October 2010 Archives

Moral Hazard with Justice

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Many international commentators including the Wall Street Journal, New York Times, Financial Times and Economist have queried the pain being inflicted on Irish taxpayers arising from the banking crisis. They had anticipated that taxpayers would be at the end of the pain queue after shareholders, management, borrowers and lenders.

Instead, they have been pushed to the front of the queue immediately after bank shareholders. At the same time, managements continue to enjoy huge salaries and pensions, borrowers get massive bale-outs thanks to taxpayer-supported Nama, and lenders are secured by guarantees underwritten by taxpayers.

Where is the "moral hazard" and justice in this?

Where are the public enquiries into the destruction of over €50 billion of wealth?

Where are the apologies and offers of restitution from the still wealthy borrowers hiding behind limited liability and sloppy documentation?

Where is the political leadership that puts citizens ahead of cronies and sound strategies ahead of self-serving spin?

Where are the prosecutions for blatantly fraudulent, reckless business activities?

Letter published in the Sunday Business Post on 10th October 2010. 

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