July 28, 2010

Selling off state assets on the cheap is just madness

Posted in Banks · 158 comments ·

This Government will not contemplate selling property just in case it would bankrupt the banks. The State’s argument is that the market is depressed so if we were to sell the land, we would not get a fair price for it.

So we will postpone the problem: we get NAMA — a financial skip into which the banks throw their worthless mistakes — and you pay. The logic of NAMA and this Government’s central strategy is to wait for the value of land to improve before selling.

Whether you agree with it or not, this is their logic. It can be summed up by: “Don’t sell land in a depressed market.”

Yet at the same time, the Government has just announced that it will sell real assets via privatisation in a similarly depressed market. So why can it sell ESB — a real company with real assets — and not a field in Athlone which is worthless and should command the price a farmer would pay you to put a donkey grazing on it?

Why is it imperative to sell proper state assets and inconceivable to sell useless land?

This is the part I do not understand. Why does the State believe that it is okay to have a fire sale of the family silver and yet protect the very asset which caused the problem in the first place? How could it be that a depressed market is a bad time to sell land but a good time to sell a strategic electricity company?

We the people are supposed to fork out for NAMA which is paying over the odds for the banks’ and the developers’ mistakes, yet look on helplessly as the State sells — at knockdown prices — those companies that our taxes have built up. Can anyone explain this inconsistency to me?

If you look at what the Government published about the privatisation of everything it can sell, the first aim is: “To consider the potential for asset disposals in the public sector, including commercial state bodies, in view of the indebtedness of the State.”

So the key phrase is the “indebtedness of the State”. But selling big companies like ESB will not solve the indebtedness of the State.

Furthermore, the indebtedness of the State wasn’t caused by companies like ESB in the first place. The precarious position of the State with respect to its finances is a result of the estimated €50bn cost of saving the banks and a reckless overdependency on land and credit to generate enough tax to pay for the State’s current expenditure.

If you don’t solve the underlying problem, the issues will not go away no matter how much you privatise.

It is akin to the alcoholic flogging his house and his car to pay for his drinking; unless he stops drinking things won’t improve. This is why privatisation (the putative cure) side by side with NAMA and the land scam (the obvious problem) will not work. It will make us poorer and make someone hugely rich as the assets are sold cheaply.

Worse still if Eircom is anything to go by, strategic state assets are sold off and then asset stripped by anyone who can raise enough leverage to do so. I gave up counting how many times Eircom was flipped, stripped and flogged on. What is clear, is that each time Eircom was overburdened with debt to make a few quick quid for the buyers, the chances of us having a first-class telecom infrastructure faded.

Think about the challenges ahead for energy. The biggest single economic issue facing not just us, but all of the global economy, is energy. The most far-sighted countries are those which are harnessing their energy companies’ resources to come up with an environmentally friendly and efficient new energy blueprint.

And what do we do in Ireland? We flog our main energy company, which will end up in the hands of a private equity outfit that has little more than a five-year time horizon.

But there will be winners, so let’s see who might make a quick buck in a rapid Irish privatisation. Would it surprise you if it is the same professional “insider” elite being bailed out by NAMA? Well the same lads emerge as winners again.

The stockbrokers who put together (and took a fee from) many of the syndicated deals which NAMA is now buying, take a fee for every new euro of debt we issue. I have been told that entire units of our biggest brokers have morphed from selling equities and land deals into flogging debt. The more indebted the country, the more fees they make.

So the brokers made in the boom and are making in the bust and now with privatisation they will make again because they will get a fee for “placing” the shares of the newly privatised companies with investors.

What about the big law firms, the ones who put the property deals together in the boom? Well apart from being given a gig at NAMA, they will be paid with your cash to issue legal prospectuses, which will govern the terms of the privatisations.

What about the big auditor companies? What about these guys who audited the likes of Anglo and Irish Nationwide and saw nothing at all untoward? Well they will be given hefty fees in the privatisation process to produce audited accounts of our companies.

And what about the geniuses in the Irish pension fund industry, the ones who bought shares in Anglo and the Bank of Ireland when they were in the high teens? These lads will be given another opportunity to shine by being given cheap shares on a plate — for which they will take a fee for buying a company on our behalf, a company which we already own!

Selling state assets for a decent price could well be a clever thing to do, but selling cheaply is always stupid, particularly if it doesn’t solve the underlying problem.

When you look at this idea of flogging the family silver right now, you see that Ireland is doing everything backwards as this Government fumbles from one crisis to another. In economics, when a country or a company gets into huge debt difficulties, the standard approach is to kick off the recovery with a debt for equity swap. This means you tell the people who are owed money that they will have to take shares in the company or in the country instead of real cash, which the country can’t afford to pay.

In Ireland we are doing the opposite: by privatising now, we are selling real valuable equity to pay for old debt! So rather than a debt/equity swap, we are doing an equity/debt swap in a depressed market.

You couldn’t make up a worse strategy.

  1. adamabyss


  2. ThomasFergus

    Ah but David, if you don’t know by now that “public sector = bad” and “private sector = good” then you haven’t been taking your daily dose of Morning Ireland/Irish Times editorials/Pravda Nine O Clock news/Sunday Indo hysteria.

    Don’t worry. That hard man of economics, Colm McCarthy, has been appointed by the Govt (yet again, how many times now since 1987?) to see what bloated public sector providers can be flogged to his FF supporting buddies before being stripped, sweated and leveraged to bits. As long as the public can whipped up into a paroxysm of outrage about the union bullies who will try to stop this deal, and as long as those union bullies are kept sweet with a few appointments to State boards, then the great scam can continue.

  3. And this hare-brained tomfoolery, because it defies the definition of strategy, will lead to enforced redundancies when the new “investors” “rationalise” the old semi-states.
    Deja Vu with the old Thatcherite policies.
    All we need now is Malcolm McDowell as a Keith Joseph cameo.

  4. doccer

    It is well worth noticing that the “interim” list of “assets to be reviewed” includes 28 items, not listed in alphabetical order. So therefore we can assume it is a prioritised list. We see that the first 16 items are transport entities. The next 4 are energy agencies. Add in Coillte and the National Oil Reserves Agency – both energy related – and fully 22 out of 28 organisations, more or less at the top of the list, are in transport and energy. The conclusion can only be made, then, that this is a concerted policy to fully privatise this sector.

    Transport and energy are fundamentally strategic and only a myopic ideologue with no grasp of economic history could not see how relative control of these are vital to a nation’s sovereignty. Selling these assets would cede national control over pricing, planning, delivery and operation of movement of people and goods, as well as how we power our economy. This would be madness, whether times be good or bad.

    Of course those proposing this daft program will say that we can regulate private interests. But private interests can hire lawyers and instead of framing and delivering policies in the national interest we will be reduced to adversarial raproche with capital market organisations wherein they retain vital information and data. And, without casting aspersions on capital markets (although they are hardly covered in glory during these times), if the assets in question are of value to private interests, how are they not of value to the state? This is purely discussion in monetary terms, however the true value of these assets is in strategic terms. We are a small island nation with an export economy. Therefore these assets need to be controlled by the state and operated in service of this society and economy.

    None of this is to even reflect on the appalling record of the state in recently disposing of assets, principally Eircom and Aer Lingus, both categorical disasters. The Aer Lingus disposal was aborted thanks to some blindingly poor planning (apparently nobody foresaw that the largest operator might be interested in purchasing the second largest operator out of Dublin Airport). The Eircom failure has slowed up delivery of broadband infrastructure – considered a social right in some countries – in-determinedly.

    Further, the terms of reference make dismal reading. They are brief (five bullet points) and really only the first two matter. These refer to “the indebtedness of the state” and “to draw up a list of possible asset disposals”. This is spin for “we’re broke, lads, what have we got to flog”. Frankly this is a humiliation for a sovereign republic and nothing other than an absolute dereliction of political responsibility. It doesn’t even bear thinking that such a sale would take place at the BOTTOM of an economic downturn. A fire-sale, as it were, and a real bargain-bonanza for the likely bidders. It also suggests that our political leaders are panicking.

    It is a pity that in the midst of this panic, strategy over our entire transport and energy infrastructure is apparently being handed over to ideologues brandishing discredited economics. As far as transport is concerned, the argument between privatisation and public delivery is both warped and irrelevant. What is needed is integrated and effective delivery of services to our economy and society. This, sadly, has never been part of the debate in administrative or political circles. Actually, many of our agencies perform very effectively within the terms of their brief. Much independent review attests to this. Coordinating these services is where it falls down, and that is an issue of governance. No marks for saying whose responsibility that is. The important point is that selling them off will, in this practical instance, make things worse not better.

    Finally, the following organisations appear to be the only transport entities of significance omitted from the list: RPA and the NRA. Go figure!

  5. 20yearsagrowin

    Do you think we will ever get it right or are we doomed to forever tinker around with the system until it eventually fails completely? Its hard to believe that so many highly educated people can come up with so many stupid ideas. This is Groupthink to the extreme from what I can see. When you see free speech being threatened ( Dept of Finance calling Friends First to complain ) or when you see that the opposition are the same as the actual Govt ( FGs NAMA Golf outing ) you begin to realise the issue is that so few of the people in charge have any real world experience outside of their cosy little Jobs for the Lads setup.

    We should start a campaign that gives the right to vote to any Irish Citizen regardless where they are living….and someone should think about setting up a real political party

    Shame to see such a great country being run by morons

    • tony_murphy

      Ireland is a broken society, like all of the western world. TV was/is the weapon used to break society by the liberal lefties

      Postman in “Amusing ourselves to death” quoted in Peter Hitchens “Abolition of Britain” referring to George Orwell, 1984. Aldous Huxley, A Brave New World

      “What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture”

      For me, the masses are vulgar. Every second word is a swear word, they eat like pigs, drink themselves stupid, take drugs like there is no tomorrow and watch brain dead TV such as Cornation Street / Hollyoaks and are only obsessed with useless celebrities.

      Cowen has the easiest job in the world, he can do as he pleases. He can be like a dictator aided by his Fianna Fail henchmen / Trade Union henchmen / IBEC henchmen aka Insiders. Fine Gael and Labour would be no better, I’d even suggest they would be worse.

      The masses have to seriously change their ways or we are all doomed

      • Malcolm McClure

        Tony_Murphy: Your mention of Neil Postman was interesting from an historical perspective. His 1990 speech ‘Informing ourselves to death’ was very perceptive in its prediction of the WMD failures of British and American intelligence in Iraq. Too much dependence on remote sensing and too little on Humint.

