Ireland’s New Century: The Opportunity for an Alternative Vision of Development (2003)

(co-written with James J. Kennelly): ‘Ireland’s New Century: The Opportunity for an Alternative Vision of Development’, Radharc, A Journal of Irish Studies, Glucksman Ireland House, NYU, 4, 2003.

The Celtic Tyger is a flaming beast, a mystery spirit that could charge this land with new vitality while not destroying its priceless past. But it is not just an economic spirit. It signals a profound change of lifestyle and values. And it’s not only full of promise; it’s loaded with dangers. (Moore, 2001)

Introduction
One hundred years ago this year, Sir Horace Plunkett generated a storm of controversy in Ireland when his book, ‘Ireland in the New Century’, was published (Plunkett, 1904). The book called on Irish Catholics to overcome their “defects”, including a lack of moral courage, initiative, independence and self-reliance, and through their own efforts to foster economic development and progress in the country. He pleaded with them to work together with Irish Protestants for the common good, to jointly go about the work of national regeneration, and for what he called the “dawn of the practical” in Ireland. This pursuit of economic interests would pull them together, and overshadow and eventually make irrelevant differences in creed, station and politics.

When Plunkett published his book, it was an uncommonly hopeful time in the history of the nation. It was the era of the Irish Renaissance, a time of re-discovery and re-creation. The Gaelic League was at its zenith, having successfully campaigned to make the Irish language a compulsory subject at the National University of Ireland. Yeats had discovered Celtic mythology and history, sent John Millington Singe “to the west” to learn the authentic language of the people, and with Lady Gregory was preparing to embark upon a national theatre with the opening of the Abbey Theatre in Dublin.

Plunkett himself was a most unlikely revolutionary. He was a member of the Anglo-Irish aristocracy, Protestant, Unionist, an MP, the founder and first Secretary of the Department of Agriculture, a card-carrying capitalist and finally, the father of the co-operative movement in Ireland. For his pains, the press and the church excoriated Plunkett for his views on Irish development. In the wake of the tumult that the book generated, he compromised the success of the co-operative movement, and eventually lost his leadership of the Department of Agriculture and Technical Instruction. Yet, it could be argued that what Plunkett advocated, namely economic development as human development, powered by the initiative of the people, while admittedly taking a long time to achieve, was realised in the period of unprecedented growth and outward prosperity generated by the recent “Celtic Tiger” era in Ireland.

We maintain in this paper, however, that a truly sustainable enterprise society has not yet been achieved in Ireland. The country has certainly caught up with the rest of Europe measured in purely economic terms. However, alongside the enormous positive consequences, there are significant negative implications of the Irish approach to development. We argue that Post-Tiger Ireland is at a crossroads, possessing without doubt the capabilities and means to make good on the vision of Horace Plunkett. The fundamental question for policy-makers, however, is whether they have the vision to move the country from promoting growth to focusing on the sustainable management of Ireland’s human and non-human resources. The country possesses a unique opportunity to follow a development path consistent with its identity, heritage, aspirations and the capabilities of its people. It would therefore be truly a tragedy if its leaders failed to now grasp the opportunity to guide it to realise its true potential.

Ireland (1922-1960): Vision without Capability
Parnell came down the road, he said to a cheering man:
‘Ireland shall get her freedom and you still break stone.’
(Yeats, 1938)

Traditionally, Ireland was a pastoral economy, exporting live cattle and dairy products, primarily butter, to its primary trading partner, England. After nearly eight hundred years of English domination, Ireland remained economically dependent on its former master long after political independence in 1921. Although Ireland remained a basically laissez-faire, free-trade oriented economy for the first decade after independence, the combination of the global depression and the accession of the Fianna Fáil Party to power in 1932 put Ireland on a very different development track. Fianna Fáil’s vision of economic development was, in light of subsequent developments, most interesting. Given the party’s domination of government for the next fifty years, it was also an enduring one. It embraced a policy of protective tariffs to foster indigenous industry, permitted only minority foreign ownership of direct investments, and was dependent upon small Irish farmers (many of them at close to subsistence levels) for a substantial portion of its political support. Ireland, of course, was not alone in pursuing such a policy; most countries adopted similar approaches, at least defensively, in order to ride out the global depression. It is clear now, however, that the widespread adoption of such protectionist policies, widened, deepened and lengthened the Great Depression itself, while also having disastrous consequences for Ireland.

