Sinn Féin banking policy may be on the money

EVERY housewife knows that when you are spending more than you are earning and have huge existing debt the last thing you do is borrow more.

The new ECB/IMF €68bn (€68,000m) loan merely adds to our debt and allows the international bondholders time to suck approx €60bn from the Irish taxpayer within the next two years (if we last that long).

Each 1% reduction in the interest rate would save just €0.250bn a year in interest repayments or €1bn over the four-year plan, when the interest bill alone will be approx €34bn and our overall debt a mere €160bn.

Growth in the economy will not happen until confidence returns to the domestic consumer. That will not happen until the debt and interest burden is reduced to manageable levels and until that happens growth will be negative and the debt and interest will merely grow and grow. Chicken and egg or Catch 22. Meanwhile, the international bondholders will suck the country dry of our remaining funds, just like the landlords did during the famine. That is why renegotiation is pointless unless it happens immediately and has the ultimate aim and effect to reduce the interest rate to near zero (0.5%) on the bubble amount of the debt, approximately €100bn and the interest rate on the remainder to a normative level, approximately 3%.

Failing this we must default on all remaining pre-September 28 2008 bank debt and demand a significant percentage reduction on the remainder, while honouring all sovereign debt and guaranteeing future bank and sovereign debt. Above all, this banking debt issue must be resolved sooner than later. If this seems closest to Sinn Féin’s banking policy (and David McWilliams’, Paul Sommerville’s, Michael Lewis’ and many others) then maybe Sinn Féin has the right banking policy, whatever about its other policies.

Kevin T Finn

Mitchelstown

Co Cork