        Ireland’s aspiration to become a knowledge based economy is in direct confrontation with Postman’s point that ‘the world in which we live is very nearly incomprehensible to most of us. There is almost no fact — whether actual or imagined — that will surprise us for very long, since we have no comprehensive and consistent picture of the world which would make the fact appear as an unacceptable contradiction. We believe because there is no reason not to believe. No social, political, historical, metaphysical, logical or spiritual reason. We live in a world that, for the most part, makes no sense to us. Not even technical sense.’ …’The point is that, in a world without spiritual or intellectual order, nothing is unbelievable; nothing is predictable, and therefore, nothing comes as a particular surprise.’
        Postman concluded that ‘ By becoming masters of this wondrous technology, they will acquire prestige and power and some will even become famous. In a world populated by people who believe that through more and more information, paradise is attainable, the computer scientist is king. But I maintain that all of this is a monumental and dangerous waste of human talent and energy. Imagine what might be accomplished if this talent and energy were turned to philosophy, to theology, to the arts, to imaginative literature or to education? Who knows what we could learn from such people — perhaps why there are wars, and hunger, and homelessness and mental illness and anger.’
        IMHO the Irish spirit is more attuned to the latter pursuit and we’d better leave the former to the Germans and the Americans, who think in restricted straight lines.

        Postman also had very advanced ideas on education that were popular in the 70s and 80s but are now largely discarded as an early learning method since ‘questioning’ requires a sound foundation of prior knowledge.

  6. Gege Le Beau

    You asked for an explanation David, one word: NEOLIBERALISM.

    Almost every move that has been made since the mid-nineties can be traced to that word and the failed economic ideology behind it. It is precisely at the point when the State is at its most ‘vulnerable’ and the people most confused and in fear that you asset strip the country and privatise the kitchen sink.

    The aim is the complete and utter commodification of all aspects of life. We pay for everything through the nose, and worst of all for the Irish, is their seeming willingness to accept with little more than a few symbolic marches.

    I went to Fota House wildlife park yesterday with 3 Chinese guests. On arrival there was a sign that said €3 for parking, pay on exit (all down through the years parking had been free), to visit Fota house one was expected to pay €6 per adult, my Chinese guests declined to go inside (too expensive was the common refrain), one of them even commented if I wanted to see nice rooms then I should visit the Winter Palace.

    Fota wildlife park charged €13.50 per adult, so for the four of us it came to the lovely total of €54.00 (this worked out at over half a week’s wages for my Chinese guests), inside the park their was a ‘train’ that took people around the park (the elderly and overweight), the train amazingly cost €1 for one way trip, €2 return, my Chinese colleagues enquired if this was a touristic example of the exploitation so associated with Western capitalism……the word has already gone back that Ireland is an absurdly expensive place to visit, at least I brought them in my car and they hadn’t taken the actual train down which would have cost another €21 euro.

    With regard to the asset stripping of the country, this is precisely the time elites attempt to sell everything in the house to stave off ‘eviction; after the casino capitalism father put the house up as security in the card game.

    But as Vincent Browne points out in the Irish Times, are we really broke or is the economic sword of Damocles being put over our heads in order to econ-terrorise the population into doing whatever is ordered from the top. http://www.irishtimes.com/newspaper/opinion/2010/0728/1224275616446.html

    We can hardly be broke if we are going to fork out €39 billion on infrastructure projects in North Dublin? Cowen (I wish someone would do a citizen’s arrest) opened the Shannon tunnel and is pictured in the Irish Times today smiling from ear to ear at the Galway races, but what is there to smile about? And why take time out to go to the races (during the greatest economic crisis in our history)?

    If they go ahead with selling State assets, which seems highly likely (I can hear the sound of the vulture capitalists and associated asset strippers winging their way across the Atlantic in anticipation), then they will have proven with appalling consequences that we are closer to the Washington Consensus than the European socio-economic model.

    • coldblow

      I was at the Fota zoo on Sunday for the first time. €3 for parking. €13.50 for adults, €9.50 for children. You can buy a family ticket but I think you’d probably need 4 kids for it to be worth it. If you queue at the far end for the ‘train’, after waiting under the noonday sun in a specially erected queuing pen for the the dash for a seat they provide an amusing little iniative test in that carriage doors all open on the far side only so you have to either dive over the top (it’s easier to throw a child in if you have a small one handy) or take your chances running around to the other side. “Only in Ireland” as Myles used to say. And the train seems to speed up whenever you pass any wild animals, so we had to go back and walk it again. But we got through the day ok all the same, thanks.

      • Colin

        If you arrive at the Zoo at 5pm, the ticket office has just closed, and you can sneak in without paying, and if you walk at a good pace you can complete the tour of the Zoo in 60 mins before it closes at 6pm.

        • Deco

          Interesting to see that everybody is talking about the assets of the said companies. No mention of the human capital, except that it will have to be downscaled.

          The state is running out of money to fund itself. We are, as a Great Chancer once said, living beyond our means. No doubt about it. But the pride of the Irish consumer can not be dented, in case the savings rate goes up and IBEC take a hit.

    • tony_murphy

      I visited Westport last week and we tried to find someplace to eat other than Wimpy for dinner. I was told I would do well to find a restaurant for dinner and escape with having to pay less than 50 Euro.

      I could get a fine meal for 2 anywhere in London for £20.

      We finally found a gruppy “restaurant”, filthy menus, 2 main courses and 2 glasses of water for £25. It was rank.

      I won’t be going back there

  7. SM

    I’m no economist but seems to me it’s all part of the international drive to take state generated revenues and place them in the hands of private business. Analysts are constantly eyeing up revenue streams to see if they can get a piece of the action.

    People pay less tax but in turn state and municipal services are deliberately run down (e.g. health, education, infrastructure). People get to the point where anything better will do. So services are sold off to the buddies of the government at the time and we start to pay for what was previously provided for on a non-profit basis. Waste collection is a good example. Councils are starting to suspend waste collection in favour of tendering it out – more money for Veolia et al.

    Although ESB is profit making a truly exemplary company with a proud tradition, the same rules apply. It is a massive revenue source and therefore ripe for transferring into private coffers.

    I think there is something much bigger going on internationally which involves a huge transfer of wealth generation at knock-down prices.

  8. MT25

    It gets harder everyday to be optimistic. I am very greatful to know there are sensible people left in Ireland (on here and in a few other places). I do feel though that selling our energy assets may be a last straw for the last of the mohicans! Cheers David for keeping us well informed.

  9. While reading this article I was thinking of todays news ‘anglo going to manage arnotts ‘. So much for bad apples becoming imposters .Logic is DEAD.

  10. [...] it imperative to sell proper state assets and inconceivable to sell useless land? full article here http://www.davidmcwilliams.ie/2010/07/28/selling-off-state-assets-on-the-cheap-is-just-madness Comment : David does have a knack of asking the right questions but I fear this, along with most of [...]

  11. Deco

    Firstly, it does not matter what the people have decided, if IBEC have already decided what the policy will be.

    Second, we have a really hilarious environment where the public sector has companies that compete (nominally) against each other, and where private sectors compete even less against each other.

    Thirdly, our public sector companies have productivity and performance problems and extort ridiculous pricing on the citizen. This is evidenced in the RTE TV licence, the price of electricity, etc. Basically, for the sake of the citizen, regardless of who owns them-there needs to be an efficiency drive.

    Fourthly, public sector companies are run to justify all sorts of agendas, often to the detriment of any attempt to run them properly. We have several public sector companies in the waste business, losing money in their escapades, all to ensure that Gormless has ‘options’ to prevent the incienrator in Ringsend. Build the damn thing, and get on with it.

    Fifth, the semi-states are loaded with useless wasters whose only qualification is nowing somebody in the political sphere, or being related to a politician. There needs to be a clean out.

    Sixth, there is nothing wrong with selling parts of the public sector where private sector options already exist, where the semi-state companies can be broken up, and where there is reduced risk of monopoly pricing-for example RTE, Bus Eireann, regional airports. But where the potential of monopoly pricing exists then the interest of the citizens is not being served – and even an inefficient public sector company would be better. The evidence of this is the M50 Toll booth.

    Lastly, there exists massive potential for corruption where there is a selloff of state companies or their assets. (As if we do not have enough corruption already…..in addition to having lobbyists like IBEC and ICTU practically running the country).

    I think that the best framework for evaluation of what to decide here is Article 45. of Bunreacht na hEireann. (hat tip once again to Furrylugs). The interests of the citizen needing services must come before other considerations. Though recent history and the current dynamic suggests that this is impossible to get out of the establishment.

    • This bit Deco??

      iii. That, especially, the operation of free competition shall not be allowed so to develop as to result in the concentration of the ownership or control of essential commodities in a few individuals to the common detriment.

      It would appear that the Constitution has been relegated to the status of the Dáil, that is, irrelevant. Unless of course it can be used to bulldoze through myopic policies like Lisbon II. BTW, what happened to Lisbon !!

      • Deco

        We voted yes to Lisbon -through a result of maximization of the middle class vote, minimization of the working class turnouts, blackmail, bullshit, lies, pretence, scare tactics, false-patriotism, authority reinforcement, massive guilt trips, and saturation advertising.

        Who says the Irish can’t be told what to do ?

        Who needs propaganda to control a society when the media can be bought and commissioned to deliver a result ? That’s what the media exist to do in a free society – to control the society. Every emotional button known in marketing firms and the media about the Irish people, was pressed repeatedly for two months. It was an exercise in scientifically inducing the people to do what they were told. And in the end there still were significant proportions of the population who were immune. If it had lost we might be now going through Lisbon 3.0.

        Anybody got any of them posters titled “Vote Yes for Jobs” lying around ? Maybe they could be positioned in social welfare offices to remind people of the massive guilt-trip induced before Lisbon 2.0, and how it turned out to be nonsense.

        • Zaphod

          Who voted yes? Me nor anyone I know did.
          Pencils used on slips where we normally have pens.
          Not just HB (the most common and cheapest) pencils but 2B’s, much softer and don’t leave an imprint you see.

          Unless your going to revolt it’s already too late.

  12. Maybe David and Peter Mathews, Dr Gurdgiev et al could combine blog forces to bring their lessons together in a new forum called the A45 Program. It might hit a wider audience than individual blogs?

    Just another idea in the attempt to educate a much wider and less specialised audience.
    Or maybe one of our web gurus could set it up with the guys as moderators. And ask Meridith Whitney to contribute occasionally on international forecasts?

    I’ve clutched at so many straws over the last two years, the haycock is wobbling.

  13. Deco

    I get the feeling that whatever economic theory says about the benefits of selling off state comapnies, that the insiders and cliques that dominate life in this country, and especially that dominate life in Dublin will make sure that the rest of us are shortchanged.

    Therefore I think that it is totally unworkable. With the best intentions in the world, the same cliques will screw the people, again, and again, and again….

    The problem is the Irish concept of management. It is routed in gombeenism.

    • adamabyss

      Deco, I’m just about to start a degree course (as a mature student) in Business & Management at NUI Maynooth in September. I have 10 years plus experience as a Business Manager (mostly in the Caribbean, but also short periods in the USA and Europe), but need the qualification now to push on. Sorry this is ‘off topic’ and a bit personal but what advice would you have (if any) for me while I’m undergoing this period of study, considering your strong views on management culture in this country? Serious question. I would have e-mailed you privately had I been in possession of your e-mail address. I’m 37 years of age and fairly hardened so I’m not likely to get brainwashed or swallow every concept introduced on the course but I’d still be grateful for any pointers. Thanks, I’d welcome and consider advice from anyone, not just you Deco. My e-mail address is adamabyss@hotmail.com . All the best, Adam.

