News Letters

Tuesday 30 September 2014

Fundamental flaw at the heart of our economic system

Published 20/08/2014 | 02:30

  • Share
A high proportion of Irish wealth is in property

Charlie Weston's straight-talking article (Irish Independent, August 17) paints a stark picture of our powerlessness as citizens in the face of unjust and exploitative banking practices. Eventually, we will have to collectively confront the fundamental flaw at the heart of our current economic system: the interests of the international financial markets are diametrically opposed to those of ordinary working people and the domestic economy.

  • Share
  • Go To

Domestic economies need relative economic stability and predictability of prices in order to maintain business viability and job security, whereas financial markets want economic instability, since they make enormous profits betting on the outcomes of market fluctuations. For ordinary working people, money is a utility which we use to facilitate our standard of living and to create a functioning, real economy and society. For the financial markets, money is a commodity to be sold (loaned), traded, leveraged and gambled, to make money out of money.

The financial sector has created vast pyramids of leveraged capital composed of complex financial instruments called derivatives, which are essentially bets on some aspect of the real economy. When one of these pyramids or bubbles collapses, they know that we, the taxpayers, will have to foot the bill. Western central banks are flooding the financial system with free money to support these derivatives bubbles, as well as forcing national populations to pay the astronomical debts of bankrupted financial institutions. In the ideology of financialisation and market theory, no moral responsibility accrues to market actors or speculators.

All deleterious consequences of market activity upon ordinary people, such as the loss of pensions, investments, jobs and homes, are considered natural market outcomes for which no one can be held accountable, as if they were just unfortunate natural disasters.

Our elected politicians worldwide should confront the anti-democratic dominance of the international financial markets over our economies and restore the balance of power to the public. Corrective measures must include reinstating the Glass-Steagall Act, which separated main street commercial banking from speculative investment banking.

Maeve Halpin

Ranelagh, Dublin 6

Failed model for home loans

In the absence of any significant reform to a flawed banking model, news of a sharp rise in mortgage lending is worrying. Clearly, lessons haven't been learnt.

The typical €200,000 mortgage costs, at present, at least €270,000 over its lifetime. The lenders, though, do little to earn such a large return. A community banking model would not seek profit, but self-sustainability, so such a mortgage might cost as little as €210,000 over its lifetime. Buyers are being forced to endorse a failed and inequitable model in the absence of a more honest and appropriate alternative. It's time the Government stopped serving banks and began serving the nation.

Keela Freeley

Clonard, Co Wexford

Respecting rights of the unborn

I think Colette Browne needs a holiday, given what she wrote in her article (Irish Independent, August 6). To describe a pregnant woman as a nine-month human incubator brings to mind a similar derogatory statement issued many years ago by Ian Paisley when describing Catholic families.

So does this mean she now recognises the unborn as a human life and not the "collection of jelly cells" or "embryos" as the pro-choice lobby would wish us to believe? Paisley has always upheld the rights of the unborn and given that Colette Browne seemingly uses similar descriptive words, can we hope an epiphany has now taken place in her thinking? One hopes so.

Fr John McCallion, M.Phil, CC Coalisland, Co Tyrone

Making light of climate change

Amazing! Ian O'Doherty (Irish Independent, August 15) concedes that pollution causes climate change. Yet he says that it's pointless to reduce it, as it comes at too high an economic price and climate apocalypse is inevitable anyway.

We can only infer that this columnist believes economic threats trump existential ones. Posterity be damned. And anyone who disagrees with O'Doherty's worldview is referred to disparagingly as "nuts", "utterly mad", "fanatic" or concerned with "the polar bears, like".

I believe (along with 98pc of geoscientists) that our future is a race between education and catastrophe. And while I accept that O'Doherty is a journalist with a glib, tongue-in-cheek style, his article is wholly irresponsible in the context of educating the public.

Kiera Rogers

Dundalk, Co Louth

Betrayal of Christ's church

People constantly err in identifying the Vatican with 'the church'. The Vatican is made up of men; 'the church' is Christ. Our church leaders have once again betrayed Christ's church in failing to deal with the scandal caused by allowing Cardinal Brady to remain on until retirement age.

Cardinal Brady should have stepped down voluntarily; but that's his problem. It seems to me these clerical VIPs in Rome consider themselves exempt from the moral code that applies to the rest of us. Indeed, this whole sad saga seems to imply that they have a special moral code that overrides conscience.

Hence the enormity of the task Pope Francis faces in trying to bring real reform to the heart of the Vatican.

Sean McElgunn

Address with editor

Gaza and humanity's failure

Yesterday marked World Humanitarian Day and as the recent conflict in Gaza has demonstrated, healthcare personnel, hospitals, ambulances and clinics have been deliberately targeted as the UN's call to stop targeting civilians goes unheeded. The harsh economic blockade imposed on Gazans has already caused immeasurable human anguish. If we are bound to revere the Hippocratic Oath there should be a universal call to stop the death and displacement of Palestinians in Gaza.

Dr Munjed Farid Al Qutob

London, NW2

Connolly's stand on WWI

There has been some debate recently in the Irish media regarding James Connolly's position when World War I broke out in Europe. Writing in the Workers' Republic in the first week of the war, he made clear his position. Connolly viewed the conflict as an imperialist adventure by the capitalist nations, and argued for the European working class, regardless of nationality, to stand united in opposing the war and fight instead for international socialism. While he argued that if the German army invaded Ireland, the Irish would be justified in fighting with it against the British Empire, this should not be confused with support for German imperialism.

He continued: "Should the working class of Europe, rather than slaughter each other for the benefit of kings and financiers, proceed tomorrow to erect barricades all over Europe, to break up bridges and destroy the transport service that war might be abolished, we should be perfectly justified in following such a glorious example and contributing our aid to the final dethronement of the vulture classes that rule and rob the world."

In taking this principled stand, Connolly was adopting a position in line with that taken by revolutionary socialists across Europe, the US, Australia and elsewhere at 
this time.

Kieran McNulty

Tralee, Co Kerry

Irish Independent

Read More

Don't Miss

Editor's Choice