A Democratic Economy in a New Ireland

by Seán Byers

[This article is part of a series called Answering Ireland’s Call: Thoughts for a new republic (Freagairt ar Ghlaoch na hÉireann: Smaointe ar phoblacht nua). The series will publish articles discussing the reunification of Ireland but within the context of early 21st Century ills such as the climate crisis, capitalism and fascism. If you like what you read, please share the articles far and wide. If you have insights and ideas on the subject and want to make a contribution, the project team would love to hear from you via irelandscall@mailbox.org. This article was previously published on ZNetwork.]

Ireland north and south is faced with challenges that are commonplace across Western Europe. There is poverty and wealth inequality, regional economic imbalance and a chronic shortage of social and affordable housing. Public services and infrastructure are crumbling after years of privatisation and austerity, and struggling to meet the needs of an ageing population. The ecological crisis is deepening, with little prospect of a state-led just transition of the energy system or the economic sectors with the greatest environmental impacts. Amidst all of this, a resurgent far right has emerged to capitalise on the social grievances that have been accumulating since the 2008 financial crisis.

These challenges are also uniquely shaped by the legacy of colonialism and partition. The Republic of Ireland, though formally independent and firmly integrated into the West, continues to be largely defined by a comprador model of economic development that relies on facilitating the profit-seeking strategies of transnational capital. In the six counties, neoliberalism and austerity have been structurally imposed via Westminster, with the devolved northern statelet lacking the real economic and political agency to chart its own path.

Irish reunification presents the opportunity to take charge our own destiny through a process of democratic renewal. This process should be one of creating an independent and sovereign republic, based on new institutions and relationships that meaningfully involve citizens in the decisions that affect them.

A new and stronger democracy implies greater collective control over the means of (re)production. But there is no question of leaving this to chance or waiting for conditions to mature. It is necessary for us to see this both as a future project and part of the unfolding struggle for a new Ireland.

As the debate around Ireland’s future stumbles on, it is becoming increasingly clear that the mainstream case for unity rests on the promise of rising prosperity linked to higher economic growth – a conventional “rising tide lifts all boats” sort of approach. A Third Way version of this consensus also exists, combining pro-social and -environmental rhetoric with assurances to vested economic interests of maintaining the status quo.

Previous contributors have rightly taken aim at this business-as-usual approach to reunification, highlighting the incompatibility of enhanced capitalist growth with a liveable planet. This leads us to the unavoidable conclusion the transition to a new Ireland must also be a post-growth transition. Guaranteeing social wellbeing in this context means the planned reduction of harmful economic activity alongside the development of goods and services  necessary for meeting real human needs.

The starting point for this task, as Marjorie Kelly argues, is “recognizing that ownership and control of our political economy by a wealthy elite is the core problem”. In recent decades, capital has become more concentrated while extending its empire from industry and finance to the basic necessities of life – land, housing, energy, water, schools, hospitals, care homes, and so on. This corresponds with a shift towards a form of economic organisation in which the 1% increasingly derives its income from control of scarce assets and resources. Whether we call it “rentier capitalism” or “accumulation by dispossession”, this model is characterised by intense wealth extraction paralleled with the ongoing exploitation of workers and commodification of nature. At its root is the drive for perpetual growth and accumulation, which pushes the ownership class to seek profit in new places.

These same dynamics are writ large in Ireland, where capitalist extraction now permeates virtually every part of the economy and everyday life. This can clearly be seen in areas such as housing, where the increasing penetration of large foreign investors has driven up house prices and rents to unaffordable levels. But it is also true of manufacturing, banking, services and even farming, which has come to be dominated by a globalised agri-food sector whose profits depend on intensive production with mounting social and ecological costs. The energy system too has been gradually privatised and subjected to market competition, leaving decarbonisation largely in the hands of for-profit interests. Meanwhile, the twin green and digital transition has opened up new frontiers of extraction, with the expansion of data centres and mineral exploration threatening to convert large parts of the country into green sacrifice zones.

The consequences of financialised extraction are far-reaching. Its main impacts include rising inequality, accumulating household debt, worsening social crises and depressed investment in the real economy, not to mention biodiversity loss and environmental degradation on a global scale. The structuring of the economy in this way also has serious implications for democracy, namely that it concentrates decision-making power in the hands of an elite and necessitates modes of governance which insulate policies from popular democratic pressure.