  14. SFR Daniel

    Maybe David Cameron would bid on the whole lot.

    • Deco

      Nah…Let’s allow the likes of Drummer Boy, Swiss Cheese, McNama, etc.. to bid for them with the stash of cash that they are all hiding from NAMA. They need a second chance to run everybody over.

      By the way, in most countries the argument is provided that the private sector has better management practices than the public sector. Here, it would be a case, of nobody being really sure which is least worst…Both have been awful. But then the pool of talent is restricted to a very small proportion of the population. And to make matters worse the same well connected, outwardly sophisticated, snob-golf-club-membered, chancers usually hold multiple positions in both the private and public sector.

      We need to rethink the Irish concept of management. (And the Irish concept of investment maybe also).

  15. David does have a knack of asking the right questions but I fear this, along with most of his other questions will remain unanswered.
    The Finnia Fail /Green government has an attitude problem, and the shear arrogance toward the ordinary citizens of this state is just astonishing!
    They have been in power for so long they now believe they have a god given right to their Dail seats and the opposition suffers from the same illusions.
    With Labor now claiming the top prize of the Taoiseach’s Office, Enda Kenny dancing around the K-Club accepting the homage from the country’s top NAMA bound developers and at the same time claiming and acting to be Taoiseach in waiting!
    What about the Jobs promised in the Lisbon Treaty?
    Where is the jobs strategy, two years after the collapse of the Irish economy and billions powered down the toxic black hole(NAMA), nothing has been done to tackle unemployment
    500,000 people are effectively dumped on to the scrap-heap and its time they united and took steps to voice their grievances
    125,000 have emigrated and another 200,000 heading the same way
    This has to be gross dereliction of duty by the current government
    The opposition are incompetent and this is why the gangsters in Government t are able to get away with their proposed plunder of what’s left of the Nations assets
    Don’t let them get away with this take action to-day get organized in your local area
    Time for talking is over we need to take action! Ireland hasn’t got another two years with these gangsters in charge!

    It’s time to show these squatters in the Dail that the people will decide and a new political reality is about to emerge from the citizens of Ireland and the message is
    We want change, we want accountability from our politicians ,we want those responsible for the destruction of our state to face justice.
    The notion of business as usual is over for good.
    The Dail family dynasties must come to an end, Gombeenisim must be brought to an end
    These squatters in the Cabinet must not be allowed to benefit from their economic terrorist activities
    Selling off what is left of the Irish states family silver at this time is just plain criminal
    And like all criminal acts under current Irish Law the perpetrators cannot benefit from their criminal deeds
    Consequently their assets and bolted pensions must be confiscated and returned to the people of Ireland

  16. coldblow

    Hudson’s article “Entrepreneurs: From the Near Eastern Take-off to the Roman Collapse”

    ““Before Caesar’s death Rome was probably the financial center of the Roman world,” remarks Frank (1933:350). “Yet no dominating banking firm grew up.” Andreau (1999:137) attributes this striking fact to the shortcomings of the oligarchy. Most money lending was predatory. Rome’s publicani lent abroad to appropriate the wealth of others, not to finance enterprise. “The generation that came to maturity under the Julio-Claudian emperors provides one of the best examples known to history of an upstart aristocracy that abused the benefits of prosperity,” Frank (1940:29) summed up. Without much productive investment from the 2nd century BC onward, Rome could consume only by taking booty from foreign lands — tribute and usury from Asia Minor, Spanish mine output (dug out largely by slaves), and the looting of Egypt that continued even long after the tribute demands of Mark Anthony and Caesar…

    In contrast to Near Eastern Clean Slates to restore a balance between debt and liberty by freeing bondservants (and other unfree labor throughout the Roman Empire), Diocletian tried to save matters by imposing price controls and a “totalitarian economics” (Frank 1940:303), to which Herodian added a distinctly Roman coda: “When Maximinus [235-238], after reducing most of the distinguished houses to penury, found that the spoils were few and paltry and by no means sufficient for his purposes, he attacked public property.

    All the money belonging to the cities that was collected for the victualling of the populace or for distribution among them, or was devoted to theaters or to religious festivals, he diverted to his own use; and the votive offerings set up in the temples, the statues of the gods, the tributes to heroes, all the adornments of the public buildings, everything that served to beautify the cities, even the metal out of which money could be coined, all were melted down.”

    “And yet the history of antiquity shows that evolution is not inevitably carried upward by economic or technological potential automatically realizing itself. Entrepreneurs have obtained surpluses through the ages, but often in ways that injure society as a whole. Predatory loans mounting up to strip capital, and economies living in the short run by asset stripping are universal deterrents to long-term investment. Many vestiges of the rentier ethic that culminated in the post-Roman feudal period are still with us, weighing on the present like a dead hand (lit. mort-gage). Much as classical antiquity plowed its commercial gains and the extraction of interest into the land, many enterprises today find land (along with financial speculation and corporate takeovers) more attractive than new capital formation.”

  17. Exellent post, couldn’t agree more. Re Eircom, we have not had mobile coverage in our village since the ivention of the mobile phone. The chances of gtting it recedes each time it is sold on and debts have to be repaid..

  18. Garry

    Great article..

    Its all the stronger as its written by someone who probably has no ideological objection to companies being privatized, its focused on what is the best use of money.

    The article clearly describes the cronyism, corruption, incompetence and moral bankruptcy of those in power.

  19. wills

    Hello David.

    SHOCK DOCTRINE by NAOMI KLEIN very informative read on the questions the article above poses.

  20. coldblow

    DAvid, by the way I love that ‘equity/debt’ swap. Very droll.

  21. DarraghD

    I imagine the government at this stage, and possibly the rest of us, have come to the conclusion that the only way to cut wages and introduce some meaningful efficiencies in some of these is places is to cut them loose and be done with them and let them be someone else’s headache…

    Shane Ross wrote an excellent article on this very matter last weekend…


    After reading this article, flogging the ESB and other cossetted semi states becomes a no brainer… To be honest after reading this article, you can’t help but come to the conclusion that only a fool would buy these state assets.

    • paddythepig

      In fairness to Shane Ross, that is a cracking article. It shows that the Government is right to look at all these State so-called ‘Assets’.

      For example, the ESB grid may possess a valuable physical asset. But many of the overpaid ESB staff may well be a liability. Who pays for Padraig McManus’s 650K salary? The ESB customers do. And where there’s one guy sucking a huge salary from the customers, you can be guaranteed there are many many more underneath him.
      Why should the customers finance this?

      Brendan Ogle was on the last word a few days ago, giving the same arguments as David. Ultimately, he was only interested in the well-being of his union members in the ESB, and by proxy his own well-being.

      Why not consider decoupling the human liabilities from the state assets? Why not consider a different business model, that will reduce the cost of utilities for the ordinary man woman and child?

      I wish Colm McCarthy well, and I look forward to seeing what he proposes.

      P.S : I see the usual anti-NAMA and anti-Anglo postings here which is fine, but very little concentration on the more substantive issue which is the annual and accumulating theft of money from our children via our fiscal deficit. Strangely, that never gets a mention. Why is that I wonder?

      • Not so, repeatedly borrowing at 6%, €20 bn borrowings, to run the show, on zero growth, has been defined as bankruptcy of Ireland INC, Anglo/NAMA being kernel of a fiscal coup de grace on our economic future! Plus asset stripping of utilities as we enter the tunnel of downward debt spiral while we bondage our children and destructure public service and infrastructure and say goodbye through emigration to the young! Not just NAMA/Anglo, its a bigger hatchet job than that!

  22. coldblow

    From Hudson’s “Latvia’s Cruel Neoliberal Experiment”:

    Western investors are waging their own social war of finance and property against labor. Initiated by the Chicago Boys in Chile in 1973, sponsored in Britain by Margaret Thatcher’s Conservatives after 1979 and by Ronald Reagan’s Republicans in the United States after 1980, this class war was capped by “Rubinomics” under Bill Clinton and the Democrats after 1992. Rejecting the classical distinction between earned income (wages and profits) and unearned income (economic rent, financial charges and land-price gains or other asset-price gains), this global war seeks to rationalize privatization of the land and key resources of the former Soviet Union and China as well as those in Third World debtor countries.

    Its aim is to roll back a century of Progressive Era regulatory reforms and taxation of rentier wealth. So over and above being on the losing side in this victory over Communism, Latvia has been swept up in this war of oligarchy against democracy.


    From time immemorial, wealth has borne an obligation to support overall social welfare. But over the past few decades the vested interests have refined their strategy for reversing this principle. Led by financial lobbyists, they have sponsored a campaign to shift the tax burden off real estate and monopolies onto labor, privatize the public domain and break free of public regulation to extract rents and fees without constraint. The result is a change in the direction in which Western civilization has been moving for centuries.

    The International Monetary Fund (IMF) and European Union (EU) are key players in this about-face. They demand that governments impose austerity plans, scaling back employment and public spending on such basic necessities as schools and hospitals, and selling off public assets and enterprises to pay creditors. This extractive effort has polarized economies. Creditors have backed politicians pledged to rewrite the tax laws, deregulate government oversight, and to bail out banks (even foreign banks) with public funds when loans go bad, as they must do as the debt overhead shrinks economies.

    Latvia and its Baltic neighbors are victims of this counter-revolution. Since dissolution of the Soviet Union in 1991 they have been used as a laboratory to break from liberal European tradition. For starters, a radical tax policy (a heavy flat tax on labor, almost none on property) has replaced the tradition of progressive taxation. A philosophy of privatization with no recapture of the rental value created by public investment and general prosperity has replaced the tradition of a mixed economy, while financial policy encourages borrowing in foreign currency despite local income being in domestic currency.

    From “Trouble in Europe, China”:

    The IMF and European popular press misrepresent their tax problem as if it were a financial problem. But it’s basically a shift of the tax burden off the higher income and wealth brackets (and especially off real estate) onto labor. This stifles domestic markets and industry. The tax shift off property — along with privatization of public enterprises — raises the cost of living, especially for housing, and hence raises the break-even price of labor to live.

    This raises the cost of doing business and makes neoliberalized countries less competitive. Yet creditors are telling Greece that in view of its failure to tax the upper brackets and real estate, it needs to tax labor and the lower brackets all the more to make up for the gap.


    The global Bubble Economy’s collapse triggered a phase change, a change in direction. I think most countries that borrowed from the IMF and EU can see how irresponsible its austerity and devaluation plans were. They’re junk economics. I’ve showed why in my history of theories of Trade, Development and Foreign Debt (new ed. 2009).

    Debtor countries on which bad economic advice has been foisted can make the moral argument (and possibly even a legal one) that they should not be held financially responsible for the mistaken economic model that led them to rely on foreign lending rather than developing their own self-reliance. This model led foreign lenders to extend credit without being able to explain how loans —indeed, loans denominated in foreign currency — could be paid, with interest, on an economy-wide basis.

