October 5, 2011

Sacrificing jobs to protect landlords is plain wrong

Posted in Irish Independent · 176 comments ·

THERE are few more evocative images in Irish history than the Irish tenant being evicted by Irish police on behalf of a foreign creditor. For many, this injustice sums up the primary reason for our independence struggle.

It is clear that without the legal system that favoured landlords over tenants, great national movements like the Land League would not have been founded. Ironically, a more flexible legal system would have done more to protect landlords than the rigid legal system, which was designed to secure the landlords’ interests but led to their undoing.

What is sometimes overlooked is that in some cases the landlords themselves were bankrupt and were evicting tenants at the behest of their own creditors. For much of the second half of the 19th Century, land prices fell in Ireland as global food prices dropped in response to an “invasion” of cheaper food and grain from the USA and Latin America. Many landlords were greedy and venal and deserved what they got, but some were not so evil and found themselves squashed by economic forces beyond their ability to control.

That said, it is still clear that the overwhelming victims were the small tenant farmers, who were crushed by a legal system that supported the rights of landowners over all others.

Legal inflexibility and political inactivity led to revolution where the landlords lost everything.

Fast-forward to today and little has changed. The interests of property owners and landlords are still given primacy over the interests of tenants and small businesses. The problem for an economy with 500,000 on the dole and youth unemployment running at 30pc is that landlords don’t create many jobs.

In fact, as was the case in the boom, land and property generate nothing in terms of innovation, ideas, dynamism or skills.

Look at the great companies of the 21st Century: they are founded on human ingenuity, not property punting. Investment in property can only “house” innovation and creativity. In contrast, small business people and entrepreneurs do create jobs and opportunity for others. These people take big risks, without any covenants or guarantees or “upward-only” clauses in contracts and these people are the engine of employment growth.

The legal system should not be used as a battering ram to bully them, any more than it should be used as an instrument to rob legitimate landlords from their fair rental income. There has to be a balance between the interests of the tenants and the interests of the landlords.

There has to be co-responsibility. The tenant and the landlord need to display give and take. When the domestic economy is on its knees, every job needs to be minded and, therefore, solutions to tenant-landlord conflicts rather than evictions should to be the norm for the legal system.

It is against this complex background that the following case is so distressing and emblematic of indignation over pragmatism, where there is only one real loser — the worker.

Next Monday morning, the Sheriff of Dublin, together with his bailiffs, will evict a successful small business in South Great George’s Street. The Sheriff is responding to a court order based on a clause in which allows either party to terminate the lease. So legally, there is nothing wrong; however, legally isn’t enough because ultimately when the business is closed the workers will pay.

As a result, the workers — 22 of them — have decided to barricade themselves in and, consequently, the bailiffs will have to drag these workers out of the premises by force.

The business in question is a thriving bar called Shebeen Chic, which over the past four years has established itself as part of Dublin’s nightlife.

Having lost money initially, this management has turned the premises, which was previously the site of four unsuccessful restaurants, into a hopping venue of music, comedy, food and late night fun. Now it will be shut down.

The workers are the ones who will lose their livelihood. The staff have decided not to take this lying down and their protest next Monday will draw more attention to one of the most perplexing legacies of the bust which is still the primacy of property over employment interests in a country with too much property and not enough jobs.

When you gain a bit of altitude from this and other cases, you see a similar pattern. Many landlords need the rent to service debts they incurred in the boom. And so even if they wanted to do a deal, they might be squeezed by banks to whom they owe money.

It is not always banks, domestic or foreign, that are the sources of the problem. In many cases, it is also Irish pension funds.

The reason we have upward-only rent reviews and nonsense like that is to ensure that the owners of commercial property don’t lose out from the property crash. How mad is that? Many landmark buildings in the city are owned by Irish pension funds. So for rents to fall to reflect trading reality, Irish pensions need to take a hit.

So it comes down to a scrap between the interests of those about to get pensions with those about to go out to work. Pensions are seen as sacrosanct while society tolerates the fact that so many young workers must go on the dole or emigrate. Why should pensions be more protected in a downturn than jobs? Why should the wealth in pensions be maintained, while the wealth in houses allowed to fall?

This inequality must stop. The interests of the young cannot be indefinitely trampled to protect the interests of the late middle aged. For many years the generational nature of Irish economic policy has been evident, whether it was in the housing boom where the young transferred resources and money to the older generation or today when the young are again expected to pay.

NEXT Monday’s eviction is only the latest instalment in Ireland’s battle for economic survival. As the pie shrinks, these battles will become more frequent.

No more than in the late 19th Century, things have to change. In the first decade of the 21st Century, the laws need to change to reflect these new realities because the lesson from Irish history is that if the law protects landlords over workers and tenants, this will soon become the unique source of the grievance. Our history tells us that it’s easy for things to spin out of control, so why let them?

  1. Lets Re-invent The Brehon Laws to the profile of our current way of life and business .

    We cannot abide by the English Common Laws .We have always been known as the unruly Irish .And the Bankstaz have proven that .

    We must decide whether we want the laws of nature where the grass root make the laws or the laws of authority where the EU and Monachy impose on the people what thet ‘should do’.

  2. molly66

    Here we go again i am self employed for the last 21 years, at one stage i had four+ myself employed.in 2008 my turn over started to drop.i had 2 trucks on the road collecting rubbish for different companys around dublin.the red tape the down turn the public liability lnsurence, permits,hoilday pay running cost more red tap have all taken a toll and when i think of it now why would some body like me have any incentive to employed any body in the ireland of 2011/2012.i feel sorry for any body trying to employ people in uphill ireland.why is a 65 year old woman in jail for trying to protect her trees shame on ireland Esb hold your head in shame.

  3. CitizenWhy

    Oligarchies of Big Property, with property rights supreme, is what neo-Liberalism and Wall St and the hapless governments of Europe are all about. Perhaps the ghost of Lord Castlerea should be the new President of Ireland.

  4. What’s the story with Shebeen Chic? Has the landlord new plans for the premises? Presumably the landlord is either going to re-rent the premises or re-develop it.

    Isn’t Shebeen Chic more about the people who work there and the product and service they deliver. Isn’t there an abundance of vacant city centre premises to which Shebeen Chic might be able to move, preserve employment and, after a period of disruption to be sure, be back up and running. What’s so special about the actual premises on South Great George’s Street?

    • Dorothy Jones

      There is great footfall at that particular spot. However, there is also great footfall here on Sth. William St. parallel to the Dame St. location of ‘Shebeen’. ‘Crackbird’: the pop-up restaurant is always busy night and day for example, and there are a number of suitable empty premises for rent.

    • transitionman

      Premises has all the required boxes ticked Fire, Health/ Safety food etc. Moving to new premises takes new fitout and time for all inspections. Only alternative is to move to current food / pub with all the red tape.

      • Realist

        This is why businesses have long term contracts with special clauses about breaking it.
        If tenant breaches the contract he should be evicted of course.
        From the main story on Internet so called “good business” cannot pay the rent.

  5. Colin

    Your best article in a while David. Can’t add much further to that. Agree 100% with all of it.

  6. Its not so much ageism that is the problem as a simpler story of the rich vs the poor, just happens there was also a generational aspect to this morass as well.

    Also re “The reason we have upward-only rent reviews and nonsense like that is to ensure that the owners of commercial property don’t lose out from the property crash. How mad is that? Many landmark buildings in the city are owned by Irish pension funds. So for rents to fall to reflect trading reality, Irish pensions need to take a hit.”

    There is another reason, that is to do with our ‘pillar banks’. Basically those pension funds form a good part of the deposit base of our banks. If that base goes, the banks require more funding injected from the Government.

    Agree with the sense behind the article. Basically what we have here in Ireland is a ripout of the soul of the country by the banks and the financial class clinging on to their feeder stake in the setup.

    Their only agenda is to milk the poison from The Troika/ECB/EMU who share a common interest in our banks, to ensure they get paid back in full for the wasted, toxic lending meeted out by our so-called establishment.

    Its a poor day in Ireland where an IMF official is praising Ireland for emigration rate last year of 36,000? ; unemployment figures of 500,000 ; and a growth rate of 1%.
    I’m guessing one of those figures above is wrong and its not GR.

    Good luck to the occupiers in their efforts to defend themselves against government Sheriff of Nottinghams and their lying propaganda machines.

    Compared to Iceland, we are a global disgrace!

  7. Adam Byrne


  8. dwalsh

    Maybe things need to spin out of control a bit for people to wake-up.

    • 33square

      shush now… you’ll incite a riot…

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    • redriversix

      Hey Dwalsh

      How are you ?

      Your right…things do need to spin out of control a bit more for people to wake up.

      This Landlord / tenant crisis is old news and just one of many firefights being fought on a daily basis.

      We are heading or are already in the beginning of the greatest financial meltdown known to Man.

      I even doubt if David Mcw would be allowed to print what I am sure his Professional opinion would be….?

      That is not a dig at David , but at his “editors ”

      We have no leadership with the balls to make the hard decisions and walk away from the IMF [INTERNATIONAL MAFIA FEDERATION ] If landlords are forcing tenants to adhere to upward only reviews , if its not profitable to stay in business , WALK AWAY….Simples !

