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Bailout Referendum, what way would you vote?

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    #62
    Scofflaw
    Registered Users Posts: 23,283 ✭✭✭✭Scofflaw


    Kumejima wrote: »
    But morally you don't have a problem with it being socialised onto irish taxpayers?


    You're not happy to discomfit hundreds of millions of our "European partners" who are meant to have responsibilities towards us in exchange for relinquishing decision making to them , but you're happy to have the 1.8 million taxpayers here pay this burden for generations to come?

    there must be something I'm missing here

    Possibly you missed the point of the question, which contained no statement that loading the debt onto Irish taxpayers was right. The question was: if loading the debt of Irish banks onto Irish taxpayers is wrong, how is loading it onto non-Irish taxpayers right?

    cordially,
    Scofflaw


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    #63
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    Permabear wrote: »
    This post had been deleted.

    The people had long since lost all confidence in them. They were clinging on to power by a thread and the IMF bailout was almost a parting shot from them, one last nail in the coffin of our economy before we finally managed to wrench the hammer from their grasp.

    You seem oblivious to the fact that many of these bondholders are entities such as pension funds. If you burn them, yes, you do burn ordinary people—namely those who have invested their money for retirement.

    You choose to invest, you take a risk. Simple as that. It is not the state's responsibility to compensate you.
    Teetotalers, my rear end. The Irish people are not innocent parties here. They voted eagerly for all the policies that led to the boom and bust.

    True to an extent. The corruption, the fraud, the incompetence was very well hidden from them. Hell, even the feckin' REGULATOR didn't know about Seanie's antics.


    Sure—give Brussels the two fingers, tell them that you and Pearse and Gerry aren't giving a red cent to these "speculators." Tell the IMF and EU to f*** off, and see what happens then. :rolleyes:

    I never said we didn't need a bailout for the nation's finances. I did say that banking debts are a separate issue and are not the government's responsibility. Once again, private debt is private. What part of this are you failing to understand from my part? :confused:

    If I as a businessman f*cked up, broke the law, and committed what is more or less large scale fraud with my company's money, should the company be bailed out? Even if a huge number of the Irish population are shareholders, should it be bailed out?

    No?
    Then what makes a bank any different?

    It may have escaped your attention that €50 billion of the bailout is going toward our public finances; otherwise the state would have run out of money in the middle of this year.

    I already said that we should differentiate.
    And yet our government guaranteed those same banks. The IMF didn't do that, the EU didn't do that—the Irish government made that decision, on what Eamon Gilmore is fond of calling "that fateful night of September 30th, 2008." That changes the whole picture.

    And as I've already said, in my view every action taken by our previous government after recession was declared was absolutely criminal. We should be investigating these people for corruption and bringing them before the courts instead of following their poisonous policies and giving them golden handshakes. Overturn the guarantee. It was undertaken without a mandate and without justification.
    I'd certainly love if we had a more liberal government that drew a stronger line between public debt and private debt. But we don't. We have a statist government presiding over a corporatist system, and so events such as this should come as no surprise.

    Why exactly? Again, if someone running a business OTHER than a bank went under, would the state bail them out?


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    #64
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    later10 wrote: »
    No matter what type of assisance is provided to Ireland, bondholders will have to be repaid. In my opinion, the best way to address this issue is not by defaulting, but by having a Euro debt agency to buy up bank bonds on the secondary market and engaging in a maturity swap with the Irish Government. I don't even think that bondholders need to be brought into the room.

    The bailout, as it stands is unacceptable. That doesn't have anything, in itself, to do with bondholders. It's another issue.

    WHY?
    *They* invested *their* money of *their* own free will. I did not. You did not. Why should you or I pay for their mistakes?


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    #65
    Chucky the tree
    Closed Accounts Posts: 19,341 ✭✭✭✭Chucky the tree


    We'll renegoiate it the interest I feel. I've still yet to see anyone come up with suggestions how we'll run the country if we burn the bondholders and reject the bailout. I really hope we don't go for a referendum on it, I don't have much faith in the Irish electorate doing the right thing.