    Debtor countries therefore can argue that just as a bank that has made bad loans should be allowed to go under for its shortsighted bad gambles. You creditor-nation governments and you IMF and EU predators should not be repaid for having made loans that we cannot pay in the normal course of living and doing business. You are demanding that we not survive as democratic economies. Your loans are the equivalent of ‘odious debts,’ because they have been made under false pretenses and assumptions. Borrowing-country officials were told that this credit was needed to help our economy, not hurt us.”

    So there is in fact a case for reparations here. The problem is that it will now take five or ten times the amount that was lent to enable these financially and fiscally injured economies to recover from the disaster of having listened to IMF-EU junk economics. Yet the IMF and EU are now adding insult to injury in demanding that the Baltics, Iceland and post-Soviet economies make Swedish, Austrian and other banks “whole” on their irresponsibly bad loans.

    This is to be done at the cost of drastic cut-backs in domestic public spending, drastic privatization sell-offs that will turn debtor economies into rentier “tollbooth” economies — remitting foreign rent-seeking abroad and making the balance of payments even worse.

    It is an old story, one made all to familiar in Third World victims of the IMF and World Bank from the 1960s onward. It should not be repeated in the 2010s. If an attempt is made to do so, then the class war will be back in business — on a global scale.

    From “Neoliberalism and the Counter-Enlightenment”:

    Today, the Social Democrats have been losing elections throughout Europe. I believe that this is largely because they no longer have an economic program. Yet they began as an economic reform party — the party of progress, progressive taxation, rising wage and living standards and public sector investment and subsidy. This has been lost. Labour Parties throughout the English-speaking world in particular have embraced an anti-government political ideology of privatization diametrically opposite from the views held a century ago.

    Those views were developed by classical economists, from the French Physiocrats and Adam Smith in the late 18th century to John Stuart Mill. Mill was a turning point, as the political economy discipline was soon traumatized by Karl Marx, who pushed classical analysis to its logical conclusion in dealing with wealth, property and income, earned and unearned.


    Post-classical economics as a reassertion of special rentier interests — by ignoring them

    The classical distinction between earned wealth created by one’s own labor, and unearned or socially created wealth obtained without one’s own effort or cost — by inheritance or special privilege appropriating what nature, the public sector or asset-price inflation provides — points to an economic policy of taxing away income not necessary for production and distribution. This fiscal reform triggered a reaction by vested interests receiving such gains.

    In a political analogy to Newton’s Third Law of Motion (every action has an equal and opposite reaction) they sought to rationalize un-taxing and deregulating finance, real estate and monopolies. It was to provide such logic that post-classical theory began to emerge in the 1880s.

    Rather than describing how economies worked, the new doctrine was based on hypothetical reasoning more akin to science fiction than descriptive of the real world. It avoided dealing with unearned wealth and economic parasitism by assuming that all income was earned productively.

    Everyone was “worth what they got,” so there was no “unearned increment” to be un-taxed. And to avoid discussion of structural and legal reform, this post-classical economics focused on merely marginal changes in supply and demand. Marginal changes are by definition tiny — so small as not to affect the economic environment.

    Changes in the existing political context are treated as “exogenous” to economic analysis, so the status quo is assumed as a “given.” This narrowing of scope effectively excludes discussion of property, free credit creation by banks and unearned income as “exogenous.”

    It also portrays government spending, subsidies and taxes only as deadweight, inherently unproductive. Yet throughout most of history the public sector has provided basic infrastructure investment in roads, railroads and bus systems, education, research and development to enable economies to obtain basic services most efficiently at minimum cost and on fair terms.

    The largest capital investment in nearly every economy consists of public infrastructure and enterprises such as have been privatized on credit since 1980 under “free market” carve-ups of the public domain. Economies have been turned into “tollbooth” opportunities for the buyers of hitherto public monopolies to extract access (“rent-seeking”) charges in what is, from the overall economic vantage point, a zero-sum set of transfer payments.

    Marginal utility theory leaves no room to analyze this appropriation of wealth from the public domain. It depicts consumers as choosing from an existing menu, without discussing the advertising, deception, rent extraction and price fixing involved in real life. The resulting model is based on a crudely quantitative analysis of satiation of food or other commodities — but not wealth addiction to monetary and property aggrandizement.
    The result is a view of prices between individual buyers and sellers as heuristic stand-ins for relations between consumers and producers in a more realistically complex economic system. Credit is treated as if “savers” defer consumption so that consumers can “enjoy” more in the present.

    There is no acknowledgement of the fact that banks create interest-bearing loans freely, or of a wealthy rentier class (and financial firms, hedge funds and kindred money managers) whose aim is simply to make more money faster than anyone else, not to consume more.

    Anyway, that’s enough out of me for now.

  23. Tourism is one of the few sectors we can turn a buck on and stories like those from posters above abound and make you want to weep. Similar Cliffs of Moher charges upped recently amid public outcry. Many public events e.g the recent flower/garden show at Phoenix Park a killing fest for rip off merchants selling a cup of tea and a sandwich for €10 euro.

    Now they’re talking of tolling the National roads you thought your taxes had paid for. Putting in a low cost tourism friendly infrastructure should be a no brainer, developing assets we have with investment that would involve and benefit local communities as well. Transport and energy and broadband infrastructure should be no go areas and should be retained by the state to develop according to the national interest and the service of the public. That is, apart from selling the DAA and Aer Lingus on to O’Leary with a public shareholding that would safeguard national interests.

    DarraghD above refers to Shane Ross comparisons between efficiencies vis a vis Ryanair and ESB which is a template for other semi states. This is a ‘baby and bath water’ story and we should be very mindful of not throwing the baby out. The solution should be to fire the NEDS, get in efficient management structures with decent performance goals, not dump the semi states to a financial consortium that will rip out assets and future value to the state.

    Rip Off Ireland is being led from the top and has infected and spread downward and outward. New management is urgently needed across the political spectrum to rid ourselves of the bad management/rip off pollution that’s cost us dearly and continues to do so. I reckon we’ve a couple of years to make the pragmatic changes required until the shit really hits the fan. Perhaps we can stave off state bankruptcy until then.

    2013 should be very interesting!

  24. Philip

    I see a worrying logic behind all of this

    1) We must keep Anglo afloat because if it crashed, over 50% of the TDs would have to walk out due to bankruptcy.

    2) Selling off and making all a commodity is really a case of toss out the last sandbags to avoid the inevitable crash.
    3)Roads are all good and clean to allow armies/ polices to get from one part of the Island to the other to quell revolution

    This is all about societal control using pay as you go for everything Tolling the national roads is the key giveaway.

  25. Deco

    At this stage, if Ireland has to sell the family silver, then the likely buyers will be sovereign wealth funds from East Asia or the Middle East.
    There is a lesson in this for all of us.

    Well, it is not to be learned by Irish people, because Dermot Ahern says that we are all saving too much. We can be sure that along with IBEC, the government is fully intent on doing something about it. (raising taxes, charges, fees, price fixing, etc…).

    We are seeing a courage crisis in Kildare Street. Politicians running around trying to appease union fat cats, IBEC lobbyists, bondholders, activists, party upstarts, etc…The great practical problems of the era are dodged. They just keep getting shoved into the future.

    Meanwhile, countries that are not supposed to register in the prevalent official analysis of the world, are consistently winning. Clearly this was not supposed to happen. Right across the media you will find nobody who thinks that we have anything to learn from countries with sovereign wealth funds. When we sell our prized semi-states it will be a big blow to the collective pride, no matter how much we nuance it as something else. (that’s if they could be bothered with us and our obsession with our own significance). Because their leaders are thinking in very practical terms. They are making the priorities a priority. Our leaders are dealing in irrelevancies.

    Our leaders are sorting out the stag hunting, communicating the semantics of the situation without telling us the truth, hyping up consumer demand, and ensuring a schedule of distractions to prevent too many people joining the dots. A steady stream of minutae and irrelevant nonsense will be thrown at the population. Throw in loads of absurd theories that have already failed, but which have their loyal adherents, and you the direction where things are going. I get the impression that nobody really knows what is really happening. It is all like some sort of TV drama.

    Of course this is not just the story of Ireland but is the story of most of the Western part of the OECD. But, with pride we can say that we are up there on the leaderboard of countries in a state of self-delusion. We have been aiming for this for a long time, and have tried really hard to get there. We cajoled ourselves stupid into getting our status right. And now we are have a significance to meet our need for signifigance. Just look at the statistics from Constantin Gurdgiev.

    It only costs 20 Billion a year that’s all. Sure, it’s only money – we have a lifestyle to keep up. All we need to do now is to find away to abdicate personal responsibility for it.

    • wills


      The ‘ruling interests’ are using an ‘economy based on consumption’, liquidating it, and in the process, turning it into a business opportunity and strategic game play too re position their interests for the best seat in the house for the next economic model coming down the neo liberal pipe.

      • Deco

        Wills – I would not accuse the brains that bankrupted the banking system of being able to design such a scheme by careful calculation. The assumption that they have the brains to concoct such a scheme is too much to beleive.

        But, as opportunists they will grab anything that comes there way. This applies to economics, politics, the media and whole range of areas. Basically, there are opportunists who regard this as an excellent opportunity to access wealth and power.

  26. Peter Atkinson

    Your older contributors may remember a play which was first staged in the West End in London by Agatha Christie called the Mousetrap.Originally planned to run for something like twelve weeks it is still running nearly forty years later.Why you may ask would something like this run for so long.The plot and outcome is well known yet week after people come to see it, some even see it week after week.A bit like the Rocky Horror Show.

    Fast forward to Ireland in the 90s and an unassuming election that was held with the probable usual outcome of a hung result and a coalition which might run its full term and may not.The difference this time was the cavalier figure that led the major partner, namely one “Bertie Ahearn”.A man of the people for the people, the peoples champion.We all know how Irish people adore rogues namely George Best and Alex Higgins to name but a few.Add a bit of “ould bladder and guff” buck the system and to hell with the rule book and there you have it.

    Term one and lets ramp up the spending, after all Charlie used to pay ESB bills for his constituents in Donnycarney in North Dublin and that worked.Now we have cast the bait, let the big fish swim in and take it.And so they did.The die had already been cast anyway when that big greenhouse on Dublin Quay had been built and the “tax break” template was already in place.The top end of the pyramid was now built.Just sit back and let the little fish swim in and we can hoover them all up.

    They love us.Lets have an election with another five year plan.Result.We’re in again.What are we going to do with all this money.The glasshouse is full.Build an extension beside it.What do you mean there is a small factory beside it employing thirty people.Get them out.Buy it at any price.Sure the workers can be employed building the new glasshouse and it will take twenty years to complete anyway.We have the unions onside feeding off the frenzy.They won’t notice some poxy factory and thirty jobs producing goods for exports disapperaing……….

    The story goes on and the rest is history.The family silver is the last desperate attempt to bail out this morally and financially bankrupt junta.It is akin to the last days of the Roman empire or the British Raj in India but Brian is no Caligula or Nero.They had style.

    ps has anyone noticed the latest plan is to run to 2016.Ominous timing really.The 100th anniversary of the Rising.

  27. mycommentttttttttt

    We didn’t tax property! Like Latvia we taxed labour


    If you have the time, its considerably worth it to read the following echoing Coldblow’s Hudson refs above.


