Posted tagged ‘NAMA’

Vox pop

October 20, 2009

Over the last three days I overheard two things that, in different ways, seemed to tell something about the times we’re in. The common element is banking.

First, overheard on Grafton Street, Dublin – teenager begging at the side of the road with the shout: ‘Any spare change for NAMA?’ [On second thoughts, maybe he really was collecting for NAMA…]

The second occasion was in a London cafe, where two middle aged ladies were in conversation as follows:

‘Do you remember our French neighbour, Monsieur Chouin?’
‘Yes, indeed.’
‘Do you remember I told you he had voted for the BNP [British National Party, see my previous post] at the European elections?’
‘Yes, terrible.’
‘Yesterday he told me it was all a big mistake, he thought it means “Banque Nationale de Paris”.’

Leaving aside the total weirdness of that exchange, I could not help wondering what would now be considered the lesser evil at the ballot box, a banker or a right wing extremist. I’d say it would be a close call.

Stand down the mob

October 13, 2009

In a press release issued yesterday, the Services, Industrial, Professional and Technical Union (SIPTU) criticised what it described as the ‘Government policy of imposing the entire burden of fiscal adjustment on working people and the less well-off, while the wealthy are insulated from any requirement to contribute at all.’ All of this serves as a prelude to their campaign to bring about a change of government policy, to reverse public service cuts and to protect public sector pay.

But for the moment I am not concerned with the justifiability or otherwise of any SIPTU campaign. Indeed, I am not particularly meaning to have a go at SIPTU specifically, but I am wondering about the rhetoric which has become more and more common and of which the quote above is fairly typical. Alongside this are the increasingly wild campaigns of personal criticism directed against property developers, bankers, politicians and businesspeople. While I would certainly not wish to defend those who have abused their positions, wealth or power, we have reached the point at which lynch mobs are being sent out the moment a politician is seen in the vicinity of Dublin airport.

If we are to achieve a speedy recovery from our current problems, we need to stop this hysteria. The government may be good or bad (and I have’t been too impressed of late), but it certainly doesn’t have a policy of ‘imposing the entire burden’ on working people. NAMA may be right or wrong, but its purpose is not to protect miscreant bankers – it is to allow the financial system to provide the necessary service to those who need finance. Politicians may all too often have abused the system, but it is not a sign of national decay and corruption if a minister goes on a business trip to London and stays in a hotel rather than sleep in a doorway. PAYE taxpayers may well be destined to pay more tax to help restore public finances, but some of these are quite well off, and those who are well off are being asked to pay more. Not every senior public figure has behaved like Rody Molloy. And while John O’Donoghue did, in my opinion, need to step down because his expenses really were way out of line, even he should have been given an opportunity to state his case before somebody started fixing the rope to the tree.

We have got ourselves into a condition of frenzy, and this is doing us no good at all. Maybe the next campaign should be one to combat righteous indignation and to restore a sense of proportion to our state of mind. We need to think and act rationally at this point, and to stop baying for blood all the time. And we need to be careful that we do not create an atmosphere in which entrepreneurship and wealth creation are seen as wicked, because once we have got to that point we are throttling our best hopes of recovery.

Frankly, it’s time to calm down.


September 10, 2009

As Ireland struggles to correct the problems with its banking sector, the proposal by the government to establish the National Asset Management Agency (NAMA) has become not just a policy measure but a football being kicked around rather aggressively by the various players, and those who think they are or should be players. Wrapped into this is a feeling of popular anger, sustained occasionally by populist opportunism, at the behaviour of bankers.

For me at least, the intervention of 46 academic economists in the debate didn’t add much. From the article in the Irish Times explaining the background to this intervention, it appears that the key motivation was to provide a platform for economists as a kind of pressure group, which is in my view a doubtful use of academic status, and adds to the impression that the whole discussion has been compromised by the colourful array of vested interests of the participants.

It is hard to have confidence in the quality (as distinct from quantity) of public debate on this issue. But as this may be the biggest decision this country needs to make, that may be serious. It is time to take out of the mix the crescendo of judgement and condemnation and posturing, and to focus on national interest and needs. If we need to feel good about the personal treatment of bankers and property developers, let us find another forum for that. Having a viable banking system is a critical need for the economy.