Was anyone ever held accountable in Ireland for the 2008 crisis?

armabelle · 13-04-2016 04:23PM #1

I am not Irish so don't know much about the crisis here in 2008. I did read that Ireland was one of the worse off countries as a result of the crisis. I was just wondering if anyone was actually persecuted or held accountable for the loss to the economy after the crisis?

mahoganygas · 13-04-2016 04:31PM

The main problem with holding people accountable is that there was no single overriding reason why Ireland entered a recession in this period.

There certainly were some domestic issues and blame can be laid at the door of politicians, property speculators and bankers.

But by far the largest factors which affected the Irish economy were as a result of foreign influences.
A lot of blame is placed at the sub-prime mortgage fiasco in US banks. This is seen as the catalyst that started the downfall of the global economy. This week Goldman Sachs admitted that they were wrong in how they packaged and sold mortgage backed and asset backed securities to investors. They paid billions in fines (around $5bn I think?) but to this day no individual has been found guilty of wrongdoing and imprisoned.

armabelle · 13-04-2016 05:00PM

mahoganygas wrote: »

The main problem with holding people accountable is that there was no single overriding reason why Ireland entered a recession in this period.

There certainly were some domestic issues and blame can be laid at the door of politicians, property speculators and bankers.

So by saying this you are saying that there are no "people" to blame, just institutions? How can that be? Surely people set up institutions. If a building falls down, those that built it are responsible. Similarly, if I buy a toaster and it breaks after a week, the company would be giving me a new one so I am not out of pocket. Isn't the loss to the Irish economy and everyone in it as a result of the crisis so big that there must be someone that is held accountable?

punisher5112 · 13-04-2016 05:02PM

Bankers that caused most and developers along with corrupt politicians....

Nobody has had to answer or seen any jail time.

Most are back making a fortune again anyway.

armabelle · 13-04-2016 05:08PM

punisher5112 wrote: »

Bankers that caused most and developers along with corrupt politicians....

Nobody has had to answer or seen any jail time.

Most are back making a fortune again anyway.

Really? That is awful. You Irish must be placid and peaceful people for this to happen and nobody go down. Was there a protest of some kind ever in Ireland about this when it happened? Did people even want justice?

mahoganygas · 13-04-2016 05:15PM

armabelle wrote: »

So by saying this you are saying that there are no "people" to blame, just institutions? How can that be? Surely people set up institutions. If a building falls down, those that built it are responsible. Similarly, if I buy a toaster and it breaks after a week, the company would be giving me a new one so I am not out of pocket. Isn't the loss to the Irish economy and everyone in it as a result of the crisis so big that there must be someone that is held accountable?

Well in those example you have given both the building company and the toaster manufacturer are institutions.
Who do you hold accountable? The individual bricklayer who placed a brick incorrectly? His supervisor? The Director of the company who wasn’t on site for the entirety of the building project? The owners of the building company?

You can see that it’s difficult to assign blame to any single individual. Also what are you blaming people for? “The 2008 crisis” is a very broad term. What factors caused the crisis and which factors just seemed to make it worse? Therein lies the problem with holding people accountable.

punisher5112 wrote: »

Bankers that caused most and developers along with corrupt politicians....

Nobody has had to answer or seen any jail time.

Most are back making a fortune again anyway.

Again, to my point above:
Specifically which bank officials, property developers and politicians can you prove are guilty of specifically which crimes?

ballyargus · 13-04-2016 05:24PM

The people in general seem to have been held highly accountable, by their own government as well as those wonderful folks in the IMF and the EU

mahoganygas · 13-04-2016 05:25PM

armabelle wrote: »

Really? That is awful. You Irish must be placid and peaceful people for this to happen and nobody go down. Was there a protest of some kind ever in Ireland about this when it happened? Did people even want justice?

There has been huge upheaval in the past 8 years. Fiana Fail, the party in government at the time were kicked out of office in the 2011 General Election. They went from 71 seats to 20 seats.
They received the brunt of the blame.

Additionally there have been attempts made to prosecute directors of Anglo Irish Bank. These cases are ongoing.

