Interested in maladministration. Estd. 2005
This letter in today’s Irish Independent hits the nail on the head regarding the Carroll farce.
Has no-one told ACC Bank that above the Supreme Court, we have the Very Supreme Court and possibly the Very Very Supreme Court ?
Gerry O’Donnell
Dublin 15
Now let’s be clear on this – The multi-national American giant Intel is funding a major campaign for a Yes vote in the upcoming Lisbon II referendum but it is not a political campaign.
According to Intel’s general manager, Jim O’Hara, the company is simply putting forward the business case. We don’t want to get into the political debate said Mr. O’Hara as his PR personnel blocked any awkward questions from the media (Irish Independent).
I wonder will the Standards in Public Office Commission (SIPO), on behalf of its political masters, be launching an aggressive investigation into the funding of this political campaign by Intel similar to its investigation into Declan Ganley and Libertas?
Apparently not; SIPO has assured Mr. O’Hara that they have absolutely no issue with foreign multi-nationals flexing their considerable financial muscle to influence domestic politics.
This assurance, we can assume, is strictly reserved for those who support the government point of view.
The people of Ireland, as they struggle with the disastrous consequences of political incompetence and corruption, can take solace in the knowledge that Fianna Fail TD Mary O’Rourke, the Marie Antoinette of Irish politics, understands their anger.
Speaking in defence of John O’Donoghue’s extravagant expenses on Newstalk’s Lunchtime (Wed 19th), O’Rourke said she could understand people’s anger as they struggled to cope with the economic crisis but didn’t think it was her place to criticise O’Donoghue.
This is not Fianna Fail propaganda but I wouldn’t put pressure on him to explain, why should I, he’s a minister and I’m a back bencher and we each live our lives according to ourselves and I would think he would be best positioned whether he should go public or not.
Civil servants, she said, were to blame for the expensive hotels, nothing to do with politicians.
Questioned on the need for O’Donoghue to spend a full week in Cheltenham at taxpayer’s expense she replied:
Agencies like Horse Racing Ireland would always want a front of house person to add a bit of glitz and colour.
On the angry public reaction to the scandal she said:
It’s 2009 and things are extremely difficult so we’re judging what happened some years ago in a land of plenty, at a time of plenty. We’re judging them by today’s much more rigorous and much more stringent circumstances and of course that gives an added patina of dissatisfaction and envy.
She goes on:
That kind of atavistic spirit which is so evident now and I can understand it being evident because times are very tight and people are wondering how to get school books and clothes on the back of kids. At a time like that sentiments of that kind of atavistic nature can produce themselves and can lead to anger.
I checked out the definition of ‘atavistic’. Pertaining to, or characterized by atavism; reverting to or suggesting the characteristics of a remote ancestor or primitive type.
On O’Donoghue’s refusal to provide an explanation.
Maybe he sees that in his present position of Ceann Comhairle that he doesn’t want to go public explaining things of three or four years ago, I mean what does he want (need) to explain?
On the practice of taking along partners on trips:
There are men and women who feel better and can perform better if they have a partner with them I don’t see anything wrong in that.
Here’s my interpretation of O’Rourke’s mindset.
I absolutely refuse to make any criticism of my fellow party colleague. I do, however, think he’s a brilliant servant of the State and its people. Civil servants are to blame for any extravagance and my colleague has no responsibility in the matter whatsoever.
Some citizens are, of course, angry but this is because they are too stupid to see that all this happened a long time ago and we now live in different times. This has resulted in a reversion to primitive instincts among the peasant class making them resentful and envious.
My good friend John may at some point decide to briefly lower himself to peasant level to explain, in simple terms, the intricacies of wielding great power but he must take care not to become too familiar with ordinary folk as this could have a detrimental affect on the prestige and respect due to him as holder of the illustrious office of Ceann Comhairle.
According to a report in today’s Irish Independent:
The days of first-class flights and extravagant stays in five-star hotels are over for globetrotting ministers and senior public servants.
