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

micosoft

K-9 wrote: »

Tbh I'm wondering why you left FG out of that...

True. It's a spectrum of awfulness. But ultimately if all the parties are doing this who is to blame other than a fairly consistent electorate.

ancapailldorcha

Armabelle, please read the charter before posting again as this is a forum for serious discussion.

armabelle

ancapailldorcha wrote: »

Armabelle, please read the charter before posting again as this is a forum for serious discussion.

I don't understand what you mean?

djpbarry

KingBrian2 wrote: »

At least we in Ireland can be flexible with our tax laws, employment policies and housing schemes. We don't rely totally on selling to larger countries.

Because Ireland can borrow money from said larger countries?

KingBrian2 wrote: »

By creating a market at home we don't need to constantly worry about the risks of global turmoil. Oil prices go up and they impact all of Europe and the world whereas we can devote our little island to more cost effective methods to shelter us from the harm of global capitalism.

This all sounds tremendously isolationist . We already tried that – it was an unmitigated disaster.

It’s perfectly possible to have an open, globally-focussed economy while also being prudent and prepared for shocks – the two are not mutually exclusive. The problem was that (as has already been pointed out) Ireland decided to funnel all her wealth into property, property and more property and the funding of public services was heavily based on said property market, which ultimately left the country dangerously exposed to any kind of external shock.

KingBrian2

djpbarry wrote: »

Because Ireland can borrow money from said larger countries?
This all sounds tremendously isolationist . We already tried that – it was an unmitigated disaster.

It’s perfectly possible to have an open, globally-focussed economy while also being prudent and prepared for shocks – the two are not mutually exclusive. The problem was that (as has already been pointed out) Ireland decided to funnel all her wealth into property, property and more property and the funding of public services was heavily based on said property market, which ultimately left the country dangerously exposed to any kind of external shock.

Their are positives and negatives to free trade and as we see with Trump doing so well in America free trade can have bad consequences on a country's people the same with places like Britain, Germany and elsewhere. Trade has been very good for Ireland although the emphasise on growing the Irish economy has been neglected.

smurgen

micosoft wrote: »

Fine what? They all went bankrupt. You can't fine someone who has no money.

As an aside the Shareholders of all the banks bar Bank of Ireland (who were more prudent then others despite Shane Ross* and others berating them to be more like Anglo Irish Bank) lost EVERYTHING when the banks were nationalised. Ten's of thousands of Shareholders ranging from retired professionals with 100k to Pension funds lost their shirt. They were the beneficial owners and they were punished harshly.

As for the property developers (which I think you mean) - the vast majority were made bankrupt. Many committed suicide. Some who had assets outside of Ireland which were not as badly affected might make a comeback.

We have to end this toxic narrative that a small group of people created the crisis and that it was a banking crisis. The banking element is a small part of the crisis - borrowing to pay for day to day Government spending is a far bigger story. The state relied on extraordinary bonanza from the overheated building sector to fund this. Essentially the elected Government funded day to day expenditure by getting it's citizens to borrow it in the form of mortgages and pay stamp duty. When the music stopped this collapsed.

It took the electorate three Fianna Fail administrations to wreck the economy by demanding lots services without any idea how we pay for it. It looks like once again the Electorate are going to vote for another Ponzi scheme.

The buck stops with an electorate many of whom don't care where the money comes from. Going back to your question - was anyone punished for the crash. They were. The Irish Electorate was punished heavily for what it did. The real question is have the electorate learnt anything. Sadly the answer seems to be - very little. And false narratives like the above don't help.

*And this is typical of the Irish Electorate. I know what I consider to be educated people voting for Shane Ross because "he shines a light on the incompetence in Government" when in actual fact he was one of the worst. Lauding Sean Fitzpatrick back in the day and suggesting he run the Central Bank. Denigrating the Court of Bank of Ireland because they were not making "gangbuster" profits like Fingletons Irish Nationwide. This man represents the worst of that cheerleading yet seems utterly unaccountable for what he put in print before the crisis. The electorate needs to be more discerning on who they vote for and the forth estate better at critiquing this.

There's only one problem with your entire narrative. We elect a government, this is democracy and we take the blame when they make bad decisions.however, when this government makes massive decisions overnight that have not face a referendum this is not democracy.

micosoft

smurgen wrote: »

There's only one problem with your entire narrative. We elect a government, this is democracy and we take the blame when they make bad decisions.however, when this government makes massive decisions overnight that have not face a referendum this is not democracy.

And the problem with your narrative is you seem to believe that one "simple" decision reversed and Ireland would have been fine which is simply not true. There were no "good decisions" at the point - just bad and even worse.