The Financial Regulator has been turned on it's head and new laws have been introduced to ensure reckless lending behavior doesn't happen again at Irish Banks.

I wouldn't say that we are placid about it. There has been a lot of anger and hurt over the financial crisis. I think that one of the reasons that we appear placid is because the main causes of the collapse of the economy were because of external factors which we had little to no control over. Ireland is a very open small economy which means we are particularly susceptible to economic shocks if the economies of our main trading partners (UK, EU, US) start to suffer. Keep in mind that the 2008 financial crisis affected and still affects hundreds of countries around the globe.

Fr Tod Umptious · 13-04-2016 06:20PM

Three local factors that affected the crash were

Reckless lending by banks.
Reckless borrowing by consumers.
Over reliance on revenue from construction by the government at the expense of other parts of the economy.

None of the above are criminal but all are incompetent.

The FF government were punished in the 2011 election and since then the regulations around borrowing and lending have been tightened.

No one criminal action by an individual or individuals caused the crash.

KingBrian2 · 13-04-2016 06:29PM

Their is a trial ongoing of the leading bankers who are alleged to have committed fraud.

Godge · 13-04-2016 06:41PM

armabelle wrote: »

So by saying this you are saying that there are no "people" to blame, just institutions? How can that be? Surely people set up institutions. If a building falls down, those that built it are responsible. Similarly, if I buy a toaster and it breaks after a week, the company would be giving me a new one so I am not out of pocket. Isn't the loss to the Irish economy and everyone in it as a result of the crisis so big that there must be someone that is held accountable?

Your examples aren't great. The responsiblity doesn't necessarily lie with the builder or the manufacturer.

The building could fall down because of an earthquake.
You could have stuck a fork in the toaster.

We can say the banks failed, we can say government revenue collapsed. However, we need to understand how and why, before we can apportion blame. Then we need to establish whether it was avoidable, whether it was incompetence, or whether it was corrupt.

There is a certain narrative in Ireland among the protesting class that it was all the fault of corrupt bankers and politicians. Looking at it objectively, that hasn't been demonstrated to have been the case.

Fr Tod Umptious · 13-04-2016 09:15PM

Godge wrote: »

Your examples aren't great. The responsiblity doesn't necessarily lie with the builder or the manufacturer.

The building could fall down because of an earthquake.
You could have stuck a fork in the toaster.

We can say the banks failed, we can say government revenue collapsed. However, we need to understand how and why, before we can apportion blame. Then we need to establish whether it was avoidable, whether it was incompetence, or whether it was corrupt.

There is a certain narrative in Ireland among the protesting class that it was all the fault of corrupt bankers and politicians. Looking at it objectively, that hasn't been demonstrated to have been the case.

I think the actions of the government were certainly avoidable if you look at them in isolation.

But you cannot look at them in isolation.
Any sign of a pull back in public spending or any attempt to put a lid on an overheating economy would likely have resulted in an election loss.

As we have seen this year the Irish electorate are fickle, throw them a bone, like FF did mid campaign about water charges, and they will be all over it.

The public are not without blame in the whole bloddy mess.

armabelle · 13-04-2016 09:51PM

mahoganygas wrote: »

Well in those example you have given both the building company and the toaster manufacturer are institutions.
Who do you hold accountable? The individual bricklayer who placed a brick incorrectly? His supervisor? The Director of the company who wasn’t on site for the entirety of the building project? The owners of the building company?

You can see that it’s difficult to assign blame to any single individual. Also what are you blaming people for? “The 2008 crisis” is a very broad term. What factors caused the crisis and which factors just seemed to make it worse? Therein lies the problem with holding people accountable.

Again, to my point above:
Specifically which bank officials, property developers and politicians can you prove are guilty of specifically which crimes?

it is difficult but surely for something like this the builders and institution/s should be blamed and fined instead of the tax payer?

Fr Tod Umptious · 13-04-2016 09:57PM

armabelle wrote: »

it is difficult but surely for something like this the builders and institution/s should be blamed and fined instead of the tax payer?

But blamed and fined for what ?

