Ireland is Bankrupt…a letter from an Irish citizen
A letter sent from Ireland (updated):
For less than what the US spent to save AIG, a corporation, with relatively easy terms; a country sinks below the financial waves. TBTF reaches across the ocean. As posted by Zeus-boy, his comments on his homeland of Ireland. (introduction by run75441)
Ireland is Bankrupt
Herman Van Rompuy, President of the European Council, warned that if Ireland didn’t apply for an EU/ECB/IMF bailout for its failed banking system, its soaring budget deficit and its colossal national debt, then the European single currency might collapse [the bond markets have already panicked and cashed in], and if the International markets lost confidence in the Euro, then the dissolution of the Union would quickly follow. He said the future of the Eurozone depended on stemming the tide of market distrust caused by the tanking Irish economy. He feared contagion, that Portugal and Italy and Spain would soon follow.
Ireland is not only insolvent because it has no liquidity, no way of meeting its debts. The government decided to link the economic future of the country to a failed banking system and now the two are inextricably intertwined. No amount of raised taxes can bail out the banks and still pay the day-to-day running expenses of our welfare state. The famed ‘Celtic Tiger’ boom economy was always a high-risk, dangerous fiction. Someone dubbed Ireland the ‘Wild West of Economics’. Our illusory wealth was tied to a property bubble that was as unsustainable as it vacuous, and all the money was borrowed, primarily from German savers. We were hooked on credit like it was crack cocaine. We binged but never purged and we stayed high to postpone the inevitable hangover. Everybody was in cahoots, from corrupt local governments, driving through emergency rezoning laws, to rogue bankers financing the criminal inflation of developments and shoveling billions to builders, to newspapers cashing in on their property advertising to regulators asleep at the wheel. Our mafia don cum Taoiseach, Bertie ‘Gombeen-Man’ Ahern, invited critics of the system to commit suicide. Nobody left the orgy. Nobody wanted to leave. Planet Hollywood had finally come to Planet Ireland!But inevitably the whole house of cards would come crashing down, and Bertie [who tendered his timely resignation just before the collapse] soon got his wish as the suicide rate started to climb to the highest in Europe. The government panicked. The Minister for Finance, a barrister by profession, got a crash course in national and global economics. He learned about markets and budgets and bonds and gilts on the job, on a need-to-know basis. He instituted an abstraction called N.A.M.A. http://www.nama.ie/ , The National Assets Management Agency, whose remit basically is to buy up all the debt and properties left unfinished and unpaid for by the construction moguls [developers & builders] and their bankers, to transfer them to a national trust, cue Irish tax-payer, as if we owned them, or even wanted them, or could avail of them in any way, and to pay off the outstanding loans. All over Ireland, in every town and village, are these unfinished ghost estates. These now belong and do not belong to the Irish taxpayer. This offense was compounded by the decision to bail out the very banks [like Anglo Irish and Irish Permanent, really, all of them] that got us into the mess. The banks were hemorrhaging money [and still are] and the government was on hand to provide on-the-spot triage, a botched stitch-up job if there ever was one, a cluster-fuck of cosmic proportions.
The government, Fianna Fáil in coalition with The Greens and a few independents, lied through their teeth and kept telling the Irish taxpayer that exports were up, that the revenue would come in once the austerity budget was passed, once the 4-year plan was unveiled and ratified and that no bail-out would be necessary. Reduce public spending, they told us, tighten our belts; cut the public sector; Trim this, give a haircut to that and all would be hunky dory. Well, the same shower of gangsters who gave the green light to sub-prime lenders and hedge-fund speculators-gamblers went to the ECB/IMF with cap in hand this week and begged for a bailout. Then they came on TeeVee to announce the done-deal. Ireland will borrow over 85 billion from its partners in the EU and the IMF and, depending on the repayment interest, 5 -7%, we could be paying back upwards of 4 billion a year. That’s about 1/4 of the Tax intake. The debt is completely beyond our means as Constantin Gurdjiev, http://trueeconomics.blogspot.com/ and David McWilliams http://www.davidmcwilliams.ie/category/articles/ are trying to point out.
Ireland is used to erosions of its sovereignty ever since we joined the European Union. We, we had our first referendum on the Lisbon Treaty in June 2008 and it was defeated. Sarkozy told our Taoiseach that he delivered the wrong result and to go back to the people and get the right result next time, so that’s exactly what happened and so in April 2009 the treaty was finally passed in Ireland. So much for Irish sovereignty. Our membership of the single currency in 1998, as part of our EU obligations under the Maastricht Treaty, further compromised that independence. Now ceding control to the IMF — to save the Eurozone — is the final nail in the coffin of that putative myth known as Irish sovereignty. We gave away so glibly what we fought so hard to achieve.