      Keep it simple , do not be afraid.The Banks set a precedent in 2008 that they can do what they like , when they like.But Joe citizen has to abide by the rules and live in fear or shame or both ? for what…

      If you are doing the best you can DO NOT BE AFRAID.Too many debts ? are you trying to work with your creditors and Bank ? are you being straight ? Can your business survive given the agreed time and support ?

      If it can , but you can’t get a straight answer or you are constantly being delayed with decision making from “upstairs” in the Bank.?

      Do you have your paperwork in order ?

      Can you stand in front of a Judge and tell him you did your best ? you can ! great..then tell the Banks and the landlords to take a long walk of a short cliff !!

      If that’s not clear enough for you Guys , tell them to go and F&^%$ Off.

      Look after yourself ,look after your family if you do not have a family , look after some one else’s family…!!!!

      Ireland as a Tenant of Europe needs to tell the EU , IMF and whoever else to ……..F$%^& themselves.

      Greece to default before Christmas

      The collapse of major European Banks

      Relaunch of Deutshmark ?

      The collapse that is coming is huge…
      Is someone keeping the price of Gold down artificially ? and if so …who , and what have they to gain ? are they doing the same with oil ?
      Does Goldman Sachs own the President of the United States ?

      Who has vested interests in our European leaders…?

      450,000 Unemployed , Europe in a spin, UK trying to figure out how much exposure its Banks have to Euro loans [ A LOT ].

      America on the Brink , and our government / E.S.R.I or whoever tells us we have , or are going to have , Growth…! Could somebody please tell these guys to have a Coke and a smile and shut the fuck up…!!!!


      Our Government
      knows exactly who it has to ” Look After ” and it sure isn’t us.

      Look after yourselves……FIRST

  9. DarraghD

    I’m going to be a contrarian/devils advocate here for a minute and argue that if Sheebeen Chic hadn’t have worked out and the business had failed within year one, wouldn’t the promotors who signed the lease, have been highly grateful for the clause that let them walk away from the premises without having to worry about being chased for loss of rent???

    I do see the point that David is making though, if this is the bank trying to control the landlord and the cause is job losses, there needs to be protest action to oppose this and stop this eviction from taking place.

    • breltub

      If it hadn’t worked out, the landlord would also have been happy to settle up, get new tenants in and hope for a customer more able to meet rent/obligations. They could have dissolved the contract, made an arrangement to set up for a new business to come in and both could have moved on without too much loss or lawyer fees. Do you know how annoying it is chasing a tenant for rent?

      Failure suits no agreement, so get out as best you can on both sides of the deal without additional drama.

    • Last week was a good week to be a bondholder in one of the Irish banks, a total of nearly €2bn paid out, the holder of a €1.4bn unsecured bond with AIB doing best of all. Ah we’re a generous people, handing over all that money to those financial institutions, failed gambles all but honoured by us all the same.
      Appearing for the first time this week the €1bn Anglo Irish Bank bond, the remaining €700m of which falls due for payment on November 2nd. That’s Anglo, the zombie bank, and our masters – the ECB – expect that like so many million zombies we will pay that money, follow the path they are dictating for us, the details of which are set out by their local ‘controllers’ here, our own government.

  10. wills

    Fcukin A David.

    Great article.

    Simple and devastating in its reality defining.

  11. cutehoor

    Methinks pension funds could be yet another great ponzi scheme to collapse.
    In addition to DMWs comments …. We have an inefficient pensions industry subsidised by the taxpayer, dodgy entry/exit valuations, management fees, additional management fees when they invest in funds of funds, upfront fees and very dodgy classification/representations risk profile of their funds.
    Did I forget to mention the whole defined benefits grenade and indirect leverage on investments.
    Did the pension funds use their block votes to keep the banks boards in situ perchance?
    There’s a wee bit save our a$$ going on by those pension fear mongerers.
    Yes DMW you’re 100% correct. We need to tear up the system and start again.

  12. Optimistix

    David, you are last night I watched Michael Lewis interviewed by Charlie Rose who as an independent outsider spoke of how the Irish when we got access to cheap credit in the boom went mad on a buy Ireland spree. It was made me cringe with shame because he was bang on the money. Even today the money that left the Irish banks is waiting to flood back into Irish land. Lets not fool anybody we have the old money or so called smart money still waiting for the market to bottom out so that they can snap up bargains creating another delusional Irish property boom. make jobs.

    FF Brian Lenihan swore to the Irish people that NAMA was not designed to reward or let the developers off the hook but really nobody believes that today when one sees NAMA admit that its job is to recoup the money it paid for the loans which were written down by 60-70%. This write down was borne by the state not the developers so why are we surprised that we have laws designed to protect the landlords and upward only leases.

    The only way to stop this is to introduce a property tax on landlords who don’t index the rent in line with the business revenue making it attractive to business startups. If the business booms then they get rewarded but if it wanes the rent is aligned.

    Land is the Irish Gold and we are addicted to it. Unfortunately its turned out to be fools gold for the younger generation who have been landed with the bill.We need to rapidly change our laws even Michael Lewis told the world our bankruptcy laws are from the dark ages.

  13. Malcolm McClure

    David writes: “There has to be co-responsibility. The tenant and the landlord need to display give and take. When the domestic economy is on its knees, every job needs to be minded and, therefore, solutions to tenant-landlord conflicts rather than evictions should to be the norm for the legal system.
    It is against this complex background that the following case is so distressing and emblematic of indignation over pragmatism, where there is only one real loser – the worker.”

    Whist the background to the particular situation you chose for illustration is complex, I am unclear whether your argument is based on Moral, Political, Legal or Economic considerations. – It smacks a bit of bleeding heart, neoliberal confusion about objectives. What are you trying to achieve with this piece?.

    There’s more: “So it comes down to a scrap between the interests of those about to get pensions with those about to go out to work. Pensions are seen as sacrosanct while society tolerates the fact that so many young workers must go on the dole or emigrate. Why should pensions be more protected in a downturn than jobs? Why should the wealth in pensions be maintained, while the wealth in houses allowed to fall?”

    Who says that: ‘society tolerates … that young workers must go on the dole or emigrate’ ?
    I cannot see a plausible cause-effect link between pensions, falling house prices, and the dole or emigration. It is just an ill-assorted melange of special interest groups each fighting their own corner. Politicians specialize in waffling about these things. We look to Economists to provide solutions.

    • We look to Economists to provide solutions.

      They are part of the problem not the solution!

    • 33square

      “Pensions are seen as sacrosanct”. Pensions have certain guarantees, unlike the bonds that are being paid out. Pensions are, and should be, sacrosanct in comparison…

    • 33square

      “When you gain a bit of altitude from this and other cases, you see a similar pattern”

      This article tells us of the competing interests among the serfs, with an elevated (illuminated?) point of view.

      “The interests of the young cannot be indefinitely trampled to protect the interests of the late middle aged”

      incite riots much Dave? How’s about this?:

      The interests of the serfs cannot be indefinitely trampled to protect the interests of the already clusterf@#kingly rich!

      I’ve never doubted DMcWs intentions until reading this article.

      it’s not young vs. old! young AND old were making money on property, be it a young couple flipping their first house to make 50K or young lads too cool for school going working labouring/building, driving BMWs they thought they could afford while their classmates struggled on into college.

      it’s all about the serfs (hens) and the lords (foxes). the hens don’t even know who the foxes are, and with friends like Dave, it’s unlikely they ever will…

      • 33square

        Peter Sutherland: fox

      • 33square

        Denis O’Brien: fox

      • 33square

        Paul Gallagher: fox

      • 33square

        Michael McDowell: fox

      • 33square

        David McWilliams: ???

      • 33square

        Dermot Gleeson: fox

        • Praetorian

          @ 33square He worked in investment banking, he is not Che Guevara. He is more about making the system work more efficiently and with some degree of accountability, he is not about ending the system. Operates within certain parameters, but once you understand that, then you take this site as it comes.

          To be fair to David, he warned publicly in 2002-2003 that property was going to end in tears, some say even a stopped clock is right twice a day, regardless, took courage to do what he did and as he said himself, he has taken flak from the ‘establishment’, an establishment which was still prepared to ‘consult’ with him in the early hours of the morning and in Farmleigh. As for Bulmers commercials, well…. :-)

          • marooned

            David McWilliams almost alone amongst Economists/Financial Commentators was correct in relation to the so called “Celtic Tiger”. Morgan Kelly has got a lot of publicity with his comments/articles in 2007 but at that stage even the “shoe shine boys” could see that the end was coming. Where was Kelly in 2002 – 2005 when we needed him? Yes David McWilliams put his professional neck on the line and was proved correct.

    • transitionman

      I am not surprised you cannot see a plausible cause-effect link between anything. Your ability to join the dots between various topics is well documented.

      • Malcolm McClure

        trnansitionman: I would certainly not wish to follow your join-up of the dots that leads to World Government. Curious about your pointer, I got as far as David Korowicz and ‘Irelands own FEASTA’ website and found that their advocacy of WG has the potential to scare DMcW’s readers considerably more than your risible but endearing belief in the Witches of Halloween.

        • transitionman

          For anyone else that got lost on FEASTA website and could not find David Korowicz
          How Mr Mc Clure could imply it in advocacy of WG ???