What law did they break ?

Many a good person in the building/property trade lost their livelihood over their own reckless actions, but they did nothing illegal.

armabelle · 13-04-2016 09:57PM

Godge wrote: »

There is a certain narrative in Ireland among the protesting class that it was all the fault of corrupt bankers and politicians. Looking at it objectively, that hasn't been demonstrated to have been the case.

how so?

armabelle · 13-04-2016 09:59PM

Fr Tod Umptious wrote: »

But blamed and fined for what ?

What law did they break ?

Many a good person in the building/property trade lost their livelihood over their own reckless actions, but they did nothing illegal.

instead of answering that, allow me to ask you the question: what did the Irish citizens actually lose as a result of the crisis?

Fr Tod Umptious · 13-04-2016 10:18PM

armabelle wrote: »

instead of answering that, allow me to ask you the question: what did the Irish citizens actually lose as a result of the crisis?

A lot of Irish citizens lost a lot of different things.

Some lost their family homes, others lost their jobs, others lost their savings, others had income reduced due to increased taxes etc.

armabelle · 14-04-2016 07:51AM

Fr Tod Umptious wrote: »

A lot of Irish citizens lost a lot of different things.

Some lost their family homes, others lost their jobs, others lost their savings, others had income reduced due to increased taxes etc.

so if any one of these things had happened to you, wouldn't you feel as though a crime has been committed against you?

Fr Tod Umptious · 14-04-2016 08:09AM

armabelle wrote: »

so if any one of these things had happened to you, wouldn't you feel as though a crime has been committed against you?

No not at all.

People lost their homes because they had unsustainable mortgages, or used their homes as collateral for other loans.

People lost their jobs because the domestic economy, build on a construction bubble, collapsed.

People lost their savings because they invested them in investments that failed, bank shares, developments, global stocks for example.

And everyone ended up paying more tax because of the shortfall as a result of the property collapse.

None of the above happened due to specific criminal acts.

Yes bankers are on trial, but for causing the crash, because individuals and banks alone did not cause the crash.

armabelle · 14-04-2016 08:12AM

Fr Tod Umptious wrote: »

People lost their homes because they had unsustainable mortgages, or used their homes as collateral for other loans.

People lost their jobs because the domestic economy, build on a construction bubble, collapsed.

Oh ok, well then great... then there are really no victims in the crisis and it is a beautiful world.

Fr Tod Umptious · 14-04-2016 08:16AM

armabelle wrote: »

Oh ok, well then great... then there are really no victims in the crisis and it is a beautiful world.

I don't understand what you ate saying.

Rather than asking rhetorical questions why don't you tell us what your opinion is

El_Duderino 09 · 14-04-2016 08:22AM

It's too hard to quantify the damage done by each party. The banks packaging bad debt and selling than as good debt, was a problem. Some of it was irish, some was external.

How much of the blame lies with irish people's fundamental misunderstanding of economic cycles? Boom-bust. Everyone can't have a massive house and a holiday home. That's only for rich people and still everyone thought they could afford it.

In all the talk about the recession, never once have I heard the Irish people's role in it. Saving money went out the window. The only way to absolve the people of any blame is to compare them to children who were left unsupervised and they got into the drinks cabinet. Now they have the inevitable hangover and want someoneelse to be held accountable for their mistake.

It won't happen because people don't want to know who was responsible. Next time there's a few bob going around, the tradesman will be back out in his new Beemer and looking for property in the holiday destination of the day.

armabelle · 14-04-2016 08:23AM

Fr Tod Umptious wrote: »

I don't understand what you ate saying.

Rather than asking rhetorical questions why don't you tell us what your opinion is

What rhetorical question? I asked no question in my previous post, rhetorical or otherwise. I am glad that people weren't deceived by the institutions in Ireland and am glad that no crime was committed.

I never had an opinion which is why I wanted some more information. Generally speaking, if this happened in my country, I would feel like a crime had been committed against me because a crisis doesn't just happen... it is caused.

armabelle · 14-04-2016 08:24AM

Fr Tod Umptious wrote: »

I don't understand what you ate saying.

