Wednesday 18 January 2017

David McWilliams: No future for our banks without radical thinking

Published 13/04/2011 | 05:00

DO you find it strange that as a result of reckless lending at AIB, 2,000 people will lose their jobs, yet as a result of the same lending, the bondholders of the same AIB will lose nothing?

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Some of the workers who supplied their labour are allowed to lose everything, yet the creditors who supplied capital lose nothing. This is not what capitalism is about. This is a type of cronyism.

In a country where unemployment is running at 14pc while at the same time running a balance of payments surplus, this is clearly the wrong choice to make. Yet we have just made it. We would save much more forcing a debt-for-equity swap on the bondholders than laying off the workers, but we do the opposite. Why?

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