          • Malcolm McClure

            transitionman: No need to dig that deep into FEASTA’s agenda; just go to
            The second paper on that page dated 17th September 2011 is entitled Climate Governance– a new paradigm.
            It begins:
            “This paper, prepared by members of Feasta, asserts that the climate crisis demands a new paradigm of global governance. “

          • marooned


            MM obviously did not read the Feasta article. It is simply making the point that in order to combat climate change a co-ordinated global effort is required.

            Its not just MM who is not joining the dots however, the ostrich mentality is going to remain with the majority until the “ship” is going down and even then the blame will be placed anywhere but where it should. Remember the captain of the Titanic never considered that an iceberg would damage his ship, Hitler was still moving non existant armies around as Berlin was being bombarded. Our leaders are trying to revive sovereign countries and banks who have long since passed the point of no return. Mr McWilliams here refuses to even discuss the looming energy shortage and resource depleted planet of the near future (he is not the only economist who takes this ostrich stance however). Anything to do with natural resources and the environment are seen as simply “EXTERNALITIES” as far as neo classical economists are concerned. If a resource gets scarce then there will always be a substitute to replace it once the price is right. Mr McWilliams opines that if debt is forgiven to sovereigns, banks and individuals we can all start again and return to our 2000 – 2007 lifestyle. There are many serious commentators who contend that our current economic problems are being caused by rising natural resource prices. Our need for basic requirements of food, water, and heat are going to replace the wants of Mercedes, Louis Vuitton and shopping trips to New York etc (in our case) as the cost of necessities rise and indeed get scarce.

            So David lets have your opinion on the predicament outlined and put my mind at ease that I’m mistaken.

        • transitionman

          Wonderful you don’t read the article I referred to, you read the headline of the first paragraph on something else and come to your conclusions. I rekon you must be a long way up the food chain in this country. I met Colin Campbell a few weeks ago he was amused he had the IMP going to Ballydehob for a consultation.Will economists will have to include energy input in the maths when the IMF tell them ?
          The Oct 10th conference hosted by ASPO and SEAI http://aspoireland.org/ breaks new ground. Marooned David Mc Williams knows all about peak money peak oil he even has appeared on TV on location in S America at the site of collapsed society to demonstrate the serious nature of the problem. The difficulty is the Catch 22 the more people realise whats happening their actions accelerate the process. What needs to happen will have to happen in the guise of something else as the vast majority are oblivious and do not want to know.

          • marooned

            Please refer me to somewhere David McWilliams has written at length a piece about our energy and resource depletion predicaments, I have not come across it. I’m sure you may be right that he is totally au fait with the problem but (sorry David) he is quite willing to stay quiet about it. Having someone with his public profile stating publicly his concerns in this area would be hugely beneficial to the overall debate.

          • Malcolm McClure

            I know Dr. Colin Campbell, a good exploration geologist in his Colombian youth, who adapted later in his Amoco career to analysing other people’s data on global oilfields. With due respect, he does not possess the intercontinental range and depth of hands-on appraisal of giant fields that I have. His quantitative bias is on the cautious side because of his comparative lack of exploration success, his comparative lack of exposure to modern development technology and the constraints of SEC regulations.
            I am also familiar with the publications of King Hubbard and Peter Odell, so the notions of physicist Korowitz are entirely superfluous.
            I have made my position on peak oil clear and will say no more about it.

          • marooned

            Well MM if you appraised the oil fields as well as you appraised the FEASTA website!!!!!

    • dwalsh

      Neoliberals dont have a heart Malcolm.

  14. Well said, David. The American, Henry George, worked on the very matter with Micheal Davitt and Land Leaguers more than 120 years ago, but nothing’s changed.

    A two hour read of “The Land Question” (as you’ll see, it was originally called “The Irish land Question”) will prove to be an excellent investment for readers. http://www.wealthandwant.com/HG/irish_land_question.html

  15. SamB

    Nice rhetoric, David… but as an economist, you must know that there is no such thing as a free lunch.
    Who is going to pay for the loss in the capital value of all this investment property?
    How will we be regarded by the international investment community when we no longer honour legal contracts, but renege on them using retrospective legislation?
    How does our constitution and the EC Courts view preferring one set of citizens (tenants) over another (landlords)?
    Did you learn nothing about the free market from your dinner with John Mauldin?

    • Dilly

      The international investment community do not care. If it all goes tits up they will be rubbing their hands at the prospect of picking up bargains. The suckers who get caught out wont matter at this stage. I have yet to see a Free Market anyway.

  16. Anglotax

    Disagree with the article. The author states that either party – the landlord or tenant – has the right to terminate the contract of tenancy. There appears to be no breach of contract but rather aggrevated damage caused by an intended occupation by the tenant’s workforce. Is the author suggesting tenants in commercial property in Dublin have the right to breach a rental tenancy contract and unlawfully sieze and occupy the premises? I am more concerned about the flagrant breach of property rights afforded by the ESB/Eirgrid with the connivance of a venal court enabling an elderly lady to be deprived of her liberty in defending her right of peaceful enjoyment of her tree plantation, or must we take an English paper – the Irish Daily Mail – to highlight a real breach of justice here in Ireland – that would be a better example for the author to comment upon.

    • lff12

      The point of the article is that a business is effectively being shut down to serve the interests of its landlords creditors, with a subsequent loss of jobs.

      As for the ESB/EirGrid situation, there is much more to the story than reported so simplistically in the press. EirGrid have been having “discussions” with the tree lady for 4 years. The cost, by the way, of all of the legal proceedings, assuming the lady in question will be unable to afford them, will be paid for by YOU. If backup lines don’t get built, YOU will pay because nobody will be able to build heavy industry or high availability facilities in that region (this is actually the case with the upcoming case around Macroom). So no jobs for YOU.

      Its surprising that nobody has pointed out that cases like this are critical evidence that EirGrid should be held in public ownership, and that the physical assets should not be left in the hands of the profit-making ESB, to be sold at a whim to a conglomerate.

      It was a huge mistake to jail the tree lady, but the are few innovative alternatives. However I do feel that anybody who opposes energy developments should be denied the right to use them for a short period of time to realise how important they are: removing Theresa’s electricity for a period of time would be far more powerful than creating a martyr of her in Mountjoy.

      • Realist

        Any business that is not profitable should be shut down.
        I am sure if the business is great they will easily find new place.
        If they had the proper long term contract with the landlord and paid for it properly this could not easily happen. Employee’s shoould be crossed with their owner who could not work it out with the landlord.

      • Realist

        EirGrid/ESB should never be public.
        It should be privitised.

        • marooned

          The only body that can interfere with a person’s property rights is the State according to S 43 of the Constitution. The ESB is not the State and I doubt that the State can divest itself of its duties under the Constitution to the ESB. Teresa Treacy I believe will challenge this in the High Court. The ESB also better bring evidence of the extra costs of going underground with them the next time.

          From looking at maps it would appear that the ESB very intentionally went through the woodland in order to avoid farmland beside it. They appear to have thought that this woman would have complied with their wishes and they are now afraid to backtrack.

          By the way I dont think there is much heavy industry in Tullamore and with the level of emigration there will be little need for any upgrading of the lines or roads for that matter for some time.

          Finally Realist it would seem that you only want financial reality for the tenant. Reality would surely allow a compromise in this situation in relation to the rent. There is now a situation where people are out of work and a landlord has no rental income. Should the vagaries of risk/reward not apply to all.

          As for the ESB to be made private I thought the supreme irony in relation to the requirement of the EU to have the ESB monopoly broken up was that they had to increase prices in order to entice competition into he market. Only in Ireland!!!!!

          • Realist

            I agree with you. Nobody should have special privileges. I am sure they could use another route if they could not find the deal with the woman.

            >> There is now a situation where people are out of work and a landlord has no rental income. Should the vagaries of risk/reward not apply to all.
            People are not out of work because there are landlords with something to rent, nor opposite. The problem is there is no investments to employ people and land to produce something for consumers.
            So, obviously investors are not interested to employ high wage people (minimum wage discrepancy) and overpriced land to do something.
            Also to build capital structure (apart from pubs and simple things) takes time, sometimes many years, so nobody is crazy to do this in the environment where government is upping taxes and where you do not see big progress in the next few years.

          • Realist

            > There is now a situation where people are out of work and a landlord has no rental income.

            Nobody has and idea how to employ them at this moment in time.
            Entrepreneurs are on the bay, due to high labor prices, high rents and scared of government interventions.
            Capital is wasted in abandoned projects, so it will take time for all to come back where it should be.

            We are now hearing stories that consumption will bring economy up. What a nonsense. We need the balance between investments and consumption that driven by our needs. Any attempt for the government to control one or the other is making things worse.

    • juniorjb

      I did not get the impression that David was endorsing the occupation. Surely the point is that the situation arising is not in the best interests of the country taken in the round and rather than treat the legal particulars as unalterable givens we need to at least ask ourselves what interests are being protected and what purpose this serves.

      • Realist

        David just found the wrong example to write this article.
        Nobody should be allowed to be bailed out, even small pubs. If they are not profitable and cannot pay rent they should not exist.

        • juniorjb

          In a perfect world everything would find it’s level but I think the point is that the rents demanded are being driven by unreasonable expectations. I have certainly seen viable businesses shut down by demands for increased rent with the former premises lying empty for months on end. If it is the case that the banks are putting the squeeze on then I don’t see what relevance the ten commandments of the free market have to do with it.