Rather than asking rhetorical questions why don't you tell us what your opinion is

have you seen this?

https://www.youtube.com/watch?v=fiCXsu_4BoA

armabelle · 14-04-2016 08:30AM

Fr Tod Umptious wrote: »

No not at all.

People lost their homes because they had unsustainable mortgages, or used their homes as collateral for other loans.

People lost their jobs because the domestic economy, build on a construction bubble, collapsed.

People lost their savings because they invested them in investments that failed, bank shares, developments, global stocks for example.

And everyone ended up paying more tax because of the shortfall as a result of the property collapse.

None of the above happened due to specific criminal acts.

Yes bankers are on trial, but for causing the crash, because individuals and banks alone did not cause the crash.

I actually came asking this question after reading this article

http://www.irishtimes.com/news/world/europe/conned-a-german-view-of-ireland-1.1454115

armabelle · 14-04-2016 08:32AM

El_Duderino 09 wrote: »

It's too hard to quantify the damage done by each party. The banks packaging bad debt and selling than as good debt, was a problem. Some of it was irish, some was external.

How much of the blame lies with irish people's fundamental misunderstanding of economic cycles? Boom-bust. Everyone can't have a massive house and a holiday home. That's only for rich people and still everyone thought they could afford it.

In all the talk about the recession, never once have I heard the Irish people's role in it. Saving money went out the window. The only way to absolve the people of any blame is to compare them to children who were left unsupervised and they got into the drinks cabinet. Now they have the inevitable hangover and want someoneelse to be held accountable for their mistake.

It won't happen because people don't want to know who was responsible. Next time there's a few bob going around, the tradesman will be back out in his new Beemer and looking for property in the holiday destination of the day.

so do you think people deserved what they got? I mean those kids with a hangover probably did don't you think?

armabelle · 14-04-2016 08:36AM

mahoganygas wrote: »

I wouldn't say that we are placid about it. There has been a lot of anger and hurt over the financial crisis.

Anger and hurt are emotions. You can be angry and placid or hurt and placid at the same time. I was just wondering what the publics reaction to it was at the time. Like did people protest or did they hold themselves accountable? I did not live in Ireland at the time so don't know.

Wanderer78 · 14-04-2016 08:40AM

Good to see you 're still asking questions about the crash op, I feel a lot of the real causes are being swept under the carpet, and we 're looking at it eventually happening all again. I don't think we 've learned much at all from it. I'd highly recommend the work of American economist Bill black regarding the criminal aspect of financial fraud. I think he hits the nail on the head.

El_Duderino 09 · 14-04-2016 08:47AM

armabelle wrote:

so do you think people deserved what they got? I mean those kids with a hangover probably did don't you think?

Are you happy to compare the nation to children?

We share responsibility. I don't know anything about blame or prison sentences. I think it's just silly talk. If we don't have an honest look at why it happened, we'll learn nothing.

More importantly, we have never had a discussion about what we should do next time there us money floating about. I'm going to be a complete heretic and suggest that next time there's money, we put some aside for a rainy day...

You don't trust the car salesman just because they said its a good deal. You don't trust an estate agent just because they said it's a good deal. Do you trust the credit salesman just because they said it's a good deal?

Wanderer78 · 14-04-2016 08:52AM

El_Duderino 09 wrote:

More importantly, we have never had a discussion about what we should do next time there us money floating about. I'm going to be a complete heretic and suggest that next time there's money, we put some aside for a rainy day...

I personally think we need a public banking system and fast to try protect ourselves from future problems within the private banking system. Rainy day funds are highly debated but I'd rather see it being placed into a public bank if it was created

oscarBravo · 14-04-2016 09:39AM

armabelle wrote: »

so if any one of these things had happened to you, wouldn't you feel as though a crime has been committed against you?

It doesn't matter whether or not you "feel" a crime has been committed - unless you can demonstrate that a law has been broken, and that there is sufficient evidence to secure a conviction, then there's not much point complaining that nobody has been punished for the alleged crime.

Was anyone ever held accountable in Ireland for the 2008 crisis?

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