EVEN though we have been warned about the terrible impact personal debt will have on individuals or families, yesterday’s news that the number of homeowners struggling to repay mortgages almost doubled between June 2008 and last September is chilling.
We have also been warned that this is likely to deteriorate. We – Government, the lenders and those directly affected – must have a clear and practical plan to deal with the challenges this situation brings.
Putting people, whose mortgage repayments were made on time before they lost their jobs, out of their family home is not the kind of proposal that will wash in the Ireland of NAMA and multi-million euro retirement packages for discredited bankers and regulators.
This startling acceleration reflects almost perfectly the collapse of the fantasy of the Ahern years. As RTÉ’s Prime Time proved again this week this crisis is firmly rooted in the days of Ahern and his see-no-evil, hear-no-evil lieutenants in the Department of Finance, Charlie McCreevy and Taoiseach Brian Cowen.
It is difficult to decide whether the revelations about Mr McCreevy’s €1.6 million Irish Nationwide loan or the sight of Mr Cowen sitting at Mr Ahern’s right hand as he made some of his infamously bilious and utterly discredited attacks on those who predicted this crisis is more disturbing.
The discomfort caused by the revelation that Mr McCreevy was a fast-tracked customer of one of the lenders right at the centre of the property storm is more than disquieting and will feed suspicions of the worst kind. The sorry situation is not at all improved by the fact that Mr McCreevy’s loan broke the bank’s rules. He borrowed €1.6m to buy a house for €1.5m. Putting aside the unbelievable implication that he had no funds of his own to use towards this purchase, the fact that a minister for finance gave a rogue bank such a captive to fortune – and that is the very politest description possible – is astounding. Mr McCreevy’s bombast and robust self-confidence was matched by, at the very least, outrageously poor judgment. Again, that is the politest possible way to say it.
Though Mr McCreevy has retired from politics Mr Cowen’s credibility is still undermined by his close links to the culture that facilitated our economic disaster. However, he is in a position to do something about it.
He can insist that lenders support homeowners in difficulties by whatever steps are necessary to keep people who try to meet their responsibilities in their homes.
He can also amend ethics legislation so politicians will be obliged to list not only their financial interests but their financial obligations too. Had this been the case, the sweetheart deals uncovered by Prime Time would not have been so shocking, so inappropriate or so utterly suspicious.
Another cosy, corrupting channel used by Ireland’s golden circle has been exposed and it must be cut off.
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