The electorate had wrecked the economy by selling their votes for three elections in a row. That is when they had their democratic choice. When the car-crash of an economy crashed there was no time to ask the patient if they wanted their leg amputated above or below the knee. The damage was already long done before that fateful night and the false narrative that this substantially created the hole in our national accounts is simply untrue.

You also need to understand we have a representative democracy. There is no provision in this country (or any other for that matter) for referendum on executive decisions. Half the problem in this country is that most of the electorate don't understand how our representative democracy is constitutionally defined.

micosoft

KingBrian2 wrote: »

The Germans have had historically a problem with hyperinflation.

No. They had one specific case of Hyper Inflation during the Weimer republic due to specific conditions at the time. Outside of this Germany has historically had one of the harder currencies in the world.

KingBrian2 wrote: »

While they produce many goods many of the debtor nations are not always able to buy German made goods. Right now the German economy is doing well with a surplus. It is not so good that all the competitors within Europe have inferior goods and services and as we see with the migration crisis word gets around that Germany is the best place to be. This puts pressure on the entire German welfare state.

I suspect many other countries would disagree with that and Germany receives plenty of competition from other EU states. Cliched tbh. Large parts of east Germany continue to lag behind the performance of other parts of Germany and the EU average. It has similar levels of immigration as the UK and less than Spain, the US etc. Migration is a global concern.

KingBrian2 wrote: »

At least we in Ireland can be flexible with our tax laws, employment policies and housing schemes. We don't rely totally on selling to larger countries. It is domestic demand we need to build up at least that is how I see it. By creating a market at home we don't need to constantly worry about the risks of global turmoil. Oil prices go up and they impact all of Europe and the world whereas we can devote our little island to more cost effective methods to shelter us from the harm of global capitalism.

No country relies totally on selling to larger countries. That said as a small country with an open economy we will always have a higher trading proportion as we cannot make every good we seek. Not even the US is self sufficient or even close to it.

What do you mean by building up domestic demand? You mean Supply perhaps? Increasing domestic demand by decreasing VAT or Income Tax will only increase outflows from the country. How would you increase domestic supply? Should we start building cars? We import all our Oil so how does that not impact this "domestic" economy of ours? Can Irish people make the same things without oil that other people use oil to make? This is incoherent tbh and would only make us permanently poor. It's called Juche by the North Koreans and there is a good reason nobody has adopted this.

TBH you might want to read up on a economics 101 as you are not using the right words to describe what you mean which would make meaningful discussion possible.

micosoft

psinno wrote: »

Real economies are great and all but building an economy on selling stuff to other countries on credit might not be a sustainable thing. Each party involved needs to be doing due diligence not just blaming the person with too much debt when things end in tears. It applies equally to people blaming the bank for lending them too much money.

I'm not getting this. Are you suggesting that countries buy things from each other? So the Irish Government put in an order for 100,000 BMW's on credit?

If somebody decides they want to buy a car made in Germany by borrowing 30k from their bank in Ireland how exactly is the "party" i.e. the German State/BMW (not sure you've thought this through tbh) meant to do due diligence?
- Should Germany state that there is a limit of goods to export to Ireland?
- Would it do quotas on specific types of goods? e.g. 10,000 Golfs, 15000 Passets
- How would we prevent a grey market of goods sold to a third country coming back in?
- How do we avoid hyperinflation of goods already imported as they are in short supply.
- What exactly does this solve (aside from crashing the world economy and sending us back a few hundred years). The bank/Government debt was not incurred by countries selling things to each other. The debts were incurred by Governments borrowing money from overseas to pay for day to day spending. The impact of foreign goods bought on credit had negligible impact on the crisis.

Another myth created to avoid the problem of a electorate who don't want to pay for the services they receive from the state.

Here's a bizzaro idea that might work though. Tax and charge the citizens of a state for the goods and services they receive from the state. Say charge people for consuming water. State doesn't have to rely on borrowing money from the markets to subsidise peoples lifestyles. If they have cash left over they can buy imports from that.

smurgen

micosoft wrote: »

And the problem with your narrative is you seem to believe that one "simple" decision reversed and Ireland would have been fine which is simply not true. There were no "good decisions" at the point - just bad and even worse.

The electorate had wrecked the economy by selling their votes for three elections in a row. That is when they had their democratic choice. When the car-crash of an economy crashed there was no time to ask the patient if they wanted their leg amputated above or below the knee. The damage was already long done before that fateful night and the false narrative that this substantially created the hole in our national accounts is simply untrue.