Although its economic policies were confused, there was little doubt of the guiding vision of the first Dáil, the Free State and then the Republic of Ireland. This “vision” of Irish nationhood, with its notions of “frugal self-sufficiency”, was prominently displayed in Éamon de Valera’s often-quoted St. Patrick’s Day radio address to the nation in 1943¹ :

That Ireland which we dreamed of would be the home of a people who valued material wealth only as the basis for right living, of a people who were satisfied with frugal comfort and devoted their lives to the things of the spirit - a land whose countryside would be bright with cosy homesteads, whose fields and villages would be joyous with the sounds of industry, with the romping of sturdy children, the contests of athletic youths and the laughter of comely maidens, whose firesides would be forums for the wisdom of serene old age.
(Quoted in Lee, 1999)

This vision of an Irish-speaking, nation, politically and economically independent, rejecting a narrow materialism and contented with a “frugal self-sufficiency” was not, in spite of modern notions of economic man, a necessarily unattractive one; it was apparently shared by most Irish people. Unfortunately, the policies put in place to achieve it simply did not work. The result was decades of a moribund economy, chronic unemployment, and the shame of the emigrant boat, that social relief valve endorsed by none but accepted, seemingly, as inevitable by all.

It was the capability to enact that grand vision that was lacking. As pointed out by Daly, the government, in the early years of the Free State, was awash in the task of “nation-building”.

The fledgling Irish state therefore inherited a confused baggage of ideals: a desire to protect rural society and its values and to stabilize the rural population; a vision of industrial development minus the evils of capitalism, materialism, and urbanization; a desire to redress previous disadvantages suffered by Irish businesses; an expectation of material progress without state welfare provisions; the restoration of the Irish language and culture. (Daly, 1992)

This task, to build an Irish nation into a modern state, from an Irish people emerging from nearly eight centuries of political domination and not even a dim memory of nationhood, was no small challenge. However, as Joe Lee (1989) has pointed out, de Valera had scarcely a clue as to how to achieve it. The policy of industrialisation behind high trade barriers did not work, growth was anaemic, and Ireland sank deeper into economic malaise. This stagnation carried over into other dimensions of national life: emigration, a symbol of national disgrace and hopelessness, reinforced a profound sense of national inferiority, a tolerance for mediocrity, an acceptance of shoddiness, and a fatalism that would hardly spark an economic resurgence. Lee (1989) writes, “it is difficult to avoid the conclusion that Irish economic performance has been the least impressive in Western Europe, perhaps in all Europe, in the twentieth century. It must count as one of most striking records in modern European economic history.” Even cultural life was tainted, with the adventurous, the best and brightest in the creative arts going into self-imposed exile, or reduced to incessant fighting with the censors at home. Although the Irish market was too small to support industries of any economically efficient size or scope, a drive to promote industrialisation was the order of the day. Busteed described the challenge as follows,

. . . a nation condemned to peasant specialisation in farming is doomed to be a nation of hewers of wood and drawers of water . . . Ireland’s hope then rests in making the greatest possible effort and in carrying the heaviest possible burden to promote industrialisation. (Busteed, 1930, p. 188)

The burden, however, was even heavier than many were prepared to, or able to, pay. The Irish continued to vote with their feet.

Ireland Today: Capability without Vision
In the early 1960’s, under the leadership of Sean Lemass, who had ironically been the architect of much of the now discredited protectionist legislation, Ireland began to open the door economically. Tariffs and other trade barriers were reduced, foreign direct investment (FDI) was not only allowed but also aggressively courted, and the country gradually began to find its economic legs. This period culminated in 1973 with Ireland’s entry into the EEC, a move that changed Ireland’s economic fate profoundly, and without a doubt for the better.

