Monday, July 11, 2011

The Three Ages of Brian Lenihan

This post specifically addresses my reflections of Brian Lenihan the politician. It does not reflect entirely on Brian Lenihan the human being. Anyone with an once of respect and dignity shall show such respect and dignity to someone who has unfailingly shown courage, warmth, compassion and humanity. As a person, he is someone I aspire to, because unlike me, he had grasped the opportunities available to him. Whatever his role in life he applied vigour, intelligence and hard work. As a father and a husband, I would imagine he was amongst the best.

If, like most of the media and politicians you feel that Brian Lenihan was a great statesman and a fine politician. This is not the post for you. You have been warned.

The Age of Innocence

Hello. My name is Inigo Montoya. You killed my father. Prepare to die. 
Brian Lenihan is not much older than me. That being the case, it's likely he was brought up like my generation where we adored our fathers. And you couldn't really blame him, his father Brian Lenihan Sr was recognised as being one of the more charismatic of the grey men of FF. No doubt their home would have been a constant buzz of excitement with numerous meetings to include the great and the good of Irish politics, or in Fianna Fails's case, the criminal and the corrupt.

Growing up under these circumstances, Brian Jr must have looked up to his father like none other. His father of course had a chequered history with the political party he belonged to. Apparently unable to choose between the knave and the fool (Haughey and Colley) he later amended the record of revisionism to indicate that he had indeed supported Haughey. No matter, stints as Minister for Justice, Minister for Education, Minister for Foreign Affairs and Minister for Transport were a more than adequate reward for a lifetime of mediocrity. None could say that Lenihan Sr. wasn't a charismatic and able Irish politician, but none would say he was an able statesman.

In 1990, Lenihan Sr made the transition to FF presidential candidate, a shoe-in if ever there was one. FF after all, had never lost a presidential election, and Lenihan was a popular choice. Unfortunately for him, three events were going to conspire against him. Firstly, in a needless effort of revisionism, Lenihan insisted that he had not pressurised President Hillery into refusing the dissolution of the Dáil in 1982, widely accepted by all as being a power play on behalf of Charlie Haughey. Unfortunately for him, a tape quickly surfaced featuring an interview with Lenihan admitting to phoning President Hillery for precisely this reason. Forced to admit he had lied - although the term used was 'on mature reflection' he then appeared on TV attempting to defuse the situation.

Things were to get worse. The PD's who were in government at the time wanted Lenihan's head on a stick or they would pull out of government. Haughey courageously drafted a resignation letter which Lenihan refused to sign on point of principal - that he was only doing what he was told. So Haughey sacked him through the presidential office. Lastly, Padraig Flynn's decision to attack the Labour candidate, Mary Robinson, completely backfired on the campaign and the consequences as we all know, led to a seismic change in Irish politics, for the better.

Brian Lenihan Jr was 31 years of age at this point. What do you think went through his mind? What do you think he thought of Charlie Haughey, his father's 'friend of 30 years'. What do you think he thought of Bertie Ahern his father's campaign manager? What do you think he thought of Padraig Flynn, the best example of everything FF stood for in milking the gravy train?

Let's park that for a minute, we'll move onto the next age.....

The Age of Advancement

I never met anyone who didn't have a very smart child. What happens to these children, you wonder, when they reach adulthood?
Life is so unfair sometimes, and so is the gene pool. From the same combination of mother and father can come unbelievable contrasts in looks, charisma and intelligence. Look for example, at Conor and Brian Lenihan. Same gene pool, same education. Except Conor just manages to get into journalism whereas Brian on the other hand, merely goes to SSC Cambridge by way of Trinity College all with first class honours. Lecturing Law in Trinity College he gets called to the bar in 1984. He marries a future circuit court judge and they have a gentleman's family. Conor...........well, Conor eventually on the death of his father inherits the family entitlement as a TD, entering the Dáil in 1997 where he joins his brother......

......hang on, hold up there! Joins his brother? Wasn't he a well known and well regarded barrister? Why on earth would he want to contest a by-election after his fathers death, especially when no-one thought he would win it? One can only assume that the political blood that courses through the veins of the Lenihans was strongest in the elder sibling, particularly when he won the election, based as it was more on his charisma, likeability and good-humour, as it was on a sympathy vote.

Re-elected in 1997, great things were predicted for Brian Jr, was he not one of the smartest kids on the block? Was he not stuffed with brains? Was he not exceptionally well educated and well spoken? Was he not fluent in French? Could he not quote literature, poetry and history by memory alone? Was he not a barrister, trained to understand any situation quickly, to arrive at suitable stratagems in the shortest time frame, and thence to use his oratory and rhetoric powers to convince all those around him of his merits?