          • Realist

            While I agree that the property market is somehow controlled by the government (NAMA) and their banks, I do not believe that the interest of other landlords and even government is to not rent the premises.
            The problem here was that they could not pay the rent they agreed either in the long term contract or short term contract with the landlord.
            IF landlord thinks he should be getting such rent it is his decision and they will suffer when being empty for many months.
            But all of this is entrepreneurship decision on both sides, even the landlord in this case is government.
            The pub owner did not decide well long term how to make the proper contract, suffer losses and so on.
            I am sure we do not want to base our economy on the example of 1 pub owner who could not deliver.
            I am not saying that NAMA can artificially keep properties from the public reach keeping somehow prices still high, but this cannot last forever.
            Nobody can keep high prices for a long period of time, and you can see it on the property market nowdays easily.

            Enterpreneur is responsible for putting resources, hiring people, renting premises and putting capital into the use. They knew what kind of government they have to deal with, so this one of the reasons nothing is happening in the Ireland at the moment, no real new projects going on.
            Who on earth will trust this government who put 100′s of billions of properties on the tax payers account.

          • juniorjb

            This is just it though. The principles of entrepreneurship you refer to are not controversial, but they do seem to be inadequate textbook models when faced with the situation here. In a world of uncertainty and process, never mind the fiddling and interference that goes on here, it seems to me that the kind of analysis Mr McWilliams engages in is very much to the point. It may or may not be in anyone’s ultimate interest to see properties lie empty, but it doesn’t follow that they will be able or willing to act on that interest, however rational it may be in the long term. In the short term Nama and the banks may well consider it prudent to maintain the notional value of assets. It may be that the landlord would rather see it lie empty than struggle to service loans he cannot repay and will see no profit from. I certainly don’t know. It’s a daft situation, but for years the distortions of the Irish property market have been hidden behind the claim that market forces were determining prices and supply and demand. This was a fiction and it would be a grave error to suppose things have changed.

  17. lff12

    I think the obvious issue here is that if the business in question is paying their rent, then there is income being generated. If they are evicted, the income generated is zero, and there will be few buyers, except to buy at a price that will cause the owner, and subsequently, its lenders, to lose even more.

    It doesn’t even make rational economic sense.

  18. CitizenWhy

    Banks should be levied a big tax if they hold a foreclosed mortgage for more than 6 months. After nine months any insurance payout on that mortgage should be reduced 50%.

  19. I think the article is great as it illustrates the evidence how the financial industry through its property bubble still stalks our land with its fangs sucking the lifeblood our of simple and basic commerce, plus it describe how the cultural life of our city is being destroyed by similar effects.

    Listened to Pravda RTE praising Trichet’s work at the ECB. He did mention there were some critics of the euro in the UK and the USA. Whelan of Pravda must be a crap economic journalist if he can’t read the few blogs there are in Ireland that try to be informed on evolving matters to do with economics. ECB poured money into the PIIGS hiding its responsibility behind flawed stability pact european legislation the ECB should have been a regulatory counter weight to. It wasn’t and this is due to the incompetence of the likes of Trichet.

    I have the same feeling as others do on this blog that we are approaching the end game: the same feeling that many got just before the bubble popped in Ireland. The same crowd that fueled our bubble including the likes of Pravda RTE are stlll running the show.

  20. Praetorian

    Almost impossible to save a country from itself especially when those ‘in charge’ are hell bent in looking after their narrow interests. Practices are entrenched. I bet there are more than a few in the Dail who are landlords (both residential and commercial).

    Diogenes with his lamp searched for the honest man, would he find one today?

  21. juniorjb

    A similar event occured in Smithfield earlier this year. The Lighthouse cinema was forced to cease trading due to an upward rent review that doubled the rent on the basis of a pre-crisis agreement. The landlord apparently refused all suggestions of compromise and the business closed with a similar loss of jobs. The premises remains empty many months later in an area already blighted with unoccupied buildings.

    • gerry

      Well remembered. A very good example of what David is talking about. This property was also funded by the taxpayer through The Arts Council, I think to the value of 1 million. The rest of the funding came, I believe, through Anglo. So, when it closed it was part of Nama and the developer said that he had no choice but to increase the rent to pay for the loans, etc.

      It’s a real shame that this happened. It took 10 years for the Lighhouse to get funding so it could reopen its doors after it closed at the original site on Abbey street. It’s a purpose built (awarding winning)building that now remains empty. What else could one do with it now? It doesn’t make sense to close it and to let people go. It provided a much needed addition to the Film Industry which generates a lot of revenue in Ireland.

      I really hope that it reopens in the near future. And, that other Arts/cultural/public facilities are not shutdown the same way. Because they are not deemed of strategic importance!

  22. http://www.independent.ie/education/latest-news/irish-colleges-tumble-down-university-ranking-list-2897967.html

    Our university rankings plunge….

    In spite of propaganda to the contrary Irish economy increasingly looking like a bin awaiting a bin lorry to take it to the skip…

    I’ve a question on emigration if someone would like to answer it. Its particularly hard to get statistical information on emigration in Ireland. Laughably, its not one of the menu items on either of the following sites, but if you dig, you can find some sparse information. Don’t expect any decent analysis of emigration patterns, eg breakdowns by county, age or profession, after all, they don’t like this information highlighted at all:



    “Overall emigration is estimated to have reached 76,400 in the year to April 2011,
    an increase of 11,100 (or 16.9 per cent) on the 65,300 recorded in the year to April
    2010. The number of immigrants also increased over the same 12 month period
    from 30,800 to 42,300. While this has resulted in overall net outward migration
    remaining broadly constant with the previous twelve month period (34,100 and
    34,500 respectively) net outward migration among Irish nationals increased from
    14,400 in April 2010 to 23,100 in April 2011. Over the same period net outward
    migration of non-Irish nationals nearly halved from 20,200 to 11,000.”

    Now before I ask this question, I’d like to point out I like immigrants, the more the better, I also suspect the answer I ask to the question I pose here is just just another indicator of why our economy is totally Fcuked:

    So this is the question:) How come net immigration to this country has increased from 30,800 to 42,300. In the middle of a recession? I presume to come here, they must first show they have a job to come to, its a stupid question but I need to verify this; where are these jobs? Are there jobs out there the Irish are refusing to do? They couldn’t be coming here and going on welfare, so there must be jobs out there?

    Maybe there’s a huge black economy out there with phantom jobs for all?

  23. Morning

    Looks like we might be moving swiftly in Europe as the powers realise the game is up. Just a response to Malcolm above re the links in the economy.

    Rent/land prices are a cost and if they are too high, other factors of production will be affected. Absent increases in demand, increases in costs lead to unemployment and the underemployment in general. At least, that’s my reading of things!


    • Malcolm McClure

      Yes , I can see that but we need a step by step guide that suggests what to do about it.
      How and where do we break the vicious downward spiral of indbpted investment, income reuirements (from rents or other profits), redundancy,, excessive domestic expenses, and emigration leading to closures, bankruptcy and the next cycle of deflation?

      • Praetorian

        Simple elite strategy: Keep people worried, on the edge of survival, indebted and bleed the country dry thus ensuring the continued dominance of a tiny minority, invoke God and patriotism when needed.

        On such a strategy wise words fall like seeds on barren ground.

        • Praetorian

          meant ‘by a tiny minority…..’

          “Bread and circuses”

          The Roman practice of providing free wheat to Roman citizens as well as costly circus games and other forms of entertainment as a means of gaining political power through populism. The Annona (grain dole) was begun under the instigation of the popularis politician Gaius Sempronius Gracchus in 123 BC; it remained an object of political contention until it was taken under the control of the Roman emperors. Indeed, Spanish intellectuals between the 19th and 20th centuries complained about the similar pan y toros (“bread and bullfights”). It appears similarly in Russian as хлеба и зрелищ (“bread and spectacle”).

        • coldblow

          Polanyi: “The financial market governs by panic.”

          • Lord Jimbo

            “I believe that banking institutions are more dangerous than standing armies… if the American people ever allow private banks to control the issue of currency… the banks and corporations that will grow up around them will deprave the people of their prosperity until their children wake up homeless on the continent their fathers conquered.”

            -Thomas Jefferson


    Spanish unemployment is increasing @ a rate of 10,000 per day. 4.3 million , 22% on the dole ! . Land value taxes are the solution to the ills of the western world. Too many vested interests block this from happening.

  25. breltub

    Wouldn’t the staff of Shebeen Chic be better to get together and restart a new pub. If they were successful with this one, why not go and set up a new one somewhere close by.

    Seems like they are in shock at being closed down and resenting being kicked out, a natural reaction.
    But what will it achieve, it’ll highlight the place is closed and they get a mention in David’s article.

    None of that achieves what they want; jobs!

    So sit in, create a scene if they are really that pissed off about it and make life difficult for their landlords, but in the background they should really focus on getting back on the horse

    • redriversix

      Hey Breltub.

      just curious , have you fallen off many horses in your time ?

      It’s hard to know how any of us would react unless we have been in that situation.

      Anybody can get a job , but you need a job were you can take care of yourself and your family , you need a job were you can be part of something , contribute to your employer and grow as he grow’s.

      It seem’s a lotta job’s at the moment , with the money they are offering are nothing more than contract poverty trap’s..

