The Anglo-Irish Trade Agreement
by C. Desmond Greaves
Labour Monthly, February, 1966
IT has not escaped wry comment that Mr. Sean Lemass, Premier of the Irish Republic, should sign an agreement to establish a Free Trade area with Britain while simultaneously preparing a most elaborate commemoration of the heroic insurrection of Easter 1916. Presumably he comes to bury Connolly not to praise him. But Connolly’s warnings against the cupboard-patriotism of the propertied classes are likely to survive even Mr. Lemass’s reputation, now inflated by a great betrayal masquerading as a brilliant business deal. In the Irish Parliament on January 7, the Government won the vote, only the 22 Labour deputies dissenting. We are back to the days before the national bourgeoisie took its last nibble at the apple of revolution.
The historical volte-face is remarkable. Over the last two centuries the question of fiscal relations with Britain has played a part in Irish affairs second only to that of the land. The eighteenth century cry of ‘free trade or else’ was not a demand for fiscal union with Britain, but for Ireland’s right to regulate her own trade with the whole world. More recently three successive Home Rule Bills were shipwrecked on the Tariff question. In 1917 the national bourgeoisie, which with the sniff of war orders in its nostrils, had turned up its nose at the petty-bourgeois revolutionaries of 1916, transferred its allegiance to the ‘small fry’ of Sinn Fein precisely because they were fighting for fiscal independence which Redmond had abandoned. From that time onwards the political representatives of the national bourgeoisie were no longer big-bourgeois or bourgeoisiefied landlords, but men who had ‘riz’. One section of these, led by Arthur Griffith, abandoned the revolution, disestablished the Republic and plunged the country into civil war, once Lloyd George had made his famous concession on tariffs. Every local and national newspaper in Ireland, save one, lauded them to the skies. The ‘national demand’ had been achieved.
Fianna Fail, of which Mr. Lemass is leader, stems not from Arthur Griffith’s party of capitulation but from the dissident revolutionaries who fought the civil war. His party attained its present domination in the world economic crisis of the ‘thirties. It is as if every time the workers and farmers challenge neo-colonialist institutions, a section of the petty-bourgeoisie provides big business with a new green cloak. But as the merchant and landlord interests penetrated Sinn Fein and halted the revolution in 1921, so of late years British and pro-British interests in Ireland have tended to make overtures not so much to the traditional party of imperialism, Fine Gael, but in Fianna Fail. Apart from the state industries, all very big capital to Ireland today is either British or mixed. It is only one stage from taking over the capital to taking over the party.
The process by which the change came about is revealed in the balance of payments, which has had the same basic form for the past two decades:
In the last analysis this form is dictated by imperial decision. The enforced partition of the country determines that the cross-border trade is but a tenth of that of either part with other countries. The industrial north is importing food from abroad; the agricultural south is bringing in British machinery. The short answer to those who say that the economies of the two parts of Ireland are no longer exactly complementary is ‘No, imperialism willed otherwise.’ And the necessity to send out cattle to buy machinery from Britain has hung like chains about the body of the Republic.
Under these conditions the only way to wipe out the large trade deficit by developing the resources of the country was to extend rapidly the state sector of the economy. This policy died during the anti-communist scares of the ‘forties and ‘fifties. Instead, reliance was placed on invisible exports, tourism, pensions, emigrants’ remittances and income from capital. The remaining deficit on current accounts was met by a vast capital influx. First, the provisions against foreigners having majority holdings in Irish companies went by the board. Later, even the purchase of land was virtually freed and all manner of inducements offered to foreign investors. But the tally is still too small. It can be estimated that the annual capital influx is really above £30 million, of which about £10 million is then exported by purchase of British imperial securities bearing high rates of interest. Three quarters of the Irish Republic’s exports go to Britain. Every line in the balance of payments estimates tells the story of increasing dependence, illustrating the peculiar form of motion of neo-colonialism.
The essence of the Trade Agreement is that in return for concessions on agricultural exports worth, it is claimed, about ten million in prices and subsidies, the Republic has agreed to a phased reduction in tariffs on British industrial goods. Complete free trade is to be established by 1975, the Irish being allowed to exempt only 3 per cent of their imports. The Lemass Government, preferring an alternative line of retreat, had applied for membership of EEC in hopes of diversifying foreign trade, and securing unlimited cattle exports to the continent. The British negotiators took care of this. They stipulated that Ireland should deliver every year 638,000 head of cattle worth £90 million.
The British advantage is out of all proportion to this. It is not usually appreciated that Ireland as a whole is Britain’s second largest export market, falling very little below the USA.
At present, however, the Republic spends only half of her £320 million import bill on British goods. If the proportion could be restored to the 75 per cent at which it stood a generation ago, Britain would gain £80 million a year and Ireland, on her doorstep, might become a market even more important than the USA. With this in mind, 150 air-borne tycoons swooped like vultures on Dublin the day after the pact was signed. The talk was of mergers and takeovers, the ruthless co-ordination and fullest exploitation of the market shortly to be theirs. Meanwhile old-established businesses were making trembling protests at the British monopolies buying up the buildings they worked in and the land they stood on. A reflection of their concern appeared in the Fine Gael amendment vote against the pact in the Dail.
The result has been to illuminate, as with a floodlight, the realities of the class struggle in Ireland. While the medium bourgeoisie (who still own most of the wealth in the country) whined or dithered, car assembly workers paraded in hundreds in defence of their jobs. For the first time in years the Irish Labour Party separated itself off sharply from the capitalist parties on a matter of supreme national interest. It is noticeable that the British Labour Party which refused an enquiry into the Northern Ireland police state in deference to the views of ‘our sister party’ (the partitionist wing of the six counties divided movement) does not appear even to have asked Irish Labour for its views.
The republican Sinn Fein movement represents the interests of the petty-bourgeois masses, who together with the workers, form the overwhelming majority of the population.
Protest meetings were held and a programme of struggle outlined. The Irish Workers’ Party, which with Sinn Fein pioneered the resistance to Lemass’s deal, held poster parades and public meetings. Its Christmas gathering was one of the largest in its history.
There is talk of ‘uniting every shade of green and red’ to defeat Lemass and establish a progressive alternative Government. The struggle will not be easy. Already the reactionary press are trying to use the ‘communist bogey’ to drive a wedge between Republicans, who have virtually adopted the programme of the Republican Congress of the ‘thirties, and their Socialist allies. The trade unions, with their close connections with British Labour, have not yet spoken with a clear voice. But unity will grow, and clarity will grow. What is vitally important is that the British labour movement should recognise that those who are resisting the Lemass-Wilson pact are the true representatives of Irish democracy, upholding the determination of the people of England’s oldest colony to determine their own political and economic life. From this conviction the forms of solidarity will emerge later.