    “As we turn into..”The result is debt peonage and neofeudal privileges creating dependent “tollbooth economies.”

    “Latvia’s radical flat-tax experiment….”

    “Every Western economy has financed in public education, transportation and other infrastructure investment
    first and foremost by a property tax, followed by a progressive income tax that initially fell on the highest wealth brackets. In the United States the original 1913 income tax required only the wealthiest 1 percent of the population to file tax returns. Capital gains were taxed at the same rate as wages and profits, on the logic that the effect of a capital gain is the same as earning income: both served to increase net worth.”


    just about everything we have done since 2000 has been to reduce capital gains tax, to reduce tax on financial services, to reduce tax on property. In fact, to incentivise these. The wealth we could have instead have invested in education, broad band, health/education infrastructure is mind boggling compared to the borrowings wastefully invested in property.


    “At the state and local level, property taxes have been gradually but steadily replaced by income and sales taxes falling on labor and consumers. This has caused a tax squeeze that has forced cutbacks in public services, reversing the funding of local prosperity. Counter-intuitive as it may seem, high tax rates and protective tariffs tend to go hand in hand with high growth rates — as long as the tax revenue is invested in infrastructure and other economic support. In recent American and British economic history, periods of relatively high income tax rates have also been those with the highest-growth rates and least finally polarized imbalance.”


    High tax countries such as Sweden high growth areas as well. Unfortunately, we swallowed the neo liberal lie pills from Bertie/Clowen/McGravy and Lienehan


    “A third plank of the program to renew Latvia is designed to cope with the problem of abandoned housing, squatters and crime that has plagued foreclosures in the United States. Upon insolvency or foreclosure of residential and commercial property, the foreclosing bank must put it up for auction within one month, to be sold at a market price. The current occupant (either the indebted owner or renter) will have the right to match
    the bid. Our plan is for the government to set up a bank to lend the occupant funds to buy the property, converting its current rental value into mortgage debt service. At current prices, the new mortgage may be about 30 percent of the existing debt — and it will be denominated in domestic currency. The oligarchs seem
    happy with this, because loans on the large public utilities and other assets they have taken over and borrowed against also will be redenominated in domestic currency.”


    Variable rate mortgages are going to skyrocket foreclosures in Ireland. We need to do something. What about 30% of existing debt for new mortgages that a new state bank could lend to those foreclosed to allow them bid on their house, the rest being taken up as an equity investment by the bank?


    “Appropriators of natural monopolies and other public enterprises translate their economic gains into political influence to free themselves from taxes and disable price regulation and anti-monopoly laws. Their idea of a “free market” is to shift the tax burden onto labor, off themselves and their special privileges — and off the interest charges paid to banks for the purchase of such privileges. The aim is to leave the maximum amount of
    revenue “free” to be paid to high finance. ”


    yeah, the cronies buy the utilities and their oligarchies leverage the government with their new power, expect government to bow to their wishes and not the taxpayer’s interests.


    So, let’s tax land and property and capital gains and not wages. Let’s tax the rich and not the poor. As Hudson advises, lets not tax labour to pay for the mistakes and the profligate wastage of a property bubble fuelled by financial predators who got us into the mess.

    ‘Moral hazard’ taxes should not be spent to pay the debtor liabilities of the rich especially since they never paid taxes in the first place!

    • wills


      That said, and alongside D’s articles, one must move on from the surprise and dastardliness of the insiders machinations and get ahead of their learning curve and turn the balance of the force back in the direction of free markets allocating the earths prosperity fairly amongst earths peoples.

      Are you up for the next step David.

      • Wills, D is already doing a good job with his articles,research, journalism and other events/ yourself, myself and other posters do what they can by posting views and learning more/ and becoming more informed. Public opinion is closer to our view than you think, the more informed public opinion is, the better. Change for the better, however small, is good, No?

        • wills


          I think so too.

          But, also, whether one likes it or not, the *insiders* do make a tremendous success of their modus operandii on an ongoing basis and are ahead of the game when it comes to circumventing the long arm of the free market law.

          My point, been that, its one thing to keep blowing the whistle on the *insiders* nonsense, which is always a good thing, but, I think, if the insiders are to be taken apart and exposed part of the picture we cannot fail to get away from, is the simple fact, that, whatever else the insiders do win the poker game every time and that is a result, for them, but a result every time.

  28. michaelcoughlan


    One of the things I have noticed is that every time David puts up a new post people tend to respond with their own viewpoints on what is actually happening which is fair enough. The commentary is very well informed from a bunch of very smart people who seem to be very well read. The arguments seem to be split along political lines either centre right centre left etc. The point I would like to make here is that it dosen’t matter which political viewpoint you take whether you believe every business in the state should be nationalised or privatised etc. What we should be focused on is the fact that IRRESPECTIVE of how the state is administered politically it is the people issuing the loans who will ultimately call the shots now that we are in the end game of asset stripping the country. In case any of you may have missed the point the most important asset we are losing is the Human assets voting with their feet by emigrating many of them the first Irish generation in history having to emigrate twice in their own working lifetimes. Do you think any of them will return to be raped a third time and what advice do you think they will impart to their British, Canadian or Australian children: Yes my son/daughter Ireland is a great place to establish a business and settle down in. Sadly I don’t think so.

    • Yep, the country is hemhorrhaging people and talent at an enormous rate. We’ve been robbed and the poor taxpayers are made to pay debt reparations for the rich banks, and the robber barons call the shots as the country gets asset stripped. ”The result is debt peonage and neofeudal privileges creating dependent “tollbooth economies.”(Hudson)I guess the ECB hold the neofeudal privileges over us.

      I guess as long as enough are gaining out of the current situation, are relatively unaffected by declining standards etc, and prepared to cough up, it will continue like so.

  29. michaelcoughlan

    Hi Gege Le Beau,

    I think it was you who asked a question on a previous post where you asked why is it that “we” allow sociopaths to “rise to the top” of various organisations which do so much damage to the lives of ordinary citizens. The answer to that question is shockingly simple and I am afraid I don’t think there is anything we can do about it. In the first instance they don’t “rise to the top” they drag everyone and everything around them down to the level they are at. Let me explain using a bank as an example. When the shareholders buy shares they expect their shares to increase in value and possibly get a dividend. If the share rises very quickly do you think that the shareholders will become alarmed and raise questions of the management asking are we taking unsustainable risks which is resulting in the share value growing so quickly? No Chance. So when a sociopath is in charge and taking the risks it is because he is a sociopath he dosen’t have to live with a guilty concience or as a psychologist would say he has no internal conflict. You put anyone posting on this website in charge and I bet you each of us would be turning in our beds. Sociopaths will sleep well until the whole thing collapses. Then when it does they will sincerely feel it was other peoples fault and will actually feel they themselves are victims. The most shocking example I can tell you of this was at the end of WW2 when the Russians were invading Germany Hitler gave the order to destroy every piece of infrastructure in Germany to deny it to the Russians. Albert Speer (I think) countermanded that order. Hitler’s thinking was because the German people had failed they were responsible and wouldn’t need the infrastructure anyway now that the Russian’s had prevailed. Sociopaths prevail because we are too stupid, greedy, or cowardly to stop them. David has always made the point that the European banks and pension funds lending money to banks in Ireland are just as responsible as the bankers themselves. My two cents worth is that the shareholders are also responsible for not calling the management to account. The exact same thing applies in a republic. Freedom is not free or perpetual. It is an extraordinarly beautiful but fragile flower which must be husbanded and protected every day the republic is in existence and if the citizenry are too yellow, stupid, indifferent or greedy to protect it she will simply withhold that beauty.

    • Gege Le Beau

      Hi MichaelCouglan – yes, there are similarities in the current behaviour and with the historical analogy you brought up and yes, it was Speer who countermanded Hitler’s ‘destruction order’ (Speer also probably knew there were thousands of officers and functionaries who were working to undermine such orders – it is never one man, but Speer did play a role – an intelligent man, who misused his abilities (Gitta Sereny’s book on Speer is one of the better ones, while the art Historian, Robert Hughes has an excellent documentary on Speer available on Youtube called Visions of Space (http://www.youtube.com/watch?v=ZUzX46Xk7Fw). Speer knew the way the winds were blowing and possibly used his role to prevent the destruction of what was left of Germany as a bargaining chip at Nuremberg).

      I wonder if we’ll have our own version of the Nuremberg trials someday…………..

      You are correct to focus on the shareholder, they play a role in the monstrous system, with CEOs and Chairmen (mostly men) carring out a kind of public confession/act of contrition at AGM/EGM’s, the whole performance is quite perverse, while the system is feudal in its disregard (contempt) for the general populace, hence the need for its complete dismantlement. Cbweb says the ‘sociopath’ is of no interest to him, he is interested in the shutters going up, businesses closing, but how have we got to that stage and who has led us to it, and how is it that it is worse in Ireland than in Canada, Australia or the Scandinavian countries?

      We compare ourselves to the PIGS, to the UK and the US but these other countries slip through the radar as if they were cloaked in stealth materials…..

      Those in charge, and I have met a few of them in person have some of the the most relaxed countenances imagainable, some will benefit from the difficulties of their political colleagues and must secretly hope that things worsen so they can be propelled into power, that is the system, as for their demeanour, well I thought they either know something we don’t or they have no absolutely no conscience? Either way, the people lose, the elites win. It is a historical truism.

      • No, they don’t win. Destruction of the country through catastrophic incompetence, gombeenism, mismanagement , corruption, arrogance and hubris mean they lose big time. Plus many are on the hook bigtime for debtor loans themselves. You think Bertie or Seanie like seeing their ineptitude probed as cause of the meltdown.? No, they don’t. Lets give them all a good RAT (responsibility, accountability, transparency) test to plot their individual roles in the economic destruction of Ireland Inc. Notice the silence of Gormless The Reformer in having a public inquiry into the planning corruption that led to the 600 ghost estates! Let’s not let them off the hook with abstractions like “Either way, the people lose, the elites win. It is a historical truism.” We need system wide implementation and action on a civilised form of Madame La Guillotine!

  30. Selling National Silverware is one thing and selling Private Silverware is another .Watch how Ireland loses out to the Arabs when they finally control the best equine seeds in the world and we languish behind on second fiddle.That day has already arrived but it will be a later time when you will find out.

  31. Hi michaelcoughlan,

    Not sure if the ‘sociopathic’ label is worth while. I’ve heard Joe Stiglitz talk similarly of how the system weeds out those with a social conscience and promotes those who don’t suffer the soft underbelly of responsibility and a value system that conflicts.

    The excellent movie ‘LA Confidential’ where the police chief lectures the aspiring detective lieuftenant with a list of questions along the lines, ‘would you be prepared to plant evidence on someone you knew to be guilty but would get off if you didn’t’. Or quoted on this list, Hilary Clinton stating national security holds precedent over citizen’s rights. ‘Shutter Island’ similarly explores schitzophrenia vs reality.

