Mike Soden - enjoying a cold dish!

The resignation of Mike Soden as Bank of Ireland (BOI) Group Chief executive was a surprise announcement on Saturday 29th May 2004. The market gave its judgement on Monday 31st May, the next working day, when BOI shares rose 4%.

Revenge, they say, is a dish best eaten cold and, almost 5 years later, Mike Soden is enjoying that dish and a new lease of life on RTE and other local media, where he is calling for the heads of the current bank CEOs and an amalgamation of AIB & BOI. Now where have I heard that proposal before?

Mike Soden succeeded Maurice Keane as BOI CEO in Feb 2002. Soden was an outsider, brought in from National Australia Bank, where he was Executive General Manager of Global Business and Personal Financial Services based in Melbourne, specifically to do the “transformational deal” which would take BOI from being a big fish in a very small pond in Ireland into a serious player on the European banking stage. It was felt that the internal contenders for the top job were all BOI “lifers” and lacked the experience, and possibly the imagination, to spot and execute such an opportunity.

Soden’s first big idea was to merge BOI and AIB to create a “national champion” with sufficient scale to ward off predators and expand geographically. This champion would have sufficient capacity to stage takeovers of mid-sized local players in other countries.

This “big idea” fell at the first hurdles – AIB weren’t remotely interested and the competition implications of combining the two largest players, by some margin, in a relatively small market like Ireland were overwhelmingly negative. However, Soden persisted with the promulgation of this idea long past the point where it was dead in the water, showing a distinct lack of business and political judgement. This didn’t endear him to the analysts community or, indeed, to his board of directors and senior executive colleagues. His preoccupation with this proposal, and obvious lack of cop on when it was clearly a non-runner, became something of an annoyance and embarrassment to his BOI colleagues.

Soden’s next big idea was to take over the troubled Abbey National in the UK – an October 2002 proposal which was badly received by the markets and the BOI share price fell like a stone. That deal was rejected by Abbey National and, in due course, it fell through, causing the BOI share price to rise.

In 2003 BOI signed a 10-year deal with the British Post Office (BPO) to provide financial services across its network of post offices. This deal was largely sealed on the back of the relationship built up with First Direct, a BOI subsidiary which has provided all the BPOs foreign exchange services since the mid-90s (and had grown to be the largest provider of FX services in UK).

Despite his clear remit to do “the transformational deal”, the BPO was the nearest Soden ever got to it – and, 6 years on, it’s still relatively small beer in the overall scheme of things. Long before the end of 2003, Soden had “lost the dressing-room” of his executive management team and was failing to convince the analyst community that he had any vision for BOI worth listening to.

So when, in May 2004, Mike Soden’s visit to an escort agency web-site was leaked by disgruntled IT staff to a newspaper, the Court (board of directors) was happy enough to have the opportunity to wave him goodbye. The nature of the transgression was embarrassing to be sure, but if they had felt he was worth saving they could have done so. Instead, it was made clear to him that he was going and a generous severance package would grease his exit.

Now he’s back – at least in the media. And what’s he calling for? The amalgamation of AIB & BOI. And the heads of the CEOs of the banks.

I heard him on Pat Kenny today – and he offered the view that the new bank heads should not come from the next tier of management within those banks – anyone who is tainted with the current policy/strategy failures.

Now Soden may well be right on this “firing & succession” point, but it’s hard to imagine that he’s not getting pleasure from shafting some of the people he feels shafted him.

But I will offer one piece of advice – don’t let Mike Soden himself anywhere near the helm of an Irish bank.

Breakdown in Social Partnership talks.

It’s unfortunate that agreement could not be reached at the Social Partnership talks, but it hardly comes as a major surprise.

Several days appear to have been largely wasted as the Government’s initial input was so lacking in specifics as to be described as “a blancmange” by union participants.

This seems in line with the standard Govt approach to planning – evidenced by initiatives from the 2003 Decentralisation scam to the October 2008 budget. A “back of the envelope” approach to everything.

The second issue which always seemed likely to derail the talks was “Scope Creep”, where a weak "talks management process" allowed the talks agenda to become an ever lengthening wish list for all participants.

All the above simply raises further questions about the Taoiseach’s (and Govt’s) competence and ability to manage the economy out of its current distressed condition.

Footnote: Published as a letter in the Irish Times

Predicting Roy Keane's managerial demise.

You read it here first! While looking for an earlier post (on Dublin bus network), I trawled back to the start of this blog and found the following - my first post on 24th November 2005. Considering how things turned out at Sunderland, I don't think I was too far off the mark.

