Time for buck to stop with transgressors in Ireland’s economics

Harry S Truman, US president in the late 50s, is credited with not only using the phrase ‘the buck stops here’ but also having a sign on his desk with that phrase on it, writes Paul Mills. 

The meaning was simple — he made decisions and had to accept responsibility for them. I do not know if Truman followed his own motto, but whether he did or not does not take away from the importance of the concept.

In Ireland, however, we are followers of the concept that ‘that success has many fathers, but failure is an orphan’. The nett effect is that when anything goes wrong, when tens of billions of taxpayers’ money goes awry or when the economy is destroyed by the failure of senior mandarins and politicians to do the job they are well paid for, they are not held accountable.

Mind you, it’s probably wrong to say nothing happens. The opposite is the case. Those who were guilty of the failing or the negligence get to walk away with telephone-number lump sums and handsome pensions. Our politicians fail us and we get to pay them, despite the fact that they were given a term contract and not re-elected for incompetence or negligence or just being plain not up to it.

Indeed, they get to walk away relatively unscathed when the economy is devastated on their watch, while the ordinary man, woman and child gets to live in near destitution for the rest of their lives. We should never forget that we live in a rich country, where the top 300 have wealth in excess of over €70bn — that is €7bn more than last year, according to a recent report.

Well, it looks like in the UK the issue of responsibility is once again to the fore and they are doing something about this failure to accept the consequences of one’s actions. The reason I say once again is because, strangely enough for formerly labelled perfidiousAlbion, people actually do the honourable thing and resign when they’ve been caught out.

Some, including MPs, even do time in jail. If such people do time here it’s generally because he or she upset a judge during the legal proceedings or is found in contempt of court. It’s just not good enough.

On Monday, the Financial Conduct Authority announced details of a “presumption of responsibility” rule, which requires senior managers to demonstrate that, where a firm is guilty of misconduct, they “took such steps as a person in their position could reasonably be expected to take” to avoid it happening.

In effect what they have said is that senior bankers will be presumed guilty until proven innocent. Fair dues. The cowboy behaviour of some of our senior bankers in their efforts to be ‘masters of the universe’, or to make a quick buck, brought this country to its knees. Strangely enough, they suffered very little and are once again back to the land of plenty, with mind-boggling bonuses to boot. Indeed, this country is in hock to the world for tens of billions of euro because of their antics.

How did they thank us for our largesse in pulling them out of the manure?

They didn’t. In the guise of bringing the banks back to what passes for normality, and despite the fact they were rescued partly to get the economy back on its feet again by offering credit to small businesses, they withheld the money to bolster their own balance sheets. Then, in an effort to kick those they had pushed money on to buy houses in the boom, they started to repossess houses, not only investment properties but also people’s homes. Of course, being sanctimonious they do not want to be accused of creating a moral hazard.

Just in case you think I’m being hard on these wonderful folk, think of their actions over the years, illegal offshore accounts for Irish residents, Cayman Island accounts, illegally jacking up interest rates, dodgy mortgage insurance, playing games with exchange rates, to name but a few.

So if you’re feeling teary that these folk might have to pay up, don’t — you already have on their behalf.

It’s now time the buck did actually stop with those responsible. Will Ireland emulate the UK in making people responsible? That’s the $64,000 question. Then again, St Patrick did get rid of the snakes — so maybe there is hope.


Lifestyle

Meet Tony the Turtle.How to explain Covid-19 to kids on the spectrum

More From The Irish Examiner