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    #66
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    Scofflaw wrote: »
    Possibly you missed the point of the question, which contained no statement that loading the debt onto Irish taxpayers was right. The question was: if loading the debt of Irish banks onto Irish taxpayers is wrong, how is loading it onto non-Irish taxpayers right?

    cordially,
    Scofflaw

    How about loading it on to the people who actually owe it and leaving everyone else out of the whole situation?

    How about those institutions who owe money either pay it back or go bankrupt, just as any other sector of society does when it can't meet its debts?


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    #67
    Chucky the tree
    Closed Accounts Posts: 19,341 ✭✭✭✭Chucky the tree


    hatrickpatrick wrote: »
    True to an extent. The corruption, the fraud, the incompetence was very well hidden from them. Hell, even the feckin' REGULATOR didn't know about Seanie's antics.


    Well hidden? :pac: This was the party that gave us Charlie Haughey. Bertie was Minister for Finance under Haughey. In 2006 admitted to getting a "loan" of £39k, which at the tie he hadn't paid back or paid any interest on. Everyone knew how corrupt and bent FF and Bertie were in 2007, people just didn't give a toss because they had money to go on two holidays and had enough money to buy themselves a nice new house.


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    #68
    Mister men
    Closed Accounts Posts: 2,487 ✭✭✭Mister men


    I'd vote no as a matter of principle. I'm ready and prepered to take the pain for a few years so we can become the rulers of our own fate once again.


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    #69
    steelcityblues
    Registered Users Posts: 4,630 ✭✭✭steelcityblues


    Would vote NO

    Only people who don't understand how a banking system is meant to work in a democratic society would vote yes in a referendum like this!


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    #70
    cast_iron
    Registered Users Posts: 2,454 ✭✭✭cast_iron


    Scofflaw wrote: »
    Possibly you missed the point of the question, which contained no statement that loading the debt onto Irish taxpayers was right. The question was: if loading the debt of Irish banks onto Irish taxpayers is wrong, how is loading it onto non-Irish taxpayers right?
    Your original question didn't really imply what you are asking here.

    Of course it makes no sense for it to be wrong for us to accept the Irish bank debt, but okay for the Europeans to accept it.

    But as regards loading non-Irish taxpayers with Irish bank debt (the original question), it was the non- Irish banks that recklessly lent to the Irish banks....

    In that sense, I won't be losing sleep over it.


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    #71
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    cast_iron wrote: »
    But as regards loading non-Irish taxpayers with Irish bank debt (the original question), it was the non- Irish banks that recklessly lent to the Irish banks....

    In that sense, I won't be losing sleep over it.

    This is precisely the point I have been trying to make, which Scoffy is scoffing* at. Their investment, their choice, their debt, their responsibility. End of story.

    *Sorry Scofflaw, I just couldn't resist >_>


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    #72
    Scofflaw
    Registered Users Posts: 23,283 ✭✭✭✭Scofflaw


    cast_iron wrote: »
    Your original question didn't really imply what you are asking here.

    Of course it makes no sense for it to be wrong for us to accept the Irish bank debt, but okay for the Europeans to accept it.

    But as regards loading non-Irish taxpayers with Irish bank debt (the original question), it was the non- Irish banks that recklessly lent to the Irish banks....

    In that sense, I won't be losing sleep over it.
    hatrickpatrick wrote:
    This is precisely the point I have been trying to make, which Scoffy is scoffing* at. Their investment, their choice, their debt, their responsibility. End of story.

    *Sorry Scofflaw, I just couldn't resist >_>

    No problem - however, both of you are, I think, missing the points I made.

    First, the money didn't come from "European banks" - it came from outside the eurozone. The amount of money poured into Irish domestic banks is recorded by the Central Bank according to three classifications of origin - Irish, eurozone, and 'rest of world'. The figures are here - an Excel spreadsheet giving monthly totals for the banks' balance sheets. You can see for yourselves where the money came from that poured into our banks.

    So, if the eurozone didn't pour money into our banks, sticking them on the hook for our banks' debts isn't some kind of payback - they had very little to do with them.

