State guarantee to Irish banking system

Madam, - By now the wider implications of this week's actions by the Government are being understood

Madam, - By now the wider implications of this week's actions by the Government are being understood. State underwriting of the banking system has not only mortgaged the country, but alienated our European neighbours - and for what?

We are led to believe that if one of Ireland's six banks had fallen it would have led to an "implosion" of the banking system. We are a nation of 4 million people with six "domestic" banks as well as other "foreign" banks such as Ulster Bank and NIB. The UK has 60 million people and also no more than six main banks. Yet despite the collapse and nationalisation of Northern Rock, as well as Bradford and Bingley, the banking system there still operates without a guarantee. This country has been kidded into potentially the biggest swindle in its history - a "momentous" day indeed.

It is a shame the current Taoiseach does not have the mettle of Andrew Jackson, the seventh president of the US, who said to a delegation of bankers in 1832: "When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter, I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves." - Yours, etc,

GARY LUFF, Rosmeen Park, Dun Laoghaire, Co Dublin.

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Madam, - Anybody watching Prime Time on Thursday night must have despaired of the type of people in key posts in this country. In one interview Patrick Neary, chief executive of the Financial Regulator, seemed in total denial of the magnitude of the problems facing Irish banks. Subsequent panel discussions cemented that impression and in my view must leave his position untenable.

Also in those discussions, Martin Mansergh, representing the Government view, seemed all at sea when confronted with the fact that there were no specific caveats in the guarantee proposals - only agreements to review certain aspects of banking in this country. Banking chiefs must feel they can do no wrong.

The most disturbing aspect of this global crisis has been the sight of politicians on both sides of the Atlantic crying crocodile tears and engaging in incredulous finger-pointing. The fact that they, the legislators, bear ultimate responsibility for this fiasco seems lost on them.

Why is there an acceptance that the economy comes in cycles and that the poor will always be with us? The "economy", as constructed by the free market ideologues, has created a consumer society enslaved by credit, and powerless governments. I hope this latest crisis may provide the impetus to legislators to break the circle, get back to social governance and finally bury the sham of "trickle-down economics". - Yours, etc,

BARRY WALSH, Church Road, Blackrock, Cork.

Madam, - I recall Michael McDowell, then a senior government Minister,   warning before the last election that anything other than a vote for the then government would set the Irish economy back years. It now seems that the economic model of the FF/PD era  had all the year-round durability of a tent at a racecourse in the West of Ireland.

Fancy tents look lovely in sunny weather, but offer very little protection against the depressions which tend to come in from the Atlantic. -   Yours, etc,

CATHAL RABBITTE, Bombay, India.

Madam, - The Government's decisive action to ease the uncertainty in the banking market should be applauded. While other EU countries were doing a "Neville Chamberlain" on the matter - waving pieces of paper in the air declaring everything would be all right because Wall Street said so - the Irish Government rushed to slam the door on a catastrophe.

I congratulate Finance Minister Brian Lenihan, Green Party finance spokesperson Dan Boyle, and TDs from all parties who supported the emergency measures.

I do believe, however, that the shysters - ie, the top bankers who sold us the pyramid scheme also known as the property market madness - should be removed from their Ivory Towers and forced to work for the good of the country at the average industrial wage to undo the damage they caused over the "Tiger years". If they refuse they should be tried - and jailed if found guilty - for endangering the future of Joe and Joan public, pensioners struggling to make ends meet, and future generations. - Yours, etc,

MICK MURPHY, Model Farm Road, Cork.

Madam, - Charles Smyth (October 2nd) is right to demand the heads of the chief executives and chairmen of the six Irish banks.

But why stop there? If there is to be a hanging match, there are a number of others who should not escape the noose. He has overlooked the Financial Regulator, the governor of the Central Bank and the former Minister for Finance and current Taoiseach, Brian Cowen, who failed to see - or who ignored - the scandal as it unfolded on their watch.

They all turned a blind eye to the gathering financial storm that even a first-year economics student would have foreseen. Mortgages of 100 per cent and more were allowed for house purchases when a more realistic and manageable 75 per cent was previously the norm.

The Fianna Fáil-led government is now running around like a headless chicken in a farmyard of its own making and the taxpayer is being asked to pay to clean up the dirt. - Yours, etc,

BRENDAN M.REDMOND, Hazelbrook Road, Terenure, Dublin 6w.

Madam, - With the onset of the State bank guarantee, may we take it that the activities of Messrs Byrne and Lynn will be covered by the taxpayer? - Yours, etc,

RONAN TIERNEY, Knockeen, Graiguenamanagh, Co Kilkenny.

Madam, - Having worked in the financial services industry for the past 16 years as an economist and derivatives trader, I believe the taxpayer should know that if the Government were to receive a market rate for guaranteeing the banks' liabilities, the banks' shareholders would be unlikely to receive a dividend ever again.  In fact, their shares would, in effect, be worthless. - Yours, etc,

GARETH Ó MURCHÚ, Luogh North, Doolin, Co Clare.

Madam, — Why should Gordon Brown criticise the Irish Government for guaranteeing all Irish bank liabilities when Northern Rock benefited from a comparable British guarantee? The competitive advantage Irish banks have now in Britain is no different to that enjoyed by Northern Rock Ireland. - Yours, etc,

PAUL JENNINGS, Elm Court, Dublin 4.

Madam, - The people at Cern near Geneva assure us the Large Hadron Collider will not generate a black hole that will swallow the earth ( Science Today, October 2nd).

Can they explain the black hole that has swallowed our money? And is it connected in some way with the gnomes of Zurich? - Yours, etc,

LEON SHARKEY, Ryebridge Lawn, Kilcock, Co Kildare.