Sadly for Brian, he met his antithesis in Bertie Ahern. Bertie wanted to be educated in UCD or the LSE, or so he and others would have us believe, but had to settle for being a DIT accounts clerk. Bertie could speak Dublinese. Bertie mangled every maxim and proverb in existence. Bertie couldn't quote anything remotely relevant if it wasn't a sporting event involving Dublin or Manchester United. Bertie was DNS. But, and crucially, Bertie had two things Brian didn't have, raw cunning and political experience.

So for six years Brian Lenihan Jr cooled his heels while Bertie ignored him. For the next 5 years after that Bertie made him Minister for Children, a sort of halfway house for the politically useless. This way, he could be part of the cabinet but not be required to use his ability, skills and influence to bear on his colleagues.

Presumably after 11 years of loyal service to FF, keeping his oh-so-clever mouth shut, Ahern finally decided that Lenihan could now be trusted with a proper job, so in 2007 he was made Minister for Justice, the post his father once held, and the one most appropriate to his experience and skillsets.

One has to wonder what Lenihan actually thought of this. Hadn't he cut off his career in its prime to take up the reins of his father's political career? Was he not 100 times more capable than anyone else in the cabinet? How on earth could anyone justify that someone with his God-given talents would be left out of any significant part in government for 11 years, just because some trumped up little political rat had a complex about him? Things were to change quickly though, because Bertie's past had finally caught up with him.

The Age of Delusion

He's not the messiah, he's a very naughty boy
Brian Cowen succeeded Bertie Ahern as Taoiseach in May 2008. One of his first actions was to recognise the supreme talent of one of his closest political allies, Brian Lenihan, by making him Minister of Finance. Not Tanaiste of course, that privilege went to his even closer friend, the idiot savant that is Mary Coughlan.

Cowen gave Lenihan the role as MoF because of its seniority, not because he was suited for the role. Not that he had any worries of course, after all, he, a mere solicitor, has sleepwalked his way through MoF over the last few years, no doubt an actual real live barrister would be an absolute genius.

Unfortunately for Brian & Brian the runaway train of global fiscal correction was heading down the tracks and Ireland Inc. was the car stuck at the level crossing. So. Standing between Ireland and fiscal ruin stood three people. Brian Cowen, Taoiseach, previous MoF, overseer of the biggest vanilla property boom ever seen in the EU, Mary Coughlan, Tanaiste, idiot savant, and Brian Lenihan, the smartest guy in the room.

Alas, Brian wasn't the smartest guy in the room anymore. That would be the lying bankers. A lifetime of being servile to the interests of FF ensured that he never questioned Brian Cowen. His inexperience in his brief ensured that he trusted his department officials, even if they insisted the problem was liquidity and not solvency.

And now we get to the crux of Brian Lenihan Jr. This was a brilliant, affable, and intelligent man. Someone who would make a consummate politician, statesman, Taoiseach. A man far, far abler than any of his peers in FF. And yet, and yet, this is a man that saw his father shafted by his party for political expediency after decades of loyal service. This is a man who sacrificed his career in memory of his father. This is a man who every day he looked at his brother could see how lucky random chance can be. This is a man who kept his mouth shut for 11 years where he was pointedly ignored by a charlatan masquerading as a leader of the country. And when finally asked to step into the breach with all this experience, knowledge and baggage, comprehensively failed the people of this country.

Brian Lenihan is a statesman? He was no such thing. Above all politicians this learned, intelligent and able individual never put his country first. Because his first loyalty was to his party and his leader. Excusable perhaps for some neophyte journeyman, but inexcusable for a veteran in realpolitik, who given an opportunity to redress the wrongs slung at his father, compounded them in his miserable cowardly failure to stand up for the State against the party.

Brian Lenihans legacy is to financially cripple this State, to stigmatise this state with an IMF and EU bailout, and to destroy his reputation not just through his actions, but also his inactions, and in his inability to never once admit that he, or the party he served with such blind stupidity were wrong in any - ANY - of their financial actions.

J'accuse Brian Lenihan. Failure to the citizens of this country.

Tuesday, April 19, 2011

Death of Irish Industry 2012-2012

 It's important at various times in our roller-coaster economy (a misnomer though, as it also implies upward motions), it is important to catch one's breath and observe the situation in more detail. This allows us to make an assessment of the wider economy and make a calculated perspective of the road ahead.

Accordingly, my observation for the next 12 months is exceptionally negative, and I will outline the reasons why over the next few paragraphs. I would welcome comments and opinion that agree and hopefully, disagree with my findings.