      Tell me about your horse , breltrub..please

      • breltub

        Ya, I’ve been unemployed for more than a year. I had to repeat a year in college because I spent too much time having a good time and had to cop on to myself. I couldn’t do the masters I saved up for due to circumstances beyond my control and all that money was wasted on being unemployed. Plenty of other mistakes along the way too. Who cares, so now that you have seen a horse fall, stick to the topic.

        At the moment anybody cannot get a job. Look at the dole queue!

        My point here is the staff at this place seem unified. They have run a successful establishment from what I understand from the article.

        It would seem to me that they could harness what they are good at, and it would benefit them more in the long run than just protesting and then all going their separate ways.

        You stated that you think people want a job where they are contributing to growth both personal and business and feel part of something. I agree with you.

        I think that is exactly the kind of thing I’m proposing they do. Take charge of their own destiny and work together to get over this set back.

        They are a team, and that should make it easier. Life will be a lot harder as 22 individuals.

        So, have you a comment on what actions I think would be in their best interest? Can you add something to it that might be to their benefit? or would you rather talk about falling off horses?

        • redriversix

          Morning Breltrub.

          I think I would rather talk about falling off horses…!

          I am not sure if i can honestly say I do have a solution for them.

          My Business life was focused on crisis management , turning business around ,helping set up and save business’s.

          But the way thing’s have gone I really could not say ,honestly ” how to help them”

          I have seen business plan’s passed by Banks that should have been binned and I have seen business’s binned that should have been saved.

          Maybe my beleif’s have changed ,Everything used to be very straightforward , Debit’s and credits . profit/loss account’s etc

          Their was a time when I could turn around anything and I made money doing it , but I beleived in what I was doing , that was the difference.

          Today , I don’nt know what to beleive anymore apart from people’s right’s.

          So I support their right to protest.

          Nothing makes sense any more ,either in Banking or in business, A lot of companies are just ” kicking the can down the road ” hoping next month will be better.

          You cannot bank or eat hope

          The only thing I know this Morning, breltub, is that you and I should probable stay away from horses…!!

          Take care

          • breltub

            I too support their right to protest.

            But there are a lot of “rights” I don’t agree with in society. We have created a “rights” culture where it’s my rights versus yours.

            Most specifically, I’ve the right to your money and it permeates every sector of the political body.

            I’ve the right to tax you, I’ve the right to bail out a losing bank/health insurance/property developer as I see fit, I’ve the right to spend your money because I know better than you. I’ve the right to tell you how you should live, work, think, eat, sleep and drink!

            The state is completely out of control, incapable people have assumed rights far exceeding their abilities to live up to the responsibilities that come with those rights!

            Nothing makes sense anymore because rules do not apply. We have been sold a ponzi scheme of lies and I believe that people have been lied to so much they no longer know the truth, because of this they have been mentally enslaved through Nationalism, Religion, Belief in Government, Belief in law and Justice.

            We have been told all our lives that the above “forces” would protect us, like a shield against the evil that is out there. Nothing could be further from the truth

  26. coldblow

    The independent state just carried on with the inherited economic institutions and thinking. Following on from what David says, property in land (and also in capital) got preference – land is held without cost to the owner, money earns interest, as a result the cost of employing labour was very high – this is particularly the case in countries like Ireland (Crotty).

    Or to look at it from a wider perspective, not just Ireland, the free market makes the assumption that labour is merely a commodity for sale just like the other factors of production. It seems the argument has been that land and capital ‘earn’ their keep (although, although legit savings have been earned, this still looks to others like a free lunch for the wealthy) so labour will just have to find its own price. Contracts are sacred, so those workers have no right to challenge the terms of the lease. If there were no welfare safety net, it is argued, then the market would soon reach a fair equilibrium. It is clearly nonsense (labour is people’s lives not a pure commodity) but the free-marketeers are also right from their own perspective, that unless the rules of the game are respected the system can’t function. You can cover it up in the good times but not when it gets nasty. David is calling for the rules to change, if only modest reforms to tide us over a bad patch, and that would seem to be in everyone’s interests, including those who benefit most as things stand, seeing as to refuse to change is to risk total breakdown. But any reform puts further pressure on the pension funds, the banks etc and it’s argued that now is not the time to tinker with the machinery, it’s under too much strain as it is. Any heresy at this time of peril might bring the whole edifice crashing down. Catch 22.

    Alternatives require careful thinking. Can’t see that happening in Ireland at any rate. Hope someone else can work it out for us…

  27. george

    Your analysis is so incredible perfect, and depicts a very sad reality of this Country that lingers because most of our Political Class chooses to show strength to the weak, as in the case of Teresa Treacy serving jail in Mountjoy for demanding to the ESB what is just and reasonable; and weakness in front of the strong: Banks, Landowners, the super rich, and Corporations, etc.
    In the meantime we are fixated with how bad the English were in the past, as if greed over need is below the great Irish Nation.
    Anyone can pass laws, Hitler, Franco and Pinochet did it, and also a majority of politicians voted by a majority of adults, prone to be coerced by what Naomi Klein calls “The Shock Doctrine”. But where is what is just and justice?


    Haven’t had time to read all the responses to this but isn’t our constitution mostly about the property rights of landlords? Ironically, this leads to our restrictive residential renting laws, which in turn lead to our obsession with owning our own properties, which contributed greatly to the property bubble. So it was all Devalera’s fault.

    • Lord Jimbo

      Private property rights have been the cornerstone of capitalist democracies for hundreds of years, in the early days as I am sure you know, only those with property had the right to vote, nice way to maintain the status quo.

    • Praetorian

      “The Greek people were not the ones who agreed to accept these debts and for the most part they did not benefit from them; yet they will be burdened for years to come because they were hoodwinked by the international banking community and their own corrupt leaders.”


      “In my books, I write about how world economics and politics today are controlled by a very few people — the corporatocracy. This is clearly demonstrated by the fact that whenever “debt restructuring” or “debt forgiveness” deals are struck they include privatizing parts of the economy that were previously considered public. Utilities, schools, prisons, even significant parts of the military are sold to multinational corps. Those who demand smaller government, are — knowingly or not — supporting a new brand of corporate imperialism.

      These corporations are usurping the economic engines of growth that historically have been considered as belonging to the public domain. When I was an economic hit man during the 1970s, I was ordered to implement these policies in many “Third World” countries. It took me nearly a decade to see beyond the smoke and mirrors of the World Bank/Business School models, but eventually I came to understand that this was nothing less than the Big Steal. Now it has struck Iceland, Ireland, and Greece; Spain, and Portugal are in the cross-hairs.”

      • redriversix

        Hey Praetorian.

        When the big money Boys approach Greece with their final offer , after Greece defaults,

        They will tell them “We can give you this Money , but what’s in it for us”

        “what resources you got for us , you got any Oil , Gas ? you gotta give us something , after all we are here to help you “.

        It is a bit like the conversation the guy offering ” protection ” to a shopkeeper has before he arranges to collect his ” Cut ” every Friday…..

        Remember the Titan’s

        • Praetorian

          Stand and deliver for the IMF highwayman.

          Heard the Chinese bought one of the Greek port facilities, they have been forced to flog their family jewels, if they default they might save some as well as their nation in the long run, this austerity drive is lunacy.

    • dwalsh

      Thanks for posting that.
      Perkins knows what he is talking about first-hand; I agree with him. This crisis is intended and being managed. It is WW3. Nothing less.

  29. Re the figure of 76,000 + annual emigration given above plus the 1% growth rate and the employment rate going down, I know there are sceptics out there, who say this is Sept return to education/FAS or due to emigration. But I put it to you the policy of emigration pursued by our government alongside the policy of increasing unemployment, thus leading to more emigration, can, in fact, be improved upon.

    Just give Johnny Swift here a chance. His proposal that children be eaten could in fact solve our balance of payments deficit and cure many of the problems we have, don’t you agree?

    I’m sure this policy will find favour with FG/LB and cure the land of its main problems, namely too many people at the expense of too few multi nationals, too few banks and small salaries and bonuses for bankers. It also follows on naturally from current emigration policies.

    A Modest Proposal for preventing the children of poor people in
    Ireland, from being a burden on their parents or country, and for
    making them beneficial to the publick.

    by Dr. Jonathan Swift. 1729


    • transitionman

      A little more backround on My Oil And Gas http://bit.ly/mPKnVI

      • Great work from those who produced the video.

        Seems like a no brainer to ask for a take it or nothing deal, same as negotiated by the Norwegians ! There again we specialise we are good at playing cowboys and indians and in handing away our future to anyone that’ll take it for nothing! I see documents that’ll fill ten rooms. Summarise them: the government get a few up front lollipops, the dealer gets a job later on, on the Bord of the Bank/Oil Company, the people shell out and get stiffed.

        Business as usual on Craggy Island!

      • Malcolm McClure

        Those who contend that the exploration and development of petroleum resources offshore Ireland has not been thorough should familiarize themselves with the data:
        Clearly the prospective areas have been saturated with seismic, and up until the 1990s the offshore well success rate was pretty dismal.
        The Petroleum and other Minerals Development Act 1960 section 13 indicates that lease terms and conditions are negotiated with leaseholders after a discovery has been made. Unless these development licenses are published it is idle to speculate that Ireland receives no income from them.