Roy Keane's latest bust-up 24/11/2005

Roy Keane seems to display some of the classic traits of a bully - he can hand it out but he can't take it.

Some media reports of the post-MUTV session with the manager & players say that, when reprimanded in front of the players by Alec Ferguson, Keane threw the "Rock of Gibraltar" affair back in his face.

If true, this clearly had nothing to do with the situation but was the petty, spiteful response to criticism that you might expect from a spoilt child.

It's sad that a footballer of his undisputed class has such an immature personality. It's hard to imagine him succeeding in team management where player motivation would be a key requirement.

Instead of fond memories of his exploits for Manchester United and Ireland, he'll probably be remembered for the sour taste of his departures from both camps.

A dog's life?

There's a good , if somewhat poncey, restaurant called La Petite Maison in Nice.

We ate there and the wife was horrified when the "madame", who directs the action like a circus ringmaster, actually kissed the little pooch carried by a regular customer.

The following day, I spotted on the outside corner of the premises this charming little feature - a "dogs-bar". So at least the fondness for dogs appears to be long-standing and genuine.

Reviewers differ and diners scratch their heads.

Today’s Irish Times restaurant review by Tom Doorley features Corrigan’s Mayfair, Richard Corrigan’s new restaurant in London, which was also reviewed by the Sunday Times last December.

I was amused by the following glaring contradiction in their experiences. Reviewers differ and diners scratch their heads.

“linguini cooked in red wine with bone marrow and pecorino, fabulously intense, sharp, salty, savoury, rich, weird but wonderful.”
Tom Doorley Irish Times 31st January 2009.


“Corrigan has occasional moments where the enthusiasm gets the better of him, and there was a fashion disaster. This was the linguine cooked in red wine, pecorino and bone marrow. It looked, smelt and tasted not a little like, not a bit like, not almost like, but precisely and exactly like drunk’s puke. I didn’t finish it. I didn’t want to meet it twice.”
AA Gill, Sunday Times 14th December 2008

I prefer Gill’s prose style – shades of Helen Lucy Burke at her most acerbic.

Footnote: I emailed the above observation to Tom Doorley and got the following reply:

Hi Mollox
Gill is a great writer and can tell you a lot about the overall quality of a restaurant. But his interest in food is limited...
Curiously, Jay Rayner of The Observer adored the linguini but described them in such a way as I wouldn't recognise it.
Yes, indeed. Critics differ and I suppose life would be very dull if we didn't!
Many thanks for letting me have that quote - I see Gill's stuff from time to time. I adore his description of vegetarians as "people who take pleasure in not eating things" (even if it's unfair to a few of them).
AAG, I was told last week by a colleague of his, is paid €1m p.a. I wouldn't mind swapping columns for a few weeks!

Every good wish
Tom

Social Partnership process - will we get real reform?

The current social partnership process is important as a means of reassuring both ourselves and international markets that the country is working constructively to find a way out of the current economic mess.

However, the Social Partnership model is also responsible for many of the compromises which have left us with the burden of an overpaid, oversized and under-delivering public sector and political system. What confidence can we have that the current process will not repeat the mistakes of the past and deliver fudged, temporary solutions which fail to deliver the fundamental long-term reforms required to terms of employment, work practices and organisational structures? This reform challenge applies just as much to the Oireachtas as it does to the wider public sector.

As someone who remembers (and paid) the very high personal tax rates of the 1980s, the prospect of paying more tax now is unwelcome; but it can be endured, if there is equity in how it is applied and if it is coupled with a transparent process which delivers meaningful reform in terms of efficiency, effectiveness and value for money. I do not wish to pay higher taxes simply to maintain the status quo.

This raises the question: who is representing the interests of ordinary taxpayers in the current process? They are not represented by employers, unions or politicians, who all have the agenda of their own vested interests foremost in their minds.

While the Government would claim to represent taxpayers’ interests, the reality is that the primary concern of most politicians is retaining power and preserving political careers. These same politicians have created their own bubble, enjoying high salaries, bizarre pension arrangements and an over-generous suite of tax-free, unvouched perks. And all the while TDs tell us how hard they work, regarding many activities which are solely aimed at their own re-election as the legitimate employment for which they are paid.

Therefore, we must see, within the "Framework for Economic Renewal" currently under discussion by the social partners, the clear commitment of the Government and the public sector unions to meaningful reform and a robust process to get us there.

If we can’t get commitment to fundamental change in the heat of the current crisis, we’ll never get it.

Footnote: Published as a letter in the Irish Times.

Should Queen Elizabeth visit Ireland?

