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State spending in Ireland sustains firms that are so inefficient that many of 
them they would face extinction in the absence of this spending. Many, if not 
most, of these firms are low waged and non-unionised. Their conditions of work 
tend to be appalling too. 

State spending supports this backward capital through the diversity of moneyed 
benefits, unemployment assistance etc, transferred to the working class. This 
revenue maintains the demand necessary for the existence of many of these 
firms. They also benefit from the state spending to maintain public service 
workers such as the army, the gardaí, teachers etc. Many of the small farmers 
too are dependent on the state. The latter are the source of this artificial 
demand. This holds back the development of farming capital. There is also other 
state spending from which small capital benefit. 

Much of the surplus value generated by more efficient firms is transferred, 
through the imposition of taxation, from these firms to these less competitive 
ones through the above mentioned spend. The outcome is less  surplus value 
available for more profitable firms. This restricts capital growth since there 
is less surplus value available. It is, instead, gobbled up by these backward 
firms. The growth and concentration of industrial capital is hindered. This 
correspondingly constrains the growth and concentration of the industrial 
working class. The economic prosperity of the country is constrained by this 
leakage of surplus value. 

Not unconnected with this, state spending artificially maintains many of the 
villages, and even towns, in rural Ireland. In the absence of state spending 
many of theses villages and small towns would cease to exist. This is because 
many inefficient firms, shops, cafés etc. would be forced out of business 
because of the absence of demand.

In short state spending hinders class polarisation in the Irish republic. This 
hinders the expansion and concentration of capital together with the 
corresponding growth and concentration of the working class. This, in turn, 
hinders the politicisation of the working class.

Under these conditions of restricted accumulation of capital a global economic 
recession adversely impacts on the Irish economy with greater severity. This 
manifests itself in the form of the atrophy of many rural villages and small 
towns. This actually happened in the 2008 period.

The Irish state promotes backward capital and thereby artificially sustains a 
backward (petty) bourgeois class to the detriment of the working class and the 
class struggle. Consequently increased state spending cannot serve the class 
interests of the working class. Ironically much of the Irish Left promote 
spending by the capitalist state as the solution when it is the source of the 

If anything these backward firms and state dependent villages need to be 
eliminated if a cities concentrated working class is to exist thereby 
generating the objective conditions for the political development of the 
working class.

Take Care
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