Saturday, August 2, 2008

The End of Catholic Corporatism

The surprising thing about this morning's collapse of the national wage talks is not that Social Partnership is over, but that it survived for so long. Ireland has been conducting a unique experiment in corporatism for over 20 years: with a number of features aligned to the ethos of catholic corporatism first set out by Pope Leo XIII in his encyclical Rerum Novarum.

Nevertheless collapse was inevitable. The four 'partners' in social partnership - government, business, trade unions, NGOs - are all subject to very different forces pulling them in opposite directions. Government's ability to 'deliver' in the context of a nation state is declining due to the European Union and globalisation. Businesses of any scale are now planning their futures around the emergence of the BRIC economies - not the twenty six counties. Trade Unions are increasingly a representative force for the public sector only: by my calculations, nearly 6 in 10 public sector workers are trade union members compared with just over 2 in 10 private sector workers according to CSO data (pdf). Note though there are more private sector than public sector workers, with the former making up a (declining) majority (54%) of union members despite their lower membership rate. And the IFA of course have been running their own unique campaign to stop globalisation at Dublin Port. Indeed, he Catholic Church in Ireland has also been a partner, at one remove, through organisations such as CORI whose opinions have reflected Catholic social teaching (and been incorporated by Fianna Fail) and been generally supportive of social partnership.

So what are the consequences of the collapse of the talks? In the short run: none that I can see. Public sector pay negotiations were always going to be about pay rises, not pay freezes, as they are inoculated from the economic consequences of their own actions. As for private sector pay: if some employers pay more than they should (ignoring financial and/or competitive circumstances) then they will go out of business. The difference, of course, is that private sector employees pay the consequences of asking for 'too much'; whereas taxpayers pay the consequences of public sector employees asking for too much.

Still, with the uncertainties now arising from the rejection of the Lisbon Treaty, the failure of the WTO Doha round and now the collapse of social partnership we are well and truly in unknown territory. Corporatism in the past has been associated with some unsavoury regimes that promised to replace uncertainty and insecurity with something more comforting. So perhaps one blessing from the collapse of social partnership is that the (admittedly tiny) risk of lurching into some form of Liberal Fascism has been avoided. I just hope we don't flee from the accumulating uncertainties into the seductive embrace of those who would 'free us from our freedom'.

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