Was it for this the wild geese spread
The grey wing upon every tide;
For this that all that blood was shed,
For this Edward Fitzgerald died,
And Robert Emmet and Wolfe Tone,
All that delirium of the brave?
Romantic Ireland’s dead and gone,
It’s with O’Leary in the grave.I’m afraid the verdict isn’t very flattering. Ireland is indeed a banana republic, a land full of cronyism, wink and nod business deals, insider trading, nepotism, feather your own nest and forget about the next guy, take all you can as quickly as you can no matter who gets hurt, ostracize the whistle blowers and critics, advance number one every time and keep the circles closed. There’s no sense of civitas here, no notion of self-sacrifice, no pride in history, culture, nation; it’s all up for grabs to the highest bidder. It doesn’t matter that we struggled for 800 years to achieve independence, that millions died in the process; it doesn’t matter that the folk memory of harsher times is still very much alive; none of this mattered to the few generations that have dismantled our country institution by institution and thrown the Irish people to the wolves, the bean counters in the IMF who will now control our destiny. Our political system is in ruins. The people have lost all faith in their elected representatives. They feel that welfare for the wealthy, bailouts for crooked corporations and rewards instead of punishments for embezzlement and thievery is the rule of the land. And what the British and the world said about us, all the stereotypes, seem to be true after all and maybe were always true: we were never equipped to govern ourselves, we’re a nation of drunks, peasants, irresponsible wasters and chancers addicted to violence and quick fixes. Our independent republic is less than a century old and already it’s in smithereens — we’re in the gutter and being dictated to by the UK, Germany, France and the IMF. Mr. Ajai Chopra is our new vice-chancellor, our new Taoiseach, our new overlord and big boss and we’ve just been recolonized, first by our own brood of inbred gangsters and now by international bankers. We didn’t deserve any better. It’s our own damn fault.
By ‘we’ I mean the select few that got our country into the financial mess. But the blame game serves no useful purpose now: we’re all fucked, not equally, mind you [but when are people ever fucked equally?], and the nation has no option now but to drive through a draconian austerity budget and then take the bailout and let our affairs be run by outsiders. Could we say ‘Fuck You’ to the Euro and go back to the punt? Could we say ‘Fuck You’ to Germany and all our debtors? Could we say ‘Fuck You’ to the EU and let the Eurozone fall? Our politicians tell us we have no choice. It would be therapeutic to tell the lot of them to piss off and to return to hunter-gatherer status but how feasible is that? Kids think beef patties are really square and grow on trees. They wouldn’t know how to pluck a chicken let alone sow and reap a harvest. Everything’s in the grocery store and they’re too busy playing play station, twittering and gabbing on Facebook to worry about the right time of year to plant a tuber. The EU is run by neo-liberalist economic policies and if Ireland doesn’t play ball the multi-nationals will up and relocate to cheaper labour markets. They’re already doing just that. They’re encouraged to do it by Merkel and Sarkozy and Cameron.
And then there’s always the fear that this crisis will inaugurate excessive nationalism, that the Provos will exploit civil unrest and lack of confidence in the government to push their demented and deranged United Ireland bollocks. Gerry Adams has already announced his candidacy for a seat in Co. Louth which, if elected, will find him in Dáil Éireann. This would be disastrous for Ireland. Ireland doesn’t need Sinn Féin’s brand of patriotism. People should remember Gerry Adams’ devolvement announcement for the Good Friday Agreement: He said he was now ready to pursue through the political process the same agenda he failed to achieve through armed struggle, that is, a United Ireland. If Sinn Féin ever gets a foothold in Irish politics there will be a return to the rule of the gun; if his bunch of murderous, terrorist thugs are ever allowed to exploit the political vacuum in Ireland there will be a bloodbath. Adams has always preached against the EU and partnership with Britain. He’s still the same dickweed that did time in Long Kesh and had Jean McConville a widowed mother of 11 children murdered because she administered last rites to a British soldier who died on her footstep. His brand of fascistic nationalism is no good for Ireland. We must reject him and what he stands for.
As a nation we’re a joke, a laughing stock, and now it’s time to become a colony of the IMF under the direction of the same cowboy outfit that brought peace and prosperity to Argentina and Iceland. O Joy, I just can’t wait. We the Irish People have our asses greased for yet another bout of sodomy. We’re used to it. It feels good. And this time we walked right into it. Heck, we can always get drunk afterwards, have a rare old session and weep and wail over our Fenian dead.