    The second point is that the original bank debt has been turned into sovereign debt. The month end before the Guarantee was put in place in September 2008, our banks had the following outstanding amounts of bonds:

    Ireland|Eurozone|Rest of World
    €27.1bn|€17.3bn|€73.7bn

    and owed the ECB €20.6bn.

    The month after the Guarantee ended, our banks had the following instead:

    Ireland|Eurozone|Rest of World
    €34.8bn|€10.4bn|€23.4bn

    and owed the ECB €85.7bn.

    At the end of last year, it looked like this (the current position is slightly worse, and complicated by the fact that the covered banks have just borrowed €17bn off each other):

    Ireland|Eurozone|Rest of World|ECB
    €33.3bn|€10.1bn|€20.6bn|€94.6bn

    So what we've done there is paid off the banks' debts to foreign investors (€7bn to the eurozone, €53bn to the rest of the world) by borrowing from the ECB. The banks have borrowed yet more from the ECB to cover the outflow of deposits (again, primarily 'rest of world').

    The bad news is that borrowing from the ECB requires collateral - good collateral - and the banks have been giving the ECB Irish government guaranteed promissory notes as collateral. The debt run up at the ECB is therefore, in effect, sovereign debt - defaulting on it requires sovereign default.

    There's only one way to turn that sovereign debt back into private bank debt - the banks have to pay back the ECB and release the sovereign collateral it holds, by borrowing money from someone who is prepared to take non-sovereign collateral instead. That's either the markets - who currently won't lend to the Irish banks - or the Irish Central Bank, whose rates are stiffer than the ECB's (worse collateral = higher rates). However, the Irish banks are already into the Central Bank for €51bn - and in any case, if they stiff the Central Bank, they're stiffing the taxpayer.

    At this stage, then, there's only at most €30bn of foreign-held debt in the Irish banks. And a good chunk of that will be either government guaranteed (so defaulting on it = sovereign default) or secured (so defaulting on it = seizure of collateral).

    Sorry - got carried away there. The basic point is simple - the eurozone didn't lend Irish banks a lot of money, but people are suggesting it's morally right to get them to soak up the losses, while the 'rest of world' bondholders, who did lend the majority of the money to our banks, have already been paid back in full almost entirely.

    In other words, the "non-Irish taxpayers" who we want to load with Irish bank debt are not the "non-Irish lenders" who lent to the Irish banks. That seems to me to mean there is no moral argument for it - it's an immoral action attractive only on the basis that we have a better practical chance of loading our banks' debts onto eurozone taxpayers than we do of loading them onto US and UK taxpayers.

    cordially,
    Scofflaw


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    #73
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    later10 wrote: »
    No matter what type of assisance is provided to Ireland, bondholders will have to be repaid. In my opinion, the best way to address this issue is not by defaulting, but by having a Euro debt agency to buy up bank bonds on the secondary market and engaging in a maturity swap with the Irish Government. I don't even think that bondholders need to be brought into the room. .
    If I understand your proposal correctly, the debt agency pays off the bond holders over a short term and then we pay this debt agency over the longer term. Is that correct?


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    #74
    RichardAnd
    Registered Users Posts: 3,630 ✭✭✭RichardAnd


    Chucky the tree wrote: »
    Well hidden? :pac: This was the party that gave us Charlie Haughey. Bertie was Minister for Finance under Haughey. In 2006 admitted to getting a "loan" of £39k, which at the tie he hadn't paid back or paid any interest on. Everyone knew how corrupt and bent FF and Bertie were in 2007, people just didn't give a toss because they had money to go on two holidays and had enough money to buy themselves a nice new house.


    Agreed. FF, for all their failings, were surprisingly honest about their dishonesty :D

    YEar after year, we'd hear about the dodgey races, the scandals, the chancer antics and general smart arse behaviour yet FF always manged to get into power once again. I can only postulate that the reason for their sucess was that they perfectly represent Irish society with its corruption, lazyness and general lack of ability.