The article goes on:
Under tough new rules, they will instead have to avoid using business and first-class flights and will have to stay in modest hotels instead of running up massive bills at taxpayers’ expense in some of the most salubrious establishments and enjoying champagne travel.
Taxpayers should not, however, get over excited by this alleged reform. The so called new ‘tough rules’ are nothing more than guidelines and corruption fatigued citizens will be only too well aware that politicians, who regularly break the law with impunity, will have no scruples about trampling over some meaningless guidelines.
The O’Donoghue expenses scandal was discussed recently on Today FM’s Sunday Supplement (9th August) where columnists Fiona Looney, Sarah Carey and Hugh Linehan of the Irish Times ‘enlightened’ the nation on the matter.
To his credit, Hugh Linehan, got it just about right when he said that the expenses were hugely excessive and such abuses were properly still going on.
Sarah Carey and Fiona Looney, however, thought it was all a bit of a joke.
According to Looney this all happened a long time ago – between 2005 and 2007. We can take from this that Looney would regard 1997 as ancient history when, effectively, the present regime, came to power and began the process that has brought the country to the brink of ruin.
Expressing sympathy for O’Donaghue, Looney said that different rules applied then. Sadly, she didn’t enlighten listeners as to what exactly the ‘rules’ were at the time or how they have changed in the last two years.
Sarah Carey thought the whole thing was a bit of a side show but did express puzzlement about the silence from the Opposition on the matter. She suggested that perhaps they too may have abused their expense accounts when they were last in power and were afraid that this might be exposed if they complained too much.
Here’s the reality.
The greed and arrogance of John O’Donoghue is exactly what can be expected in a corrupt state. The ignorant and mealy mouthed analysis by journalists is exactly what is to be expected from a media operating in a corrupt state.
The silence from the Opposition is exactly what is to be expected in a corrupt state. The entire political expenses system in Ireland is corrupt to the core.
Millions are robbed from taxpayers every year by ruthless and greedy politicians operating within a system designed by politicians for the sole benefit of politicians.
The Opposition is keeping quiet because they also benefit enormously from the same corrupt system, not just when they’re in power as Ms. Carey suggests, but every day, even while in opposition.
One of the principal reasons that allows greedy and ruthless politicians like O’Donoghue to abuse the system with absolute impunity is that Ireland is blighted by a lazy, uninformed and largely captured media.
Recently, I tuned into the Wide Angle on Newstalk. Dick Roche was on the panel with a couple of journalists.
When the subject of Denis O’Brien and the Moriarty Tribunal came up the presenter informed listeners that the station was owned by O’Brien. There then followed a withering criticism of the tribunal by everybody including the presenter.
The usual attack, too expensive, going on too long, making unsubstantiated claims, should be closed down, not a word of criticism of O’Brien.
O’Brien must be proud that ‘his’ presenter, the journalists and the politician are all in full agreement with him that the tribunal is conducting a personal vendetta against him to justify their existence.
The discussion then turned to the O’Donoghue expenses scandal and among the usual waffle surrounding this scandal we heard what has now become the standard excuse mouthed by dishonest politicians and lazy journalists – It was a different time, different rules (apparently) applied then.
Effectively, we are being told that when there’s lots of money sloshing around it’s perfectly ok for our politicians to spend as if they were royalty.
This letter writer to the Irish Independent asks the question:
Do our politicians not understand the damage that is being done to our democracy by both this behaviour and, more importantly, by the lack of challenge from them, our elected leaders?
For example, why are they not demanding to know who within the banks is actually authorising these decisions; and why are the banks adopting this strategy of continuing to support a developer when the courts rejected his survival plan as “fanciful and lacking in reality”?
The answer is simple – It’s the bankers who are in charge, it was the bankers who called in the politicians last September and issued instructions on what was to be done. It is the bankers who are issuing instructions on the whole NAMA scam, the politicians are mere puppets.
NAMA letters in today’s Irish Examiner and Irish Independent.
NAMA is nothing short of economic treason.