        • Malcolm,

          Fair point, but I don’t think the authors of the website and the video would argue that ‘speculate that Ireland receives no income from them.’

          What they are saying is that these license terms are not the terms negotiated by the Nordic countries.

          We should tear up development licenses unless they contain the same terms obtained by Norway.

          This is quite easy to do now that the Norway has a template for this in Statoil.

          We should set up Celticoil nationalised on behalf of the state. Argentina, Bolivia, Peru and many more states made these dumb deals with oil companies, only subsequently to realise they were ripped off. No doubt our own gombeens will be persuaded by rubbish, the conditions are difficult, there might not be anything there.

          Celticoil could issue some bonds and by a rig to do its own exploration.

          • Malcolm McClure

            Looked at from an explorer’s point of view there is no comparison between the potential of Norway’s giant fields, which are clearly defined on seismic even at an early stage, and Ireland’s miscellany of awkward prospects mostly in deep water. Therefore even when encouraging shows are seen in a couple of exploration wells confidence in development potential takes a while to build up. Therefore, Irish government negotiators are in a much weaker position than their Norwegian brethren. I said earlier that they daren’t look cross-eyed at a golden goose until it starts laying golden eggs, otherwise it will fly to pastures new.

          • @ “said earlier that they daren’t look cross-eyed at a golden goose until it starts laying golden eggs, otherwise it will fly to pastures new.”

            Surprised at you there, Malcolm. This point of view exposes you to lies and deception and corruption and a position of weakness.

            The simple remedy is to assume energy resources belong to the Irish people and will not be extracted except vis a vis Statoil Norwegian agreements.

            Technology is increasing its abilities all the time, oil is growing scarcer. Nobody pulls the wool over your Irish eyes. Statoil extraction agreements on behalf of the Irish people, or nothing!

            Incredible I need to make this argument given what you already know re smoke and mirrors and our experience re banking.

            This rubbish of the Irish government that they are competing to get the oil comapnies to explore off our coast with other jurisdictions? What a laugh these suckers give us, except its Irelands future they’re giving away for a song!

          • Malcolm McClure

            colm brazel: Government negotiators are inherently in a position of weakness. They have access to exactly the same data as the oil companies but their experts don’t have the depth and range of expertise of oil company experts. For instance how many government employed geologists understand the nuances of Schlumberger log interpretation? There is absolutely no occurrence of or need for, lies and deception in my experience. The oil company is severely restricted in its declared optimism by SEC regulations, which got Shell into trouble a few years back.

            There is no disputing that the resources belong to the Irish people, but oil companies are in a very risky business, exacerbated by the physical difficulties of operating in deep, rough water offshore Ireland. They require big potential rewards to become interested in the first place.

            After a major discovery is made there, say 200,000 barrels per day, the industry will come flocking to follow it up. Then the government will be in a much stronger position to negotiate contracts more favourable to the irish taxpayer..

        • transitionman

          No surprise to see you supporting the line that there is nothing out there compliments of the Dept of Marine and Natural Resources. I worked in this area in the 80s. We had Aran, Bula, Eglinton, Osceola. The game was financial and still is. The directors of the companies leaked information to drive up the share price to split levels and the insiders offloaded. Exploration today has the same insiders selling percentages in return for big oil companies to fund the risk. A bit like banking privatise the profits socalise the losses. The point is that in the event of oil being commercially viable off our coast the people of Ireland will be robbed all over again.

          • marooned

            For once I have to agree with MM. Common sense dictates that if there are potential oil and gas fields off our shores the big companies would be there exploring. Lets face it why would they be exploring the much more difficult Artic and dealing with the much more treacherous Russian oligarchs when they could be sipping tea with our Civil Servants. Unfortunately I don’t think under present economic and technological conditions that we have viable energy resources off our shoreline.

        • @Malcolm

          “After a major discovery is made there, say 200,000 barrels per day, the industry will come flocking to follow it up. Then the government will be in a much stronger position to negotiate contracts more favourable to the irish taxpayer….”

          Marooned: “For once I have to agree with MM. Common sense dictates that if there are potential oil and gas fields off our shores the big companies would be there exploring.”

          To me this is typical of the Irish Charge of the Light Brigade mindset. This nonsense is a servile neo colonial remnant of a master slave relationship we need to quickly grow out of in order to compete in the modern world.

          This has noting to do with common sense, it has everything to do with business carried out in a scientific and professional and efficient manner. Spare me the arguments that led to Honahan accepting a 5.8% scalping with the view that if we performed well enough, the haircut would be reduced later. Lol.

          The last thing we need is 200,000 barrels a day given away to scalphunters to prove we have oil, so that we may cravenly demand a better deal later on? This is crazy and wrong ‘give away’ attitude to our national resources.

          We offer exploration and harvesting rights on a shared basis with the majority of profits going to an Irish Celticoil company holding the majority rights on behalf of the Irish people according to the Norwegian template model.

          If no one wants to buy at this time, we await the time when they do? If they don’t, we wait until the price of oil goes up to make exploration worth while. We gave away our fishing rights, now we are prepared to give away our energy rights!

          But rather than sit and wait, Celticoil could look for venture capital to do some exploration of its own.


          “Who owns the oil and gas in Norway” ? Ans: “We regard that particular resource as ours”

          • Malcolm McClure

            Getting a bit hot under the collar there, Colm?  –”a servile neo colonial remnant of a master slave relationship ..” Seems you had a rush of blood to the head? :)

            I never suggested that the first 200.000 b/d was an inducement gift. Of course it will be subject to PRT and some kind of over-riding interest. However, it is commonplace for exploration and development costs to be deductible against tax until they have been written off. –Even in Norway. :)
            After that comes the golden eggs.

            What made you think that these rights had been given away?

      • @Malcolm,

        Re “Seems you had a rush of blood to the head? :)”

        Nope, just had one of my Simpson Honahan Byrnes moments where the two wildebeest of the absurd giveaways appeared to coalesce for one moment together.

        Honahan was giving away our future oil assets to the troika while some doppelganger of his from the DOF was telling the IMF that Honahan had overvalued the energy assets, they were irretrievable, too expensive and dangerous to extract!

        Honahan had just given away Coillte in return for a contract to engage the Irish army to barb wire/fence Coillte Lands across the country and patrol against enemy incursion from Irish hillwalker people:)

        The troika have first call on all these reserves so to some extent debate on these matters is moot:) Re “What made you think that these rights had been given away?”

        Tip, I assume everything I read, hear or see coming out of our political establishment is based on total incompetence, mismanagement, alas, I’m rarely proved wrong!

        Is PRT PR Tax:)

  30. Konrad Dechant

    You are entirely correct in pointing out that the laws have to change:
    “No more than in the late 19th Century, things have to change. In the first decade of the 21st Century, the laws need to change to reflect these new realities because the lesson from Irish history is that if the law protects landlords over workers and tenants, this will soon become the unique source of the grievance…”
    “It is clear that without the legal system that favoured landlords over tenants, great national movements like the Land League would not have been founded. …”
    An aspect of this change must first of all relate to the way we understand land. To treat land as capital distorts our understanding of how the economy works and obscures a remedy to our economic ills.
    It is not the landlord that is the problem; it is the seeming unwillingness or inability of politics to recognize, who is entitled to profit from land?
    In ‘The Sovereign People’, completed on 31.3.1916, Pearse argued that it was ‘for the nation to determine to what extent private property may be held by its members, and in what items of the nation’s material resources private property shall be allowed. A nation may, for instance, determine as the free Irish nation determined and enforced for many centuries, that private ownership shall not exist in land; and that the whole of the nation’s soil is the public property of the nation…
    To respond to this call all we need to do is to introduce a Land Value or Site Value Tax, and enable the landlords to create genuine improvements the fruits of which they are perfectly entitled. Here is the recipe for small government funded by fair and efficient tax system to which everyone contributes according to the benefits enjoyed and which no one can avoid as land cannot be moved offshore
    Let us recognize as John Kay wrote in the Financial Times (27 Dec 2009): “You can become wealthy by creating wealth or by appropriating the wealth created by other people. When the appropriation of the wealth is illegal it is called theft or fraud. When it is legal economists call it rent-seeking”.

    • gizzy

      Nothing has changed. Was in the U.K. last week and someone said. I hear PWC is running Ireland. The same PWC who audited Aib through the boom and bust years. I said surely not.Who now have three ex employees on the AIB Board (never). I then hear from another source that they are hiring 300 people to deal with the AIB workload and didn’t they get the NAMa gig aswell (can’t be). So as far as changing laws David we have not even changed the people who can influence the cahnge in laws, the saying same circus different clowns does not apply, it is same circus same clowns.