You also need to understand we have a representative democracy. There is no provision in this country (or any other for that matter) for referendum on executive decisions. Half the problem in this country is that most of the electorate don't understand how our representative democracy is constitutionally defined.

The bank guarantee and the bank bailout were not carefully considered.anglo should have been left fail.I do not think the situation at anglo was caused by normal irish punters. I also never said the reversing the decision would have fixed everything.

VincePP

I wonder if Armabelle would tell us what country she/he comes from.

No matter what country it is there will be history of some sort of economic issues that in hindsight could have been avoided.

In Ireland many people have to share responsibility for the crisis.

Yes, the banks lent too much money, but people signed the forms and in many cases threatened to move banks if they were not given loans.

Yes property became over priced. Caused by builder contractors, electricians, plasterers, carpenters etc etc demanding huge salaries.

Yes people bought the over priced property because 100% of people who wanted a job, had a job. Taxes were low, wages were increasing and many thought that things were just going to continue. Remember the last real recession was in the mid-late eighties, so only those over 50 had any REAL experience of a serious downturn.

One day, one person asked for the loan they gave the bank back. Then that bank asked for their loan to another bank back. That bank had bought property or lent it for a property purchase, the property had to be sold - multiply that scenario by the hundreds of thousands all over the world. Wealth was based on property - property tanked, spending tanked, shares tanked, wealth disappeared.



Try to find one person to blame? Not a chance.

Some countries will make a scape goat of a few to please the left wing sheep. But in reality its human behaviour ti blame and we're all human.

VincePP

smurgen wrote: »

The bank guarantee and the bank bailout were not carefully considered.anglo should have been left fail.I do not think the situation at anglo was caused by normal irish punters. I also never said the reversing the decision would have fixed everything.

The bank bailout will probably cost about 28-30bn at the end of the day.
Deduct the additional interest rates savings on the national debt because the country did nit default and you could make an argument that the net cost will be in the 15bn range.

That's about 4 months of tax.

In the overall scheme of things, it probably was right. Yes it could have been better, but i reckon if the country defaulted it would have been an awful lot worse.

micosoft

smurgen wrote: »

The bank guarantee and the bank bailout were not carefully considered.anglo should have been left fail.I do not think the situation at anglo was caused by normal irish punters. I also never said the reversing the decision would have fixed everything.

And somehow putting it up for referendum would have made it "carefully considered". As I have repeatedly said Irish Punters created the conditions for Anglo Irish by voting in FF three times in a row based on giveaway budgets.

A change in that decision on the night would have made a very small difference to the impact of the crisis. It might have made it worse.

The biggest by a magnitude was the Irish Electorates decision to base day to day spending on our health service and social welfare on borrowings and unsustainable property taxes. When they dried up we had a crisis.

My fundamental point is that the "stab in the back" myth is leading us to creating the exact same problems in the future. The electorate can't walk away from it's responsibility and accountability for the mess it created and is creating again with the latest Dail by simply voting for whoever promises the most.

djpbarry

Eugene Norman wrote: »

Ireland didn't have high borrowing costs during the boom, private debt was increasing enormously but no economist said much about that.

Well, that's not true. Plenty of noises we're being made about Ireland's over-heated property market - people just didn't want to know.

micosoft

djpbarry wrote: »

Well, that's not true. Plenty of noises we're being made about Ireland's over-heated property market - people just didn't want to know.

Agreed. And if you think it through - the Government was relying on taxes (stamp duty) based on private borrowings (Mortgages) to fund day to day expenditure. It was a FF inspired Ponzi scheme. And plenty warned at the time that this was the case. Good to see the Ponzi scheme still in full flow over the last few days.

djpbarry

micosoft wrote: »

Good to see the Ponzi scheme still in full flow over the last few days.

Yep - any hope I had that lessons might have been learned is quickly evaporating.

Although it does illustrate why having a bogeyman to blame for the recent economic crisis is counter-productive, as it absolves society of responsibility for their actions, and therefore nothing is learned, and leaves them free to repeat their past mistakes.

hmmm

micosoft wrote: »

A change in that decision on the night would have made a very small difference to the impact of the crisis. It might have made it worse.

Agreed. If we had left Anglo go bust it would have led to a different type of crisis, and we've no idea how that would have gone. I suspect we'd have ended up like Iceland, which is still in a mess, but no-one can say for certain. It would almost certainly have led to a failure of the entire Irish banking system, the seizure of any deposits and who knows what else.

This is all largely moot - the electorate will vote FF back into power in the next election, it's obvious that as a country we lack the maturity that other countries have.