THE column by Brian O’Mahony headlined ‘NAMA delays would be bad for the country’ (August 8) was, to quote Judge Peter Kelly, “trespassing on fantasy”.
NAMA must not be rushed. Had the Government properly managed evoting, PPARS, PULSE or decentralisation, we might have got some value from the millions it wasted on these projects.
With its latest project, its not millions but billions of taxpayers’ revenues that are being wasted on overvalued rubbish. Had the financial regulator (Government watchdog?) done its job properly and not just walked, our troubles would undoubtedly not be so great.
And we are giving the same Government the same power? Again? It’s legitimate to demand an unequivocal answer as to why the state, via the actions of the Government, favours de facto private interest over the citizens?
NAMA, in its current form, is nothing short of economic treason — banking legislation written by bankers for bankers and for the good of nobody except bankers and their property development debtors.
Currently it has got all the hallmarks and financial engineering brilliance of Enron. The old Celtic Tiger could afford previous levels of Government waste and incompetence but Ireland — European Capital of Incompetence 2009 — cannot afford to get NAMA wrong.
Don’t let the Government hoodwink the nation into accepting the flawed NAMA bill in its current form and please, please, don’t allow it to be rushed.
Paul Feeney
Botanic Hall
Glasnevin
Dublin 11
NAMA ‘death warrant’ hanging over us
The voice of reason has been spoken by the Supreme Court on the Liam Carroll appeal for enough time to stick the taxpayer, through NAMA, with paying bloated values for property assets which have no basis for assessing their true worth now or any time soon.
It is incredible how, within an hour of the ruling, that the Department of Finance could issue a statement to the effect that NAMA will proceed unaffected by the judgment. Clearly the disdain shown by the State to its citizens is set to continue unabated.
Three months ago, you published a letter from me calling for a referendum on NAMA. I believe that the dangers inherent in NAMA are staggering. I have no confidence in this Government to do anything other than facilitate an enormous over-payment of our money to the banks for property assets that have no prospect of recovering to even 50pc of the value ascribed to them when the irresponsible lending took place.
This will be a disaster for Ireland.
Regrettably there is but one solution to this problem and that is to nationalise the banks. NAMA can make sense after nationalisation. It cannot be the other way round as we will see our money paid out in exchange for grossly over-valued assets and we will have no control over those who are in charge of the banks.
If we do nothing then the NAMA legislation will be passed and sent to the President for her signature by the end of September. The enormity of this brings to mind the sadly prophetic words of Michael Collins on signing the treaty as “feeling I have just signed my own death warrant”.
Patrick Byrne
Dublin 14
The Irish taxpayer will be screwed left, right and centre when NAMA is up and running.
The Government will tax us more to repay the massive debt they will accrue on our behalf and the banks will hike rates so they can make the huge profits they need to justify their existence to shareholders.
It is about time we woke up and smelt the coffee. The only people who will benefit from NAMA are the banks, the private investment funds and the shareholders. And the home buyers are being hung out to dry.
Justice in this country is the preserve of the elite.
Martin Barnes
Carrick on Shannon
Co Leitrim
This will be a long post, so stay with me if you can:
Countries are in a desperate economic situation for one simple reason—the powerful elites within them overreached in good times and took too many risks. Emerging-market governments and their private-sector allies commonly form a tight-knit—and, most of the time, genteel—oligarchy, running the country rather like a profit-seeking company in which they are the controlling shareholders. When a country like Indonesia or South Korea or Ireland grows, so do the ambitions of its captains of industry. As masters of their mini-universe, these people make some investments that clearly benefit the broader economy, but they also start making bigger and riskier bets. They reckon—correctly, in most cases—that their political connections will allow them to push onto the government any substantial problems that arise.
In Ireland, for instance, the private sector is now in serious trouble because, over the past seven years or so, it borrowed at least $130 billion from banks and investors on the assumption that the country’s property sector could support a permanent increase in consumption throughout the economy. As Ireland’s oligarchs spent this capital, acquiring other companies and embarking on ambitious investment plans that generated jobs, their importance to the political elite increased. Growing political support meant better access to lucrative contracts, tax breaks, and subsidies. And foreign investors could not have been more pleased; all other things being equal, they prefer to lend money to people who have the implicit backing of their national governments, even if that backing gives off the faint whiff of corruption.
