December 24, 2015

Own goals scored by Blatter and Platini put me in mind of bankers

Posted in Irish Independent · 28 comments ·

Yesterday morning the McWilliams’s kitchen table resembled a mini war room. My son and I spread out a huge map of France before us and tried to figure out Paris to Bordeaux in a camper van. We’d been up in Belfast over the weekend and had tried to coax our Nordie family to come with us on a unique united Ireland family football convoy next June.


But even they, proper Prods to a man, scoffed at the idea of exposing their kids to what they called the “Crazy Prods” who follow “Norn Irn”. After a heated discussion on the difference between reasonable Prods and crazy Prods, the idea was dropped.

So we, the Southerners, are going on our own.

As I scoured the map of France, my eyes hit on the city of Saint-Étienne, rekindling childhood memories of the brilliant Saint-Étienne football team and their outstanding captain Michel Platini.

Platini was the best player in the world. He won the Ballon D’Or three times and captained not only Les Verts, but also the extravagantly talented French teams of 1982 and 1984.

Platini has just been handed an eight-year ban for taking a massive and unusual payment from Sepp Blatter. He is appealing this ban.

For those of us who have followed football for many years, there is something shocking about a football genius like Platini being caught up in all this. The likes of Blatter, a career bureaucrat with grubby hands, mean very little to football fans, being emblematic of institutional corruption. In contrast, the case of Platini is a huge surprise.

The fall of Platini got me thinking about why highly successful men can often behave badly and fail to see that the behaviour is bad. Why take huge risks with a nonchalant entitlement? How come Platini sees nothing wrong, where everyone else sees red flags? And why does he bluff and bluster to the end, not realising that the game has changed? Why did Platini, the head of UEFA, the best player of his generation, a man feted all over the footballing world, and a man who could get a table at any Parisian restaurant, do it?

The behaviour of Platini and Blatter in recent weeks has been very similar to the behaviour of extremely well-off bankers who bet the balance sheet of the banks on hugely risky investments and saw nothing wrong. Not content to have almost everything, they want more. Not content to be richer than they ever need to be, high-flying bankers doubled up again, borrowed more, ignored warnings and blew everything.

Why is it that people who are at the very top of their businesses can make such a mess of things and why do so many go along with it?

Traditionally, after a catastrophic debacle, there is an inquiry aimed at making sure that it never happens again. When trying to find answers and solutions, there are normally three ways to think about these financial/systemic failures, whether they are at a bank or FIFA or UEFA.

The first way to think about it is institutional failure. We see there was a failure of regulation. The police were asleep at the wheel allowing people at the top to get away with running the institution like a fiefdom and we conclude the entire mess was systemic failure based on a failure of policing.

The second way of looking at these crises is that the people at the top – or close to the top – were in over their heads. We conclude that they were just incompetent. The amounts of money were too much and they didn’t realise what was actually going on. So the problem is a lack of talent at the top.

If either of these two reasons fit the bill, the solution is easy. If we get better regulators or less incompetent professionals who know what they are dealing with, we won’t have more crises.

But when you look at the debacles in the world of football and the world of banking, we are not only dealing with incompetence on the part of the regulator and the top brass. We are dealing with something else.

The risks were taken, not by men who didn’t know what they were doing, but who knew more about this field than anyone. They had prestigious track records and had been working in the area all their careers.

In fact, when you look closely at both the way Blatter and Platini ran football and the way some of our top bankers ran the banks, it is not a fumbling, insecure incompetence that caused the problems but exuberant, preening over-confidence.

They were so confident that they thought they were doing the right thing, whether it was running FIFA like a fiefdom and doing deals with Qatar to put the World Cup in the desert or, in banking, lending hand over fist. They couldn’t (and still can’t) see they were doing anything wrong.

Maybe this miscalculation, this inability to see the world clearly, comes not from being wrong on occasion, but from being right so often before. Being right results in over-confidence that assures them that they can’t lose. Think about it: if everyone tells you that you are great, you think you are great and you don’t see the dangers all around you.

The study of over-confidence in people (particularly men) in power is a huge field in psychology. Many of the bad decisions taken by these guys come from a gap between how good they think they are and how good they actually are. This gap between ability and perceived ability exists in all humans. For example, when surveyed, the vast majority of us think we are better than average drivers. But this gap is larger the more you are told by others that you are brilliant.

This gap distorts reality and leads to massively stupid decisions that profoundly undermine institutions and stability. Over-confidence leads to an inability to see reality, an unwillingness to contemplate alternatives and a misplaced certainty in your own competence. Think Jose Mourinho.