    To my mind, I’m sure this is all interesting for a psychiatrist or a clinical psychologist, but its of no great interest to me. What’s interesting to me is the shutters going up on businesses everywhere, the emigration, taxpayers and public services paying for the mistakes of the rich.

    These are whole system events, not just the effect of one person, who can easily be replaced by another clone. And yes, the system favours sociopaths for whom power is the god, words have no meaning, speeches have no meaning, events, actions or people have no meaning, except insofar as they enhance or threaten grip on Cratus http://www.theoi.com/Daimon/Kratos.html There are often system wide pogroms in church and state against adversaries that don’t fit the bill. Our current lot will do all they can to attack whomsoever they believe is a threat.

    That said I’m sure psychiatry or clinical psychology is a fascinating science and I don’t wish to belittle it:)

    • Clooney in ‘Up In The Air’ or better in ‘Michael Clayton’ as well. Maybe we’ll get lucky and have some of our own local sociopaths spill the beans on Anglo etc soon?

    • coldblow

      I mentioned this before. Oliver James in one of his books (maybe Britain on the Couch) says that he had interviewed a number of leading politicians and found them all to suffer from massive personality disorder.

  32. Thanks for all the comments. I think the key to all this is to get back to the simple insider/outsider analysis. Those who will benefit are a small group of “rent seekers” and they are dressing all this up as the “national interest”. I wish it wasn’t so, but it is.

    Best David

    • wills


      Hope you are enjoying your break and the fresh air.

      Let me comment on your comment above in an earnest and sincere way.

      The bottom line with the insiders is the fact that the econ system they control does in actuality benefit most people, it may not be as beneficial as it ought to be and the spoils of war not shared out fairly, but, the system under their control does benefit most people, so, the insiders and outsiders do benefit.

      Its the fact that the system they control does pass on benefit to alot of people including outsiders is what renders unto its power base a potency.

      David, let me ask you a question. Do you see in your comment above and OUTSIDERS play, a resignation of a kind which offers you comfort of a kind that by exposing the scope of the insider / outisider difficulty in the system it in some way eases the pain of an indecisiveness of a type you prefer to just put aside and leave be. (back to my hamlet theory again)

    • Malcolm McClure

      David, I have just seen your comment after posting below. I respectfully disagree with your assertion that insider/outsider analysis will lead to a solution for anything. People are just different and birds of a feather flock together in all walks of life. Lets leave personalities and their preferences out of economic analysis for a week or two and apply what brains we have to solving the basic problem, which is establishing a viable and export-led economy.

      I would have no problem with selling off the power stations, as they will become obsolete anyway when carbon tax starts to bite. Meantime the nation should retain the grid and rent its capacity to the privatized generators who would compete with each other. Likewise with the trains, keeping the railway track network and privatizing the train operations. Likewise with the buses, licensing the routes to the highest bidder and privatizing the buses.

      Family silver is there to tide us through hard times. Someone said that grand pianos were exchanged for sacks of potatoes and a side of bacon in Germany during the 1920s. People’s well-being is of far greater importance than who owns the power stations.

      • Malcolm.

        I think your are hustling FF propaganda again here. Biffo puts it a lot simpler than you which is, ‘Lets get on with the job’. ‘We are where we are’.

        But this is the real job Biffo and I suspect you want to avoid at all costs while they continue their hatchet job on Ireland Inc.

        The main job is RAT testing.

        R(esponsibility)A(ccountability)T(ransparency) and using Madame Guillotine in a civilised way to deal with the insiders who’ve carried out the destruction of Ireland Inc while they hold on to their jobs.

        Lets continue to put a searchlight on the mess they’ve made, clear the insiders out and stop any further mess they’re continuing to make with NAMA, Anglo, privatisation, planning etc etc long, long list that describes the economic destruction of Ireland Inc by FF.

      • DavidIreland

        You mean let them eat cake?

    • Gege Le Beau

      Inside/Outsider needs its ideological context otherwise it is too simplistic and does a general disservice as it does not inform.

      An exploration of the ‘Washington Censusus’ and ‘Neoliberalism’ backed by the IMF and World Bank structural adjustment policies is needed. Ireland has its own internal dynamic, but it plays a full an active role in the Paris Club, the Trilateral Commission, the arms industry, use of Shannon, the debacle with Shell in Mayo where our major national resource has been sold off to a dubious multinational (with no debate/no referendum).

      These have to be explored if a) we are to find answers to what is taking place and b) understand the context we are in.

      I think it is a little disingenous to be ‘surprised’ by the government’s decision to investigate selling State assets, if the last few years have taught us anything, then it would have to be ‘that we should not be at all surprised’, we should expect such a move as it is totally in keeping with the kind of neoliberal policies we have seen implemented across the world. Ireland is a pawn, a useful one to a degree, in that global game.

      Think it is time we stopped ignoring the elephant in the room and debate it.

      Professor Noam Chomsky on Neoliberalism and the Global Order

      • Gege Le Beau

        The Washington Consensus


        Nothing operates in a vaccum. With regard to the above, a nation state may bring its own characteristics to bear, influence a system, shape an ideology in its own unique way, but the central thrust remains the same, and the incidents in the banking system and property sector in Ireland are carbon copies of similar events in the US and UK (no surprise as we are between the jaws of these Imperial powers, economically, politically, geographically, historically, lingusitically and so on).

        To the extent that insiders (political/business/academic/media elite) benefit from this system to the detriment of outsiders(the general population)is a given, it is the context in which they operate however, the ideology that informs their political and business decisions which merits closer attention otherwise we will go on being ‘surprised at government stupidity and incompetence’.

        There is nothing stupid about it from an elite perspective, these people benefit MASSIVELY from the decisions they make, decisions which ultimately sees the privatisation of profit and the socialisation of risk and more recently, titanic size societal debt.

        Interestingly, those who make the decisions are some of the richest and well placed individuals in the country whose position only strengthens with the business friendly decisions they make, the only question for them is how far they can push it before a societal revolt.

  33. Malcolm McClure

    David said:”Think about the challenges ahead for energy. The biggest single economic issue facing not just us, but all of the global economy, is energy.”

    I was standing at the Atlantic coast today watching the waves crashing against the rocks. The forces involved are colossal, even on a mild summer afternoon. I believe that it is not beyond the wit of Irish engineers to harness that energy and export the resulting technology throughout the world.

    This will require interdisciplinary teamwork of the highest order, harnessing the expertise of offshore construction engineers, marine, civil, mechanical, hydraulic and electrical engineers with the efforts of patent lawyers and industrial workers in Ireland.
    I am convinced that we can develop economically viable electricity generation from wave-power by combining these talents judiciously.

    Let’s do it.

    • oe1

      There is no doubt that energy infrastructure is the number one priority for the next 20 to 30 years. Whereis this investment going to come from is the question.

      One of the benefits of the property boom was that, at one stage, the extra equity in property could be borrowed to invest in energy infrastructure. Since then economists, commenators, and every one else has blown this one out of the water, maybe rightly.

      The answer to privatise should be based on the premise of raising money alone. Perhaps if its easier to raise investment needed by privatisation, then so be it. However, if its easier to raise money through public ownership, then this is the answer.

      Recent examples have shown that it is quite easy for state owned bodies to get outside funding. The Eirgrid grid interconnector to Britain, funded through the european investment bank, is an example. Eirgrid controls the high voltage line network and will always be state owned, unlike the ESB that owns the low voltage line network.

      It is expected that electricity use will double by 2050 as transportation is moved onto to grid. Any future debate about privatisation of energy infrastructure, must centralise on future investment. As far as I’m aware, in the Eircom sell off, the privatisation debate didn’t include the raising of future investment.

      Also if the privatisation debate is simply down to the opinions of economists, financiers and law makers, and not engineers and technical people who provide the service, it is simply wrong and is bound to end up with a worse solution where the system will suffer.

      Quite simply, energy infrastructure is too important an issue to worry about for the sake of plugging up a financial balance sheet.

  34. Philip

    When the aim back in the late 70s was to try and get a phone into every house, the political interference was crushing. We had the technical expertise. But the deals with the vendors was political and compromise. Planning was continuously usurped by having to look after a little fiefdom of some TD in the back of beyonds. What do we have now, a 3rd world broadband.

    We could easily do our own energy. But the TDs will block you at every step. They’ll wreck every single plan to meet local over national needs.

    Privatise the lot of it I say. The sooner the better. Keep national government out of it. Corporatism may be the most benign option for Ireland at the end of the day. We are so open an economy, our ability to compete will not be based on national ability to fend for ourselves, but to be able to support a truly flexible global corporate transhipment point with zero governmental.

    I take corporate meritocracy over over insider cronyism any day.

    • Zaphod

      Phil you have a point.
      But nepotism abounds in private firms too.
      Government oversight/regulation by elected officials is all we need.
      Ignore the traditional parties, vote for a change.

      We can design our future or hope for the best.

  35. paddyandhisturnips

    time for an idea again, I respect all the comment and thoroughly enjoy reading all opinions so…idea time, this may not be new but worth a go ………..tourism….I was thinking of chances to promote our country with good news, good offers, good things…..why not combine one of our biggest musical exports with one of our best assetts ? {our best assetts being our people}…

    U2 will recommence their world tour soon…They will play to a lot of people, I would think 100s of thousands.. a lot of tickets have been booked through the internet and I thought…Why not send out some information about ireland and tourism opportunities to all the ticket buyers…Get Ryanair on board along with U2, .This could be a simple brochure about ireland, its scenery, its nightlife, its music ??? …simple idea but might be worth doing something with…And I know it would not be easy but there is a market of thousands of people there….probably youngish..with disposable income..maybe??……

    maybe tourism ireland or one of our hotel chains might have a competition, free entry and win a trip to ireland…database assembled then for future promotions…

    We have to keep thinking and not let the bxxxxxds grind us down….

    we still have a fantastic country……..

    • Deco

      I heard the phrase years ago, and it comes back into my mind again.

      “U2 have gotten far more out of Ireland than Ireland will ever get out of U2. Just ask the Revenue Commissioners.”

    • Glengara

      Tourism Ireland haha. They are still printing glossy brochures and redoing the website at an extreme cost. Someone should tell them everything is going mobile — Google CEO Eric Schmidt announced at the Mobile World Congress in Barcelona that they will consider “mobile first” in all future endeavors. The buzz everywhere particularly in the USA is about iPhone and iPad and Tourism Ireland don’t even have an app!

  36. paddyandhisturnips

    Ryanir may not be a great example because there will be need for transatlantic and othere international flights.. you get my gist….