Although Ireland had now turned its economic face outward, it was scarcely immune from the vagaries of the global economy. Ireland contended with a variety of crises throughout the 1970’s and 1980’s, including near default on its loans, a staggering burden of public debt, and out of control government spending. It was at this time that Irish political parties achieved the unexpected. Working together, they agreed upon a joint programme to get public finances back on track, cut spending, reduce taxes, and control (wage) inflation through “social partnership”. This unprecedented partnership is credited by many with setting the foundation for the “Celtic Tiger” economy of the second half of the 1990’s. Combined with Ireland’s well educated, technically skilled, English speaking, and relatively low-priced workforce, and its advantaged location as an export platform for shipments to other EU countries, these contributed to a surprisingly rapid turnabout in Irish economic fortunes. Ireland was “reinvented”. It was no longer an economy with “the statistics of a third-world country” (MacSharry & White, 2000). By 2000, it had developed into the fastest growing developed economy in the world.

Evidence of vigorous growth was everywhere. GDP grew at double-digit rates, unemployment declined to the lowest point ever recorded, new housing completions and the number of registered vehicles doubled, there was a considerable trade surplus, tax revenues swelled the government’s coffers, living standards improved, and the national mood evolved into one of affluence and prosperity. The mounting evidence illustrated a fundamental shift in the economic, social and physical landscape of Ireland. The psychic landscape underwent a similar shift.

Although the reasons for Ireland’s rapid (although long-delayed) economic development remain the focus of considerable study (for instance, O’Hearn, 2000; O’Higgins, 2002; Sweeney, 1998), there is no lack of purported success factors. As the old saw goes, ’success has many fathers, while failure is an orphan’. A sampling of possibilities includes economic liberalism, tightened public finances, substantial inflow of foreign direct investment, social partnership (wage restraint tied to payroll tax reductions), EU structural fund transfers, a highly-skilled and modestly paid labour force and, finally, a general embrace of the dictates of global competition. The ultimate result is in no doubt: the Financial Times (January 9, 2002) recently rated Ireland as the most “globalised” nation in the world.

Dark Side to the Tiger
Yet, amidst this heady success, concerns have arisen that such rapid economic development has had negative impacts upon social equity, a sense of community, traditional values and the natural environment. Indeed, to some critics, globalisation, and by extension much of the recent thrust of Irish development efforts, runs counter to the dictates of sustainable development. Even as the “Celtic Tiger” grew at an unparalleled rate, the numbers of those living at the margins of society continued to increase, and the stresses upon Ireland’s natural environment wreaked enormous damage. In the face of such aberrations, the very nature of progress and the value systems inherent in Irish society are increasingly called into question (Kirby 1997). Many wonder in fact whether the particular type of development policies pursued by successive governments, will lead to equality and sustainable prosperity appropriate for the country. Such thinking is consistent with a deepening realisation internationally that high GDP growth, and the accelerating social and environmental impacts associated with it, is not necessarily matched by a proportional improvement in the human condition (Bronk, 1998). Indeed, to some sceptics, measures of GDP are only one dimension, reflecting “hard” measures of quantity over “softer” measures of quality. GDP, after all, includes the depletion of the natural resource base as an income item, ignores questions of distribution, excludes all non-monetary exchanges, and counts social and environmental calamities (pollution cleanup, costs of dysfunctional families and communities, prisons and law enforcement, etc.) as legitimate products that, summed together, provide a ‘quality of life’ metric. Yet, to critics such as Daly & Cobb (1994), Douthwaite (1992), Robertson (1999) and Schumacher (1993), GDP may be as reflective of what is lost by a community as of what is gained.

