Prof. Gary Murphy, School of Law and Government, Dublin City University

Paper delivered to inaugural meeting of the Lemass International Forum,

Royal Irish Academy, 23 June 2009.¹

I am very honoured to have been asked to give this lecture on the relevance of the Lemass/Whitaker legacy for the challenges facing the Irish state today at the inaugural session of the Lemass International Forum. Much of what I have to say is based on my forthcoming book In Search of the Promised Land: Politics in Post-War Ireland which will be published by Mercier Press this coming November.² In one of the celebrated works of recent Irish history Tom Garvin (whom I am standing in for today, and they are big shoes to fill) in Preventing the Future: Why was Ireland so poor for so long comments that Ireland ‘faced with the conditions and circumstances that pertained in the changed world of 1945, made a series of “non-decisions” that in the short to medium term were disastrous to the country’s development prospects’.³ It is my argument, however, that Irish politicians, particularly Seán Lemass, and not the nebulous concept of Ireland herself, who actually did take significant decisions to move the country out of the economic morass that she found herself in. Politicians have to make decisions and policy making cannot simply be left to the dismal science of economics nor the invisible hand of the market. Such political decision making is the lesson of post-war Ireland that current politicians and policy makers need to be aware of. Political will is necessary to lead the Irish state through lean times and political decision making is what counts.

In October 2008 Minister for Finance, Brian Lenihan presented the 2009 budget which he described as nothing less that a call to patriotic action to face the deterioration in the government’s fiscal position.⁴ The concepts of foreign direct investment, social partnership and membership of the European Community so crucial to Ireland’s economic success over the past decade all have their origins in the Lemass/Whitaker era. And if ever there was two patriotic Irishmen it is that duo of Lemass and Whitaker.

It has long been assumed that the Irish state suffered from a sort of rampant isolationism in the immediate post-war period happy to amble along in a cocoon of attempted self sufficiency. Yet it is my contention that such isolationism in the late 1940s and 1950s has been overstated and misunderstood and the concepts that have shaped the success of modern Ireland can be traced back to the period between the end of the second world war and the beginning of the 1960s. This was a period which saw Ireland first tentatively and then wholeheartedly explore the option of joining a European trading bloc. It is also the period when governments began to explore bringing economic interests into the charmed circle of power. This can best be explained by economic considerations. The dismal economic conditions of the post-war period brought with it significant political uncertainty. It also brought with a number of innovative proposals for the overhaul of the Irish economy by Lemass. The most radical of these was the introduction of the Control of Prices and Promotion of Industrial Efficiency Bill of 1947, which if implemented would have given the government unprecedented control over the running of the economy. This was an attempt by Lemass, the original progenitor of protectionism, to create an industrial efficiency bureau, which would combat excess profit taking and restrictive trade practices in protected industries. It is an early example of his vision that the country would be better served by the government playing a more active role within the economy, not to perpetuate protection, but to lay the foundations for a more competitive economy which would include free trade. While in this case Lemass was defeated by the more conservative forces in society, it showcases a mind, in many ways unique at the time, which was not happy to see a stagnant Irish economy.

The ending of the second world war is important because it can be categorised as the moment when Ireland significantly begins to fall behind the western European norm as it becomes poor in comparative terms. The question the Irish body politic faced was how could the independent Irish state improve the economic and social welfare of its population. Most Irish nationalists had assumed that political independence, after all won at major cost to human life, would significantly improve Ireland’s economic position whereby the state could provide enough employment opportunities for an increased population. By the 1948 general election this had proven not to be the case. When Fianna Fáil sought another election victory they did so having governed a state since 1932 where the economy was heavily subsidised and intensively protected. In addition, the strength of the economy was heavily dependent on privileged access to the British market and the success of British policy making. Political success brings with it the potential for hubris as longevity in power can lead to complacency and conservatism. This is exactly what happened to Fianna Fáil in 1948. Its success from 1932 had made the party much more conservative and it had by the end of World War Two long since lost the radicalism that it promised when first elected.⁵ Its defeat in the 1948 election was a bitter pill for Fianna Fáil to swallow after sixteen years of government, but they offered little alternatives and paid the price by losing office for the first time.