When I see the once-great Platini appealing UEFA’s ban and claiming a giant conspiracy against him, the over-confidence conundrum comes screaming back into the equation. It’s a major human weakness and it links the behaviour of Platini to dozens of banking/corporate titans who have fallen to earth over the past few years.

Luckily – and I can say this with confidence – over-confidence will not be an affliction that will trip up either set of Irish ‘Boys in Green’ come June.

  1. Corruption Rules

    Merry Christmas.

  2. Deco

    I can live with the fact that a body, in charge of grown-ups chasing a plastic lump around a field for two hours, is corrupt.

    It makes little difference to the essence of life. If I want I can grab a football, call around others and chase it for exercise. And that is much healthier than sitting in a pub entertaining a fantasy called “us” and “them”, feeding a beer-belly, and starving the intellect.

    And, as far as I am aware, I am not encuraging corrupt FIFA power-brokers, or indeed the likes of John Delaney.

    The most hilarious version of this fantasy, features two clubs in Glasgow, who both use the same beer sponsor. And the fans detest each other immensely. It is a form of identification of lack of critical faculties. Both sets are in acute set of under-development. So, for the benefit of humanity, I will venture into the viewpoint that is unspeakable in our media driven age.

    We have the freedom to opt out. Even if we are instructed relentlessly to participate. The teachings of Viktor Frankl are particularly instructive in this regard.

    We each have the freedom to choose a different path from that presented to us.

    The freedom to find truth in our lives, and in our relationships with other people. We will make our societies stonger as a result of it.

    I wish you all a peaceful Christmas, with time to get to know those closer to you, and to be better connected to them in case they need you in the coming year.

    • Wills

      ….ditto deco.

    • Sideshow Bob


      The Queens Celtic and Pope´s O´Rangers use the same shirt sponsor by mutual agreement. Such was the sheer hatred between the groups of supporters that when a brand appeared on one team´s shirt, that brand´s sales among the other team´s supporters nose-dived immediately. So, the only way forward to make money from shirt sponsorship was for the two rivals to team up and have the same sponsor on both shirts at the same time.

      Not the first time, nor the last, that cognitive dissonance has been used to make money!

  3. Colm MacDonncha

    So how come none of the banksters got an eight year ban? Or jail? We have the right to opt out of engaging with football,but unfortunately those of us working are paying the price of electing gombeen men to run the country for their fat cat cronies.

    I asked our twelve year old who was playing fifa 16 on his playstation why he didn’t go out to kick a ball around with the neighbouring kids. ‘Nah’he says, ‘I’ll stick with the real thing here….’

    • SMOKEY

      Too damn funny that. Out of the mouths of babes. Really good. Next time, unplug the thing and send him out. Period. We have to do it all of the time here, 8 and 9 years of age, dont want them getting fat and lazy. Looking back on my own childhood its no wonder I lift weights and jog and stationary recumbent cycle at least 5 times a week. I should be dead with the diet I consumed until my mid twenties! As for exersize? Head banging at band practice and lots of chasing young girls with sweet perfume, but it caught up to me eventually and I fight it daily. Oh, and maybe the endless amount of booze and bbq had something to do with it too……..Merry Christmas to all on this blog and of course to our host who only lost the plot and threatened us once in over 10 years. I would have banned me along time ago. Merry Christmas David to you and your family, and thanks for indulging us wannabes on this side of the screen.

  4. Deco

    There is also a similarity, with respect to over-arrogance, with respect to the sub-prime debacle, and the version of dishonest pretence, that nobody would get found out.

    And indeed something similar, again with respect to real estate mania in Ireland in 2005/2006.

    Ponzi-scheme asset price speculation bubbles seem to be sustained for years, on self re-inforcing feedback loop of ever larger schemes of aggrandizement and glory hunting.

    With low interest rates (thank you, Jean Claude), fiddled GDP accounts (thanks Suds and the boys in GSucks), and all sorts of incentives for real estate speculation (the norm since the 1990s), an oversized proportion of the societal capital base gest squandered.

    Since the real estate crash, we have seen similar type disasters in the hydrocarbon space, and in mining (on the back of the PRC having it’s very own real estate boom).

    What can we do when the leadership keeps directing policy making in direction of such nonsense ? The entire system is now making bigger and more idiotic system level gambles.


    The only irish banker who went the USA languishes in prison. Seanie and Fingers played it cute. Nollaig shona gach duine.

  6. survivalist

    Why is it that people who are at the very top of their businesses can make such a mess of things and why do so many go along with it?

    Is this a joke? Profits at the 5 largest US banks have doubled in the years after the GFC than were achieved in the years prior. From 25 billion 2002-2008 to 41 billion 2009-2014. They have made out like bandits BECAUSE the regulation worked exactly as it is intended to.