Yesterday’s “Head to Head” in the Irish Times was on the topic of “Should Queen Elizabeth visit Ireland?”

http://www.irishtimes.com/newspaper/opinion/2009/0126/1232474680314.html

Making the “Yes” case was Mary Kenny, while Charles Lysaght took the “No” side.

I found much of Lysaght’s argument to be indicative of someone caught in a time-warp. Here’s a couple of extracts:

“I have grave misgivings about Queen Elizabeth paying us a State visit, with all its panoply of parades and speeches.”

“A parade by the queen through our streets would provide an occasion for displays of enthusiasm by some who are all too likely to provoke the hostility of others.”

“The queen would doubtless be expected to apologise for British misdeeds, including the Famine, but not allowed to mention benefits we derived from the British connection.
She would probably not be allowed to voice British gratitude to the many Irish who served the empire, including those who in Churchill’s memorable words, “hastened to the battlefront to prove their ancient valour” in the second World War.
She would have to walk the tightrope of praising the achievements of modern Ireland without sounding patronising.”

It seems to me that Charles Lysaght envisages such a royal visit as something one would have seen in an old Pathe News black & white newsreel, reporting on the visit of the monarch to the grateful natives of a loyal colony in the 1920s or 1930s.

Can’t you see it - the Queen in a gilded open-top horse-drawn carriage, Prince Philip beside her in full dress naval uniform, chest covered in decorations and topped with a feathered admirals hat. Escorted by household cavalry outriders, all gleaming breastplates & helmets, long leather boots and drawn sabres, with her majesty waving to the happy flag-waving natives. Our Army No. 1 band, in their new Ruritanian uniforms, playing God save the Queen at every opportunity.
Royal Speech: “My husband and I are happy to be here in Eire among our contented former subjects blah blah blah”

If the queen does come, I imagine that it would be kept relatively low-key diplomatic affair with few banquets and set speeches (and none by John Bruton after his cringe-making tribute to Prince Charles). I can’t imagine her apologising for the famine or, indeed, making much reference to our shared history.

I think we should just get it over with.

Footnote: An abbreviated (by me)version published as a letter in the Irish Times.

Gormley finally sees the light on bulbs.

In his “Carbon Budget” on December 6th 2007, Minister John Gormley announced new legislation banning the sale of the normal incandescent light-bulbs from January, 2009.

http://www.independent.ie/national-news/gormley-lights-the-way-with-ban-on-bulbs-1240074.html

This caused consternation among manufacturers, builders, householders and retailers.

Light-bulb manufacturers would have to change their equipment and processes as well as manage stock levels and the transition from old to new bulbs. When they sought detailed guidelines it transpired that it was only a light-bulb in the Ministers head, nothing had been planned and he’d be holding a consultation process.

Builders with unfinished houses/apartment blocks were faced with a dilemma. Should they continue to install the downlighters, dimmers etc., or should they change the lighting design altogether – given that no suitable non-incandescent replacements were then available. It’s worth remembering that downlighters and “mood lighting” involving dimmer switches have become popular among the

Householders with existing fittings – dimmer switches, downlighters etc. were worried that, in 12 months time, they would be unable to get replacement bulbs.

Now we’re doing it the way it should have been done from the start – on an EU-wide basis, with a reasonable lead-in time for all interested parties.

The Gormley approach illustrates the extreme danger to the economy posed by allowing the Greens too much influence. The ideas are often worthy, but they are thrown out in a top-of-head way which causes confusion among those who make their living in the real economy. They haven’t been thought through in sufficient detail – which is a clear responsibility of those making Government policy.

The change in the VRT/Road tax regime last year was another good example. By introducing it in mid-year, the initiative effectively killed the motor trade in the first half of the year – when they traditionally achieve over 80% of new car sales.

Spare a thought for the poor bankers.

Out of curiosity, I looked up the last published accounts of the 3 main banks AIB, Anglo & BOI to see how the main men involved there might be suffering financially from the catastrophic collapse of the share prices of their banks.

Anglo - only issued preliminary accounts for y/e 30/9/08, the last published full set of Annual Accounts was for the year ended 30th September 2007
At that date, Chairman Sean Fitzpatrick owned 4.5m shares, which would have been worth €75m+ at their peak price.
Chief Executive David Drumm owned 511k shares, worth €8.5m+ at peak, and had 1.2m share options.
All the above are probably worthless now.

AIB – last published accounts are for year ended 31st December 2007.
At that date, Chief Exec Eugene Sheehy owned 256k shares, worth c. €6m at their peak price. Today they’re worth about €250k.
In addition, Sheehy had 120k share options and a further 251k in a Long Term Incentive Plan scheme – all of these are presumably so far under water that they’re worthless.

