Insider Stories from Iceland

The literature on the Icelandic crisis is growing.  While the report of the ‘Truth Commission’  is eagerly awaited, it is also very interesting to read insider accounts of the crisis.

I found Why Iceland?: How One of the World’s Smallest Countries Became the Meltdown’s Biggest Casualty by Asgeir Jonsson to be an excellent read.  Jonsson was the Chief Economist at Kaupthing Bank.

A new release is Frozen Assets: How I Lived Iceland’s Boom and Bust, which is written by Armann Thorvaldsson, a former CEO at Kaupthing in the UK.

While it is illuminating to read such insider accounts,  it is also important to recognise the inherent trade off:  such individuals have access to non-public information and can provide a unique perspective; however, by the same token, the interpretations offered in such books are not necessarily fully balanced.

Still, it would be very helpful if senior figures in the Irish banks provided such insider accounts of the boom and bust in the Irish banking system.

34 replies on “Insider Stories from Iceland”

@Philip Lane
It is high time we had a full scale investigation into all of our lenders, guaranteed and unguaranteed, foreign and Irish. By investigation I mean FBI style: wiretaps, surveillance, multiple arrests, heavy sentences to encourage witnesses to testify, more arrests and jailings. Treat Ireland’s rogue politicans (especially but not exclusively FF), bankers, developers and senior public servants as they really are: the Irish Mafia.
We should be aiming to jail 400 of them:
100 politicians, 100 developers, 100 bankers and 100 civil service, regulator, state agency, local government and semi-state employees.
If trade union leaders turn up too so be it.
The direct cost for NAMA is €65 Bn. So it will only be one jailing for every €160 million of criminality. This doesn’t include any further NAMA costs like demolitions or alterations.

The costs of our economic collapse have been immense and not just economic:
– great increase in suicide that has occurred and will continue
– rise in murder and random violence, burglary and vandalism
– marriage break-up and resulting blighting for ever of parents and children’s lives
– huge rise in racism (still to be really felt but I believe is inevitable)
– return of involuntary long-term unemployment and poverty traps
– immense mental and therefore physical stress on those who lost their jobs and are now threatened with losing their homes
– return of mass emigration
– immense damage to national confidence (except that of FF/developers/bankers/senior public servants/social partners, which is rock solid).

Not to mention the economic consequences:
– years of below trend growth
– probable long-term damage to living standards
– loss of human capital
– immense reputational damage
– huge increase in risk aversion and loss of entrepreneurial vigour

Would an overall cost of €100 BILLION for the devastation caused by the lending bubble be a fair estimate?

The government knew there were problems in Anglo since 2007. As shown by their approach to Anglo, the bank they fully control and that other bankers and FF TDs (as on the Marian Finucane show yesterday) blame for most of the problems, they are trying to preserve the culture of Irish banking not transform it. The TD bristled when Dan O’Brien confronted him about the lack of change in banking boards and personnel. He said words to the effect that: “So you want us to go into private institutions and remove the top 10 in each? It’s their own responsibility to change themselves.” {we could have bought AIB, BOI and Permanent TSB for €3BN before the government told the markets of their unstoppable desire to massively overpay for bank loans}.

This is just not credible. The government are in full control of Anglo, and they appointed seven internal candidates to top roles just this month.

The only way to break the grip of this mafia is to treat them like a mafia.
We need full investigations of the entire Irish banking sector now. To be preserving these corrupt institutions (and relying on their good faith through NAMA!) is simply evil.

@ E 65
Your pounding the keys hard at the moment.
I would question your use of ‘We’ and ‘Them’
A more tolerant analysis may end up leaving this polarised black and white and end up with shades of grey and an ‘Us’.

Expertise needs a critical component: usability.
Anyone called to, or summoned by the lord for that matter, to help the country in this situation has to be able to work with people (government) to improve the situation.


If I were to point to a decisive moment in the long debate on the NAMA legislation I would say it was just after the 46 issued their unprecedented letter on NAMA. This was followed by furious spinning by the NAMA lobby and the intervention of not one but two former FG leaders. Both Alan and Garret had a dreadfully flawed pedigree when it came to bank bailouts but it didn’t stop them intervening. Encouraged perhaps by former government colleague, former AIB chairman and fellow Jesuit product Peter Sutherland and in concert with other Jesuit products like Brian Lenihan and Eamon Ryan their intervention was crucial. This was not a Jesuit plot but it was perhaps a Jesuit educated one.