The crisis that Ireland faced in the 1950s led to the most fluid political situation since the establishment of the state. Political instability, mainly due to voter disenchantment with the economy, plagued successive governments throughout the period as voters inevitably blamed the party in government for the stagnating economy. Mass emigration which returned after the end of World War Two, grew steadily worse throughout the 1950s. The crisis of emigration, unemployment and the widening gap in the standard of living between Ireland and Britain and most sensitively with Northern Ireland could not be ignored by Ireland’s political elite. For the vanishing Irish of the 1950s, such phrases as Economic Development, the Programme for Economic Expansion, Seán Lemass and T.K. Whitaker did not feature prominently in their first hand accounts of leaving Ireland and the process of adjustment to life in Britain.⁶ Yet for Lemass, who had a strong vision of a practical, as distinct from an idealised, nationalism such emigration hurt deeply. He more than any other politician of the period recognised that conditions in Ireland were driving young men and women out of the country and his various policy suggestions during the 1940s and 1950s attempted to explicitly address this. While Lemass remained a nationalist, in contrast to de Valera his nationalism was promoted as an active commitment to change and development. De Valera seems to have had little interest in the economy or in the conditions under which Irish people had to live. His call to Irish emigrants in Britain to return home, as their living conditions in British cities were often poor, demonstrated a seriously worrying lack of understanding about the underlying state of Ireland. What can be seen in the 1950s is Lemass developing a set of ideas that challenged the existing certainties of de Valera and the Fianna Fáil of Seán MacEntee amongst others. As Patrick Hilley noted:

It was exciting with Lemass. He was through all the politics of Fianna Fáil, his brother was murdered, but he was stepping away from the bitterness, you know; he never went in for shouting or downing the other people [the opposition]. He had a kind of politics that I could go along with.⁷

More fundamentally Lemass appreciated that the world outside had changed, that it did not owe Ireland a living and that Ireland had to change to meet the challenge of this new environment.⁸ That was the nationalism that led him, the apostle of protectionism in the 1930s, to tear down that particular house and build another around the twin precepts of free trade and, more slowly, entry to the EEC. Yet he was not initially clear how free trade and the benefits that would bring could be achieved without widespread disruption of the Irish economy and nor was he sure whether the Irish economy could survive in a European trading bloc.

It is in these terms that one can see Lemass’s courtship of the various economic interest groups in the period. It was his view that the development of the country in economic terms necessarily revolved around a corporatist style arrangement with the government leading these groups in a new economic partnership. For that to happen, Lemass realised that government in its political form would have to be the hegemonic player in the policy making system. Of even more importance was that he be at the head of such a system and for that to happen he would have to devise a long term economic strategy that would return Fianna Fáil to government. While he bemoaned the fact that civil servants did not do enough independent thinking, he was firmly of the belief that it was political government which should lead. It is in that context that one can see the evolution in the process of the formulation of public policy towards a more conscious and overtly corporatist set of arrangements. Within these parameters, the political interests, particularly in the form of Lemass, would lead, but it was intrinsic on individual interest groups, farmers, employers and trade unions to play a full and active role in a modernising coalition of sorts. But of course Lemass had to be in power to enact any significant policy change.

It can be a bit of a caricature to portray Lemass as the saviour of modern Ireland. The second inter-party government while it undoubtedly made significant mistakes, perhaps principally in 1956 by prolonging the fiscal crisis, was not without its own ideas regarding Ireland’s future.⁹ The package of grants and reliefs to expand production which were to become the hallmark of the new system of foreign-led industrialisation under free trade, were first mooted by this government in September 1956. It also initiated the Irish application for membership of the International Monetary Fund and of the World Bank. And probably most importantly of all, it was this government’s Minister for Finance Gerald Sweetman who oversaw the process of T.K. Whitaker becoming Secretary of the Department of Finance over traditional civil service promotional norms. Implementing policy is, however, about being in government and politics is about winning elections. In that context the second inter-party government had too much of the aura of bad news about it and lost the 1957 election leaving Fianna Fáil and Lemass to push the modernisation drive.

In the aftermath of the 1957 general election Lemass was determined that his modernising coalition be brought together to transport Ireland into the promised land of economic development where it could share in the prosperity apparent in Western Europe. Significant changes in thinking at both a governmental and a non-governmental level led Ireland to adopt an interdependent approach to economic policy making symbolised by the most famous plan in Ireland’s history, T.K. Whitaker’s Economic Development of 1958. On the fiftieth anniversary of Economic Development Brian Lenihan spoke of how it remained highly relevant as a vision for Ireland’s future. More significantly he also noted that it was the political class which took the decision to implement Economic Development and the consequences that it entailed.¹⁰ While some policy makers were reluctant to accept any form of multi-lateral trading arrangements which would alter protected industry and the country’s privileged access to British markets, the severe economic crisis that affected Ireland throughout the 1950s led to the adoption of fresh economic thinking both within and outside the civil service. Such thinking eventually led the government to seek entry to the EEC in 1961 and to eventual membership twelve years later. In that context the Irish policy-making community was much more acutely aware of events in Western Europe and how they would impact on Ireland than previously thought.

Once Lemass became Taoiseach in 1959 he used the power of that office to promote an active expansion of the economy. Furthermore, he and the Fianna Fáil party accepted that Ireland had to be integrated into the global economy if it was to benefit from the worldwide expansion then underway. The key to this was entry of a trading bloc. The British decision to apply for membership of the EEC in 1961 was hugely important in this regard. It both forced Ireland to apply but also made her very dependent on Britain, because without British good will Ireland could not hope to gain any type of entry. More fundamentally it oriented policy in a much more external way than had previously been the case as Irish entry to the EEC became the overriding aim of government economic policy.

