Business World

Tuesday 12 December 2017

Maeve Dineen: Leaders should not have cut short their holidays

ONE of the striking things about this crisis is how many leaders have been forced to break from their holidays and come back to deal with the emergency.

German Chancellor Angela Merkel will meet with French president Nicolas Sarkozy tomorrow to discuss the eurozone crisis. No doubt this has been instigated by Mr Sarkozy who witnessed one of France's biggest banks -- Societe General -- lose a fifth of its value in a flash last week.

Mr Sarkozy has told his ministers to spend their holidays in France. They were, he said, "entitled to rest, but not to a vacation"; they had to stay in close touch with their departments. Italian prime minister Silvio Berlusconi, and Spanish prime minister Jose Luis Rodriguez Zapatero have both been forced to cancel their holidays. The Greek prime minister, George Papandreou, is staying in Athens to oversee the start of an ambitious privatisation programme that he hopes will stave off bankruptcy.

British Prime Minister David Cameron has also been forced home from Hollywood to deal with the unprecedented riots in London. This is a damning indictment of how countries are run these days and another sign that leaders are actually becoming too important.

It is a rule of business -- or at least is should be -- that everybody takes holidays. Countless frauds have been unearthed through forced holidays, illness, and even retirements. It is also the case that the next generation of leaders can only be tested in operational situations. If everyone rushes back this never happens.

The fact that so many holidays have been interrupted shows how bad modern leaders are. Obviously there is a complete inability to delegate.

But, of course, the main reason for many is the huge fear that they will be shown up to be unneeded if they go on holidays. We all know the person who leaves a complete mess behind them when they go on holidays so that they have to be contacted on their break and therefore feel like the company can barely function without them.

In contrast the European leaders have no one to blame but themselves for having their holidays ruined. No doubt they hoped that they had done enough to keep markets calm while they went on holiday; once again they had done too little, too late. The package of measures announced in late July calmed nerves about Greece, Portugal and ourselves with the long-feared restructuring of Greek debt not as traumatic as had been expected. But Italian and Spanish bond markets focused on the fact that although the European Financial Stability Facility had a wider remit it did not have deeper pockets -- and that the remit could not be acted on until the 17 euro-area countries had ratified the changes.

On the back of this the financial markets decided not to take a break. At the best of times the markets are iffy at this time of the year. But this August hurricane euro is gathering pace for the autumn. Billions have been wiped offstock markets in the last week. Business and consumer confidence is plummeting and growth is grinding to a halt again in most major economies. Taoiseach Enda Kenny has remained on holidays despite the crisis and is absolutely right to do so.

KENNY is showing an admirable ability not to be driven by the BlackBerry agenda. There is little he could have done to stem the latest element of the euro crisis. In fact, Ireland's cost of borrowing is plummeting in his absence. To be fair, there is no correlation between this and he being on holidays!

But, come September, his European counterparts may be sorry they didn't do the same as they will need all their energy to face into the next part of this storm.

Irish Independent

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