The Oligarch of the Upper Merrion Street

Flip-Flop-Flip Brian
On October 23, 2008, just two and a half months ago, Minister for Finance has gone out of his way to explain that the State investment in the banks was the 'very final option' he was willing to take. On that date, Anglo’s shares were trading at €1.80 or almost 90% down on their historic high. Flip! Brian's jacket of being 'conservative with taxpayers' money' came undone!

Fast forward 2 months ahead – on December 15, 2008, announcing the rescue plan for Irish banks, Mr Lenihan has flopped the ‘very final option’ into an actual policy. By that date, Anglo’s shares moved to €0.36 or 80% below their October 23 level, yet still the ‘very final option’ was to involve no more than a 3/4 stake in Anglo with no voting rights for the Exchequer. The fig leaf of decorum of being only 1/4 true to his October statement was all that was left of a respectable Exchequer.

Today, Brian ‘The Flipper’ Lenihan has completely reneged on his October-December claims. The state is now poised to take the entire Anglo – toxic and healthy assets, workforce and physical capital alike. Flip! The fig leaf is sailing across the Upper Mount Street - its new Bank-owning Oligarch is now fully exposed as Minister whose words must be read between the lines.

Details? Go straight to the consequences!
Whatever the deal price might be the main point of this performance by the Government has been totally lost in the media to date. The nationalization of the Anglo Irish Bank is simply wrong. Full stop.

Let me focus on this point:

Irish Exchequer has no business taking money from the working families at this time of need (or at any time indeed) to rescue a handful of large development deals and bail out a party of investors. No financial stability emergency, no amount of bad loans on the books, no balance sheet analysis can ever justify the Exchequer using ordinary peoples' cash to buy assets into its own ownership.

If the Anglo needed capital, the Exchequer should have placed money with the institution, collect the shares in return to the current value of the money deposited and then immediately disburse the shares to those who are paying for them – the people.

And I do not mean some collective People – aka the public sector who will reap most of the benefit of any future recovery in Anglo’s fortunes, but the people whose cash 'The Flipper' has so princely pledged to Anglo’s creditors.

To be morally justifiable, the nationalization of the Anglo Irish Bank should:
(1) involve a rigorous investment case analysis carried out by an international assessor with NO connection to Ireland, the Anglo Irish Bank or any other party to the transaction before any announcement of the takeover was made; and
(2) if allowed to proceed, be carried out as a voucher nationalization scheme, with all new Anglo Irish Bank’s shares (underlying the State liquidity injection) being distributed uniformly amongst all households in Ireland.

We've paid for them, Mr Lenihan, in case you've failed to notice!