Madam, – Garret FitzGerald (Opinion, August 29th) warns that the State could end up in the hands of the International Monetary Fund (IMF) as if this would be a bad thing. At least the IMF would put a stop to the out of control public spending, borrowing and taxing that is only delivering high public wages and transfer payments. The IMF would at least act quickly to enable a recovery by inducing a short and sharp deflation or devaluation. The longer we have to wait for this to be done, the longer people will be unemployed. By the time of the December budget another 12 months will have been wasted by this reckless government, and for nothing. – Yours,etc,
CIARAN DALY,
Stradbrook Park,
Blackrock,
Co Dublin.
Madam, – I find Garret FitzGerald’s logic perplexing, to say the least .
On the one hand, he tells us that a general election in December, prior to the Budget and the establishment of Nama, would “throw our State into the hands of the IMF”. On the other hand he welcomes the prospect of an election after the Budget in January, since “there could then safely be a change of government”. How is it that a mere four weeks can mean the difference between the destruction of our economy and its salvation?
Does Dr FitzGerald seriously believe that after over a year of spiralling economic decline, Nama and the budget will have such an instantaneous stabilising effect? In many ways, the medicine prescribed by Dr Fitzgerald is a recipe for even greater economic and political disaster.
If an election were to be held after the introduction of the budget and Nama, it would almost certainly result in a change of government. This new government would – from its first day in office – be handcuffed to a set of irreversible policies to which both it and the public at large are fundamentally opposed.
How could a new government be expected to take tough decisions when its every turn would be met by the shadow of this €90 billion edifice? Dr FitzGerald has written extensively about the serious difficulties which faced the Government he led between 1982 and 1987 in making the kind of decisions which were necessary to get the economy back on track. It is therefore all the more astonishing that he should implore the leaders of the Opposition to sit on their hands during the passage of the Nama legislation, and to risk consigning themselves and the country to a similar fate in the years to come. – Yours, etc,
Madam, – I wish to echo the concerns raised by Fintan O’Toole regarding the oversight and implementation of Nama (Opinion, September 1st). John Mulcahy, the auctioneer advising Nama, informed the Oireachtas Joint Committee on Finance and the Public Service on August 31st, that the property market has reached the bottom of the cycle. How can he possibly know this? For example, in view of builders such as McInerney Holdings offering massive discounts (as reported in your Business Section on September 1st), how can anyone say the market has reached the bottom? Many experts would differ. Mr Lenihan is reported as saying the market is “nearly” at the bottom of the property cycle. This is equally worrying.
Nama may well be our “least worst” option but in the interests of the taxpayer, its decisions must not be informed by unfounded optimism. – Yours, etc,
Madam, – One aspect of the Nama debate that has received little attention is whether Nama will pursue the personal guarantees of of the major property borrowers.
Because these borrowers were private companies, often without the obligation, or need, to prepare comprehensive consolidated financial statements, it became normal for corporate lenders to demand personal guarantees. It will be extremely difficult for Nama to assess the worth or value of these guarantees without full disclosure of all personal assets and liabilities (including other guarantees). I doubt that Nama will be able to obtain such full disclosure.
Personal guarantees are a key element in the collateral security available to Nama and it would be reassuring to all taxpayers to have a public statement from the Minister for Finance and the CEO of Nama that personal guarantees will be pursued, through the courts if need be, and that Nama will not shrink back from forcing some developers to sell their trophy homes for the benefit of the taxpayer. – Yours, etc,
Madam, – I refer to Phelim Murnion’s letter (August 31st) in which he points out that Dr Alan Ahearne is a public servant paid from tax revenue. I would remind Mr Murnion that the 46 academic economists are also paid from tax revenue.
In answer to his analogy of not talking to the plumber: if you had one of the leading plumbers in the country in your house and you were discussing plumbing, surely you would ask him for his opinions as an expert?
I, as a taxpayer, welcome a public debate on Nama and I want the most expert voices included in that debate. Therefore, I welcome Dr Ahearne’s contribution. – Yours, etc,