  31. Lord Jimbo

    David’s plea to the greedy, myopic and downright insane reminds me of the poem ‘The Listeners’ by Walter de la Mare (1873 – 1958)

    “Is there anybody there?” said the Traveller,
    Knocking on the moonlit door;
    And his horse in the silence champed the grass
    Of the forest’s ferny floor;
    And a bird flew up out of the turret,
    Above the Traveller’s head:
    And he smote upon the door again a second time;
    “Is there anybody there?” he said.
    But no one descended to the Traveller;
    No head from the leaf-fringed sill
    Leaned over and looked into his grey eyes,
    Where he stood perplexed and still.
    But only a host of phantom listeners
    That dwelt in the lone house then
    Stood listening in the quiet of the moonlight
    To that voice from the world of men:
    Stood thronging the faint moonbeams on the dark stair,
    That goes down to the empty hall,
    Hearkening in an air stirred and shaken
    By the lonely Traveller’s call.
    And he felt in his heart their strangeness,
    Their stillness answering his cry,
    While his horse moved, cropping the dark turf,
    ‘Neath the starred and leafy sky;
    For he suddenly smote on the door, even
    Louder, and lifted his head:–
    “Tell them I came, and no one answered,
    That I kept my word,” he said.
    Never the least stir made the listeners,
    Though every word he spake
    Fell echoing through the shadowiness of the still house
    From the one man left awake:
    Ay, they heard his foot upon the stirrup,
    And the sound of iron on stone,
    And how the silence surged softly backward,
    When the plunging hoofs were gone.

    Is there anybody listening?

  32. dwalsh

    Hey redriversix

    I heartily agree with all you say…especially:

    “Look after yourself ,look after your family if you do not have a family , look after some one else’s family…!!!!”

    A truly human expression.

    In my view we are in the beginning of something bigger than we yet know. I have said here previously that it will probably have to get a lot worse before it will get better. But I am optimistic; I believe we will come through and it will get better.

    But the world that emerges from this process will not be the one that we know today. Those who believe it will be back to business as usual once this debt problem is sorted out are mistaken, in my view. They’re missing the bigger picture. They’re thinking within the parameters of mainstream economic-speak; which means they’re not thinking at all.

    We are in transition to a new era and a new phase of human civilisation. How that will look and how it will be, shall be determined by how we all think and act in the months and years ahead as the process unfolds. It could turn out very grim…or not too bad.

    We should be clear about one thing: the elites who are generating and managing this crisis in order to implement fundamental global changes, will also have as a main objective the maintenance and transfer of their pre-eminence and power into the new system. This is the possibility of the ‘grim’ outcome I mentioned.

    The ‘not too bad’ outcome will require a major awakening and peaceful mobilisation of the general population. If we can keep our heads and don’t let the elite and their media apparatus lead us by the noses we might get a rational and humane outcome to all this yet.

    • redriversix

      Evening dwalsh

      Thank you for your comments ,Sorry for my use of bad language in earlier blog , but sometimes i get very annoyed about our ongoing situation.

      Contrary to my forecast’s I too am a optimist.
      As I have said before.. “I do not believe we ,as a people have a problem with adversity”

      What we have a problem with is the Lies and media spin we have to put up with on a daily basis.
      This is really a huge crisis we are in and I am really not sure if people truly realise the Social and commercial damage it is going to cause.

      As you point out this Financial War being waged against the “lowest common denominator” [the people ]by the chosen few has far reaching effects in which everything that we came to respect in society will be changed forever , Dare I say ……….
      ” A New World order ”

      This Great Depression that we are entering has some scary historical precedents.

      History has taught us that after or during a massive financial change , A War has followed.

      N.A.T.O reported today it would continue it’s Bombing Campaign in Libya , even though Regime change has already happened..Why ?

      Saudi Arabia..a dictatorship ,No regime change , Same for Yemen and Syria and yet these Countries continue to slaughter their own people on a daily basis…No intervention..Why ?

      Bank of England today printing 75 billion pounds to try and boost their Economy.

      What “assets” do they have to back these additional funds , How does it have a worth ?
      There are so many wide ranging factors in this crisis that we could be writing forever.

      The social fabric that we know is Dying , being killed off by Global power’s to launch their own society , will it be fascism ?

      I hope not , but all that is needed for them to succeed is for people to do nothing.

      Apathy and the dumbing down of society is what they have worked on and what they expect.

      We need to keep it simple , Debits & credits.

      Inform others and debate our point of view
      and get some [media] coverage…?

      Help ourselves so we may help others and never lose our Humanity.

      Maybe we should ” Occupy DailEireann “..?

      Look after each other.


      • dwalsh

        What’s going on would drive any sane man to cussin’.

        I hear all you say. In my view the attack on Libya was based on lies no more real than the lies about WMD in Iraq.
        Libya will be looted and the libyan population will be murdered and traumatised. Global central banking will co-opt their economy and IMF shock-therapy will be applied to all the social benefits they previously had under G.
        The people running Libya now for the Western elites are terrorists not freedom fighters.

    • dwalsh,

      Appreciate your concern there. The most worrisome aspect of the current crisis is the erosion of democracy and the flaunting of democratic will of the people by incumbent political parties. There is one law (no law) for the rich and one law for the poor. This is happening in Ireland, in Europe and the US.

      Its not beyond imagination that the uncertainties, growing impoverishment of the middle class, increasing divide between rich and poor, will lead to conditions in this economic crisis that will return the world to a modern version of Nazism. There is growing political disillusionment and growing right wing movement in Europe and the US ready to step in and fill this vacuum.

      This time round the forces to do battle may not be in the West as in WW11 Germany vs other western powers. This time we may have a Tea Party led war fronted by a US supported corporatocracy with its eye on energy supply in the East. We know it won’t be a war between Christianity and Islam though propaganda will say it is so, neither will it be a war between left and right; as always, it will be a war caused by the rich stealing from the poor.

      It would not be the first time economic uncertainty has been used as a cover and device for the invisible hand to make profit.

      The above bleak outlook does not have to follow from the economic meltdown we face. Abraham Lincoln withstood similar forces in the melting pot that formed the US as it sought its freedom from Europe’s banking system. The US can audit the Fed
      and return banking to the people. The G20 could outlaw private banking and strictly regulate or outlaw private investment banking. Governments could print their own money.

      Ireland has the opportunity to give a lead here to the rest of the world. We should simply follow the lead given by Abraham Lincoln:


      “a nationally regulated private banking system, which would issue cheap credit to build industry; the issuance of government legal-tender paper currency;
      the sale of low-interest bonds to the general public and to the nationally chartered banks; the increase of tariffs until industry was running at full tilt;
      government construction of railroads into the middle South, promoting industrialism over the Southern plantation system.”

      With a ‘greenback’ punt nua, national reconstruction intercity and a new ‘tourist trail’ 32 county coastline railway system built in stages, we’ve already enough 19th century ideas to improve our lot, never mind 21st century ideas.

      In summary, we should follow the example of Iceland re writing down our debt. We should return to a ‘greenback’ punt nua. We should set up, regulate and finance our own banks and force banking to serve the democratic will of the Irish people. Our energy resources should be nationalised and made to serve the needs of the people. Simples.

      • redriversix

        Well written Colm brazel

        Excellent point’s , you are closer to the truth than you think you are..

        families first

        Take care

      • dwalsh

        Good points all cb.

        If we had the leadership we could go it alone in the manner you say.

        Do we have the leadership?

        It would be essential to institute sovereign money and have nationalised utility banking only. If we let the private banking cartels and financial speculators in they would just wreck the place again.

        Of course you do realise NATO might decide we are being oppressed or about to be genocided or whatever; and we need to be bombed into freedom and the free market??

        Not entirely joking. The International private bankers would not like us setting a dangerous precedent.

    • transitionman

      I am a pessimist. As for New World Order I have just finished Robert Fisk The Great War for Cililisation. Lies and deception is more like it. Students of our history will ask how so few sought to see the truth. How the NWO started a resource war in 2003.

  33. Black Cat

    Every acquisition that is disproportionate to the labour spent on it is dishonest…Like the profiteering made by banks…this is evil, I mean, the acquisition of enormous fortunes without work.’ Leo Tolstoy – Anna Karenina – 1877 (substitute banks for landlords, speculators)

  34. marooned

    Just wondering about some of the bullish economists of the Celtic Tiger era, is Dan Mclaughlin still working as an Economist? He must really love replaying some of his interviews from 2002 – 2007.

  35. Farmleigh Economic Forum

    I am not impressed in general by the list of attendees of shown by RTE and I do not think O’ Brien should be there .

  36. uchrisn

    The Coucil of Europe has suggested moving voting ages to 16 across the EU due to young people being left out of national debates. Austria has done it already. The average voting age in Europe is late middle aged, around 50. Basically Europe is being run for the 50 year olds and they are stiffling the young to save themselves.
    Now everyone knows that the retired people have worked hard and deserved to be looked after.
    It seems they don’t trust the young to look after them any more, maybe the rise of the nursing home. The older generation are very slow in transferring inheritances to their kids fearing they’ll be forgotten about. If they keep the money they can have some control over the kids. For me its all about control. The older generation want to keep the money and control.
    This strategy will not work as if they stifle the young, their savings will be inflated away and the young will not be in a position to help them when this happens.

  37. uchrisn

    Ireland should bring in rent control/cap. Its such a small country.

    • …not only rent control but also price control of property in general, great system for this in Germany and some other european countries, no gombeen bubbles for them

      • Lord Jimbo

        Labour tried to bring into the Dail legislation which would see commercial rents reviewed with a view to reducing. It was voted down in the Dail. Later heard from a city councillor friend that in his council vote Labour councillors also voted against it (would need to confirm but the guy in question is a standup person so no reason to doubt what he said).

        Think it is a fundamental issue which stands out like a sore thumb and clearly indicates the priorities. Centre will do whatever it has to, to protect its interests, including seeing hundreds of thousands emigrate if necessary and have the tear in the RTE studio, the beating of proud breast, as the Irish fans wave back at a failed state from half way around the globe.

