It’s no surprise that parties put on a united front over Apple

Fianna Fáil and Fine Gael drop their rivalry when FDI policy looks threatened

Micheál Martin’s argument that the EU Commissioner’s decision was a Trojan horse to get at our corporation tax rate was “pure sophistry”.  Photograph: Cyril Byrne / THE IRISH TIMES
Micheál Martin’s argument that the EU Commissioner’s decision was a Trojan horse to get at our corporation tax rate was “pure sophistry”. Photograph: Cyril Byrne / THE IRISH TIMES

For half a century at least, parties of the left have been calling on Fianna Fáil and Fine Gael to coalesce, saying there’s not a cigarette paper between their policies or ideology.

By doing so, they argue, Irish politics can finally attain the left right alignment that is the norm in other countries. But in some senses, these critics are missing the point. The two big parties dismiss the ideological scale as arbitrary, and see themselves as essentially centrist, their free market tendencies tempered by a commitment to elements of a welfare society.

Sure they compete against each other. But more often than one might expect, they compete together against the rest. The name of the game is maintaining the centre. The paradox is that while they compete against each other and want to best each other, they need their rival to remain comparatively strong, certainly stronger than the rest. A few times one or other of the parties has come close to extinction – if that happened, it would surely change the alignment. So their relationship is as much symbiotic as a rivalry.

Overlapping

When it comes to what they consider fundamental questions of the national interest, there is substantial overlapping of their circles in the political Venn diagram. When their interests coincide at council, parliamentary and at government level, they will pull the oars as tightly and as in synch as the O’Donovan brothers.

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And so it is with the fallout from the Apple ruling. The interests of both parties in this controversy are perfectly aligned. Fine Gael, with the Independents, has tabled a motion for tomorrow’s recalled sitting of the Dáil, seeking support for the appeal against the European Commission ruling.

In a very unusual response by an Opposition party, Fianna Fáil has indicated it will support the motion unequivocally and will vote for it. In addition, unlike the other Opposition parties, it has not tabled any amendments. Therefore, it can be taken that its support is unconditional.

It could be said the party would be hypocritical if it were to adopt any other stance, as the Apple judgment mostly relates to the period when Fianna Fáil was in power. The complicated tax avoidance schemes that Apple (and other multinationals) availed of happened during that party’s watch.

Consistency though is not a trait associated with too many political parties in Ireland. Fianna Fáil has been more adept than others in effecting smooth 180-degree turns when it suited it. We saw two juicy examples recently where, without the slightest trace of embarrassment, the party opposed the property tax and water charges it itself had proposed. It quibbled with the details. There is always an “out”.

Clever schemes

In the context of modern industrial and economic policy in Ireland, there is no bigger cornerstone than the strategy to attract multinationals, and the related 12.5 per cent rate of corporation tax. Many policies have been developed over the years, and some very convoluted and clever schemes dreamed up for so-called tax efficiency. For both parties, these are the untouchables.

And it showed in the remarkable resonance of the reaction from both parties. Fine Gael came out fighting last Friday with an attack on the European Commission and on bigger EU states. It was an attack on our tax sovereignty, on our low rate of corporation tax, and by big states on a small defenceless nation like Ireland.

In his interview on RTÉ's This Week on Sunday, Micheál Martin used the self-same arguments, even claiming that the ruling was a Trojan horse to get at our low corporation tax rate.

That argument is pure sophistry. Sure, if Ireland’s really low rate of corporation tax was applied to Apple’s worldwide profits there would have been no problem. The problem the commission had wasn’t with the Irish tax rate but with the fact that Apple had a problem with it. It was way too high for Apple who much preferred to pay a rate of 0.005 per cent using a convoluted scheme that made a loophole out of a provision of Irish tax law.

In any event, whatever the cause, we now know what the effect will be. With Fianna Fáil support, the Government’s intention to appeal the Apple ruling is secured. The new politics might electorally pitch Fianna Fáil and Fine Gael as rivals but in every situation where the country’s economic direction is at stake, you can be sure that they will join forces strategically to protect the status quo.