    IReland is a funny country, individually people can be honest and hardworking but there is someone about Irish people en mass that really doesn't stand to us. But hey, that's just the way things are :(


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    #75
    dan_d
    Closed Accounts Posts: 2,819 ✭✭✭dan_d


    I'd vote yes.
    No exact reasons other than a vague idea that it's not just as simple as "burn the bondholders" or "default on everything".....
    I'd rather find that out with a steady stream of income from the EU, than find it out while cut off from any income.
    We're too small (and apparently too stupid) to do this by ourselves.
    I would however like to see a system implemented whereby every 6 months a breakdown of the Gov spending by dept, (divided up so that you can see what each percentage of their overall budget each dept is spending on what) and then repayments on this bailout is either published in the papers, or dropped in our doors.
    As each day goes past I find I am less and less comfortable with the idea of taxes all going into a central pot, from which (it appears), anyone can help themselves at will, with no need to account to the taxpayer for anything.


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    #76
    kenrr
    Closed Accounts Posts: 42 ✭kenrr


    I find it somewhat disappointing that usually this sort of discussion soon concentrates on the 'burn-the-evil-French/German-bondholders' concept.

    It's been well established by Scofflaw and others that the amount of debt reduction achieved by burning eurozone (mainly French/German) bondholders would be very small in relation to the overall debt problem. In other words totally irrelevant as to whether or not to we default and/or whether the EU/IMF package is fair or unfair.

    It's also a question of whether or not we are still a developed country that abides by the rule of law or whether we degenerate into a second rate banana republic that is going to arbitrarily confiscate assets belonging to overseas bondholders. If we are to continue with the rule of law then we have to burn depositors and senior bondholders equally. Irish depositors, Irish bondholders and Irish taxpayers (as shareholders and unsecured bondholders in the banks) will suffer by far the most from the burning. Government does not have the 80bn or whatever that would be needed to reimburse Irish private depositors up to 100K therefore depositors would have to accept equity in restructured banks and may get paid back in 10 years or so.

    If we don't like the EU/IMF package then we don't have to draw down the loan. On a pro rata basis, out of the 67.5bn that might be borrowed, 27.5bn is for the banks and 40bn for tiding us over the budget deficit problem. Drawing down the 27.5bn for the banks will cost about 1.5bn a year in interest ... hardly enough of a sum to cause us to default ... and certainly much cheaper than Govt trying to borrow 80bn or whatever to reimburse domestic depositors.

    I also think that the media over-exaggerate the EU fear of contagion if bondholders are burned ... the effect on French/German banks would be minimal. Probably what is more of concern for the EU is that it is expected to help out members who are in trouble. If bondholders are burned then depositors are equally burned and Ireland's banking system falls into chaos ... the EU do not want to be put in the position of having to find the very large sums required to fund the reimbursement of depositors and to fund the recapitalisation of the banking system. If Ireland wants to go that route on its own against the advice of the EU then Ireland will have to suffer the extreme pain of that course of action on its own.


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    #77
    ixtlan
    Registered Users Posts: 1,209 ✭✭✭ixtlan


    later10 wrote: »
    I don't have a crystal ball, and this is all very much a discussion on probability, but notwithstanding the IMF's agreement with the Eurozone, it has to be said that the IMF has never turned down a request for assistance and I do not think they would reject an application for external assistance by Ireland in the event of talks with Frankfurt and Brussells breaking down.

    I think that is true but... you are being somewhat disingenuous here or maybe you don't understand the IMF. Before the IMF came to town there were discussions about 30% salary cuts in public service pay, massive cuts in social welfare, hospital closings, etc etc. What we are seeing while widely called "savage" is nothing like this. Why? Because we are operating under an EU/IMF bailout where the EU is providing the majority of the funding and taking the majority of the risk. An IMF-only bailout would find headline-makers rather perplexed as they sought to find terms to outdo savage/draconian by several orders of magnitude.

    look at what Latvia had to do with an IMF-only bailout...

    Ix.


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    #78
    Permabear
    Closed Accounts Posts: 39,022 ✭✭✭✭Permabear


    This post has been deleted.


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    #79
    ei.sdraob
    Closed Accounts Posts: 9,376 ✭✭✭ei.sdraob


    Permabear wrote: »
    This post had been deleted.