Environmental issues seem to be at the periphery of Irish policy-makers’ concerns. The prevailing mind cast suggests that environmental protection is an “either/or” proposition . . . a false dichotomy between further economic growth and better protection of the environment. The Environmental Sustainability Index, (or ESI, developed by researchers at Yale and Columbia Universities, in association with the World Economic Forum) reflects an effort to measure progress toward achieving environmental sustainability on the part of some 142 countries around the world. The ESI tracks some 20 “indicators” of environmental sustainability, each of which is built upon a number of variables, utilising some 68 different data sets. The ESI attempts to measure the relative success of nations in achieving sustainability in five primary categories:

• Environmental Systems (Ireland is ranked 37th in the world.)
• Reducing Environmental Stresses (Ranked 135 in the world.)
• Reducing Human Vulnerability (Ranked 13th in the world.)
• Social and Institutional Capacity (Ranked 17th in the world.)
• Global Stewardship (Ranked 91st in the world.)

Although Ireland’s performance on these indicators is hardly the worst, at (overall) 37th of the group of 142 countries, it offers scant grounds for satisfaction. Overall air quality throughout the country continues to get worse. There have been substantial increases in traffic congestion, and housing prices, so that between 1990 and 1998, while GDP increased by 61% and the volume of industrial production more than doubled, vehicle numbers increased by 50% and house prices doubled. The Irish have gone “roads-mad and seem prepared to spend hundreds of millions of euro indulging in this communal insanity” (McDonald, 2002). The pace has been frenetic, and the lack of planning abysmal. The tendency has been to provide additional capacity to foster additional development and sub urbanisation. When compared to the EU average, an unusually high percentage of Ireland’s rivers, 67% in 1997, can be classified as unpolluted and there has also been a rapid growth in all categories of waste.

Ireland’s National Development Plan: 2000-2006 (NDP), the official blueprint for public policy during a 7-year planning period mandated by the EU, reflects the priorities of the nation in further developing its infrastructure such as roads, education and transport. The current NDP is consistent with trends in Irish public policy, which are driven by the goal of achieving efficiency dictated by market needs and tempering this through public controls to persuade people to behave properly. Privatising state enterprises, championing individualism and stimulating the dominance of an entrepreneurial culture in the country while setting up a comprehensive regulatory structure to oversee players in this competitive environment are key elements of this approach. In essence, the development strategy is driven primarily by self-interest, dependent upon laws to guide behaviour and various legal remedies to punish wrongdoing.

The NDP is set within the context of a relatively rosy economic picture. Ireland’s economy appears poised, at least over the medium term, to continue to outperform many of its EU neighbours. Over £40 billion (in 1999 prices, reflecting a rise of 27% over the previous 5 years) of public, EU and private funds will be spent over the period 2000-2006 to implement what the Plan assesses first and foremost as “the development needs of the country”. The predominant idea is that if macroeconomic stability can be maintained, infrastructure development substantially completed, and national productivity increased, Ireland will have ‘arrived’ at a place from which it will have the relative leisure to address other non-economic issues. As Cassidy (2001) states, “If the economy can enhance and produce close to its productive potential, the opportunity will present itself to address the distributional and ‘quality of life’ concerns which have emerged as a by-product of the recent rapid period of growth”. This ought to raise questions. Foremost among them: Need social and environmental issues wait? Are they to be addressed as an afterthought, or a nuisance? Are social and environmental issues to be treated as disconnected from the economic policies of the country? Will they be attended to as part of a sequential, trickle-down process? A review of the NDP offers no grounds for optimism. Indeed, social and environmental issues proceed at a pace of their own, and will not so neatly wait their turn. The Heritage Council, for example, estimated that there is presently in Ireland an unprecedented rate of destruction of archaeological monuments, with a staggering 10% of all such monuments being destroyed each decade (Irish Times, April 27, 2000). One thing is certain: the stresses on Ireland’s natural environment, and on its social cohesion, will continue to worsen.