While Alan Bailout slagged off the FG plan Garret Bailout started a diversionary row over a reference in the letter by the 46 to the likely government deficit. In all the confusion the fact that a government scheme was being condemned by an unprecedented number of independent economists (it was cheered by banker and stockbroker economists) was lost. The media – having in general taken the side of FF/Developers/Bankers – moved on from the controversy as fast as they could. The letter by the 46 was rarely referred to thereafter.

Hearing political journalists referring worriedly to Greece and sovereign default and the difficulty of issuing more bonds indicates that many of the media have been captured by fabrications the government doesn’t believe in itself. I also fear that though they have been more vocal, many of the opposition, particularly Enda Kenny, have been captured too. Brendan Keenan says there has been no danger of sovereign default since the April budget. There is certainly little danger of it after the most recent budget. If there was why does FF refuse to cut the billions in pork spending identified by McCarthy, its tax breaks for the wealthy or to lower politicians remuneration to comparable countries? Politician’s expenses have only been cut 10%! In any case, if there is a default it will be because of the bank guarantee and NAMA. Our national debt was relatively low when we started this crisis, it took the genius of the blanket bank guarantee to cripple us.

While most of the opposition/media have been worrying about sovereign default and Greek bond spreads FF have been able to conduct their cover up with relatively little interference. Massive police investigations should have occurred in all of our property lenders – instead there were massive capital injections, and one or two bankers in Anglo, Nationwide and Irish Life are facing questions. For €65BN of criminality it really is the tiniest possible response. The opposition/media raised few questions about this and some are still unsure about an inquiry (sovereign default yadda yadda yadda). All the boards should have gone – instead almost all the boards stayed. All the top executives should have gone – instead they were promoted, even in state owned Anglo. Now NAMA will complete the final stage of the process.

By the time the bank inquiry gets under way – probably in a way that gives the opposition plenty of limelight but ensures that nothing really embarassing to the establishment emerges (sovereign default!) – the elite’s financial interests will have been saved at taxpayer expense.

It is a total disgrace and a shameful reflection on much of the opposition and the media. 2009 was the year of the cover up. Is it too much to hope for 2010 to be the year of relentless scrutiny? It’s your job.

On Enda Kenny, the news that George Lee was only allowed 10 minutes speaking time in the entire NAMA debate confirms a feeling I have long had. I have long felt that there was something half hearted about FG’s criticism of the government on NAMA and the banking cover up. I would have preferred an amended version of the FG plan but FG refused:
– to back their own plan
– to amend their plan to attract more academic support
– to back Labour’s plan or to negotiate a joint position

When NAMA goes wrong and the investigations into the banks charge a only a couple of people – and maybe put one in jail for a year – FF will not be slow to remind them of this. By keeping Alan Dukes in his post as party vice president and by refusing to vigourously rebut him or Garret Fitzgerald, Enda Kenny must share some of the blame for what has happened. Together with FG’s backing for the bank guarantee the party is likely to be tarred in the public mind as either fools or accomplices. Richard Bruton has great talents. Leo Varadkar and Alan Shatter did a lot of good work. George Lee was going well until he was gagged. But I feel that the FG leaders (past and present) club ordered them to look very busy but avoid going for the jugular.

Labour took the right approach on the guarantee and their alternative was hugely preferable to NAMA and was in line with the Swedish approach. I don’t know whether they offered to negotiate a joint approach with FG. Again I felt that they didn’t go for the jugular and in Dick Spring they had an ex-leader who if he didn’t endorse NAMA also didn’t condemn it.

The parliamentary debate on NAMA now looks more like a WWF match. There was lots parliamentary theatrics in the form of late nights but after all the discussion an almost unchanged, massively secretive NAMA was created – and hasn’t been much complained about since.