    Are the only options that we are allowed to consider really a failure of regulation,just incompetence or again over-confidence?

    In reality the only possible explanations there can be are chance, necessity or design.

    Only a limited number of special cases will believe it is necessity, all the worlds media has devoted every effort t at ensuring that design wont even be considered. And so we are expected to believe that it was a matter of chance.

    The claim of over-confidence is nothing more than a description of the psychological state of the ‘bosses’. But it was in fact a well founded confidence because of chance….no, necessity….no again…design then…BINGO! (oh wait that’s chance again)

  7. StephenKenny

    The obsession with this FIFA thing is rather perplexing, I mean why is everyone suddenly claiming to be surprised by it? This sort of corruption is rampant in all sports where there’s a lot of money involved. Of course, on the one hand there’s clearly the issue of the 2018 World Cup in Russia, that the US/UK are desperately trying to get cancelled, but on the other is the fact the the newspapers, TV, and radio in these countries have become so sadly pathetic, useless, and sleazy.

    While the media and politicians are swelled with righteous indignation about a few million in FIFA ‘enticements’, they, along with their legal systems, strenuously cover up and blatantly support the hundreds of billions (hundreds of billions each in both the US & UK alone) of ‘bonuses’ given to the financial services sector from tax payer funds.

    What’s even more interesting, are the so-called ‘anti-bribery’ laws in the EU. It’s absolutely fine for a bank or broker to spend any amount of money in entertaining potential clients, as long as the intention is to win some work. This can run into hundreds of thousands of dollars each, per event (New York and London can be expensive, if you know the wrong places). I’ve yet to hear any credible reasons that mean winning the World Cup for your country is different to winning a huge bond issue for your company, when both involve ‘incentivising’ the decision makers in the ways we’ve seen.

  8. McCawber

    Firstly – David buy yourself a GPS device and dump the maps.
    Secondly – Where there is a lot of money there is a lot of corruption.
    That is an indisputable fact of life and it doesn’t take a genius to figure it out.
    So look around the world and you can see the unbridled corruption in plain view. Look for cocky overpaid men and women (don’t be fooled by David’s mostly men comment, it’s true now but it will change in time)
    Follow the Money.

    David you can help to stop some of the corruption.
    Shine the torch light on things like financial spread betting and why it should be curtailed initially and perhaps eliminated.
    Explain the risks, who are the winners and losers.
    Most importantly explain how it should be done to minimise damage.
    Eg restrict the number of trades per hour, restrict the leverage available/allowed, ban automatic trades.

  9. michaelcoughlan

    Happy christmas to all.

  10. mike flannelly

    Irish are 2015 Failures at shouting STOP. Nobody should ever apologise for the state again. As Bill Black put it – Bankers and politicians have NAMES.

    The following are my own opinions.

    Ego needs and self-actualisation needs are never fully satisfied. Irish Bankers, health care unions, media and politicians needs are never fully satisfied.Their increase of appetite grows by what they feed on.

    For Bankers it is about abusing the customer to the maximum until someone shouts stop. Bonus payments and golden pensions are also what they feed on.
    Justification and financial logic is never required as they are over confident that NO economist, politician, or Irish newspaper will shout STOP.
    Core questions will not be asked.
    Q1. After 2009 Irish land banks were written down by 90%, house values were written down by 55% and apt values were written down by 65%. Because 2003 to 2009 bankers are STILL our proudest bankers we need to know what METHOD did they use for valuing the debt on land banks, houses and apts from 2006 to 2009?
    Q2. Did Irish bankers earning up to 2 million a year carry out an asset quality review before declaring that their banks were solvent before the bank guarantee?
    Q3. Did Irish bankers earning up to 2 million a year use “true and fair override” when declaring that their banks were solvent before the bank guarantee?
    Q4. How in gods name does a “blank cheque” variable rate for bankers meet the needs and objectives of Irish bank customers? Why are the Irish Consumer Protection Commission NOT doing their job for Irish bank customers? Why are Consumer Laws not being enforced in Ireland ?
    Q5. Why did the Irish central bank and Irish politicians not negotiate/demand a 30bn for 25yrs @ 0% esm fund for restructuring overvalued mortgage debt? That was their duty of care. Instead michael noonan is rushing firesales of Irish property below build costs during a social housing crisis.

    A 2013 OECD report told us that the state pension system lacks transparency. The economic management council of school teachers that deferred the Irish bankers reform have also deferred Irish pension reform.
    In Ireland we have more than one million non secure workers that have no private pension who are levied and taxed to pay lump sums and pension payments above the contributory pension for select citizens with secure employment that are NOT based on contributions.
    Is this practice unconstitutional ?

