It's hard not to like Brian Lenihan. He didn't ask to be Minister of Finance and take on the world's worst economic crisis, none of which was his making. It's hard after all, to influence government economic decisions as Minister for Children (2002 - 2007).
There's also his courage and endeavour to tackle and withstand an awful cancer.
Nonetheless, such is the catastophic nature of our economic crisis that sympathy has to go out the window particularly if like me, you are following an agenda to get rid of this government as quickly as possible. So regretfully, I'm afraid I am going to have to call Lenny out on the big lie this week, the one that he and other FF ministers and TD's have trotted out with gay abandon.
The lie we are told, is that at all times the government has seeked to limit the losses to the taxpayer. This is easily disproved in the case of Anglo Irish and INBS. In order of cost, here are the losses accrued to the stakeholders in these fine, upstanding financial institutions.
The senior bondholders post September 2008. The state guarantees any bonds sold by any of our financial institutions post 2008 to present. This is why the senior bondholders can't be burnt. It is to all intents and purposes as good as sovereign debt, if we were to default on these bonds (and it is for the lifetime of the bonds) then we might as well default entirely. These bondholders are making an excellent return in the rate of interest they are charging. No loss, excellent profits.
The senior bondholders pre September 2008. The state has guaranteed to pay back these bondholders during the lifetime of the scheme. All bar about €4b has been paid back. In spite of the fact that these bondholders took a calculated risk when they took what effectively were worthless bonds in an insolvent bank, they have either gotten their money back or will be getting it back shortly. With interest. No loss, reasonable profits.
The depositors. Anyone with a deposit in these institutions will get their money back. Whether you are a family, or the ECB, your deposit is guaranteed and earning the relevant interest allowed, if applicable. Zero loss. Some profit.
The subordinated bondholders. Anglo has already aggressively seeked to limit the repayments on these bonds, in spite of the guarantee scheme. Typically they have and will be discounted by up to 70%. Hilariously, this will be spun as making a profit when reality they are worthless junk bonds. These bondholders are losing 70% of their stakeholding, but will be thankful in getting anything.
The shareholders. Once nationalised, the shareholders lost everything. This includes families like you and I along all the way up to the top financial instutions. I put this next to last, because any shareholding has a risk. Total Loss.
And finally, we have the Irish taxpayer. We will be putting €40b+ into these two institutions and getting absolutely nothing in return. Unlike the shareholders, we did not sign any coupon along the dotted line to participate in this scheme. Our losses are total, and we are the bottom of this particular pyramid scheme.
Brian Lenihan has expressly said that at all times, he has seeked to reduce the cost to the taxpayer. In his dealings with these institutions he has done the reverse and actively pursued a policy to maximise the losses to the taxpayer.