I am fast becoming tired of the old story about the banks.
Fine Gael, Fianna Fail, Labour and the Green party keep throwing out the same old rhetoric about had we let the bank’s collapse or even if we do let them collapse now or in the foreseable future, we wouldn’t be able to pay Doctors or Nurses, Teachers or Gardai. Business would collapse and ATM`s would shut down.
Everything these party’s speak describe a doomsday scenario.
But how far from the truth are we here? Would this actually have happened and would it happen now?
In my opinion the whole idea of bank collapse is fiction, we were told by Fianna Fail not too long ago that the state had enough funds to last us for 2011 and we didn’t need any bailout. We were told we didn’t need any more money from bond markets and we were in good shape.
Ireland had a National Pension Reserve fund of around 20 Billion, this was more than enough cash to plug the hole in our finances for one year, so had we let the banks go we would not have seen wages for Doctor`s, Gardai etc go unpaid.
We would have in fact been in a position where we could have taken the Sinn Fein approach and taken the banks into full state control. We then could have told all the bond holders and people who had debts with the banks that they banks were now in administration and the only guarantee we would honour would be personal bank accounts of Irish citizens up to €100,000.
The banks would then be in a position to continue trading whilst agreeing a debt repayment scheme with its debtors as any administration of a business would normally exist.
Even if we did as Sinn Fein want to do now and end the states affair with the banks I see no reason as to why the doomsday scenario portrayed by the other political parties would exist.
We would simple split state debt from bank debt. We could then work with the people of this country from top down and cut the deficit whilst attracting new business into the country for jobs. Any financial gaps we would have could be plugged by returning to the bond markets with a display of cutting the sovereign debt of the nation with real ideas and fairness whilst cutting all ties with bank debts, this would encourage a positive effect with the bondholders and show them Ireland was getting its house in order without the stranglehold of tens of Billions of banking debt around our necks.
The situation should be that whilst this state is in the mess it is no TD should take a salary above the national industrial wage of €40,000. Its thinking outside the box like this that this country needs and not deflationary ideas such as cutting the poorest people in society as Labour, Fine Gael and Fianna fail wish too.
Finally to summarise I wish to make one final point.
We are told that the debts of Ireland as they exist today will cost every man woman and child around €60,000. Imagine instead that we handed every man woman and child €60,000 in cash instead of bailing out banks, imagine the stimulus this country would have had. Would we even care about banks collapsing if this was the option we could have had?
http://www.politics.ie/economy/152323-fact-fiction-whats-real-story-letting-banks-collapse.html