BOI – last published accounts are for year ended 31st March 2008.
At that date, Chief Exec Brian Goggin owned 600k shares, worth c. €11m at their peak price. Today they’re worth c. €360k.
In addition, Goggin had 398k share options and a further 402k shares in a Long Term Incentive Plan scheme. All these are now probably worthless.

None of these guys will be on the breadline, but at least they will all have taken a very serious hit to their personal wealth, never mind their reputations.

It’s appropriate that they should be sharing our financial pain.
It may make you feel a little better.

David Bellamy - Global warming debunker

David Bellamy was on RTE’s Late Late show on Friday night vehemently debutting the threat of global warming. His views were broadly those expressed in this Sunday Express article.

http://www.dailyexpress.co.uk/posts/view/73486

It’s always confusing for those of us in the middle when long-standing and credible environmentalists like David Bellamy are so publicly and trenchantly opposed to the growing scientific and public consensus on global warning.

Ditto when you hear James Lovelock, creator of the Gaia Hypothesis, advocating nuclear energy – an energy source which is anathema to many Greens, particularly the Irish variety.

I’m sure most people would agree that programmes such as recycling, reduction in energy consumption, improving our living environment etc etc are all good and worth doing. Even if Global Warming was scientifically debunked, we should continue to implement such programmes.

What I worry about is a growing bunch of tree-huggers taking us back to an economic stone-age with their zeal for the new green religion. The process of transition to a new model must be achieved without destroying the economy.

The challenge is this: if it is necessary to change the tyres, we have to do it without stopping the car. (How unGreen is that analogy!)

Reform of Oireachtas allowance/expense regime.

The news from the Green Party conference today is typical Green populist posturing – they’ve heard public reaction on talk radio and they’re leading from the rear. Anything to try to grab back a bit of the high moral ground, having already compromised all their core principles to death.

Now here’s what the new expense regime should really look like.

1. Rev. Comm rules should apply to politicians in exactly the same way as they apply to ordinary Joe Citizen – e.g. BIK, receipts, limits etc etc..
2. State transport should only be supplied for state business – not for personal or party business. No garda drivers – if security deemed necessary for any minister, provide it in an appropriate manner. That should only apply to 2-3 key personnel. State cars subject to the same laws as ordinary motorists – e.g. speed limits, red lights, bus lanes etc etc.
3. No daily allowance, currently €60 per day, for attending at Dail Eireann – what other worker gets paid extra simply for turning up? It’s a bloody disgrace.
4. No overnight allowances – the Board of Works to supply hostel accommodation at a convenient location. Take it or leave it. Much of this hostel accommodation (might be split over several locations) can be let to tourists during the overlong summer recess, to offset some of the costs.
5. Travel Allowance – whatever the appropriate bus or train fare might be. Mileage allowance is only to the nearest train station or bus stop, whichever is appropriate. This should help familiarise our public representatives with the quality of our public transport systems.
6. No additional salary/allowances for work on Dail Committees, other than any genuine, vouched out-of-pocket expenses.
7. Constitutional limit on number of junior ministers (currently 20) e.g. maximum 15, as currently applies for full ministers. Others may be appointed if deemed essential, but with title only – no additional pay, perks or pension rights.
8. Dail to sit during normal office hours e.g. 9-5. This will be a more family friendly regime and might encourage more women to participate in politics. It will also allow our TDs to personally experience rush-hour traffic and might incentivise them to do something about it.

What would you like to add?

Economists - the new media terrorists?

Last September, in the wake of the Govt €100k deposit guarantee, David McWilliams was the first person I saw publicly call for the Government to provide a 100% guarantee of all the liabilities of the Irish banks, not just their deposits.

http://www.davidmcwilliams.ie/2008/09/28/state-guarantees-can-avert-depression

Then, at end December, he called for nationalisation of Anglo Irish.

http://www.davidmcwilliams.ie/2008/12/31/nationalisation-of-anglo-could-actually-be-a-help

However, included in this latter article is the following paragraph: “About a year and a half ago in ‘The Generation Game’, I wrote that “one of the big Irish banks is simply a leveraged hedge fund betting its own and its clients’ money on overvalued property” and “normally when the property market collapses, these type of outfits go bust”.”

Am I alone in finding it difficult to square the thinking behind these two pieces?

If McWilliams was convinced, as early as mid-2007, that Anglo was “simply a leveraged hedge fund betting its own and its clients’ money on overvalued property” and “normally when the property market collapses, these type of outfits go bust”, why, following the collapse of that property market, was he calling in September 2008 for the Government to guarantee all the liabilities of Anglo Irish???