    While I hate the sentence "what done is done, time to move one" I agree with you here

    BUT

    few weeks ago we paid out 750 million to Anglo bondholders who where not under the guarantee, there was no reason to pay them. Yet we did.


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    #80
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    kenrr wrote: »
    If we don't like the EU/IMF package then we don't have to draw down the loan. On a pro rata basis, out of the 67.5bn that might be borrowed, 27.5bn is for the banks and 40bn for tiding us over the budget deficit problem. Drawing down the 27.5bn for the banks will cost about 1.5bn a year in interest ... hardly enough of a sum to cause us to default ... and certainly much cheaper than Govt trying to borrow 80bn or whatever to reimburse domestic depositors.
    The stipulation is actually that 35 billion is to go into the banks so that's about 2 billion a year. Alan Dukes has said another 15 billion will probably need to go into the banks bringing it up about 3 billion a year, and he's been a defender of the viability of Anglo in the past so he's probably being optimistic here. And that's just the banking debt; it doesn't take into account the extra debt we've run up propping up the failed banks to date.


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    #81
    kenrr
    Closed Accounts Posts: 42 ✭kenrr


    SkepticOne wrote: »
    The stipulation is actually that 35 billion is to go into the banks so that's about 2 billion a year. Alan Dukes has said another 15 billion will probably need to go into the banks bringing it up about 3 billion a year, and he's been a defender of the viability of Anglo in the past so he's probably being optimistic here. And that's just the banking debt; it doesn't take into account the extra debt we've run up propping up the failed banks to date.
    Out of the 85bn package it's 50bn for the deficit; 10bn immediate for the banks and 25bn contingency for the banks. The amount actually borrowed will be 67.5bn which on a pro rata basis (rounding off) is 40bn borrowed from the EU/IMF for the deficit and 27.5bn borrowed from the EU/IMF for the banks. What we're talking about is the EU/IMF package ... no way will borrowing 27.5bn for the banks at 5.8% make the difference between default or not default. Anyone can make all sorts of hypothetical pessimistic projections on debt levels by adding together every number they can think of but that is not relevant to the current EU/IMF package.

    Dukes is talking about an overall figure for re-capitalising the banks in order to set up a viable Irish domestic banking system and expects that eventually a return would be received on some of that funding. I don't necessarily believe entirely what he says but it's a benchmark to measure the populist media-soundbite doom&gloomers against.


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    #82
    kenrr
    Closed Accounts Posts: 42 ✭kenrr


    ei.sdraob wrote: »
    While I hate the sentence "what done is done, time to move one" I agree with you here

    BUT

    few weeks ago we paid out 750 million to Anglo bondholders who where not under the guarantee, there was no reason to pay them. Yet we did.
    Under the law as it currently stands, there was no alternative but to pay them. Are we a banana republic that is going to arbitrarily say we are not going to pay or are we a developed country that thrived on international trade and investment because of our good reputation for upholding the rule of law? As far as I can see there's no political party that is proposing to introduce legislation to change the law to arbitrarily burn bondholders?


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    #83
    ei.sdraob
    Closed Accounts Posts: 9,376 ✭✭✭ei.sdraob


    kenrr wrote: »
    Under the law as it currently stands, there was no alternative but to pay them. Are we a banana republic that is going to arbitrarily say we are not going to pay or are we a developed country that thrived on international trade and investment because of our good reputation for upholding the rule of law? As far as I can see there's no political party that is proposing to introduce legislation to change the law to arbitrarily burn bondholders?

    They found time to pass laws about Dog Breeding for gods sake, you think they would have found time to pass a law that would have saved at least 750 million?


