places where salaries are rockbottom (eg car manufacture etc). The big IT multinationals have steered clear because of the fcat that the salary advantage of employing a Slovak professional in comparison to say a German or Irish person is not that great.

Not at all. The North of England is also looking for corporation tax drops and no one is doubting whether Newcastle is part of the UK. You maybe part of the UK but you are still competing with the south east, midlands, scotland etc etc.

A corporation tax drop UK-wide would aid all of the UK, having a differential between different areas means that there are winners and losers internally within the UK. Our main competition is not with other regions of the UK but with other regions of the EU and further afield. Low corporation tax brings in the big employees (and helps the smaller entrepreneurs) salary, rent and other differentials determine which part of the country they go to.

O'Neill said...

Correction:
Brings in not employees but employers!

Kloot said...

It’s obviously a good thing the Unionist pov is now being heard in ROI,. But do they really offer comment on ROI problems?

Not unsolicited, but on programs such as questions and answers on RTE, the Unionist members of the panel are always asked their opinions on all questions raised and Unionist politicians have no trouble offering their opinion. Which is good, why should they have a problem offering opinion. There is less of a siege feeling to their presence there. Its less a case of defending their position as opposed to engaging in a debate. Another noticeable difference, and an interesting one, is that in recent years, Unionist politicians have not been afraid to get a dig in at other unionist parties while commenting in ROI media. Another sign that the siege position is gone, and a normality exists.

Point 2) To large extent is this not a return to the situation pre 1969?

Yes, I believe so. A correction if you like. It does look good on that front.

Economically, yes, there’s more mutually beneficial cooperation but as the Aer Lingus saga showed, we also remain competitors.

I understand your point there, but those workers in Shannon would have been up in arms regardless of where the jobs were moved to. It would not have lessened the pain to them if the jobs had moved to Knock as opposed to Belfast. But in the general there is of course direct competition between the ROI and NI for investment and jobs. Its one of the reasons why a joint investment authority would not work in my view. Theres nothing unhealthy about that competition though.

Closer liason between police forces and intelligence agencies is the order of the day throughout Europe, in the kind of world we live in it’s a must.

Indeed, I take that general point, but there is a local personal element to this one. In that the PSNI and Gardai cross train together, engage in sport together and also engage in charity events together. Contrast this with times gone by where very little cooperation occurred. Im not saying that its anything more then what ive outlined or that it will lead anywhere else. It wont, but its a healthy relationship which is encouraging.