They haven’t gone away, you know, as Gerry Adams once chillingly reminded us, in a different but equally sinister context.
They haven’t gone away, those Anglo bondholders, those gamblers who took a punt on the worst bank in the world, while fully aware that they might lose their bet.
Our government bankrupted the country to pay off the senior bondholders in two banks that were little more than pyramid scams, even though neither Anglo-Irish Bank nor Irish Nationwide had any value to the economy at large. Both banks were nothing more than failed Ponzi schemes and yet the Irish State somehow felt it necessary to step in and take responsibility for their losses.
The decision to pump money into those two banks increased the national debt by €34 billion and it brought no return to the country at all, because it wasn’t a bank bailout. It’s not as if anyone thought, with a little time and help, the two banks might get back to profitable trading. They were dead, both of them, and therefore the cash injection paid for by you and me was not a bank bailout. There was never the slightest chance that these banks would be able to pay back our money.
These banks were dead. Deceased. These were ex-banks.
It was a bailout by the Irish taxpayer of the gamblers who had taken a chance on the Ponzi schemes calling themselves financial institutions. If the government had sent civil servants to stand outside every bookie shop in the country paying out on non-runners and Aston Villa victories it would have been exactly the same as what happened with Anglo and Irish Nationwide, but much cheaper.
What was worse is this. Most of the original bondholders had dumped their stakes, leaving sharks like Roman Abramovich to pick up the almost-worthless paper at a fraction of the face value and to demand full price from the Irish government under threat of legal action.
And guess what? The government paid the Russian oligarchs their 900% profit without a murmur, just as they’re proposing to do again, today, despite universal agreement that junior bondholders should not be rescued from their bad financial choices by tax money.
It’s coming at a bad time, this decision. The optics are not pretty. As we speak, homeless people are dying of cold on the streets of Dublin and Cork and Limerick and Galway and Waterford and Dundalk and all the rest of it while publicly-owned buildings lie idle.
How much would it cost to open these buildings, do them up to a basic standard, something better than sleeping in a laneway, with some heat and some food and some shelter?
Would it cost €10 million? I don’t know.
Would it cost €50 million? I don’t know.
Would it cost €100 million? Again I don’t know.
What I do know, however, is that the government is preparing to pay €280 million to unsecured Anglo bondholders, on behalf of a bank it should have no responsibility for, to people who should have no expectation of being looked after.
There’s the question for you: bondholders or homeless — who should we be looking after with the money our government takes from us in taxes?
Who comes first, financial speculators or poor Irish people? The answer to that will tell you if we built a successful republic or not.