Ireland should have let the commercial banks fail. The government should have taken over their functions. It’s the same thing that the US should have done. People would scream socialism but they scream socialism when you bail them out. The first solution would not have cost you anywhere as much and the moral hazard would have being a lot less.
George Bernard Shaw described exactly how this was going to happen about a hundred years ago in a play called “John Bull’s Other Island.”
i’m guessing the bit of poetry quoted above is from Yeats.
good reading both.
Ray:
I wrote the intro to Zeus’s lament on the Irish. We write together elsewhere. Amazing, we can save a gambling bank and we can not save a nation except by punishing the people of it who had not authority. A trifle odd, dontcha think???
Zeus writes his own poetry.
run,
It is an exellent piece. As for being “odd”, yea, so much is wrong and a waste.
run
coulda fooled me.
Mark Twain said that history doesn’t repeat but it sure does rhyme. I’m thinking about the failed Darien
Colony expedition which cost a big chunk of Scotland’s wealth in the early 1700’s, and led to the bail out
and consolidation with Britain in 1707. The Scots took a big gamble, lost, and paid the price, although 300
years later most would not reverse the deal. Just a thought.
spot on
Great piece.
coberly:
Yea thang??
You would be correct on the Yeats quote as I have been told its “Wild Geese.”
According to the NYT Ireland owes marginally more to Britain than to Germany…..
http://www.nytimes.com/interactive/2010/05/02/weekinreview/02marsh.html
although that is probably because a vast ammount of business for international clients is done through London. So the money looks like it is owed to Britain but is really owewd to foreign clients.
Eire should default and be done with it. Tell the IMF and EU to go to hell!
It’s not a bailout of Eire, it’s the US and EU taxpayers country bailing out UK and German speculators. Ireland is just a conduit in a money- laundering scheme.
Irish are not supposed to pay the interest or repay the loans. Rather, it is the Federal Reserve and the ECB swapping bad paper for cash, both dollars and euros. The fact of the crisis and the bail are evidence the current credit structure is on its last legs.
Eire should default and revive the punt. Bondholders would scream for a little while but all the leverage would lie with the Irish. It could pick and choose who to repay and under terms favorable to the Irish rather than to the bondholders.
One more time, default and be done with it.
steve
that, in general, is what i have been saying, at least in prospect about the American debt. not that i think default is a good idea, but that the debt is not a reason to panic. certainly not a reason to lower the living standards (including Social Security) of the American (or Irish) people. Debts are at the risk of the lender, and only the mafia has power to enforce debt collection on terms we can’t refuse.
i think that in most cases it was not the people who borrowed the money. it looks to me like the banks lending to themselves, but i’d be very glad to see that thesis worked out by someone who knows more than i do.
Mr. Crawford’s letter of despair could just as easily be authored by anyone in the UK, US or France. We have all reached the point where no amount of twisting and turning is going to avoid the noose of poverty. We have all taken the easy way out, which in retrospect will become the most difficult way.
Those that survive will indeed learn to “pluck a chicken” or “reap a harvest”. They will also have to learn how to grow a garden, how to preserve foodstuffs and how to repair a tire. Unfortunately, they also may have to learn how to handle a gun.
Other than the above, I have no advice except that of Margaret Thatcher’s comment that socialism ends when they run out of other people’s money.
cluster
hard for me to know what your point is. it looks like capitalism may end when they have everyone’s money.
as for the poverty thing, i don’t understand it. the people who lent the money weren’t using it. if they don’t get paid back they are no worse off than they were while it was lent. for the most part… there are people who were depending on getting paid back so they could retire, but i don’t think these are the people who did most of the lending or who are threatening to break our thumbs if we don’t pay up.
i believe in paying bills, but i don’t think that world poverty is the answer to the debt crisis.
Sinn Fein may be the only hope!
We need root and branch reform and a new constitution might be a good way to get it.
32 counties insolvent is no worse than 26. It will mean revision of institutions that will show up the NZ reforms as superficial!
Credit was the poison. We now have the cure! Take advantage of this time as the bankers will be back in a decade or so!
Regarding the bail out for Ireland – The solution to erope and Ireland cirisis is to rebuild the Berlin wall and higher this time. The eastern europeans and Polish have flooded into Ireland and snapped and grabbed as much as they could and have caused havoc in this contry.
immigration?? Send me a note at angrybearblog@gmail.com