Monday, November 29, 2010

Well, Now, at Least the Irish Bankers Are Safe!

Vox points out the obvious:

According to figures published by the Bank of International Settlements, the Irish government now owes $146 billion to German banks, $134 billion to British banks and $54 billion to French banks that have invested in Irish banks and Irish bonds. This means that if the Irish government refuses to default on the debts incurred by its failed banks, it will put every single man, woman and child in Ireland on the hook for $76,781.61 for the benefit of the European bankers to whom the Irish bankers owed that money.

....and posits a question:

...After the failure of the biggest bank in Iceland, Dutch and British banks tried to force the Icelandic people to pay them $16,400 apiece to settle bad debts incurred by the owners of Landsbanki. Fortunately for Iceland, some of the politicians in Reykjavik were made of less corrupt stuff than Brian Cowen and his Fianna Fáil government and they took the matter to a referendum in which only 1.5 percent of the electorate voted for the "bailout." And contrary to the dire predictions of the furious banking elite, the island nation did not sink into the Atlantic as a result.



J. Strupp said...

I'm trying to figure out what you're position is here.

So sovereign default of debt obligations by a representative/democratic government is O.K. but default of debt obligations by an individual is not?

I'm saying that that's your position. It just saying that it kind of sounds that way.

GOR said...

While the Irish banks have a lot to answer for Dad, it’s not just them. There’s plenty of blame to go around - from craven politicians, excessive and overpaid public sector employees to overly generous pension and benefit plans. They have cut the minimum wage by €1 and it is still higher than most European countries and the US.

The HSE (Public Health Service) has 100,000 employees. Last year it was reported that each employee on average takes 12 sick days per year! No wonder there are so many complaints of poor service and long delays in getting health care.

And that is in just one area of the public sector. I’ve little doubt that it is not the exception. When I left Ireland almost 50 years ago the knock on Irish workers was that they didn’t work very hard at home but found when they emigrated that they really had to work. I thought the lesson had been learned. Apparently, it hasn’t.

Dad29 said...


I've maintained for quite some time that banks which should be liquidated SHOULD be liquidated--e.g., CitiZombie in the US.

I'm no fan of sovereign defaults, but they happen now and then.