    A 2014 OECD Health report told us that Ireland have 50% more nurses per thousand population than the UK. The UK have 8.4 nurses per 1000 population serving 2.8 beds and Ireland have 12.6 nurses per 1000 population delivering the same amount of beds.
    In Ireland we leave very sick old people on trolleys because Irish health care unions say we need more nurses. I would have thought that we need improved systems and more beds. No justification is demanded from Irish health care unions for not putting the needs of sick people before their own needs.

    For 2016 we need Irish Patriotic economists, politicians and journalists that can shout STOP when we have economic and social problems that ARE solveable.
    All our social housing,mortgage arrears and pension problems HAVE solutions that might not suit the over confident ECB,Irish bankers or Irish politicians but DO meet the greater Irish public good.

    Perhaps deferring the ego needs and golden pension needs of bankers and politicians while doing the right thing for the greater public good is the only solution that we ever had.

  11. The answer to your question, Mike is the same as my first post.
    Corruption reigns.
    The only solution is a thorough cleansing from top to bottom.
    It is a revolutionary action needed.
    Nobody will achieve a solution until as was said. ” they are a den of vipers and by

  12. The answer to your question, Mike is the same as my first post.
    Corruption reigns.
    The only solution is a thorough cleansing from top to bottom.
    It is a revolutionary action needed.
    Nobody will achieve a solution until as was said. ” they are a den of vipers and by God I will root them out”


      Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, (bringing his fist down on the table) I will rout you out!
      From the original minutes of the Philadelphia committee of citizens sent to meet with President Jackson (February 1834), according to Andrew Jackson and the Bank of the United States (1928) by Stan V. Henkels – online PDF

  13. mike flannelly

    Corruption Rules if 2016 Irish politicians choose to talk plastic patriotic blarney about 1913 and 1916, but yet completely ignore the abuses of their OWN time. This is a time where borrowers of grossly overvalued mortgage debt are being hounded to death and offered no way out of financial anxiety.
    Politicians that caused a social housing crisis and homeless crisis are forcing firesales of property that should have been restructured.Sick old people are treated like pawns by a health system that puts the needs of the customer last and the health unions first.
    In a recent interview on Ray Darcys radio one show Bob Geldof stated that “WE ALL KNEW” in the 70′s the church were abusing children and we did nothing. NOBODY SHOUTED STOP.

    In 2016 we want our soccer players to be smart, work hard and have good movement for each other. We want defenders to defend and strikers to make great runs to score. We want martin o neil and roy keane to spot opposition dangers and weaknesses.

    We also want our economists, journalists and politicians to shout STOP to the bankers abuse, health care abuse and pension abuse.
    How or why in a transparent 2016 Ireland,do we make our sickest children rely on charitable donations while golden pensions are RINGFENCED for politicians, bankers and civil servants.

    We ALL have a duty of care to shout STOP.

  14. “We ALL have a duty of care to shout STOP.”

    True enough. It will not happen until the people take to the streets as those we thought might say something are deafeningly silent.

    David is quiet so I lose hope anything meaningful will come from these columns.

    People thrown on the street or without food will be yet another economic statistic. But then statistics lie and are manipulated. The US with 48-50 million on food stamps is a sign of economic recovery to him as they do not count as under/unemployed.

    Acting is his preferred field and that is what he is best at. Writing is a close second. Economically I deem him a failure when it comes to doing anything worthwhile other than making a brilliant living for himself and family. He is a very talented person.

    Happy New Year. It is the North Island tomorrow.

  15. mike flannelly

    I think David is a nice man. He is also a very nice economist. I think that in 2003 he was a different David and a different economist. He mentioned that houses at ten times the average wage were a confidence trick.
    He acknoweledged that mortgage debt was going way beyond “Real Value Debt” in 2003 Ireland.
    Since 2009 there has been a lot of “mental health damage” and financial health damage done to Irish families by the central bank, Irish banks and politicians that are ignoring the “False Value Debt” that needed to be restructured by Irish Banks.

    In soccer defenders need to defend and when you have mortgage arrears, FORCED firesales, suicides, homelessness, a social housing problem plus go through the worst economic crisis of our history, THEN YOU REALLY NEED YOUR STAR ECONOMIST TO COME OFF THE BENCH, stand up to stitch up politics and DEMAND SOLUTIONS that are for the greater public good.

    An economist needs to offer and demand economic SOLUTIONS. Not soft talk.
    Im alright Jack is no good for ALL our children.
    A nice economist is no good to you when you are in the trenches.

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