Sustainable Development
Gladwin, Kennelly & Krause (1995) define sustainable development as “biospherically compatible and socially equitable improvement in the quality of life. The three components of this definition are inextricably connected, as none of them is attainable in the absence of the other two”. This broader and more inclusive notion of development, that encompasses environmental, social and community, as well as economic dimensions, is or should be a hallmark of a sustainable enterprise culture. They further suggest that a new, integrative paradigm is needed to generate sustainability in practice. Indeed, sustainability represents a fundamentally different way of envisioning human progress. It shifts human values and visions and societal rules from economic efficiency toward social equity, from individual rights to collective responsibilities, from separation to interdependence, from exclusion to equality of opportunity, from luxury to necessity, from short-term to longer-term thinking, and from growth that benefits a few to genuine human development that benefits all. To believe that sustainability of this sort can be achieved in Ireland by mere tinkering at the margins of public policy strains credulity. It will require a far deeper and more radical process of moral transformation.

Much of the public debate in Ireland on what constitutes an enterprise culture lacks this conception of sustainability. Entrepreneurship is increasingly seen internationally in a broad conceptual manner, attempting to integrate the economic, environmental and social impacts of business decisions. The key future challenge will be to grow enterprises that enhance all three elements simultaneously. A sustainable enterprise culture will try, for instance, to encourage business to maximise eco-friendly resource productivity, by doing more and better with less, or redesigning products and services on industrial ecology models that mimic biological behaviour in order to produce zero waste. Sustainable innovations and the companies that nurture them will increasingly reflect not balance in economic, social and environmental dimensions but integration so the design of products and services can achieve all three together. In the 21st century, the sustainable or evolutionary corporation will engage in the design of products, services, processes, and systems to create a future that includes prosperity and the healthy co-evolution of human and natural systems. Research shows that highly innovative countries tend to give a priority to sustainability. Moreover, enterprising capacities that far transcend traditional concerns with narrow, short-term profit maximisation will offer great opportunities to those who respond to the challenge. 21st century entrepreneurship will extend into community work and care, urban renewal programmes, heritage activities and social and cultural activities in the widest sense. This is Ireland’s great opportunity to rethink its present approach to development.

Hopeful Signs
There are signs of hope, especially in the realisation by mainstream economists in Ireland of the need to increasingly address environmental concerns. Clinch, Convery and Walsh (2002), for instance, identify policies that will help Ireland achieve an acceptable rate of economic growth consistent with optimising quality of life. McCoy and Scott (2002) focus on how market-based policies such as eco-taxes on pollution, subsidies for environmentally beneficial activities and tradable permits can limit the damaging effects on natural systems of the negative externalities of unfettered operation of the market.

Ireland is a signatory to Agenda 21, and has recently ratified, along with other EU member-states, its commitments under the Kyoto Protocol on Global Warming,. Under the agreement, the EU agreed collectively to reduce its emissions of greenhouse gases by 8% by 2012 (compared to 1990 levels). As part of this, Ireland is permitted to increase its emissions by some 13% over the same period.

There have been more tangible successes as well. There has been a dramatic improvement in Dublin’s air quality due to a shift from coal to natural gas and an aggressive and successful policy of banning the marketing, sale and distribution of bituminous coal. Damage from silage spills has been reduced so that the ubiquitous fish kills associated with highly toxic silage are now largely a thing of the past, due to an information campaign and grants for proper silage storage. International observers hail Ireland’s recent introduction of a tax on plastic bags as a prime example of the way to use monetary incentives to cut back on consumer waste.

The development of the Irish Environmental Protection Agency (EPA) must also be considered a success, given its well-staffed organisation, suitable legislative mandate, budget and clear brief. Even though industrial output has increased substantially during the boom, there have been substantial reductions in most emissions for those companies brought under the EPA’s Integrated Pollution Control Licensing system. Other initiatives include increasing insulation standards for new home construction, a programme to develop alternative energy sources such as offshore wind farms, labelling of new automobiles for fuel economy and CO2 emissions, and development of exclusive lanes for buses and bicycles. Many of these, however, may reflect a “catch up” approach to what other developed economies have done long ago.

