Daniel Sullivan - he’s a little political

Convert % of bank deposits into Bank Equity?

// March 22nd, 2010 // 1 Comment » // anglo-irish, bank bailout, bank of Ireland, brian lenihan, irish politics

Could we, overnight, convert a % of deposits into equity for the banks? Or is this simply a bonkers notion? Say 2.5% of all deposits under €20,000 which was the previous limit up to September 2008 and say 5% from €20,000 to €100,000 per depositor per institution and 8% of deposits over that level. If the banks were to commit to buying back the shares plus interest so issued as profits allow over a 10/20 year time frame, might this not be a better first port of call rather than all tax payers having to fund the bank bailout via state borrowings? After all those with the largest deposits have benefited most from the state bank guarantee without it they could have lost a lot more than 8%.

Or might we suggest that the banks do this themselves in September of this year by repaying the money given by the state when the guarantee runs out and could reasonably be expected to be modified? Of course the problem with such a notion is that any announcement of it would have to apply instantly or people with the most would withdraw their deposits.

Is Brian Lenihan off his game?

// March 11th, 2010 // 4 Comments » // Fianna Fail, brian lenihan, democracy

I suppose someone at some point has to ask the awful question but this incident whereby the government forgot to oppose a Labour party amendment to the Finance bill and following on from the manner of his defence of Willie O’Dea which struck many people as not being typical of Brian Lenihan and the fact that Martin Cullen has raised the issue publicly of the impact of certain types of medication on a person’s ability to perform their normal duties in the same way as before, is Brian Lenihan now showing signs of his performance being affected by his treatment?

We, the public are not privy to the form or the duration of his treatment, if it is the case that the worst of it is over and a minor slip here and there is going to be the extent of the impact then fair enough let him continue in office but if it has got some more months to run (in particular into the summer months when preparation of the budget will be underway) then we have to ask is the upcoming reshuffle the right opportunity to make a change. At the very least someone senior in the cabinet has to be designated as his 2nd.

I know people will say that’s I’m merely trying to score political points but I honestly can’t think of anyone more capable in FF than Brian Lenihan to be in the position of MoF at the moment. And while I don’t agree with much of the detail and some of the substance of what he is doing, he is, when playing at the top of his game, incredibly able. The question remains is he playing at the top of his game?

Budget 2010 - where do we go from here?

// December 10th, 2009 // No Comments » // Uncategorized

I think the core belief for the minister for Finance is that earnings in the private sector are already down and that the public sector earnings which are paid for from taxes levied on those private sector earnings had to follow them down. So I tend to agree that we had to bridge a 4 billion gap but I don’t agree with how it was done. (this notion that because we agree about the size of the problem that we all agree on the approach is lunacy but lunacy that you can get away with because of the lack of numeracy and more generally confidence with maths that exists in the media. People work in the media because they were good at English or had good social skills and could express themselves not because they could add. No more than people get the big prizes or the big for Physics, Economics or engineer not because of their ability to coordinate their wardrobe or be the first with the bon mots). Agreeing the gap is 4 billion is like saying the gap across that river is 400m, that doesn’t mean you agree with the suggestion of others that we dam the river or build a bridge or a raft.

Taking just one example of where I think we’ve gone wrong. I have to wonder at the mentality behind the cuts to those under 25. Why does a single person of 30 need more than one of 20? If ever there was a sign that the state does not have any time or faith in younger people then that was it. The notion that some adults should be at home with their parents is not even Victorian. I’m well past being in that cohort but I would have thought the last thing someone in authority with any appreciation of history would do during the worst downturn since the 30s is target young people with time on their hands and muscle at their disposal. All that is necessary now is a harsh winter and some demagogue to appear with a winning and simplistic way out of this and we’re well on our way to civil unrest before the summer has started.

Perhaps, that is all part of Lenihan’s plan make some elements of the population so angry they abandon democracy rather than vote for any of the opposition.

I personally think that the trade union movement as it is exists primarily as a public sector beast is facing a massive moment. I can’t see strikes this side of Christmas but a phased and escalated plan of action starting in mid Jan has to be almost certain now. Truth is if the unions had the faith that their members were 100% behind them they would go out 1 day a week more each week until they were completely out on strike and they would sit outside the Dáil or some such public buildings a la Ukraine. The problem is that I suspect the union membership aren’t all that convinced of their own argument, sure the lower paid, those on 30K and under are righteous but I can’t help think that some of those on 50K and more wouldn’t feel less than bullish about sitting out for a few nights to defend their salaries.

The odd thing is that the government may welcome such a confrontation as some voters who have drifted away from them because of their dithering over the last 2 years might be attracted back because of a show of strength even if it is just a show.