But inevitably, oligarchs get carried away; they waste money and build massive business empires on a mountain of debt. Local banks, sometimes pressured by the government, become too willing to extend credit to the elite and to those who depend on them. Overborrowing always ends badly, whether for an individual, a company, or a country. Sooner or later, credit conditions become tighter and no one will lend you money on anything close to affordable terms.
The downward spiral that follows is remarkably steep. Enormous companies teeter on the brink of default, and the local banks that have lent to them collapse. Yesterday’s “public-private partnerships” are relabeled “crony capitalism.” With credit unavailable, economic paralysis ensues, and conditions just get worse and worse. The government is forced to draw down its foreign-currency reserves to pay for imports, service debt, and cover private losses. But these reserves will eventually run out. If the country cannot right itself before that happens, it will default on its sovereign debt and become an economic pariah. The government, in its race to stop the bleeding, will typically need to wipe out some of the national champions—now hemorrhaging cash—and usually restructure a banking system that’s gone badly out of balance. It will, in other words, need to squeeze at least some of its oligarchs.
Squeezing the oligarchs, though, is seldom the strategy of choice among governments. Quite the contrary: at the outset of the crisis, the oligarchs are usually among the first to get extra help from the government, such as preferential access to foreign currency, or maybe a nice tax break, or—here’s a classic Dublin bailout technique—the assumption of private debt obligations by the government. Under duress, generosity toward old friends takes many innovative forms. Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk—at least until the riots grow too large.
Eventually, as the oligarchs in Cowen’s Ireland now realize, some within the elite have to lose out before recovery can begin. It’s a game of musical chairs: there just isn’t enough cash to take care of everyone, and the government cannot afford to take over private-sector debt completely.
First, an admission. The above is a quote from Simon Johnson’s excellent essay in the Atlantic in May of this year, The Quiet Coup. But I have modified it ever so slightly. I simply replaced the word ‘Russia’ with ‘Ireland’, and other slight edits to take into account energy versus property. You can see the original here.
Why the modification? Well it demonstrates at exactly the level Ireland is at.
We are a two-bit emerging market economy, dominated by political and business elites. I think it’s an open and shut case. Every word Johnson intended for Russia accurately applies to Ireland. We are almost the definition of a banana republic.
The only difference is in the last paragraph. “Some within the elite have to lose out before recovery can begin.” No. In Ireland, no oligarch property developer will lose out if the government can help it – thanks to NAMA.
The only people who will end up paying are you and me, our children, and our grandchildren. If people think our political leaders are acting out of the interest of the taxpayer they are dead wrong. Our political leaders are acting only in the interests of themselves and their paymaster developers.
Let us examine some of Johnson’s indicators that we are an emerging market, dominated by oligarchs. We could make a checklist:
* “Emerging-market governments and their private-sector allies commonly form a tight-knit—and, most of the time, genteel—oligarchy, running the country rather like a profit-seeking company in which they are the controlling shareholders.”
Check.
* “As masters of their mini-universe, these people make some investments that clearly benefit the broader economy, but they also start making bigger and riskier bets. They reckon—correctly, in most cases—that their political connections will allow them to push onto the government any substantial problems that arise.”
Check.
* “As Ireland’s oligarchs spent this capital, acquiring other companies and embarking on ambitious investment plans that generated jobs, their importance to the political elite increased.”
Check.
* “Growing political support meant better access to lucrative contracts, tax breaks, and subsidies.”
Check.
* “Oligarchs get carried away; they waste money and build massive business empires on a mountain of debt.” Check.
* “Local banks, sometimes pressured by the government, become too willing to extend credit to the elite and to those who depend on them.”
Check.
* “Overborrowing always ends badly, whether for an individual, a company, or a country. Sooner or later, credit conditions become tighter and no one will lend you money on anything close to affordable terms.”