        Wonder if Cowen and Co. will be watching. They’ll probably be at the game talking of ‘rebuilding’, ‘tough times but we can get through it’, ‘we’ve come through famines and economic collapse before’ while the next line in the various dynasties seek to get their people in place and posters up. Vote for young Cowen! A new generation who understands the past, believes in the future.

  38. Interesting article in Sept 5 issue of Time magazine on Ron Paul. Seems more and more the American Establishment are looking at his ideas. His libertarian views on drugs are reckless; but his economic views many of us would share. “Paul believes a currency unmoored from gold is based on, well, nothing, and that simply printing fiat money inevitably leads to ruin…”Ron Paul’s political epiphany took place on August 15, 1971. That was the day richard Nixon, hoping to boost a flagging US economy, decoupled the dollar from the gold standard.

    “studying the theories of Friedrich Hayek and Ludwig von Mises, giants of the Austrian school of economics, which championed unfettered free markets, individual rights and money backed by scarce commodities like gold and silver. “When I discovered people like Mises, to me they were geniuses,”Paul says. They could explain this stuff, it helped me feel comfortable that it wasn’t only me in the world.”"

    The article on Paul would have had more substance if it also drew in the history of banking in the US and the banking wars fought by Abraham Lincoln:)

    • breltub

      Backed him at 40/1 on Paddypower, hope he wins!

      But on a serious note, it would be nice to see a change in tack from voters.
      Sure his drug/abortion/welfare ideals do not sit well with people, but at least he isn’t promising a free meal to everyone.
      It’s better to disagree and still have the ability to follow your own convictions than to disagree and be powerless about someone else’s decision affecting your life.

      Everyone agreed Obama was going to be the guy, but now they are powerless to stop the squander and oncoming carnage.

      People can disagree with Ron Pauls drugs/welfare/abortion ideas but will still be able to make up their own mind on them and after a huge economic heartattack they would at least have sound money in their own pocket to follow their own beliefs

      It’s like ying and yang in a way I guess

    • CitizenWhy

      The American establishment favors a new and bigger stimulus. Nobody significant is interested in a return to the gold standard, unless you mean the ultra-right establishment and its billionaire backers. Such a move would ensure that the billionaires could dismantle the government (Social Security, environmental protection, food inspection, etc) and consolidate more and more in their hands. We would have the Confederate States of America instead of the United States of America.

      Ron Paul’s ideas on ending the War on Drugs and getting rid of the Patriot Act are sound. The War on Drugs is a total failure and has put the lives and civil peace of Mexico and other Latin American countries at jeopardy, with the US providing the drug cartels with the guns. The national federation of police chiefs of the US long ago called for the end of the evil-multiplying war on drugs. They want the money spent on rehab.

      • Lord Jimbo

        Ron Paul is right on some things, and less right on others, but his comments on US foreign policy have been refreshing.

      • Realist

        > The American establishment favors a new and bigger stimulus
        That is exactly the problem, as we have seen the effect of such in the last 10 years, and the effects are not good.

        > Nobody significant is interested in a return to the > gold standard, unless you mean the ultra-right
        > establishment and its billionaire backers.
        This is wrong, except if you think the current keynesian guys are not billionaires based on government backs.
        This is libertarian and austrian economics view and nothing to do with billionaires.
        What they want is for us to know how much we earn and what we can buy in real money, not crap fiat money that is inflated to suit politicians and bankers.

        > Such a move would ensure that the billionaires could > dismantle the government (Social Security,
        > environmental protection, food inspection, etc) and > consolidate more and more in their hands
        Plainly wrong.
        All is based on property protection.
        For example if the air is polluted in your area by somebody, are you getting money for such ? (or it is your lovely government).
        Anything public is doomed to fail, as due no competition you have crap prices, crazy benefits given to public servants and so on.
        You cannot calculate the price of any public service properly as there is nothing to compare it with.
        Products and services can only be compared in the same place, e.g. in Dublin, so comparison with healthcare in US or France is impossible.
        Calculation problem with anything public is so huge problem that brought communism down, and will do probably the same with the current socialism.


    Bank staff and those working in semi states have largely escaped the cuts.The AIB pension deficit is greater than it’s market cap ! MICKEY D IS ON A PENSION OF €120 K PER ANNUM ! As for Norris ? Should be playing the pantomomime dame !

  40. David, your title is provocative and yet in the story you highlight that the scenario may not be that simple. The jobs may be taken to potentially pay the debt the owner or business may have to its creditors be it banks or otherwise…

    I would imagine that the courts have more bankruptcy, both for liquidation and restructure (more for the former I guess), foreclosures and that organisations like MABS (Money and Advice Budgeting Service) may never see a moment in the day when the doors are closed…

    Why do Irish people have a hard time ‘asking for help’? The wolf is often at the door if we ever decide to ask or help may even have to be forced upon us.

  41. redriversix

    10 years ago we had

    Steve jobs

    Bob hope

    and Johnny cash

    Now we have no jobs , no hope and no cash….

  42. dwalsh

    So there is talk of another round of bailouts and so-called re-capitalisation of the banks.

    Re-capitalisation my foot!

    The banking system is sitting on a black hole of derivative debt that can never be paid, or capitalised. At least a quadrillion of the stuff I hear.

    These bailouts are not only not solving the problem, they cannot solve the problem. In fact they are making the problem worse. They are literally petrol on the fire.

    All they do is buy a little time…in diminishing returns.

    The bailouts enter the financial system as sovereign money — real money. They are then processed into exponentially leveraged virtual capital which is used to speculate and thus increase the derivatives black hole. All the bailouts do is feed the system; fattening the Golden Calf; and making the black hole bigger.

    The bailouts enter the black hole and are processed therein into more black hole.

    As each bailout vanishes into the maw of the beast and its belly swells, there is a corresponding diminishing return of time bought. The returns will tend towards zero. If they get that far it will be game-over globally and chaotically.

    Of course it wont get that far. Good sense will eventually prevail and the financial markets will be shut down and put into receivership???

    • CitizenWhy

      Quite accurate.

      TARP in the US is often cited as a success but it was a total failure.

      1. TARP was passed and funded to buy up the poisoned assets, the debt derivatives that the banks could no longer sell and which they kept on their books as the bulk of their “capital reserves.” Capital reserves are supposed to be ready cash, not un-sellable derivatives.

      2. TARP never bought up any of the un-sellable-derivatives. Why?Because the banks refused to sell them except at 100% of face value when any sane person would never buy them for more than 40% (and most likely less) of their face value. The banks made this refusal after Geithner lined up a number of hedge funds that agreed to buy them, along with the US government, above what they thought the debt derivatives were worth, well below 50%.

      3. Because the banks would not sell, and Geithner was committed to keeping the Big 5 banks alive (liquid, able to make their payrolls), even as zombie banks (with no real capital reserves), Geithner and the Fed had to come up with a way for a continuous and unending way to give the banks money. Here’s how they did it:

      … The banks, including Goldman Sachs which does not make corporate loans, were given unlimited access to the “borrowing” window at the Fed with the rationale that the money would be used to lend to businesses. They never lent the money to businesses.

      … The Big 5 Banks “borrowed” huge amounts of money from the Fed at 0% interest.

      … The banks kept much of this money “on deposit at the Fed, and the Fed paid them interest on these “deposits.”

      4. The Big 5 Banks used the money “borrowed” from the Fed for financial speculation, buying up foreign bonds (thus shipping the capital out of the US), and paying big bonuses.

      5. The Obama mortgage relief program was really structured, as Geithner has admitted, as another stealth way to give the banks money. The program really was not designed to do much for mortgage holders, and never affected the vast majority of mortgage owners with problems. But the banks collected a lot of money as a result of this program, without reducing the principals on the mortgages (the principal most often way in excess of the value of the property). Thus the housing situation in the US is worse than ever.

      We all know the rest of the story.

      • dwalsh

        @ CitizenWhy

        Thank you for that excellent summary.
        Wow…I howled with laughter at the bit about them getting interest from the Fed on the money lent to them by the Fed. These guys really are insane.

      • CitizenWhy

        “According to the Fed there is currently about $53 trillion in outstanding dollar-denominated claims and only $2.7 trillion (after QE2) of base money (M0, or bank reserves held at the Fed and currency in circulation). In other words, the entire US monetary system remains levered about 20 to 1.

        Put another way, there is about $53 trillion in debt and not quite $3 trillion with which to repay it.”

        Paul Brodsky, a NYC investment fund manager.

        This is why Brodsky supports Occupy Wall Street.

    • These bailouts are not only not solving the problem, they cannot solve the problem. In fact they are making the problem worse. They are literally petrol on the fire.

      You have to consider…. not for Banksters! It is a brilliant money making cycle for them, over and over again. The longer they could keep countries like Greece, Ireland etc in a forced upon state of protracted default…. THEY MADE PROFITS!

      Substantial profits, very substantial, alone the fees charged by Deutsche Bank in the last quarter of toxic derivatives trade sum up o > 400 million

      These are trades that happen every time Finance Ministers meet and make announcements of new measures, with the precision of a clock the curves went up for around a week, just to slope down again, and in these cycles billions are moved.

      They never stopped, not a second!

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