Ireland, it is claimed, has recovered from the bailout and is now the fast-est growing economy in Europe.

Ireland’s economy grew by more than 6 per cent in the first three months of the year compared with the same period in 2014, according to data from the Central Statistics Office.

The data shows that gross domestic product (GDP) in the first quarter of 2015 accelerated by 6.5 per cent year-on-year while gross national product (GNP) advanced by 7.3 per cent. (GNP includes the economic activity of transnationals, GDP excludes this).

In March the CSO said GDP grew by 4.8 per cent in 2014. However this figure has now been moved upwards to 5.2 per cent, while GNP was revised from 5.2 to 6.9. The central bank sets this year’s growth to 4 from 3.7 per cent. Government sources set expansion at 4%.

Dig deeper

Some socialists question the figures, claiming that they are the results of political massaging. In reality if we accept government data on the way down, we should accept it on the way up also. Behind denial lies a “worse means better” mentality – socialism can only get an audience when times are hard.

We have to dig deeper. What kind of recovery is it? Is it sustainable? Will conditions for the working class improve?

Right away we have an acceptance that the upturn is limited in job recovery and is also limited in wage recovery. According to capitalist economists, this is not a problem. As demand rises, jobs and wages will follow. This is true if the credit crunch was part of the normal boom/slump operation of capitalism. If we are dealing with a longer term crisis of profitability then the recovery rests on the suppression of wage rates and these will not recover. It is the working class that paid for the bailout. It is the upper and middle classes who are enjoying recovery. Many charges, for example water charges, are still to bite into working class incomes, and the government has yet to move from a process of paying interest to paying the capital owed to the Troika.

Structural

The Dr. Panglosses of capital are making the absurd claim that we can have steady growth with a sovereign debt that we will continue to pay until 2054!

But analysis does not just rest on inequality. We must also consider the structure of the Irish economy.

The figures show GDP grew 1.4 per cent in the first quarter of 2015 compared with the final quarter of 2014. But GNP, which strips out the impact of multi-national profit flows, declined 0.8 per cent.

This tells us that the recovery is driven by transnational profits which, given that corporation tax is between 0-12.5 percent, have little benefit for the Irish economy. Local firms are largely dragged behind transnational demand and the falls there reflect the uncertainties of an economy dependent on global capital flow.

The fact is that there has been no structural change in the Irish economy. Local capital acts as the client of global capital. Ireland has carved out a future as a tax haven, property speculation remains the activity of choice for the Irish gombeen capitalist and corruption roars ahead as the engine of government, filled with a new arrogance from having emerged unscathed from the bailout.

Troika

Much of the recovery is based on Ireland’s submission to the Troika, winning a supply of low interest money from the ECB. Its future depends on a European recovery on the Troika’s terms – hence the Irish governments frenzied attack on Greece. However the outcome of the Greek standoff shows that a policy of unending austerity is unsustainable and that the next crisis is likely to call the future of the euro into question.

While the facts of recovery should be accepted, the ideology behind it should not. The claim is that masterful leadership by Fine Gael and Labour will bring us to the promised land should be rejected. These claims are linked to a conspiracy with the Troika to release a substantial sum of money as a war chest for the election, in the certain knowledge of further austerity to come.

The fate of SYRIZA shows the reality of European capital and their Irish clients – the bondholders will be fed off the lifeblood of the working class. In the coming year we can expect a growing affluence and confidence on the part of the capitalists while the workers struggle. We already know that this will have a political impact in the fragmentation of politics around a range of parties and candidates of the left and right. It is the task of socialists to move beyond protest to build an independent movement of the working class and advance their interests as freedom from imperialist rule and from their local masters.