The Historic Opportunity
Ireland, we contend, possesses a unique opportunity to reframe the terms, understanding, and achievement of sustainable development. We base this upon Ireland’s historical and present day advantages: its current economic success, its small, well-educated and relatively enlightened population; its strong sense of national identity evidenced in its history, culture, language, heritage and reputation as a bucolic land of “40 shades of green”. Ireland’s current enterprise culture itself, if reframed and expanded, provides an ideal platform from which to achieve a more environmentally, socially, and economically sustainable quality of life for the population.

Even as it joins ever more fully the global economy, there are still few countries on which the hand of history lays so heavy on the land. The view articulated by de Valera in his dream speech and shared by most of the founders of the modern Irish state, of an Ireland of “frugal self-sufficiency” could be interpreted as a depiction of what a sustainable Irish nation might look like. One wonders if somewhere at the core of an Irish national identity, this abstract dreamy vision of an Ireland of small homesteads, indigenous industry, and concerns for other than the material, still lingers.

Ireland’s current notion of a dynamic enterprise culture, if expanded and reframed, is quite compatible with a sustainable enterprise culture. Entrepreneurship in the face of a multitude of environmental opportunities may help build a national prosperity that is wealth enhancing, equitable and ecologically sensible. The country’s recent economic fortunes are strongly linked to the highly skilled and specialised, and often rare, talent that drives the high-tech sector (IT and financial services). To such workers, ‘quality of life’ issues loom large. As noted by Power (1999) and Clinch (2001), as societies get richer, it is precisely the ‘non-market’ aspects of life that become increasingly valued. Ireland’s increasingly skilled workforce demands, and expects, a very high quality of life. Sustainable development, itself, is about enhancing just such a quality ethic.

The Irish nation appears well positioned to take serious steps along the road towards a truly sustainable economy and society. As a “late bloomer” (economically), Ireland has been spared the worst excesses of industrial development, and has leap-frogged into its present knowledge-based prosperity. With a reframed and expanded understanding of a sustainable enterprise culture, fully adapted to an Irish context, and an eye to its own history, values, and ethos, the nation has been presented with what may be a formidable opportunity. As a small nation with a relatively homogeneous and well-educated population, relative prosperity, a founding vision not inconsistent with modern notions of sustainable development, a “green” heritage, and various internal and external pressures that argue for environmental responsibility and sustainability, there may indeed be no better opportunity anywhere. Ireland, by virtue of its own peculiar national attributes, is possessed of a unique opportunity to foster an ethic of biophysical and social (as well as economic) sustainability.

Over one hundred years ago, Horace Plunkett and other leaders of the co-operative movement in Ireland used the slogan “better farming, better business, better living” to inspire farmers to join together for their common interest. It is an anthem that even today might be used to wave the flag of sustainability. Thomas Cahill in his book, ‘How the Irish Saved Civilisation’ (Cahill, 1995) illustrated how Ireland, standing at the periphery of Europe, over a thousand years ago collected and preserved the wisdom and culture of the known world, bringing it back to a dark continent. Can Ireland again be a light for a dark age? We believe so. The country has the opportunity to marry the practical idealism of Plunkett, the vision of de Valera and the pragmatism of Lemass to the significant capabilities it now possesses. Our hope is that the “Irish Renaissance” of a hundred years ago can still be echoed in the new millennium.

 

 

 

 

Published in Radharc/A Journal of Irish Studies, Glucksman Ireland House, NYU, Vol. 4, 2003

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Busteed, 1930???????

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¹ deValera dominated Irish politics for most of Ireland’s first 50 years as a nation, first as a leader of the Irish War of Independence, then as politician, Prime Minister, and finally President.
² Not everyone, however, agrees with the usual explanations. Ó Gráda (2002), for instance, suspects that many of these reasons have been “oversold” and exaggerated, and that the Celtic Tiger period will be “remembered mainly as the interlude when Ireland made up all the ground it had lost and became a ‘normal’ European economy”.
³ The ESI publishes all the underlying data upon which the variables are based, an exercise in transparency intended to allow for necessary critical review.