The island crushed by the crisis

It is widely agreed that the austerity measures imposed by the Troika (EU, ECB, IMF) adopted at national level to curb the banking and budgetary crises brought scarce benefits, in the face of a sequence of problems that are freezing European economies and societies. The “Crisis Monitoring Report 2014”, recently published by Caritas Europe, examines the figures and percentages on employment and poverty in seven EU countries most hit by recession (Ireland, Cyprus, Italy, Greece, Spain, Romania, Portugal), highlighting the need for an economically viable and socially constructive alternative, in agreement with so-called “inclusive growth” envisaged – albeit yet disregarded – in the Europe 2020 strategy. The Report provides an analysis of the effects of the banking crisis – notably in Ireland, that “has been one of the worst at global level” – whose “highest price”, since the outbreak of the real estate bubble, “was paid by those who had no part in the decisions that led to the crisis”. The case of Ireland is emblematic, marked by a public indebtedness that reached 117.6% of GDP in 2012 and 123.3% in 2013. High emigration rates. In the “green island” – which until a few years ago was the emblem of skyrocketing economic growth, fuelled also by a powerful speculative and housing bubble – unemployment fell by 14% from the outbreak of the crisis until 2012 among citizens aged 15-64. In the years 2011-2012 14.7% of the overall population were unemployed (316 thousand people) with a slight recovery in 2012. Figures continued being low thanks to emigration, or they would have reached 20%. For Caritas Europe emigration brought as many as 326 thousand people to leave Ireland in 2010. This aspect of the crisis is prominent in Ireland compared to other European countries where emigration waves were not as high. Moreover, the consequences are expected to be felt in the middle and long term as unemployment levels of youths in the 15-24-age bracket fell by 9%. Of those who stayed, 30% are without a job. Long-term unemployment is another scourge: 62% of the unemployed have been without a job for over a year, one of the highest rates with Greece. Percentages are higher among young people and poorly qualified workers. Long-term unemployment risks becoming a permanent consequence of the recession in terms of poverty, marginalization and social exclusion. Touching examples. Given the situation of unemployment, the figures on poverty in Ireland are to be considered alarming, warns the Caritas report. 23.7% of the overall population was at poverty-risk in 2008, while the last available figures amount to 29.4%, far beyond the European average of 24.2%. So for 1.3 million people daily life is a constant struggle: “unexpected events upset us”, an Irish pensioner told Caritas Europe. The situation doesn’t change much in the case of people at poverty-risk, people in a state of indigence, or people in low-income households – the three OCSE poverty indicators. Children are the most affected and penalized by “material deprivation”, as evidenced by the experience of an Irish child at the beginning of the second cycle of studies: families’ difficulties in coping with purchases of school uniforms, school materials, the necessary for sports activities, are the root cause of “strategic” absence from school, learning delays, exclusions by groups of classmates, bullying episodes whereby going to school becomes a negative experience that undermines the sound personal and social growth of the child. Material deprivation is also suffered by over 65 (9.7% of the elderly), and by the “working poor” (5%). Investments are needed. There also emerges that “the burden of anti-crisis measures is not fairly divided”. According to OECD figures on Ireland, 10% of the poorest families have lost over twice their available earnings, while 10% of rich families have lost only 3%. Similarly, income inequalities have escalated: 20% of wealthy citizens increased their earnings five times more than 20% of poor brackets. Healthcare and social services are also at risk. The Irish government has imposed a 5% cut of healthcare services in 2013, a measure which, based on the experience of Spain and Greece, is bound to affect access to healthcare by the poorest population brackets. To make things worse, according to the Caritas Europe survey, “Ireland ranks last in Europe in terms of investments”. The Monetary Fund thus underlines the need for investments aimed at economic and social growth.