The decision to apply for entry to the EEC also copperfastened the commitment to free trade and signalled the final death knell to the narrowly protectionist policies dictated by de Valera’s commitment to economic nationalism and isolationism. Speaking exactly fifty years ago to the day after Lemass came to power as Taoiseach it is worth restating that this commitment to multilateralism has been maintained ever since and open markets have been a keystone of Irish economic policy leading to a situation where Ireland was ranked in the early twenty first century as one of the most open economies in the world. This was a startling departure from previous Fianna Fáil policies. Indeed the very man who introduced the original economic policies of protectionism removed them from the statute book. For instance the A.T. Kearney/Foreign Policy Globalization Index placed Ireland second in 2005 in its annual empirical measure of globalization and its impact. Ireland ranked first in 2002, 2003 and 2004.¹¹ Moreover the 2006 Index of Economic Freedom, compiled jointly by the Wall Street Journal and the Heritage Foundation, found Ireland’s was the world’s third-freest economy, and the freest in Europe. It concluded that Ireland ‘has one of the world’s most pro-business environments especially for foreign businesses and investments, and Prime Minister Bertie Ahern, whose Fianna Fáil party governs in coalition with the Progressive Democrats, has maintained this impressive inheritance.’ In 2008 Ireland continued to rank third globally in the Heritage Foundation’s index of economic freedom.¹²

The road to the EEC application led to a different economic policy, one that integrated Ireland in to the wider world economically and increasingly politically. Lemass clearly would have been willing to give up Irish neutrality if that had been necessary to join the European Community, though that did not prove to be the case. It is another example of his not being hidebound to traditional nationalistic shibboleths so beloved of some members of Fianna Fáil at this time. In fact the EEC application was a classic case of Fianna Fáil étatisme. Critics of Fianna Fáil have long since complained of the party’s ability to treat itself as one with the state it should theoretically serve.¹³ In adopting free trade and leading Ireland’s entry to the EEC Fianna Fáil actually did the state some service by somersaulting on its previous dearly held mantras of self sufficiency and protectionism. By doing what was good for Ireland in abandoning both, Fianna Fáil was also doing something good for itself. If nothing else the immediate post-war period showed Fianna Fáil that the Irish people would not give it carte blanche at every election if it could not satisfy their economic needs. Tom Garvin’s comment in 1981 that ‘the penetration of Fianna Fáil into the bureaucracy appears to be very great, and is due mainly to the fact that the party has had a near monopoly on public office for almost fifty years and has, by its own success, generated social categories created in its own image’ is worth reflecting on when considering Ireland’s search for the promised land of economic prosperity in the post-war period.¹⁴ No matter how deep this penetration, the scale of the economic crisis in the 1950s and its concomitant electoral fluidity persuaded Fianna Fáil that they could not be guaranteed electoral success in perpetuity. The attempt by Fianna Fáil to change the electoral system to a first past the post system is further evidence that Ireland’s largest political party felt their secure hold on government was under threat and it is clear that this was not simply due to the vagaries of proportional representation via the single transferable vote.

The search for the promised land in post-war Ireland took place in an atmosphere of unprecedented political uncertainty. Political matters and political success did motivate Lemass, but they were not his only concerns in an Ireland that had lost 300,000 people to other lands through emigration since Fianna Fáil first took power in 1932. Political concerns did not motivate T. K. Whitaker or for that matter those on the other side of the free trade fence such as J.C.B. MacCarthy, Secretary of the Department of Industry and Commerce. Their concerns were of a more nationalist bent; nationalist in terms of loyalty to the state and attempting to get the state out of the economic mire it was stuck in. Somewhat paradoxically, however, the population as a whole did not seem to view the EEC as a panacea to Ireland’s ills as the levels of ignorance surrounding that organisation in the early 1960s were truly staggering. When, in 1961, the Irish Press asked 943 people if they had heard of the Common Market, 36 percent of those polled said they had a ‘vague idea’ of it while the same percentage said they had ‘never heard of it’.¹⁵ This mirrors to some extent the confusion over the Lisbon treaty, in particular some of the wild rumours, such as conscription and abortion, as to what was actually in the treaty. Moreover given those figures it is appropriate to ask whether anyone outside the political elite was actually listening to the leaders of the Irish state in relation to EEC membership. Yet what is important to note here is that it is the job of politicians to lead. In the case of both the movement to free trade and entry to the EEC that is what Seán Lemass more than any other politician of this era did. In essence he played the pivotal political role. Anyone tempted to regard all Irish politicians, and particularly members of Fianna Fáil, as incorrigible opportunists interested only in the short term, should revise their opinions. More than any other politician of independent Ireland Lemass sought with extreme care and attention to persuade and to prepare public opinion from 1957 onwards, as much in industry and the trade union movement as within his own party, and not only through public speeches but also through quiet encouragement of new thinking. Lemass did not live to see his long term goal of Irish entry to the EEC achieved, but by the time he retired in 1966 he had won the arguments within the cabinet and had forged a broad national consensus on the desirability of membership.