1. The twin-track economy. We have two economies in Ireland. We have one that is a mostly export driven one that specialises in products and services that people actually need. This economy is doing quite well as a comparison to the domestic one, but only on the basis that the wider global economy continues to show growth. This economy of course is what the government is counting on to raise our near-dead economic corpse off its death-bed in order to service our enormous tax burden. The fate of this economy is unknown purely because it is completely out of our hands. At any stage, the winds of ill-fortune may ensure a double-dip depression in the US, and thus the rest of the world. The only thing to be positive about is that the doom-sayers have been advocating this for the last two years with nothing to show for far.

2. The narrow gauge track. This is our domestic economy, it's what we sell and service to ourselves and boy, is it screwed. And it's screwed for a number of reasons...    

3. First and primarily there is a continuing lack of confidence out there in consumer-land who are hoarding on to what gains they have in what banks or deposit based financial institutions that are left. This lack of confidence is perfectly understandable, but the main driving factor is that the consumer cannot see any end to the recession in sight, particularly with interest rate hikes forecast through the ECB.

4. Secondly we have a lack of credit in the marketplace. So from an Irish business perspective we have businesses that cannot access finance to tie them over the rough times as the banks simply don't have any money. Furthermore, banks have been actively decreasing their credit facilities in terms of reducing overdrafts or calling in existing loans. Now, in times of recession this is no bad thing as it weeds out unviable and unsustainable businesses that can only succeed in times of bubble economies. What is different now however, is that companies which are perfectly viable and sustainable are going to wall due to lack of credit and an inability to get paid by their debtors. In short, this weeding process has now gone too far, and the longer it goes on, the more and unrepairable the damage becomes.

5. Thirdly we now have serious upward pressures in terms of inflation, particularly for the manufacturing and service industries. Let me give you a simple example. At the moment we have a transport companies hammering on our doors looking to get our modest 32 county transport business. They are continually under-cutting themselves in terms of a 32 county pallet rate because they know our business is sound and they will get paid. In normal times this would be a welcome development, in times when raw costs such as diesel prices are going through the roof it's pretty clear this is not competition, it's desperation. It will literally be last man standing. And for every fuel increase there is every other kind of commodity increase you can think of which brings us to...

6. The slow and painful death of the Irish suppliers into the retail sector. What we have here is a big squeeze. From the topside, Irish manufacturers for the domestic market are facing enormous pressures on prices because of commodity increases in raw materials, increased energy costs and then a lack of credit to pay for them. They are selling these products into multiples that are looking for price reductions on the basis that their own customers are looking for value for money in a recession. In this impossible scenario something has got to give, and that something is not going to be the multiple or the consumer. So what we have here is the slow bleeding out of Irish manufacturers to be replaced by foreign imports, and this is on the basis that they are cheaper due to reduced manufacturing costs owing to scale and access to finance. A quick win for the Irish consumer, and a slow death for the domestic economy. You will see this as more and more business goes 'own brand' and I can guarantee you that 'own brand' with the exception of meats etc won't be Irish.

Therefore my supposition is that a lot of viable Irish businesses are about to hit the wall in the next 12 months unless the government take drastic steps to ameliorate the situation. This will become apparent as our unemployment rates continue to rise and our net emigration increases. Accordingly, the tax burden on those that remain, and remain employed becomes greater and more intolerant.

In the words of the film 'Something's Gotta Give'

Wednesday, October 27, 2010

Greece vs Ireland - Austerity Measures

Yes, after availing of the EU/IMF Stability Fund and paying a modest 5% rate of interest on the €110b in funding required to stabilise the country's finances, the IMF and the EU have insisted on the following austerity measures:

*Reduce the budget deficit from 13.6% to 3% by 2014
*Pay freeze on all public sector employees
*Scrapping the annual bonus scheme (basically a 20% bonus on wages)
*Increase in the retirement age from the current one of 62
*Full pension rights increased from minimum 37 to 40 years service
*Pensions to reflect average rather than final salary in the public sector
*VAT from 21% to 23%, increases to alcohol, cigarettes and fuel taxation
*Taxing of illegal construcion
*Privatisation of various state and semi-state bodies

Above we can see what the dreaded IMF will insist on just to provide Greece with the funding required to keep the nation afloat.     Scary eh?      Not really is it?

Let's be clear, regardless of our banking crisis and our incompetent governance, we are not Greece, not by a long way. Firstly we never lied about our balance of payments, we are a genuine open market economy, we have a generous corporate rate of tax, we have a language that everyone understands and we don't rely on tourism as an exclusive means to wealth.

So if we were to avail of the solidarity fund, how much worse would it be compared to the austerity measures that we have put in place and are going to put in place? Not a lot based on the evidence above.

But in the meantime, let's just destroy what's left of our economy while we pretend that the markets will allow us a sub-5% yield and that we can actually manage to get our deficit to 3% by 2014....