Check.
* “Enormous companies teeter on the brink of default, and the local banks that have lent to them collapse.”
Check.
* “If the country cannot right itself before that happens, it will default on its sovereign debt and become an economic pariah.”
Check.
* “The government, in its race to stop the bleeding, will typically need to wipe out some of the national champions—now hemorrhaging cash—and usually restructure a banking system that’s gone badly out of balance. It will, in other words, need to squeeze at least some of its oligarchs.”
Check.
* “Squeezing the oligarchs, though, is seldom the strategy of choice among governments.”
Check.
* “At the outset of the crisis, the oligarchs are usually among the first to get extra help from the government, such as preferential access to foreign currency, or maybe a nice tax break, or—here’s a classic Dublin bailout technique—the assumption of private debt obligations by the government“.
Check. NAMA.
* “Under duress, generosity toward old friends takes many innovative forms. Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk—at least until the riots grow too large.”
Check, minus the riots. Yet.
* “Some within the elite have to lose out before recovery can begin. It’s a game of musical chairs: there just isn’t enough cash to take care of everyone, and the government cannot afford to take over private-sector debt completely.”
Except in Ireland, where we are trying to assume €90bn in private sector debt. Liam Carroll as the elite one losing out? Check.
And so we return to the original question posed: What is wrong with Ireland? My answer is this: We believe we are something we are not.
We believe we have a more mature regulatory environment, a mature, transparent and accountable political system, we believe the media holds our government to account, and we believe that our elected leaders will act in the best interests of citizens. Even the media believes it holds the government to account.
These assumptions are all wrong.
When you examine, even to a minor degree, any aspect of Irish society, you will invariably find a distinct lack of all the above factors. For example captured regulators: The Financial Regulator, the Irish Stock Exchange, the ODCE, ComReg, the Financial Ombudsman.
Whenever and wherever corruption is discovered, nothing happens. Whenever and wherever whistles are blown, nothing happens. We live in a country where the very idea of accountability, or that our politicians are our servants, simply does not exist.
As a nation state, we are a failure. As a democracy, we have failed. As a country we are bankrupt, both morally and financially. We are the emerging market, banana republic of the European Union. Our political system is broken. It is beyond redemption.
Some will reply that I am a socialist, or other such attacks. I am actually right of centre economically, I just recognise what is standing in front of me for what it is. An almost incalculable political and financial mess – generations are being saddled with the debts of the oligarchs, and the taxpayer is being lied to by its own government.
The only hope is this: That the people, in whose hands all power rests, will realise the appalling vista of a broken Ireland – a country in need of radical political reform – and demand that it is changed.
If it is not, everything that has happened, will continue to happen, and we, the citizens, will continue to pay the price.
[Cross posted to my blog]
Friday 31st July: Former Thomas Cook employees occupied the company’s premises in Dublin in an effort to get a better redundancy deal.
Saturday 1st August: A High Court judge issued a court order ordering them to leave the premises. The protesters refused to comply.
Sunday 2nd August: The High Court judge directs Gardai to have those found on the premises after 7pm on Monday arrested and brought before him to answer for their contempt.
On Tuesday 4th August (at 5am) a large force of Gardai arrested the protesters and hauled them off to court.
In just four days the legal and law enforcement arms of the State acted to bring the guilty to account.
The judge in the case said:
In a democratic society the rule of law “cannot be broken” or else there would be “anarchy”.
Nine years ago, in 2000, Jim Flavin of DCC committed the crime of insider trading on the Irish Stock Market.
Two years ago the highest court in the land confirmed that Flavin was indeed guilty of fraud on the stock market to the tune of €83 million.
Jim Flavin is still a free man, still walking around enjoying the same rights and privileges of innocent citizens.
Nine years and we’re still waiting for action against Flavin so let me rephrase the judge’s comment.
In a democratic society the rule of law cannot be broken by ordinary citizens or else there would be anarchy – privileged citizens will be treated differently.