It tolls not for thee:
IRISH PEOPLE’S finances are continuing to deteriorate with the number who say they have less than €25 to spend each week once all essential bills have been paid increasing sharply over the last three months, according to research published by the Irish League of Credit Unions (ILCU).
[…]It also reported that Irish consumers owe an average €1,100 on their credit card, with a quarter using the facility to make ends meet each month.
The Irish bank bail-out is close to $100 billion now. That’s 22K per person (Ireland has a population of about 4.6 million people).
Violet
Is this the magic austerity that our betters want us to enjoy?
Villago Delenda Est
Are there any honest bankers working for a large bank left in the entire world?
Or are they all Ferengi slime who steal without the slightest fucking hesitation?
Violet
@Villago Delenda Est: I think Iceland cleaned house, but I’m not sure if their banks are considered large anymore.
NonyNony
@Villago Delenda Est:
If our economic system requires that we expect the actors to be honest then it’s broken and cannot be fixed.
The glory of capitalism is that everyone is supposed to be working in their own self interest and the system is supposed to be self-regulating. If the system needs honest actors to function properly then it is no better than communism as an economic model.
The system is broken and needs to be repaired or replaced. All of the incentives for behaving honestly are gone and have been replaced with incentives for behaving dishonestly so that even the HONEST folks have to engage in double dealing just to keep their jobs.
Villago Delenda Est
@NonyNony:
Adam Smith did not describe the system the way you did.
He deplored the intervention of dishonest actors in the works, particularly as they influenced state policy on commerce in general. He wanted the state to serve as an honest broker, but saw the reality as a broker that was often working on behalf of men looking out for their own short term profit at the expense of the long term prosperity of the entire nation.
Things have not changed, and obviously we’ve learned very little from Smith over the past two centuries.
MattF
Well, the Irish always have the consolations of their religious faith. Oh, wait.
Brachiator
@NonyNony:
Capitalism works when you have reasonable regulation to deal with stupid selfishness and dishonesty.
Communism has never worked.
jibeaux
Michael Lewis’ book excerpt on Ireland (the other countries, too) is illuminating. Interesting how the whole economic crisis was really different in different countries, although it landed with a similar whump. I was in Ireland in 2004, and you really could see the beginnings of it — lots of real estate for sale, new construction going up…
Ben Cisco
@Villago Delenda Est:
You don’t really want an answer to that one, do you?
deep
@Brachiator: The Shakers would disagree with you. (But then again, they’re nearly extinct since they can’t abduct children anymore…. maybe you are right…)
Linnaeus
@NonyNony:
Capitalism in this idealized form has never existed.
Stooleo
OT.
hmmm..
Brachiator
What was the alternative to a bailout? I don’t know that how Ireland got into this predicament is easily comparable to the problems of Iceland or Greece or Spain or the UK or the US.
Nylund
The theoretical results that supposedly prove the awesomenes of the free market really just shows that the free market is capable of getting the same exact results as a perfectly run centrally planned economy (ie, one run by the “social planner” as this God-like economic dictator is called in economics).
So, in a sense, the free market is never no better than communism so much as it’s “just as good as.” The argument is essentially that no God-like, all-knowing, and benevolent “social planner” actually exists, thus, it’s quite a coup that you can get the same result without him (or her) running the show. Of course, that result only happens when a large number of unrealistic assumptions about the “free market” are met (perfect information, no market power, etc.)
So really, all the proof says is that an unrealistically perfect free market system works as good as an unrealistically perfectly-run communist regime.
It doesn’t say it’s better, and it doesn’t say how they compare in the less-than-perfect real world.
But, there are a number of proofs out there that show that when the real world isn’t perfect, the outcome can be improved through interventions and regulations.
NonyNony
@Linnaeus, @Brachiator:, @Villago Delenda Est:
Yeah, I know that this idealized capitalism has never existed. I should have put scare quotes around “capitalism”.
What has worked – the only thing that has worked – is a well-regulated economic system where we don’t count on people being “honest” – we build incentives into the system that reward companies and individuals who are honest and punish the ones who are dishonest. And we limit the power of banks by limiting their size and their ability to mix investment banking with commercial banking activities.
But apparently we aren’t allowed to do that, even though we know that it worked. We’re only allowed to have the kind of unfettered capitalism that was killing our country prior to the 1940s.
beltane
@Stooleo: The way to deal with people like this is to levy a “repatriation fee” consisting of a “reasonable” percentage of their total assets. If they pay the fee they can be treated in the same way as any other law-abiding foreign national; if they do not pay the fee, they should be treated as any other unlawful combatant, including a government paid vacation at Guantanamo.
Roger Moore
@Nylund:
So we just need the Free Market Fairy to ensure that the markets work perfectly.
DougJ
@Brachiator:
I’m not criticizing the bail-out, I’m putting into perspective how much a far smaller consumer debt is crippling the economy.
SteveinSC
Hmmm, wonder where all that money went? It’s got to be somewhere. Let’s see it’s not in the pockets of the Irish people. Where could it have gone? Oh yes, the speculators and banksters who are still in charge might know.
Linnaeus
@NonyNony:
I figured you knew that…I think I was just stating what most everyone here gets – that the totally “free market” is an abstraction, which is useful for basic education on our economy, but gets trumpeted in the political arena as some “real” form of the economy that actually exists or once did.
Zandar
@SteveinSC:
Why, that 22k per person would have been the equivalent of the Obama stimulus being $6.8 trillion here.
Judas Escargot, Acerbic Prophet of the Mighty Potato God
@SteveinSC:
Perhaps we should be having a little peek at their offshore IRAs as well.
El Cid
The only outrage is that currently we powerful rich Western nations are re-living what we put the entire 3rd world through in the 1980s and 1990s, complete with “austerity” budgets, damage-imposing “bailout” agreements, and the ideology of unrestrained “capitalism” as both effective, efficient, and morally redeeming.
Just pretend you’re some Latin American right wing dominated economy of the 1980s, and you’ll have a good fortification.
HyperIon
@El Cid wrote :
File under “Karma is a bitch”.
Cris (without an H)
If only the entire population of a country could be considered too big to fail.
Cris (without an H)
If only the entire population of a country could be considered too big to fail.
daveNYC
You should be criticizing the Irish response to their banking crisis. They didn’t just bail out some banks. They went full-retard and had the government assume all the banks’ debt. TARP might have been a less than ideal plan, but what the Irish government did was suicidal.
Cris (without an H)
@Cris (without an H): That comment was not pithy enough to post four times. FYWP.
El Cid
@HyperIon: It’s not so much karma as it is that they finally had the opportunity to put in practice domestically what they had success in enacting internationally so much earlier.
You name the person, and the financial elite has likely had direct involvement in projects to impose austerity / free market freakishness on some impoverished 3rd world nation within the last few decades — Jeffrey Sachs, Tim Geithner, Citicorps, blah blah blah, not just the leagues of ‘advisers’ etc.
burnspbesq
@Brachiator:
The alternative was to let Anglo Irish fail, and stick its creditors with the losses they should have borne for their craptastic underwriting.
The rest of the Irish banks weren’t nearly as badly off, and even if every Irish bank had failed, deposit insurance of up to EUR 100K would have kicked in and saved most of the Irish middle class.
mclaren
It’s worth noting, incidentally, that the Galtian genius economists who are now running America were the same ones holding up Ireland as a shining example of the free market back before the bubble burst.
DougJ
@Cris (without an H):
Win.