Finally, the NAMA debate shows that most of our politicians really aren’t interested in national policy. If they really cared they would have had a lot more to say. Sean Fleming, FF TD for Laois, has made more reported criticisms of NAMA than most of the opposition TDs. If TDs spend all their time with constituency queries it is their choice. Like the Catholic Hierarchy they are jealous of their power and won’t give any to the laity, even though it would make their own lives easier. They could have set up a comprehensive system of citizen advice centres during the boom and disbarred themselves from getting involved to the maximum extent. They chose not to. They work hard (and get paid massively) – but not as parliamentarians. Really they should be paid the same as clerical workers in the civil service with a lot of overtime. That’s not being unfair it’s just being accurate.

You were proved right but I think it’s even worse than that – the opposition seem to be intentionally pulling their punches right up to the present. The banking cover up and NAMA were opposed but not with much force. The major opposition were the academics which is why they attracted such vitriol. With Brendan Keenan stating and now Brian Lenihan happily confirming that there has been no danger of sovereign default/IMF since April the opposition’s collaboration looks worse and worse. They are now teetering on the brink of complicity.

The blind and the disabled are cut in the budget. At the same time Fingleton keeps all of his €27 Million pension for managing the private bank of the golden circle and handing the state a bill for €2 BILLION in the process. I expected a lot more from the opposition but that’s what Kenny and to a lesser extent Gilmore have chosen (perhaps the unions hope of a deal affected him).
The country is now financially safe but morally bankrupt.

Nama will end up being more divisive than the Government of Ireland Act 1920. However, because of its dirty little secrets and its not so dirty little secrets it will become the catalyst that will drive political change. Maybe we have to suffer a few more crucifixions before we wake up. There is only so much the people can take, at least that is where my money is.


Economists here are not proposing Capitalism as the solution to this crisis. Keynsians and Socialists, they have from the beginning tried to thwart freedom and restrict Capitalism. The outcome generally from this crisis will eventually be an emasculation of Parliamentary Democracy in favour of Oligarchy. An end to Capitalism in other words.

For the most part Ireland has elected governments of the Nationalist/Socialist hue. These governments believe in the State and the Church and persistently interfere in the economy. Fractional reserve lending so the banks can steal depositors money. A Central bank to print money so as to disguise the theft by the banks. Expansion of credit with no care as to the ramifications of busts for the general population Paternalism, patronage and the corrupt enriching of a parasitic clique. Ministers and other functionaries who seek bribes, jealous of the gains by private entrepreneurs. Trades unions which rob us of jobs. Priests that rob us of our intelligence. A Dail that will not legislate to end corruption on the one hand and demurs when it comes to chasing down the biggest crooks on the other. All this indicates abject failure and utter capitulation. This is because failure is all but guaranteed as a result of how the State is constituted and how Government works. Failure as an inability to understand what Freedom is and what free men need. The implication from this might be that this is willful mis-comprehension on the part of the people and that we as a nation distrust personal freedom per se. Otherwise surely we would elect men who espouse Freedom and Capitalism. Here is the crux of the matter. Until we truly know what freedom is and how it is arrived at we cannot object effectively to the Stateist and Collectivists who would control us.

Ireland ached for freedom from the English. Yet, in the nearly ninety years of the existence of this State our Professional, Clerical and Political masters have on several occasions brought the country to the brink of disaster through mis-management of the economy. Today, it appears the job might finally be nearing completion with Ireland about to consigned into debt peonage to foreigners once again.

The same fate lies in store for many nations small and large that have been caught up in the “Great De-leveraging” The United States is in peril like no other time in its history. As dangerous a predicament as the Civil War some say with the potential to sunder the Union?. In Latvia, a few short years after this small nations ecstatic escape from the clutches of vicious totalitarianism, they now face disaster. In each and every case freedom has been sacrificed by electorates suffering from collective delusion regarding the creation of wealth without the need for work. Delusions propagated by tricksters and abetted by those classes who would keep the population ignorant of Political Economy and the benefits of Capitalism.

We can save ourselves only by adopting and properly restoring the tenets of Capitalism and the elective restriction on the role of government to certain limited functions. The chicken/egg problem stems from the need to educate the population as to the benefits of a free Capitalist society. What is needed is an education system were Civics, Political Economy, Philosophy and Law together with the Arts and Sciences is taught in our schools to all our people. Such an education system will engender in a sufficient proportion of the population understanding of and facility in the ways of the Entrepreneur, the Capitalist and Work so as to ensure a dynamic, innovative and efficient society emerges; largely free from the predations of criminal gangsters, collectivists and other blackguards.