The lesson for current policy makers dealing with certainly the gravest economic crisis since the 1950s is that leadership and political decision making matters. Even when the general populace seems to be unmoved by, or actually unaware of major policy initiatives, it is the responsibility of political leaders to argue for them and drive them through. Politics might be about power but it also leads to apathy amongst a significant section of all electorates. That apathy can only be overcome through engaged citizenship, but such engaged citizenship must be spurred on by political leadership. Take the increasingly vexed question of European treaties. The defeat of the Lisbon treaty was in the main part due to an anaemic campaign by the proponents of the yes vote. Lisbon showed that the public has to be convinced of the merits of the European integration much more so than in the past and thus it was the job of the government to show much more substantive leadership in that campaign than it actually did. It would also help in future referendums for market research to be done by governments before rather than after referendums to discern the people’s views on issues which affect them. Politicians and policy makers in the post-war period did not get everything right, and in fact got much wrong. Their dereliction to the welfare of thousands of disadvantaged children in industrial schools as witnessed in the recent Ryan report will forever be a ruinous blight on Irish society in this period. But what they were able to do was show leadership on major economic issues and thus begin a process by which Ireland would be able to take her place in the world as a mature interdependent state able to provide a future for her citizens without the dreaded spectre of emigration constantly hovering over them.

Irish entry to the EEC can be placed firmly at the feet of Lemass and Whitaker. Although he never lived to see the day, it was Lemass’s process of involving the sectional interest groups of farmers, employers, and originally the trade unions that opened the way for entry. There can be little doubt as we look back on events of the first application to the EEC, and later the referendum of 1972 that entry to the EEC has meant that Ireland, through its membership, and the rights that that has entailed, has to a significant extent laid to rest the economic difficulties that plagued her during the Lemass/Whitaker era. This is not to make light of the current economic crisis but it is instructive in that it shows that the visionary inspired leadership shown by Lemass and Whitaker can work. In the context of moving out of the safety net of protectionism and a reliance on the British market, the decision to apply was the most important psychological decision taken by any government since the foundation of the state. Allied to this the Irish state was able to overcome the economic difficulties of the 1950s because her socio-economic policy had been realigned by Lemass to include economic interests in the state. While this early form of social partnership would go out of fashion in the 1970s, it was to re-emerge spectacularly in 1987 when the Irish State was faced with a major economic crisis, its worst since the mid 1950s. The solution to that crisis was also found in political engagement with the economic actors and would see the birth of the so-called Celtic Tiger.

The earlier crisis saw its resolution emerge through a twin pronged political approach of interaction with the economic interests and entry to Europe. Such a combination saw success with entry to the EEC in 1973 and still remains Ireland’s best hope for economic prosperity in the future. Social partnership has been heavily criticised as being unrepresentative, and it does clearly suffer from the tendency of being only as good as its last deal. But the most significant aspect of social partnership is that it has given both the government and the social partners a remarkable twenty years of continuity in economic macro-management and certainly helped in abating the dire economic crisis of the mid 1980s. Moreover few policy decisions have had such a profound impact on life in Ireland as the decision to first apply for entry to the EEC and then entry itself in 1973.

To conclude, Economic Development emerged from a crisis of national self confidence which was provoked by the economic difficulties of the 1950s. Todd Andrews, another great servant of the Irish state pointed this out in 1957 when he stated that a ‘psychological blight seems to have descended on the country and the young people in particular seem to have lost confidence in our future’.¹⁶ Whitaker and Lemass more than anyone else recognised this and set about doing something about it. A similar psychological blight is in danger of sinking contemporary Ireland. While the recession of 2008/9 has again brought fears about Ireland’s economic future, amidst a global economic downturn, it is well to remember that the search for the promised land of economic success in Ireland continues to be an ongoing one; in fact it may be a utopia which is unachievable, but the main legacy of the Lemass/Whitaker era is that it is one that can only be brought closer by activist economic engagement from governments, social partners and the public. In that context it is time for a new Economic Devleopment. One that spans the political spectrum, involves the social partners and is heavily communicated to the public as the blueprint for economic survival and recovery. It will require political vision but the legacy of the Lemass/Whitaker era is that it was just that political vision which charted a way forward out of the dire 1950s giving a renewed sense of hope and optimism to a people for whom emigration was a natural phenomenon. It worked then and can work again.