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    #84
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    kenrr wrote: »
    Out of the 85bn package it's 50bn for the deficit; 10bn immediate for the banks and 25bn contingency for the banks. The amount actually borrowed will be 67.5bn which on a pro rata basis (rounding off) is 40bn borrowed from the EU/IMF for the deficit and 27.5bn borrowed from the EU/IMF for the banks. What we're talking about is the EU/IMF package ... no way will borrowing 27.5bn for the banks at 5.8% make the difference between default or not default. Anyone can make all sorts of hypothetical pessimistic projections on debt levels by adding together every number they can think of but that is not relevant to the current EU/IMF package.
    The bottom line is that in order to obtain the 67.5 billion loan we have to commit 35 billion to the banks. You can say that the the x amount has to come from here and y has to come from there but it all adds up to 35 billion and in reality it doesn't matter where it comes from. 35 billion is the amount those who are lending us the money require us to put into the banks as a condition of the loan. The rest is just spin.
    Dukes is talking about an overall figure for re-capitalising the banks in order to set up a viable Irish domestic banking system and expects that eventually a return would be received on some of that funding. I don't necessarily believe entirely what he says but it's a benchmark to measure the populist media-soundbite doom&gloomers against.
    Sorry, are you trying to refute Duke's belief that it will take another 15 billion on top of the 35 we're already commited to? Do you believe it is going to be less? If so shouldn't you be providing some evidence to support your view? It is hard to make out what your point is here.


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    #85
    later12
    Closed Accounts Posts: 11,299 ✭✭✭✭later12


    SkepticOne wrote: »
    If I understand your proposal correctly, the debt agency pays off the bond holders over a short term and then we pay this debt agency over the longer term. Is that correct?

    Essentially yes. The European debt agency would buy up these bonds at their currently discounted rates on the secondary market where the headline issue is no longer relevant (hence the rising yield bids); many of these bonds have switched hands maybe four or five times over the past 18 months. These bonds are losing their value so a discount is already there to be got instead of paying back the headline rate and it can all be done without defaulting.

    What would then happen is that these bonds would be exchanged for longer maturity bonds in Dublin. In theory progressive write downs could occur pending European growth rates. But it would be a painful payback nevertheless, there is no easy way out of this mess.

    Realistically, the scheme would have to exist in line with European sovereign bonds for it to be a success.


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    #86
    Laminations
    Registered Users Posts: 4,693 ✭✭✭Laminations


    Permabear wrote: »
    This post had been deleted.

    Well if it emerges that the guarantee was secured on the basis of false or misleading information, then we should have every right to renege on it. If I ask you for a hand 'moving some boxes' and you agree, I can't expect you to stick with your promise when you arive to my warehouse to find it filled with 'raiders of the lost ark' proportions of crates and boxes.


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    #87
    Noreen1
    Closed Accounts Posts: 1,654 ✭✭✭Noreen1


    Laminations wrote: »
    Well if it emerges that the guarantee was secured on the basis of false or misleading information, then we should have every right to renege on it. If I ask you for a hand 'moving some boxes' and you agree, I can't expect you to stick with your promise when you arive to my warehouse to find it filled with 'raiders of the lost ark' proportions of crates and boxes.

    +1.
    Add the fact that the Government had a pencil-thin majority, achieved primarily by denying the people their democratic right to representation in three (eventually reduced to two) constituencies - and said Guarantee would appear to have very shaky foundations....


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    #88
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    Scofflaw wrote: »
    Sorry - got carried away there. The basic point is simple - the eurozone didn't lend Irish banks a lot of money, but people are suggesting it's morally right to get them to soak up the losses, while the 'rest of world' bondholders, who did lend the majority of the money to our banks, have already been paid back in full almost entirely.

    I think you're missing the point I'm trying to make here, so I'll try and spell it out. Not trying to be offensive here, just want to make this very frank and blunt:

    These loans were given out to specific entities, by specific entities.
    NOBODY except those specific entities should be even remotely involved in paying them back.

    It doesn't matter if it is European or International bondholders who are owed money. The point isn't who the money is owed to, it's who OWES the money. Banks - private institutions - owe that money. Not the public purse.

    Are you honestly arguing that taking these loans into public money was a good idea? Are you saying it's "morally" ok for Irish taxpayers to get utterly screwed over loans they did not choose to take out, so that people who chose to give out loans to others who couldn't pay them back, do not pay for their mistakes?


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    #89
    Laminations
    Registered Users Posts: 4,693 ✭✭✭Laminations


    hatrickpatrick, I can guess his response:

    They are the states responsibility because the government took on the debt.