No where in this analysis is there any scope for the provision of unlimited tax money to private bankers that have squandered their depositors and bondholders funds. Institutions who behave in this manner must be subject to the outcome that Capitalism proscribes ie. Liquidation. It is still not too late to abandon this reckless plan.

The key difference is the Icelandic banks were nationalised and their managements thrown out. Some may yet face corruption charges.


The destruction of capital is still continuing and is pure theft.

The voters are too sheepish to take any action when both main political parties are in cahoots. Just as in the USA. The unifying forces at work are not clear, after all, they wouldn’t would they?,0,7842580,full.story

Supposedly a libertarian medico, he has ideas about disbanding public services that are not necessary!

On Monday, the 10th anniversary of the disastrous Time Warner-AOL merger announcement, the ex-CEO of Time Warner, Gerry Levin, termed it the worst deal of the decade.

Issuing a mea culpa today is easier because he has a lot more company for bad decisions .

It’s interesting how a CEO could be swiftly fired for accessing an escort site but risking a whole bank does not invite clear sanction.

Boeing fired a CEO for having an affair with one of the staff but in the US also, risking the ruination of a company is a different story.

For a period, chartered accountants were chairmen of AIB and BOI while a chartered accountant was the chief executive of Anglo Irish.

Accountants are expected to be more risk-averse than other professions and in the case of BoI, Laurence Crowley had specialised in insolvency.

In AIB, Lochlann Quinn’s background was in providing the financial expertise to build a very successful Irish company, Glen Dimplex.

Quinn was succeeded by lawyer Dermot Gleeson and at BoI, Crowley was succeeded by Richard Burrows whose background was in the whiskey business. He was also a chartered accountant and had began his career at Crowley’s firm Stokes Kennedy Crowley now KPMG.

It would be interesting to investigate the roles of respective chairmen. How involved were they? Did any of them get an assessment of risk, independent of the chief executive?

How different was the governance system in the two main banks with Anglo Irish, where there was a long serving CE who was synonymous with the building up of the bank?

I would guess that the individuals would not voluntarily shed light on these issues.

I think also, if insider stories were written in Ireland right now, most would end on the cliffhanger…
With our ‘hero’ bankrupt, the taxman, banks and creditors circling, with the commercial court closing its doors in their faces. Our hero with assets worth 20% of what they were and rapidly running out of road.
Or with the ODCE, fraud squad and CAB circling. Despite them having arrived a leisurely few months late at the crime scene, they will picked up enough fragments to conduct a few interviews.

Thats where we are right now…. And yet, despite all the evidence to the contrary you just know our hero will survive to lie another day.

The sequel could be better than the original…

@Philip Lane

Doubt we will get too many ‘insider accounts’ – for that to happen would need to see how many of the upper echelons have been fired for incompetence etc ……………

From the US – some research – “The prospects for a robust prudently guided financial sector have been substantially clouded by the fact that the both the corporate governance structure and the executive leadership of the financial sector remain largely unchanged—92 percent of the management and directors of the top 17 recipients of TARP funds are still in office. ”

Full Paper


Source: Barry Ritholtz

I’m sure there are a few beavers in the background looking at all these pper echelons in the Irish context – at a guess over 95% still in position – ergo: no real change!

Eoin said: “The Icelandic President has actually just decided to send the Icesave bill to a referendum, so Iceland de facto defaulting and not getting an IMF bailout is now a serious possibility…”

This is certainly insteresting. The icelandic people may vote to reject the taxpayer taking responsibility for debts incurred by a private companies which they had no responsibility for. As a result they may be excluded from international monetary assistance and face trade sanctions. It certainly sounds like law, democracy and capitalism gone wrong.

Will the Governments of the UK and the Netherlands seek to make an example out of the people of Iceland? Will the USA/IMF stand by and let this happen? It is hard to imagine that will be done but it is hard to imagine they will be let off lightly either.

What is galling is that institutional investors in the UK and the Netherlands should have been able inform themselves that Iceland as a nation could never back up its banks debts and accordingly there could be no implicit guarantee.

Iceland surely is at the “cutting edge” of financial sector reform that we have sought to buy. Will it be a Windows Vista or Windows 7 experience?

@ Eoin, “The Icelandic President has actually just decided to send the Icesave bill to a referendum”

@Zhou “…and accordingly there could be no implicit guarantee.”

The Icelandic President’s decision, and more importantly the outcome of the referendum – if that is against the Icesave law – will bring some welcome focus on the morality of our own government guarantees. Our guarantees were made after the “crash”.
Q: If my house isn’t insured and burns to the ground, what is the likeihood that the insurance company will cover my costs retrospectively?
A: Zero!
Q: Why is it different for the banks?
A: The banks control the government and can depend on them to squeeze the taxpayer for the losses.

There simply should never be “assumed” or “implicit” guarantees. This is the core cause of the entire banking crisis both here and internationally.
If guarantees are required,
– draw up contracts and pay in advance,
– with full risk disclosure.
– ensure that attempts to defraud render policies void.
– no blanket unconditional guarantees.

@David O’Donnell
There have been almost no resignations by the vast majority of the board members of the government (the cabinet), the Central Bank (David Beggs!)/IFSRA (membership hugely overlaps of both of course) or the lending frenzy institutions. All of them went in Anglo and the chairmen went in AIB and BOI, but that’s it.

There have been early retirements on extravagant terms but that’s not much of an imposition given their age profile, and certainly sends no signal that anything went at all wrong under their stewardship:

No firings from the staff of the regulators, the civil service or the responsible politicians. There have been two early retirements from the regulators that I have read of – Neary and another man, who may not actually be gone yet. I believe that the secretary of the department of finance is retiring soon. That’s all.

Take the top 100 executives in each of the lenders who were active during the boom:
I have read of almost no outright firings from the top 100 executives in each of the lending bubble banks. Four or five early retirements from the bank that Brian Lenihan has full contol over, Anglo. A poster on says that two or three senior people in AIB are retiring and that there may be 30 more retirements. For BOI there is one retirement I know of. Three went in Irish Life. Fingleton went in Nationwide. I know of no other retirements from the many other institutions involved in the lending frenzy and no firings.

After a massive police investigation the following must now happen:
The 1,000 top bankers responsible for this disaster should be fired and 100 of them jailed. (Instead a few have taken early retirement.)
We should fire the government and all the local councillors responsible and allowed the electorate to decide who to rehire, and jail 100 of them. Publish their expenses first.
We should fire 1,000 officials at all levels and jail 100 of them.
We should foreclosed on 1,000 crony businessmen and jail 100 of them.

A subsidiary of Ireland, known as the establishment, has cost us €100 Billion Euro due to a massive corruption scandal. 4,000 firings and 400 jailings is the least we should expect.

I propose a 1 euro per word ‘drivel tax’ on E65bn and his ilk, with the revenues generated to be applied towards costs of tarring and feathering prominent Irish bankers

@Concubhar O’Caolai
I don’t want our criminal establishment tarred and feathered, I want them jailed. Each of the 400 I want jailed has been responsible for €160 million of direct banking criminality with regard to our banks, using Morgan Kelly’s figures. The total cost of their criminality – when you include the enormous effect on society and the economy of the collapse of the lending bubble – must be near €100 Billion (€100,000,000,000).

We have several months before there will be a banking inquiry. Let’s use the time to launch a massive criminal probe in to all those institutions operating in Ireland who lent out recklessly. Let’s not transfer loans from any banks before removing those responsible for this giant criminality.

Handcuffs and firings first – then we’ll look at buying their loans.

@E65Bn plus economic costs & NO extra lending!

Good summary of the (non)moves – thanks – and the figures. Lets say 99% of the upper echelons still in position. *** Case rested!

I’m becoming more sympathetic by the day to your developing and very understandable anarchic tendencies but the harsh reality emerging is that the ‘establishment’ reigns supreme over a supine, ill-informed citizenry that appears to have settled for the ‘blue pill’ – Keep diggin – and we see how far down that corrupt incestuous ferengi establishment warren goes …….. then pop goes the weazels!!