  37. Tull McAdoo

    The insider’s guide to owning it all
    Adapted for the silver screen by Tull McAdoo
    Plot outline (see below)
    Cast of characters, Bond holders/ landholders/ insiders.
    1. Become majority lender in an economy of people with assets you want.
    2. Encourage indebtedness by loaning generously while securing on assets of interest. (2000——2008)
    3. Backstop losses with public guarantees if possible. This is gravy if one can get it. (September 2008)
    4. Once debts are significant for the bulk of the population, sharply tighten lending standards. <– Economic shock – Onset of deflation (Early 2009)
    5. Permit default “without risk” on the assets you wish to seize to maximize wealth transfer. (stall foreclosure, stay repossession orders etc)
    6. Stall the economy to maximize default positions and deplete private liquidity, savings, redundancies, and exhaust Government borrowing.(Bonds) <– We are here
    7. Successively ratchet the economy downhill, while bettering secured positions. (Government cutbacks and general austerity measures.) Autumn 2010
    8. In a series of large actions, seize all security for default. Target the assets of greatest interest first. (NAMA Transfers) Summer 2009
    (This deals a heavy economic blow and can help cause the ratcheting required for step 8.)
    9. Transfer asset ownership, but retain prior owners as “renters” where possible.
    (This reduces public lashback and helps maintain the asset for resale) or keep developers on board in plain English.
    10. Once the bulk of assets are transferred, write them down to leverage the public financial backstop. (NAMA discount on loans creates shortfall which is made up by Bank re-capitalisation)
    11. Buy up as many remaining assets on the cheap as possible. Hide this action.
    12. Hyperinflate or default or re-negotiate to destroy the external claims on wealth. <– Onset of hyperinflation
    (This destroys treasuries, gov't bonds, Irish Euros . Ensures free title on new assets. )
    13. Stabilize the Irish Euros or devise a new local currency, resume lending at a reasonable pace. Sell the assets back, secured of course, at your chosen price in new currency.
    All characters in above are purely fictitious and any resemblance to anybody real is pure coincidence. Also if I’ve plagiarised any of this from anybody then tough diddies, that’s the sort of shit I am…..Anyway what the hell else do you do late at night in a bloody Frankfurt Hotel room. Economic doodling that’s what we’ll call it.

    Oh yea our tune for tonight is an old classic again. It is the proverbial “outsiders” anthem you might say….. Janis Ian and seventeen….Goodnight Ireland and sleep well.


    • As the west winds unwind
      We’ll send wiley wifey to replace your wifi
      A sister of Apollo with a moon upon her shoulder?

      Diana, goddess of the moon,
      To lighten dark night?

      We’ll send her immediately

      Expect her before mon,so(o)n!
      Treat her Fairly.

      LOL, re 12, powers that be will do whatever they can to prevent that happening! But if 13, sell assets back at a large discount say 30% of LTEV onto open market. Here’s the trick. Tax these assets including all property and disburden the taxpayer of taxes on labour as much as possible switching taxation onto property especially onto rentier income, Fahey will not like you for this! Lets cut out this NAMA/Anglo rubbish.

  38. Louise 1V France – this imbicile lived in an ivory tower on his commode during a period when the laws forbade anyone to speak indifferent of him.He made costly decisions that lost enormous wealth to the nation of France .Only one man stood up ‘with opinions’ and that was Voltaire and was imprisoned for doing so.A Blasphemy Law for the rich then was used against Voltaire as evidence against him.
    Times today resonate the return of more running water .

    • Deco

      History gets written by the winners. And Louis XIV and Louis XIII were able to write a biased history about their rule. Unfortunately, because of the nationalism that occurred in the decades afterwards in France, there was little revisionism.

      They ruled with a police state, that was constructed by the father of centralists control states, Richelieu. Richelieu had a caustic affect on France, on Europe, and indeed on Ireland. He caused an escalation on national conflicts, and a series of wars with Austria that eventually resulted in the emnity that started both world wars. But his affect on Ireland only emerged a century after the French Revolution. The British Navy picked up fleeing French clergy from the Rule of Terror and they relocated them in Ireland. In Ireland they infiltrated the Catholic Church, introducing a culture of authoritarianism, urbane sophistication, interference in state affairs, and class obsession. This was new to Gaelic cutlure where spirituality and anything to do with money were up to then seen as polar opposites. It had a profoundly dangerous effect. It was strongest in Leinster, especially in an arc from Dublin to Kildare to Wexford, where the Norman influence had been strongest. (Interestingly the location of the worst coverups in a later era).

      Pre-1800 Ireland had a culture based on clan loyalty, community, kinship, and individual sovereignty – and a emotional tie back to a Magna Carta that was subverted by Penal Laws. Post-1800 it veered towards class, schooling, and institution. For the British it was the panacea. There would be no more Wexford Rebellions with the priests following the peasants. Henceforth, an element in the Catholic Church would be loyal to the crown. And they were to educate the middle class, and drill in their values, aristocratic values. And this would control the peasantry. They were to produce the ‘Castle Catholics’ the class of administration. Divide and conquer. That simple. The result was what we seen in 1916 when the women of DunLeary threw insults at the brave heroes of 1916. Contempt was part of Irish society and became a core value, freely expressed. The wonder was that we became free at all.

      We have not escaped it yet. In fact, every proposal and solution and suggestion of escape seems to go back to the same basic control system. The defiant efforts at escaping this end up implementing a new system that is always based on the same underlying formula. Authoritarian control, patronizing, contempt, institutional power, centralization, control of the people in case they lose the run of themselves and drift away from central control, guilt trips, coverups, authority for authority’s sake. There is no truth, only selfish ambition, and deceit. I fear that Ireland’s Richelieu culture will bring us to the point of devastation, and will be followed by a reactionary era that is an absurd attempt at correction, that will lead us into the abyss.

      John Allen your contribution is that you steer us back to before this imposition. Thank you for that.

      We need common sense, and end to elabourate sophisticated pretenscious institutional bullshit.

      • Deco – Upon entry into the British Embassy in Paris there stands alone a big statue of the Duke of Wellington who was responsible for the defeat of Napoleon at Waterloo .This is an anglo attempt to subvert the visiting French to realise that they were beaten by the British Crown .What is more interesting is that the Duke of Wellington was born in Ireland in the midlands.So this begs me to ask what would I see if I entered the Irish Embassy !

        • Original-Ed


          He was born at 24 merrion street right opposite the dail’s merrion gates. He’s the one that pushed through catholic emancipation in 1829 against strong opposition from the king because his coronation oath was at odds with the move.

        • Deco

          Bonaparte was a miltary dictator, a murderer and a tyrant. Wellington was the liberator of the age, a bit like Eisenhower in the 1940s. Wellington also used the occupation of France as an opportunity to free slaves in French colonial territories. The French were furious, but could not stop the British Navy from implementing it, lest the British take over French territories. He did this far faster, and more efficiently than Lincoln. Yet, he is never lauded as another Lincoln.

          Wellington, is probably there to remind the French, that the British will not yield concerning Britain’s right to determine it’s own destiny.

          • Deco – sometimes I think that this site is liken to the role played by Voltaire.What is your opinion?

          • Gege Le Beau

            Wellington is beginning to take on the appearence of Christ.

            Let us not forget, Wellington was actively slaughtering in India where his brother was Vice-roy (see the assault on the famous Red Fort or fortress of Seringapatam) and he disliked his ‘Irish’ background being brought up, when engaged he used to say it was an ‘accident of birth’. Wellington ‘freed’ the slaves as it served a military and political end but the British played a critical role in the slave trade and despite talk of their role in abolishing treated colonial peoples appallingly, as we well know. During the US civil war, Britain was preparing to acknowledge the Southern states as its own political entity and they would not have objected to the deplorable slave trade there.

            I would be careful of romanticising Imperial figures. Be under no illusions, he was a servant of Empire and we know what that means, he may have been a guy you would go for a drink with but he was part of a monstrous system. And, yes, Napoleon was also a killer and a tyrant.

          • tony_murphy

            I do recommend people read Peter Hitchens “Abolition of Britain” and “The Cameroon Deception”, it has so many parallels with what has already happened/happening in Ireland.

        • O’Hara – it was another Irishman who was 2nd in command of the British Forces in the USA that surrendered to the forces of Abraham Lincoln .His name was Charles O’ Hara .Does his statue appear anywhere in any embassy?

        • Gege Le Beau – all generals in command and in war have a brutal streak and no one is blood free .That is War.It is understandable the reasons why Wellington upheld his British attachment eventhough he ignored his country of birth.He was ambitious and sometimes personal ambition requires a re-invention of ideas to win what he wants to do.As a matter of fact he also had Kerry blood in him too .Maybe he was a cute hoor too !

          • Paris – I have never been in the Irish Embassy in Paris eventhough a great Limerick man was ambassador there for many years .I can only guess what I would see upon entry :
            Samuel Beckett, James Joyce , Oscar Wilde, WB Yeats ,etc .Can anyone enlighten me ?

          • Malcolm McClure

            Jon Allen: Not many people know that Wellington was a distant relative of Brendan Behan through the Leslie connection.

          • Malcolm Mc Clure – We are breaking new grounds on this site .Does that mean that if the British show a statue of Wellington and the Irish show a burst of Brendan Behan that both embassies claim to have beaten Napoleon at Waterloo and subverting Le Bleu in the diplomatic world !This would also mean we have cracked a diplomatic code of omerta in the anglo Irish relations .God save Kerry.

          • Tubridy – the public are led to believe that his family originally came from Kilrush however before that they came from Turbrid in north Kerry .In those years rebels fled to Clare to escape the Barney Cops as they were known then.Will we next hear that he too is related to Les Duc Wellington as well !

          • Voltaire said : ‘ in government , you need both shepards and butchers’.The problem in France, during the revolution ,was that the butchers kept killing the shepards, while the sheep turned canibal.

            Edmund Burke MP ( Irish ) was an anti revolutionary who wrote ‘Reflections on the Revolution in France ‘:’In viewing this monstrous tragic-comic scene’ he writes , ‘ the most opposite passions necessarily succeed and sometimes mix with each other in the mind: alternate contempt and indignation , alternate laughter and tears , alternate scorn and horror’.

          • French Cuisine : Following the battle of Waterloo French Cuisine re-invented itself.There were so many new foods being eaten by the foreign armies in France and introduced by them and amazed the local French that they decided to ‘fake them’. These included ‘bifsteak’ and ‘champaign’ from UK ( the brits perfected the technology to give the greatest sparkle without exploding’@ Dom Pernon the monk just could not hack it), croissants from Vienna ( followed by pain au chocolate ), and ‘un pain’ the long stick used by Napoleons soldiers to carry into combat as the older ‘boulogn’ was too much of a ball shape to put into the soldiers trousers .

          • Apres Napoleon – sometime after the waterloo affair mail ordering from America begun and this resulted in the importation of a beetle that devasted vineyards and this it did big time .Eventually vine plants from America were introduced that showed resiliance to this bug .All subsequent wine growing from France has an American DNA encoded into thir origin.Does this show again how to fake a product and claim it to be your own .A Cuckoo comes to mind .

  39. Deco

    Whatever you think about the circumstances leading up to this, you have to admire the main character for making a stand. More courage that the entire contents of Kildare Street. Actually I will go further and say more guts than the entire state apparatus (D2). Unlike all the quangoes, this man knows what are his priorities.


    Well somebody has decided to stand up for himself. I don’t know how the debts were incurred. Probably in the midst of the phase of optimism. And in all likelihood the digger will get seized.

    I reckon we should ask him to deal with the Anglo Bondholders instead of the ‘professionals’ who are making such a mess of it.

