Dáil debates

Thursday, 28 January 2016

Joint Committee of Inquiry into the Banking Crisis: Statements

 

3:25 pm

Photo of Richard Boyd BarrettRichard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

I wish I could say otherwise, but I believe the outcome of the banking inquiry - the report that has been produced - is depressingly predictable. It offers us nothing that will prevent a repeat of the crisis that brought this country to its knees. I am a member of the Joint Committee on Finance, Public Expenditure and Reform. Many members of that committee put themselves forward for the banking inquiry. After thinking about it a little, I decided not to put myself forward because I feared that what has happened would happen. Sadly, that fear has been borne out. A substantial amount of time and significant resources have been spent on this inquiry, but the outcome will teach us nothing. It will do absolutely nothing to prevent a repeat of the economic crisis and the crazy mistakes that crashed the banking system and the entire economy.

I am saying this outcome was predictable because I am aware that if we were to learn anything from the crash, it would have radical if not revolutionary implications for banking and for the way we organise our society. Frankly, I do not believe the political establishment in this country has any stomach for the sort of radical or revolutionary action that would be required to take on the ideology of the vested interests who produced this crisis in the first place. Instead, sadly but predictably, the Government is blaming Fianna Fáil. In turn, Fianna Fáil is blaming the regulators and perhaps the European Central Bank to some extent. It is saying that Fine Gael was just as bad. We can all agree on the role of the bankers because that means the finger is less likely to be pointed at us. If we agree that everybody can take a little bit of the blame while arguing that everybody else is more to blame than we are, we are saying "everybody is to blame but nobody is really to blame" and "everything will be okay if we just have a little bit of regulation".

That is where it is left but that is not the truth. The truth is that the entire political establishment was captured and remains captured by the financial and corporate elites and it dances to their tune. It continues to dance to their tune even though being captured by those interests was what produced the crisis that has had such devastating consequences for the ordinary citizens of this country and for which we are still paying a terribly bitter price. The human consequence of the madness that drove the banking system, economic policy, the bailout and the austerity programme continues to be felt in the most cruel way, most obviously with the housing and homelessness crisis, which is beyond catastrophic and is a shame to any society that calls itself civilised. The consequences are also seen directly in the health service, which was butchered of 10,000 staff, €3 billion and thousands of beds so that people are sitting on trolleys and waiting years for operations. The consequences are felt in the most overcrowded classrooms in Europe by our children and future generations. However, nothing in this report points to the sort of action that needs to be taken. We need radical, fundamental and systemic change, not a little bit of regulation.

What have we learned? The report confirms what we knew before it was produced. There was reckless lending and borrowing by a small financial elite in the banks and by developers who went absolutely crazy, driven by the hunger for profit, all cheered on by the political establishment. In his minority report, Deputy Joe Higgins gives a number of quotes but this one sums it up. It is of Brian Cowen speaking to the Institute of Bankers in 2006 on the subject of the financial instruments that wrecked the economy:

Of course, not all these brave new initiatives are successful. It is a hard game but there is all to play for. Of course, that is easy for me to say because you are the players on the field and I am just an ardent supporter on the sidelines. I will continue to wear your colours.

That was the attitude of the Taoiseach, the ardent supporter of the bankers who "will continue to wear your colours". With that attitude in government and the political establishment, is it any wonder that bankers and developers thought they could do anything they wanted? Fintan O'Toole's book tells how Seán Dunne was being married on the yacht of Mr. Onassis in Greece with gold-plated swimming pools and he sends a message back to Bertie and Charlie. They apologised for not being there because it would not have looked good but they say they would have liked to be on the yacht with these developers whose greed was about to wreck the country. This was all driven by an absolute ideology summed up by Charlie McCreevy, who believed we should not regulate these people. He believed in light-touch regulation and allowing the market to do its thing. Translated into ordinary people's language it meant "Let profit be king, before everything". Has that changed? Is there anything in this report which suggests we should change it? There is nothing, and, in fact, the opposite is the case.

The Minister, Deputy Michael Noonan, promised to burn the bondholders, undo the injustice of this and reverse the priorities to put people first. However, within weeks of being in Government, he did a U-turn and submitted to the bullying of the ECB. The Government comes out with the excuse that it was being bullied by the ECB but why did the Minister, Deputy Michael Noonan, not come into this House to say he was being bullied by Mr. Trichet? We should not put up with it.He could at least have told us the ECB was bullying us but the Minister, Deputy Michael Noonan, would not do that because he has spent his entire political career, as the Fine Gael and Fianna Fáil parties have done and continue to do, saying that, at all costs, we must stay with the European Union and do whatever they say and we must be the good boys in Europe because we believe in the project. He knew that what the ECB was demanding of him would have devastating consequences for our economy and our citizens, who have paid a cruel and brutal price for his betrayal and his submission to the bullying of Trichet.

Even after all of that, nothing changes. When we took over the banks and when NAMA took over all the development land, we should have said: "We, the democratically elected representatives of the people, are going to control the banks, dictate policy and control development. We will decide development and housing priorities and all of that." Instead, the Government did the exact opposite. It has reprivatised the banks that we bailed out and has let them continue to do whatever they want. It has sold all the land NAMA had to vulture funds who care only about profit and who are guaranteed to do exactly the same thing. Even in the Central Bank, a person sent in to do the internal audit a few years ago on its failure to manage the financial system has become a whistleblower and says he was sacked and told to delete sections of the audit because he was exposing the continuing failures of governance and the lack of proper risk management in the bank. There is no serious investigation of this and it is still happening.

There is no willingness, energy or interest in actually challenging the golden circle driven by profit and greed who crashed the economy. Quite the opposite - in fact Fine Gael and Fianna Fáil support handing the economy and wealth to these people instead of redistributing it in a fair way and ensuring the public interest trumps that of a small minority interested only in profit.

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