@David O’Donnell
“Irish Economy: Ireland lost almost 160,000 jobs in the year to March 2009 – – the equivalent of two full Croke Parks”.

As a result of our lending frenzy:
160,000 ordinary people were fired (assume the number who retired is offset by the number of self employed who are now out of work but not claiming).

No politicians were fired or even retired.
One civil servant is being retired.
Two and possibly three regulators were generously retired.
Three bank chairmen were retired (presumably generously).
4 bank chief executives were generously retired (the AIB one just the other month).
A couple of Anglo, a couple of AIB and a couple of Irish Life staff were
generously retired.
Bank of Ireland – close to FF – only seems to have lost its chief executive.

What’s all this building up to?

Question: Who get’s fired after an Irish bank collapses?
Answer: The public.

Question: Who get’s a paycut after an Irish bank collapses?
Answer: Cleaners working for the government. The blind and the disabled get their benefits cut. The bankers? They get a pay rise.


My understanding is that it was only junior AIB staff who got a pay rise. If you want to call somebody working as a teller in a branch a ‘banker’, so be it.

@David O’Donnell
I am a capitalist not an anarchist. I want justice applied – to everyone. Our opposition, media and most of our civil society are still as deferential to our establishment as they are to the church (and I consider myself a christian). It is still unthinkable to jail bishops or bankers, politicians or prelates, monsignors or developers, senior civil servants or senior clerics for the systematic wrong doing they have ignored, facilitated or encouraged.

And here is the irony:
Jailing corrupt senior clerics would lead to a better church.
Jailing corrupt public servants would lead to a better public service.
Jailing corrupt politicians would lead to better local and national government.
Jailing corrupt senior bankers would lead to better banks.
Jailing corrupt businessmen and developers would lead to a better business world.

Just as the church used to silence dissent and impede real christianity by threatening critics with excommunication, so our establishment today silences dissent and impedes real capitalism by threatening us with the IMF/bond market if we don’t go along with their bailout of their cronies and cover up of their corruption.

The IMF/bond market is the new excommunication weapon of our establishment. Let’s stop playing by their rules. Instead of asking quietly for an inquiry when the government deigns to give it to them the media/opposition/civil society should demand:

A constitutional amendment to allow new legislation, the legislation we should have had but our elite have never passed to apply retrospectively. The vast scale of this act of corruption – €100 Billion – requires an unprecedented response. This should be followed by:

A massive police investigation – with international expertise – of all of our reckless lenders and the politicians, developers and businessmen whose corruption they have been financing.

With the criminal personnel out of the way we can then have a thorough inquiry.

It’s long past time for the opposition to stop buying into the government spin that if (Mainly)FF Politicians/Bankers/Developers aren’t allowed to cover up their corruption, and bank shareholders and bondholders don’t have their investments protected, the country will collapse the next day.
As Brendan Keenan said on Sunday and the Minister said yesterday, there has been no danger of sovereign default since April 2009. FF have taken the opposition for a gigantic ride -it’s what they do, it’s what they did to the country before you fell for it again. They’re making you look stupid and increasingly complicit.

Every TD in FG and Labour now has the obligation to speak out on this massive scandal. If your leaders or your party’s finance spokespersons try to shush you – and I don’t think Gilmore, Burton or Bruton would, but I think Kenny may try – ignore them. You and the public have been submissive for too long. Don’t go overboard – just keep on stating what has happened over and over. If Kenny doesn’t make you a Minister of State so be it – this is the decisive moment in the country’s history.
What do you want – eternal fame and glory or a mercedes for a few years?
I think once he sees the public reaction he will relent.

If RTE interviewers continue to give FF an easy ride call them out on it, live on air. That’s against the corrupt rules – but ignore them. FF/PDs have presided over a ginormous criminal disaster – RTE never reflect this. This government has the support of 25% of the public – but 75% of the media.
Many of the media will say that the IMF/Bond markets will excommunicate us if you don’t shush. They’re wrong, unrepresentative and having a negative impact by protecting a corrupt elite.

It’s time to speak for Ireland.

Christ, can we bring in some sort of retrospective law banning this crap? How does a post on an Icelandic crisis biography turn into this moralising mush?