Once this problem is diagnosed, it becomes clear that building a new Ireland will not be possible without the democratisation and decommodification of the economy as a whole. This means a major shift in ownership and control of assets, enterprises, services, land and resources, creating a new political economy where the people themselves decide how to meet social needs while respecting planetary boundaries.

Transforming the economy in this way will require the diffusion of democratic ownership in a variety of institutional forms, including:

1. Democratic public ownership of critical sectors including energy and (digital) infrastructure. This is essential to delivering a just and swift transition to 100 percent renewable energy, while also laying the foundations of a democratic and sustainable economy.
2. A new financial ecosystem in the public interest, to displace today’s highly concentrated and exploitative banking sector. From a global justice perspective, this needs to be coupled with the euthanising of financial and legal structures that facilitate tax avoidance on an industrial scale.
3. A significant expansion of worker and social ownership in the real economy. This is key to ensuring that production is directed towards social and ecological objectives rather than being used to satisfy the need for private profit. As well as being critical in the shift to a post-growth economy, these ownership forms allow for greater local accountability, better working conditions, higher levels of productivity and the retention of wealth by those who produce it. There is also evidence they help to build economic resilience because they are less likely to engage in speculative behaviour and more likely to trade with other cooperative firms.
4. Democratic stewardship of the commons based on defined ecological limits and a significant degree of state ownership, while involving popular participation in the management of land and resources for community benefit. While there is a lot to figure out, democratisation is a critical first step in removing the commons from the sphere of capitalist extraction. This in turn should provide a basis for moving to a regenerative system of land use and food production that restores soils, protects biodiversity, promotes self-sufficiency and improves the lot of small farming communities.
5. The provision of universal public services that meet everyone’s basic needs, helping to eliminate artificial scarcity and de-link human wellbeing from GDP growth.
6. Building a new democratic order will require the creation of institutions and processes that allow for wide participation in decisions of the state and economy. A model of participatory planning would see workers, farmers, consumers and community members involved in decision-making structures according to their “social ownership” i.e. the extent to which they are affected by or have a stake in the decision concerned.

There is no royal road to building a democratic economy; but nor does this work need to start from scratch. Across the globe, governments have started to bring key utilities and services back into public hands, rolling back the decades-long trend of privatisation and commodification. Public banking is similarly pervasive, with more than 900 institutions holding over $49 trillion in assets worldwide, representing a wedge for moving towards a financial system that serves people and planet. The social and solidarity economy meanwhile accounts for as much as 10 percent of employment in parts of Europe (Spain, France, Italy), and is now taking root in places where it the sector is underdeveloped. In recent years, there has also been a revival of insurgent thinking around the commons, giving rise to community land trusts, public-commons partnerships and agroecological farming initiatives on collectively-owned land.

In many cases, these examples form part of a broader attempt build a democratic economy at scale, from the radical municipalism of Community Wealth Building and the Fearless Cities movement, to the thriving cooperative region of Emilia Romagna, to the communal system of production and distribution that stands as a legacy of revolutionary struggle in Venezuela. That’s not to forget Cuba, which remains the paradigmatic example of a socialised economy achieving high levels of human development with a low ecological footprint.

There are also traces of a democratic economy to be found across Ireland: a positive legacy of public ownership in key sectors including energy; a long history of cooperativism dating back to the nineteenth century; a strong credit union and social enterprise sector; an economic base marked by a high number of locally-owned SMEs; and the existence of a small grassroots farming movement working to promote regenerative practices and food sovereignty. The problem is that these examples have either been gradually eroded and subjected to market imperatives, or exist at a scale that is incapable of fundamentally challenging the dominant model of capitalist extraction. We may or may not see a border poll in the next ten decade. What is certain is that we have arrived at a fork in the road, where the stark choice for humanity is between barbarism or a shift towards a more democratic, regenerative and equitable economy. In Ireland, as elsewhere, taking the progressive route means that the neglected questions of ownership and control must once again move centre stage. This is where the green and socialist left can bring clarity to the Irish unity debate and begin to popularise workable alternatives.

Seán Byers works for Trademark Belfast, a social justice co-operative focused on political education, post-conflict transformation and the new economy. He is also an active member of Unite the Union and Belfast Trades Council, as well as being involved with the Irish language organisations Glór na Móna and Cumann Chluain Árd.