The Establishment must wake up to the public’s anger
The jailing of three bankers is not enough — it’s still business as usual in Irish politics, writes Willie Kealy
IT’S just another dirty little story from the top echelons of banking, another tale of greed and corruption by men — and it is predominantly men — who forgot about the importance of the great responsibility entrusted to them and came to believe that it was they who were important.
Too important, they convinced themselves, to be bothered by the rules and regulations that applied to everyone else, and which they would be the first to insist must be rigorously applied to their long-suffering customers.
Willie McAteer, John Bowe and Denis Casey are all in jail now, starting their sentences of three and a half years or less for what Judge Martin Nolan called “a very serious crime”.
They’ll be out in no time, ready to resume their well rewarded retirements, like many of their former industry colleagues who have never, and will never, face the courts.
These men were part of a culture of greed, and there are few exceptions to culpability, if it is only for extreme incompetence and poor judgement in positions to which they were appointed to exercise good judgement and show ability well above a low bar of competence.
But in most instances we don’t know and we probably never will know the full story of what went wrong in the Irish banking system, because it is our public habit to poke a stick into the foetid mess only when the escaping stench is too much for even the long-suffering and tootolerant public to bear.
When the crash came we all paid for it, except those who had been most to blame. We bailed them out, the banks and the property speculators — as opposed to the bona fide developers and builders.
Which left us wondering: just who was running the country? It caused frustration, it caused anger and, worst of all, it caused despair.
It was the same kind of frustration, anger and despair that led the British people to vote for Brexit because they’d had it with the Establishment.
So they voted for a vague idea that was disingenuously sold to them by unscrupulous politicians, without thinking too much about the consequences.
In the United States right now, millions of ordinary people are turning to a demagogue without policies or principles, a vulgarian who speaks in bumper-sticker slogans with vague and extravagant promises about making America great again.
We might think that couldn’t happen here. But the Irish political Establishment, too, is so used to office, so accustomed to doing things the way they were always done that they have largely become allergic to fresh thinking or radical action.
Most of our elected representatives are like fire-fighters, always reacting to the latest crisis while proactive policies are viewed with suspicion.
Whether it is dealing with the banks or the housing crisis or the need to ensure a consistently good water supply, or whether it is making vultures, native and foreign, pay a fair taxation contribution, they speak in legalese, explaining in great detail why everything is “complex” and producing plausible-sounding excuses for doing nothing, including the old stand-by, the possibility that a solution “just might be unconstitutional”.
Fianna Fail recently proposed giving stronger powers to the Central Bank to help it persuade the banks to stop gouging their own customers.
This seemed to be what the majority of elected representatives in the Dail wanted, but the Central Bank said “no thanks,” which left us wondering again: just who is running the country?
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One prominent economist said this could lead to a conflict of interest, since it is the role of the Central Bank to make certain the banks stay solvent. (AIB has just turned in ¤1bn profit for six months).
But it is also the role of the Central Bank to police the banks — and surely taking them to task for fleecing the very people who bailed them out comes under that heading.
Michael Noonan, the man who encouraged Irish banks to help each other out (although in fairness, he hardly had the Anglo/Irish Life and Permanent fraud in mind), was dead set against the idea.
It might damage the chances of getting the best price for AIB when we eventually come to sell it; it might discourage foreign banks from coming here to introduce competition to the native banks, thus forcing them to lower their rates, which are currently up to 4pc higher than justified.
These are the same foreign banks that flocked to this country in the boom when they thought there was a quick profit to be picked up, and scarpered just as quickly when the downturn came.
Noonan had a better idea. Why not set up a committee to look into the matter, give it, say, six months to mull it all over and then report back? Unless they need more time, of course. (In six months the average variable mortgage holder will pay €700 above what they would pay at a commercially justifiable rate.)
This is the same old pie in the sky that lost Fine Gael the last election. And what of the collapse of the latest foreign-registered insurance company? After PMPA and Quinn Insurance and Setanta, wasn’t somebody supposed to be on the alert for this sort of thing so that ordinary people wouldn’t — again — have to pay out millions of euro?
We are fortunate that our political system does not allow someone like Donald Trump to just decide one day he will run for the top job. The Donald would never survive endless cumann meetings, years on the council, decades on the back benches before he could aspire to office — and that would just be as a junior minister. But throughout Europe we have seen the rise of extreme groupings, and in Britain Ukip would now be a junior government partner if they had our PR system rather than first-past-the-post.
Dull they may be, these Establishment types, set in their ways and, for now, incapable of seeing the danger posed by allowing the growth of frustration, anger and despair, not least because, one way or another, hundreds of thousands of bank customers are still bailing them out, long after the crisis has been deemed to have passed.
But for good or ill, they are our only line of defence against a descent into chaos. We have already seen the beginnings of an opportunity develop here for those only too happy to exploit anger, fear and frustration.
And if we can see that, it would be unforgivable to stand around like some latter-day Weimar administration and let it happen.