Our establishment is predominantly FF – they have been in power for 90% of the last 23 years and everyone loves a winner. But it also includes many FG, Labour, Sinn Fein, Green, independent and non-party people. However, they are all golden circle. Their party allegiance is as big a factor in how honest they are as which premiership team they support. I can think of three people – whose FG support I am always reading about – who are right at the heart of it. There are also many honest FF supporters which is why the party’s support was down by half before the opposition took their vow of enfeebleness.

Let me now do a fair bit of speculation:
Why did the opposition take this vow of enfeebleness? I would guess it was direct threats of national excommunication from the government and the influence of the shush puppies. The FG shush puppies Fitzgerald and Dukes – convinced by Brian Lenihan – told Kenny that if he didn’t leave FF in power for Lisbon, the budget and NAMA we would be excommunicated by the IMF/bond markets.

The Labour shush puppies are the senior trade unionists, along with probably Dick Spring and even Fitzgerald (who is seen as a social democrat.) Fitzgerald, Spring and Lenihan would have convinced Gilmore and Burton that the country would face an eternal damnation where the IMF would come in and funds for the blind and the disabled and public service cleaners would be cut. Oh wait, that’s just happened. But the major influence on Labour I would guess was the trade unions. (That is one of the reasons why we must now have state funding for political parties. Relying on business and individuals is a recipe for corruption and relying on trade unions will mean you are silenced or restrained during government pay negotiations (almost all the time)). The trade unions wanted to draw up a national recovery agreement with the crony capitalists. The crony capitalists gleefully humiliated them in public.

I thought they wouldn’t. I thought FF were demonising public sector workers to distract from NAMA and divert blame for economic collapse. But FF were serious. They really do think nurses, teachers, gardai and admistrators destroyed the country with their excessive pay demands, in spite of the fact that a lot of these were driven by the cost of housing. Remember FF had driven the cost of housing in Dublin so high that a Garda and a nurse could not afford to live there. Incredible to think that now, isn’t it. FF do not blame board members of the reckless banks, or their management for our collapse – they left almost all of them in place (see above post). NAMA will work with and assist developers not bankrupt them. FF blames one senior civil servant and two regulators a little bit. They are retiring on generous terms. No, FF believe that the excessive demands of the poor and the public service destroyed the country.

FF/PDs attach no blame to their own parties for relentless stoking of the property boom, for wasting huge amounts of public money (as identified by Colm McCarthy) or for allowing ginormous tax breaks. They have kept the pork and kept the tax breaks, protected the bankers and the bondholders, are assisting the developers and doing all they can for bank shareholders.

How the unions can defeat FF:

The breakdown of the negotiations is a good thing, if the unions can manage it correctly. McLoone and Beggs should announce that they will resign – they are too close to the government. McLoone’s involvement with FAS will be used against him. Beggs should also resign from the board of the Central Bank and call for everyone else on the board and the regulator to do likewise. Larry Broderick of the bank officials should be kicked into outer space.

Then the unions can hit FF where it really hurts:
Reveal all details of politicians expenses – see this FOI.

Review all FOI requests relating to corruption and send all possible additional material to investigative journalists.
Answer all FOI requests about corruption not just in full but in glorious technicolour. Give journalists more than they want.
Leak all the warnings civil servants gave to ministers on lending and banking.
Leak all warnings on decentralisation, evoting etc and FF’s limitless pork spending.
In short, blow the lid on Ireland’s mafia. Corruption rises hugely during bubbles so given how many criminal ministers FF’s 1987 government had it is probable that most of the current cabinet should be in jail. You need to put them there.

FF have tried to bribe senior civil servants. You need to win them over. Also, go to retired civil servants. Get them to tell you everything then give the information to journalists. If you can get depositions and go to the police – then make sure it is followed up.

FF are deeply entrenched and their continuing in government has the backing of 75% of the media (25% of the public). They are the most corrupt Irish government since Tammany Hall. If you want to defeat FF make the truth about them public. Closing schools will hurt the public and result in a defeat like the miners had in 1984. It’s not the way.

“Beggs should also resign from the board of the Central Bank and call for everyone else on the board and the regulator to do likewise.”
That should have read everyone else on the board of the regulator to resign. As so many are members of both they have two reasons to go.

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