    • Gege Le Beau

      The cumulative impact of many such incidents can spark a Rising. This scene, regardless of the circumstances, should not be occurring in a Republic and is more akin to evictions from the Colonial days, so while Cowen is smirking from ear to ear at the Galway races, this brother and sister find themselves fighting off repossession and they are not alone, meanwhile 455,000 remain on the dole, it is contemptuous, those paid to find solutions and work night and day in the midst of our worst economic crisis are taking leisurely strolls around the park, there must be another way, if anything, it is the banks that should be raided by Gardai and the senior management that gave the green light for predatory lending be brought to trial.

      Yes, people must take personal responsibility, but when an entire apparatus is loaded against you, designed to con you and then turn on you viciously when things go wrong?

  40. Gege Le Beau

    “Thus for more than 30 years, the world-dominating Anglo-American alliance has been under the sway of factions which, for all their internal squabbling and hair-splitting, are strongly united in their steadfast, unshakeable adherence to the perpetuation — and expansion — of elite power and privilege. They have shown themselves willing — eager — to degrade their own societies (and destroy many others) in the service of this brutal, barbaric, inhuman faith. The poor have no place in this system, which is a retrograde, hi-tech, rhetorically sugarcoated revival of the laissez-faire fantasies of the past, as Jeremy Seabrook notes:

    “‘Pauperism’ long ago took on the colour of culpability. The distinction between the idle and improvident poor and the “deserving” goes back at least to the Elizabethan poor law. It took on a new force in the early industrial era, which saw an unprecedented growth in pauperism. The enthusiasts of laissez-faire concluded that the evil was compounded by efforts to relieve it, and helping the poor only increased their number. Everything indicated that “natural” processes should be allowed to take their course. …. In this version of the world, the market mechanism is as flawless a creation as the earth, and should remain untouched by the hand of meddlers, whose only effect is to upset its power to enrich us all. It is remarkable that the establishment of laissez-faire itself in the early 19th century required an enormous amount of government intervention and regulation …”

    And so it is today.

    Full article

  41. Original-Ed

    Sharks are always attracted to utilities because they simply can’t be allowed to fail and that means that the taxpayer will have to ride to the rescue when all value has been stripped out. The ramshackle that is now Eircom, is the perfect case study and only the insane would go along with this proposed fire sale.
    I would imagine that the multinationals wouldn’t like any move to flog off the ESB – they may be expensive and way over paid, but at least we do get continuity of supply.
    As for the government and the land/NAMA thing – they’ve simply replaced the original speculators and as we all know these guy’s judgement was based on galway tent economics.

    • Now we’re a basket case serf, debt peonage ‘toll booth economy’ we cannot really afford to make a fuss about our representation at EU level, or continue harping on about national sovereignty issues, such as the need to guard public utilities for our citizens. Responsibility for them we’ll franchise out to the EU, hopefully we’ll get grants down the line to develop transport/energy etc, maybe French buses and a French transport company to operate transport on behalf of the EU. If not, our bondholder banks will require them in lieu of financing our debts. How else do we pay the 6% interest on our €20bn annual borrowings and sovereign debt? Plus we need to sell them to pay for our coming budgetary scam cover-up to avoid inflicting too much pain on taxpayers…..note I am being ironic above!

  42. Tim

    Housing over-supply, by county, based on today’s NIRSA report (to be discussed on tonight’s PrimeTime)Visualisation here:


    • Cool graphics. Donegal, Leitrim, Sligo, Roscommon, Longford, Cavan, Mayo, Kerry big hitters. Do figures also take future emigration patterns into account?

      • Tim

        The report does take emigration into account as “growing”, but does not explain how it is factored-in. See the full report here (There is also a link to their data spreadsheet on the document):


      • Tim

        cbweb, incidentally, if you examine the references at the end of the document-which also takes a look at NAMA- you will find that you have read most of the reference material, including that of our host and some contributors here, especially finfacts.

        It appears the report is based upon the same reading-material as many of us have been linking to from this site.


        • Thx, kudos to Rob Kitchin et al, “To date, the
          role of the planning system in creating the property bubble has been little considered.” Gormless the Incinerator/Reformer and FF will want to bury it. Won’t be till tomorrow I’ll get to read it in full. Biblio is interesting. Huge can of worms there they’ve put a spotlight on. Word came from who to bypass planning, grant anything to developers, and fund it from Anglo??

  43. Glengara

    All Corporations are being run by 35-45 year olds. Ireland is being run by a Green led dictatorship consisting of parish politicians 95% plus over the age of 45. This will not change either as the younger population refuse to vote they see no point in doing so and can you blame them? Our only alternative is Zig FF or Zag FG in power with a tail wagging either one of them.

    The only way to change this is to create a tail and the tail needs a senior committee of advisors (below)and have a selection panel to select a candidate in every constituency to be under these guys and promote policies as set by them. Each of these candidates MUSt be between the ages of 20 to 45 anyone over that age need not apply! The senior committee to consist of — Michael O’Leary (to get rid of all those in ivory towers –the civil servants at the top level and the Unions) Shane Ross to continue exposing the wrongs that are happening and have more power to FIRE those that have failed our system i.e.”We don’t do refunds” no more massive payouts to these useless idiots on massive guaranteed salaries and pensions (e.g. the entire Dept of Finance who advised the Govt and also the Regulators office who didn’t do their jobs and allowed the Banks destroy this country.

    The rest of this committee should be Denis O’Brien, Eddie O’Connor and Ivan Yates would also have my respect — and I’d consider you David as you are on the mark with your thinking!

    Who knows, this concept may be more than a ‘tail’ as the candidates will get elected using modern advertising methods, social media and mobile rather than ugly 60 year olds on posters smiling down sarchastically at all of us.

    • Deco

      As evidenced by the PDs, ILP, PDs(again), and GP the tail can have an effect more toxic than the major party in government. And then there is the hidden effect from the IBEC and ICTU in further shoving their own agendas.

      You are correct – breaking up the incompetence that pervades in Kildare Street will only come as a result of circumvention of the commercial and institutional media – which is in the pay of IBEC. There is too must distortion occurring of the people’s right to their own sovereignty. We need to throw out the middleman who is subverting democracy and making sure that it acts as a filtering process to ensure that only ‘the safe pair of hands’ type of yesman ends up running the country.

    • Deco

      No too keen on Denis O’Brien. He is Bono-esque in his eagerness to pay taxes here – kind of superficial. If he wants to work for free then maybe. But I cannot take these types seriously.

      • michaelcoughlan

        Hi Glengara,

        Whilst I emphatise with you and agree with many of the points you make I wouldn’t put Michael O’Leary in charge of anything other than an airline. You can “let people go” from an airline. You most certainly cannot “let people go” from a society unless you are a dictator and we all know how people are “dispatched” in dictatorships. Whilst Denis O’Brien has created much employment and his companies and employees pay tax here Denis like many of our very wealthy business people can “opt” to pay his tax here or not. Denis has chosen not to. At least O’Leary pays his tax here and someone with his skills would be best used to continue with his never ending heckling of the incompetence driving him bananas.

  44. bankstershill

    The very same private fractional reserve banking system which the western people as a whole have bailed out through their unlimited guarantees and inflationary central bank money laundering and killer austerity measures ect., is the same banking system which will extend the leveraged loans to the hedge funds who in turn will take stewardship of our precious assets and then proceed to charge us rent on what unready belongs to us in the first place. A scam , a racket, a swindle, call it what you will, but be sure to know that it couldn’t happen without the witting traitors in our midst who take their marching orders from the European commission, the financier oligarchy’s primary bidder. This is a repeat ( or continuation) of what Mussolini defined as corporatism .

  45. Gege Le Beau

    Consumer confidence is falling, consumer credit is shrinking, and consumer spending is dwindling. Jobs, jobs, jobs; it’s all about jobs. Budget deficits are irrelevant to the man who thinks he might lose his livelihood. All he cares about is bringing home the bacon. Here’s a quote from Yale professor Robert Schiller who was one of the first to predict the dot.com and the housing bubble:

    “For me a double-dip is another recession before we’ve healed from this recession … The probability of that kind of double-dip is more than 50 per cent. I actually expect it.”

  46. Man Bites Dog –

    John LAW was an economist and a rogue banker who made killings on those who trusted him .He created the Mississippi Bubble and a Bank and worked in USA , UK and France until he finally had to flee from those he robbed to Venice where he died .His story is a parallel to our discussions on this site.

  47. Reflections on Mc Dowell : He quoted yesterday at a private audience :

    Irish Constitution : ‘Fidelity to the Nation and loyalty to the State are fundamental political duties of all citizens’.

    Should we ask ‘are Bankers citizens ?’And lots more ….like Politicians etc ?

  48. paul

    re mcdowell,a bit late to be finding religion now,he got elected years ago on “zero tolerance” and we thought we were getting rudy guiliani,the extra guards were never employed and the crime rate soared on his watch.
    he deffo shouldn’t be even considered for the new order!

  49. Echoing posts from Tim, Tull and others, here’s some more on NIRSA Report, highly recommended reading, blogged on it here http://bit.ly/9pNPHe

  50. coldblow

    I caught the start of Vincent Brown last night with Kevin Myers in the chair to discuss Irish billionaire debtors hiding their assets behind their wives. As it was past my bedtime I could only watch the first few minutes. Martina Devlin was first up. She wrote this recent article about solicitor-gone-missing Michael Lynn:


    Lynn’s wife successfully used legislation originally brought in to protect abandoned wives to challenge the forfeiture of substantial property which had been seized on behalf of her husband’s creditors. Apparently her husband had cheated her and she didn’t know where he was but it turns out they’ve been seen together since – in the Algarve (quelle surprise!).

    Next it was the turn of an expert in women’s legal affairs who said that while such a situation was of course deplorable the authorities had due procedures already in place to deal with Lynn. At this stage I had to go to bed.

    Did anyone see how this finished? Did she then go on to argue that, while any abuse of this legislation would be regrettable, it should not be amended because to do so would put married women at risk. That it would be ‘retrograde’ and ‘unacceptable’? (I’m just guessing here.) That the justice card was trumped by a moral one of higher value. And that in a wider sense our financial overlords and our legal guardians and agents of moral enlightenment are in the end just two sides of the one (golden) coin? I’ve really no idea. I guess I’m just too cynical.

    I was thinking about David’s comment about focussing on what he sees as being the main issue, ie what the ‘insiders’ are up to. I’m sure he has his good reasons for this. But only the insiders know what’s really going on and they’re not telling. Maybe it’s the case that David is being as forthright as he can be in the circumstances. I suppose for our part all we can do is join the dots and add the numbers together. Trouble is, all I get is a picture of a sailing boat and 2+2=5!

    Quote of the day from Mr Hudson:

    “New York State Attorney General Eliot Spitzer’s prosecutions and reports by Congressional committees on investigations have done more to describe corporate and banking practices than a generation of management textbooks has done.”

    Nah, forget about it, that’s too conspiratorial.

    Wellington. According to the Dublin tour guide it was him who brought in ‘Catholic Emanstipation’.

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