Wednesday 21 February 2018

Stephen Donnelly: Enda's answer to tapes is to give banks more power

The Government needs to take a hands-on approach to the mortgage crisis and not stand idly by.

Stephen Donnelly

THE Anglo Tapes provide a devastating insight into why banks should not be left to their own devices. They expose how banks can act to protect themselves, regardless of the costs to society. And yet in the same week, the Government has supported changes to the Code of Conduct on Mortgage Arrears, making it easier for financial institutions to intimidate and evict families. Instead of insisting that banks use solutions which solve the mortgage crisis, the Government is actually giving them even greater freedom to do as they please. It seems Fine Gael/Labour are determined to learn nothing from the mistakes of Fianna Fail. And yet again, the country is paying a very high price.

We now know Anglo asked the Government for €7bn to pull the Government in. So that when Anglo came back for more, it would get it. This was not just deception, it was entrapment. The tapes are the smoking gun for a €30bn con job. Rather than give Anglo that €30bn, we could have paid no income tax for two years – imagine what that would do for job creation. We could have built 60 national children's hospitals, 4,400 schools or eradicated poverty.

The Anglo Tapes have sparked outrage across the country. But nobody who has worked in or around international finance will have been surprised by what they heard. There are responsible banks and many honest, civic-minded bankers. But there are other banks, where the culture suggested in the Anglo Tapes is the norm. The behaviours of some are so extreme that the Journal of Business Ethics carried a paper in 2011 called The Corporate Psychopaths Theory of the Global Financial Crisis. It posits that "psychopaths working in corporations and in financial corporations, in particular, have had a major part in causing the crisis".

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