Thursday, November 27, 2008


Biffo blusters, Lenihan lingers, and the economy grinds to a halt waiting on some kind of leadership from this increasingly shambolic government. Unless circulation of money and normal credit availability is re-established soon the job losses will be devastating to communities all over the country as soon as the mini-shopping boom for Christmas is over. As predator capital from outside, mostly the USA is hovering over the weakened Irish banking sector, the Government must act to defend the public interest and prevent the dissolution of viable Irish enterprises that are literally being starved of credit facilities by the same people who brought about this crisis in the first place.

Now is the time to nationalise the Irish Banks in total rather than just guarantee their deposits. The taxpayer might as well get the future benefits of economic recovery rather than the CEOs and senior managers who have done extremely well out of the boom times. This move would give the Government the power to release the credit now required by businesses all over the country and keep people in their jobs. There is no justification for the banks hoarding cash especially having been given the government guarantee, so let’s dispense with the foreplay and take control of the means to get the economy moving again. There need be no disturbance for bank customers as the Government can use a state-owned holding company to exercise its control and the existing banks can continue to operate as separate commercial entities until such time as the economy recovers and the future of the banks decided as the public interest requires at that time.

The Central Bank should be re-constituted as a National Reserve Bank of Ireland which will hold all Government revenues and taxes and state pension funds. The NRB should also be the holding bank for the Post Office Bank and, by agreement the Irish League of Credit Unions. As an immediate measure the Post Office and Credit Unions, could be given a long-term loan of €1Bn each, or more if considered necessary, to provide for capital investment for new start-up businesses and credit for existing small enterprises. The nationalised banks can introduce a moratorium on house re-possessions and institute moderated repayments terms for cash-strapped mortgage holders which would help to stabilise the housing market and restore confidence in that market which, in large part, would contribute to overall confidence and reduce the level of panic attacks occurring in recent weeks.

Preservation of useful and necessary employment is essential for a civilised response to the horrors of the artificially induced credit famine which has struck the world. We can’t allow firms to go under and massive underemployment of the labour force to occur merely to satisfy the diktats of fraudulent market fetishism. Positive action is required to achieve this, both on the release of credit facilities and the maintenance of buying power of the majority of the population. Therefore, talk of wage cuts and job cuts must be resisted tooth and nail. The strident propaganda in newspapers and on television against public sector employment numbers and conditions is an example of the attempts being made by the power elites to shift the burden of recession onto the working class.

The Fine Gael Party has become almost hysterical in pursuing this line in Dáil Éireann and in the media. Party finance spokesperson, Richard Bruton, makes increasingly rancid statements on a daily basis now excoriating the public sector but, offering no concrete proposals except scrapping existing agreements on wages and conditions. Fine Gael hitched its wagon to the de-regulation, privatisation mode of economy before the last election and has continued to attach there as if nothing has happened in the meantime and this mode of economic structure is not thoroughly discredited. It is now flogging that dead horse in expectation of being the alternative government because of a rise in its poll ratings. These poll ratings are mainly based on hostile reaction to the mistakes of the Fianna Fáil/Green Party coalition and Fine Gael being perceived as “NOT” Fianna Fáil rather than any public confidence that there is any competent alternative government on the Fine Gael front bench.

LABOUR is holding a conference this weekend in Kilkenny where, hopefully some realistic proposals will emerge to present to the people that will engage their understanding and support for a new type of economy and society. It won't be good enough just to have an election manifesto type document; the people need to be engaged in the working out of proposals that will bring fundamental change to the way the economy and society is structured in the future.

(As this post was being written it was announced on radio that the Irish Congress of Trade Unions has also called for nationalisation of the banks. This is a welcome development if it means that ICTU is prepared to fight for workers interests in a determined and progressive manner after years of compromise with a failed economic system).


FearFeasa Mac Léinn

Áth Cliath/DUBLIN, 27 Samhain/November 2008.

No comments: