Done in December

Dec 18th, 2010 | By | Category: Ireland

The New Zealander could not understand the air  of resignation amongst Irish people. ‘If this were France’, she said, ‘people would be on the streets rioting’.

She was probably right; there is a seeming infinite capacity for tolerating corruption, incompetence, deceit, cronyism, nepotism, and virtually every other vice achievable by those in political and financial life.  There is an arrogance amongst politicians towards ordinary people; a pretending amongst Government ministers that those who must now pay the bills do not understand the complexities of the problems.

At a weekend when office parties are getting into swing and when AIB staff are fighting to hold onto bonuses, despite their bank being insolvent, lines from Sebastian Faulks’, ‘A Week in December’ are apposite.  Faulks’ protagonists confront each other at a dinner party in London, and the analysis is of financial markets considerably more complex than those in Dublin, yet the principles of deceit, self-enrichment and offloading the burden to ordinary people, remain similar:

‘What happened,’ said Roger, ‘is that investment banks and hedge funds created ever more arcane instruments which they could flog to one another in a completely false market. Because it was over the counter, in private, the regulator couldn’t see it. Then they could sell an inverted iceberg of bets on the likelihood of the original instruments defaulting. They were able to account a notional profit on the balance sheet on all this Alice-in­-Wonderland crap and so pay themselves gargantuan bonuses.’

Other conversations along the table were dying out as people began to sense drama or blood.

Veals smiled thinly. ‘I’m afraid it’s rather more complicated than that.’

‘Do you know what?’ said Roger. ‘It really isn’t. It’s a fraud as old as markets themselves. The only difference is that it’s been done on a titanic scale. At the invitation of the politicians. Behind the backs of the regulators and with the dumb connivance of the auditors. And with the fatal misunderstanding of the ratings agencies.’

‘That’s a cute story,’ said Veals. ‘But financial life is more-‘

‘No, it isn’t,’ said Roger, his voice growing louder. ‘Do you know how high a million dollars in $100 bills would come up off the table, tightly packed? I’ll tell you. Four and a half inches. And do you know how far a trillion reaches?’

‘Yes. I can work it out.’ John Veals paused only for a moment.

The whole table was now watching and listening as his fabled mental arithmetic went to work. ‘Seventy-one miles.’

‘Correct,’ said Roger. ‘That’s how much has been misappro­priated or mislaid. And all of it will have to be paid back before the world can move on. Every inch of the tightly packed seventy ­one miles. Over a period of – how long would you say? Five years? Ten? And it won’t be paid back by people like you, John, you or the bankers, because I don’t suppose you pay tax, do you?’

‘I pay what I’m legally required to pay.’

‘I think we can take that as a no,’ said Roger. ‘And the mis­demeanours of the bankers will be paid for by millions of people in the real economy losing their jobs. And in paper money, the trillion will be repaid in higher tax on people who have no responsibility for its disappearance. And the little tossers in the investment banks who’ve put away their two and three and four million in bonuses each year over ten years … They’ll hang on to it all. And they of course will be the only ones who won’t pay back a coin. which is bloody odd when you come to think of it. Because really they ought to be in prison.’

”That’s enough, Roger,’ said Amanda.

‘Why, darling?’ said Roger, sitting back in his chair, rather red in the face. ‘Is there something fundamentally wrong with that analysis?’

An analysis of similar tone could have been written about Ireland, but nothing will be changed by a pliant people more concerned with whether a TD has helped someone get a council house than whether he is part of a party that has cost the country tens of billions.

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  1. I have to agree with your New Zealander although apathy about this seems to be world wide. Lots of moaning and not a lot of proactivity except in Iceland where a Mayor decided to construct a people’s budget and is now running for office. I can’t find the link but it’s on Unstranger’s blog. Very interesting. I admit though lots of my Irish bloggers just seem to berate the situation or move. I know of four families whose children are emigrating to Australia next year to get out of the rut and one ex blogger who even enquired about opening a bank account in Australia because he has reservations about the Euro. I don’t know what the solution is other than to highly regulate banks and make them accountable for their reckless investing. This just doesn’t seem to be happening.

  2. Sadly the public put the politicians in power, and the money people control them, and do the public understand whhat the politicos are saying.

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