    So the governmnt of the day could sign us up to giving away our first borns and according to some we'd have to just live with it and 'honour' the deal. This deal isn't too removed from sacrificing our children.

    Also the government guaranteed and took over banks under false pretenses, with misleading information and inaccurate stress tests


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    #90
    hatrickpatrick
    Registered Users Posts: 17,797 ✭✭✭✭hatrickpatrick


    Laminations wrote: »
    hatrickpatrick, I can guess his response:

    They are the states responsibility because the government took on the debt.

    So the governmnt of the day could sign us up to giving away our first borns and according to some we'd have to just live with it and 'honour' the deal. This deal isn't too removed from sacrificing our children.

    Also the government guaranteed and took over banks under false pretenses, with misleading information and inaccurate stress tests

    Point is, what I'm asking Scoffy is whether he agrees that taking on the debt was the right thing to do.
    He seems to believe that it's morally acceptable to have an innocent party pay for someone else's debt just because the actual debtor is "too important" to be allowed to go bankrupt.

    All I'm asking is, are we or are we not agreed that if one entity or individual incurs debts they cannot pay, it is absolutely nobody's responsibility but their to pay it back. Bondholders lose out? Banks fault, not ours. OR their own fault for making foolish investments. Point is, at no point whatsoever should an ordinary citizen be regarded as an appropriate "sacrifice" to just dump the debt on. Oh, it's ok if people starve, as long as gamblers don't have to pay the price for making a bad call.


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    #91
    Scofflaw
    Registered Users Posts: 23,283 ✭✭✭✭Scofflaw


    hatrickpatrick wrote: »
    Point is, what I'm asking Scoffy is whether he agrees that taking on the debt was the right thing to do.
    He seems to believe that it's morally acceptable to have an innocent party pay for someone else's debt just because the actual debtor is "too important" to be allowed to go bankrupt.

    I have no idea where you get that idea, though. That I don't think it's right to try to stick European taxpayers with the bill for private banks hardly suggests I think it's right to stick Irish taxpayers with the bill either.

    Of the two innocent parties, on the other hand, I'd certainly consider the Irish taxpayer less innocent, because European taxpayers didn't vote in a succession of Fianna Fáil governments.
    hatrickpatrick wrote: »
    All I'm asking is, are we or are we not agreed that if one entity or individual incurs debts they cannot pay, it is absolutely nobody's responsibility but their to pay it back. Bondholders lose out? Banks fault, not ours. OR their own fault for making foolish investments. Point is, at no point whatsoever should an ordinary citizen be regarded as an appropriate "sacrifice" to just dump the debt on. Oh, it's ok if people starve, as long as gamblers don't have to pay the price for making a bad call.

    It's inaccurate to characterise them as gamblers, though. Again, that's a way of making ourselves feel better about the business, just as blaming it on "foreign banks" is. It's an attempt to muster righteous indignation so that we can bring ourselves to screw other innocents because we got screwed.

    The fact of the matter, though, is that we (collectively) did screw up. We (collectively) voted for governments that promised an easy ride, and who used the cheap credit tap to buy votes without any thought for the possible downside risks of doing so. Did that make us morally responsible for the banks' debts? Certainly not - this is a representative democracy, and we're entitled to expect certain minimum levels of competence and attention to public interest from our representatives. Did it leave us in a position where practically speaking we were faced with a choice between propping up Irish banks and letting them fall down, tearing huge holes in the Irish economic fabric? Yes it certainly did. Sure, we could have done without Anglo, whose inclusion in the guarantee remains an act either of deepest skullduggery or grotesque incompetence, but we'd still have been facing a huge bill, if not quite as huge.

    So there we are - we weren't directly responsible for allowing the banks to build great towering piles of debt in our back yard, and we're not morally responsible for shovelling them away until they're no longer a danger - but on the other hand, they're in our back yard, and they're very definitely not anybody else's responsibility, so there's little choice but to shovel. Possibly if we whinge loudly enough, we can persuade some of our neighbours that they should give us a bit of a digout, but frankly, if they do, it's going to be on the basis that we're self-evidently useless muppets.

    cordially,
    Scofflaw


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