When I listen to the plethora of economists who now seem to fill our media 24/7, there seem to be almost as many potential solutions as there are contributors.

The beauty of being a media talking head is that you don’t have to be consistent in your diagnosis, prognosis or prescription. Hindsight is your crystal ball and you will rarely be challenged on how your previous analysis has actually held up.

Government doesn’t have the same leeway – they have to take decisions and live, or die, with the consequences.

It reminds me of the standard line on terrorism: the security forces have to get it right all the time, the terrorist only has to get it right once.

Are economists our new “media terrorists”?

And who ever would have thought that our universities have so many professors of economics and banking – all budding media performers in recent months. It must be a tidy little earner to supplement their miserable college stipend. Some will be hoping this recession/depression lasts for several years.

Challenges to Public Sector Reform

There are three obvious major obstacles to achieving meaningful public sector reform:

The Government: Their long-standing display of a lack of political will and dearth of management competence gives no confidence in their ability to achieve any meaningful change.
Benchmarking, decentralisation and the creation of the HSE without displacing any existing Heath Board staff, all illustrate the scale of the problem.
Every potential problem in the past decade has been fudged or had money thrown at it. So we can expect a slash & burn “across the board” approach which is likely to leave the end-user, the citizen, as the biggest loser.

The Unions: David Begg, General Secretary of ICTU is the highest ranking representative of the Union movement in Ireland but his public persona is not at all representative of that body’s members in their modus operandi. Begg is a consummate media performer, always coming across as intelligent, articulate, measured, moderate and calm. On the other hand, SIPTU’s Patricia King or the ATGWU’s Brendan Ogle are traditional “not an inch”, “over my dead body” intransigent union reps – where the strike threat is the first rather than the last option put on the table. These are the type of union reps who will be “negotiating” change.

The Management: Senior management tiers within the public service are almost completely untried and untested with regard to executing major strategic change. In the private sector, such management in any large company would have been through a number of major restructurings. In the public sector, the dead hands of Government and the Unions have ensured that no senior manager would even attempt major structural change.

Paradoxically, the one major change attempted in recent decades has also been the one which has most alienated the same senior managers who would be charged with leading such change.
The 2003 Decentralisation political stroke effectively ended the career prospects of many senior civil servants, who were unwilling to move with their departments to locations outside Dublin. Has anyone calculated what impact this has had on motivation these people and what impact that will now have on their appetite to facilitate and lead the necessary change?

Other than the above, it should be a doddle!

The never-ending Middle-East conflict.

The holocaust was an unspeakable atrocity of extraordinary magnitude. In the post-war period, the world salved its conscience for the failure to protect European jews from virtual extermination, but it was at the expense of the Palestinians. The ongoing dispossession of the Palestinians is unconscionable and the world now has a duty to right that wrong.

Israel must treat seriously the threat to wipe it from the face of the world made by some of its neighbours and Hamas. The Jews have, after all, had first hand experience of such an evil enterprise within living memory.

At the same time, Palestinians cannot be expected to accept a life sentence for a crime they did not commit. At best, they are now second-class citizens, restricted to a small part of their own homeland. The Gaza strip has become little more than a self-administering prison camp.

No resolution of this impasse will come from Israel’s iron-fist approach, in its current military campaign against the Gaza strip and also in its longer term behaviour towards the Palestinians e.g. the wall, the settlements, the restriction on movement etc etc..

Neither will the rabid rhetoric of some of Israel’s neighbours, or the actions of Hamas, help towards a lasting peace.

As long as both sides do what they’ve always done, they’ll continue to get the outcome they’ve always got.

When, eventually, a cease-fire is agreed, a number of distinct steps are essential:

1. The US and the EU must formally guarantee the territorial integrity of both Israel and Palestine, based on a return to the pre-1967 borders of Israel. This will have to include a removal of settlements and the resolution of the status of East Jerusalem – perhaps as a UN protectorate?
2. Israel, the US and the EU must fund a compensation package for the dispossessed Palestinians, which should include some limited right of return.
3. Those three parties and the Arab League members must provide a 10-20 year economic stimulus package to help get the new Palestinian state on its feet.

Incoming President Obama has the opportunity to write on a clean slate. Let’s hope he takes that opportunity and provides the necessary leadership to finally resolve this ongoing injustice.

It is, after all, the great running sore that fosters ill-will between the Muslim/arab and Christian/western worlds. It's in everyone's interest that this confict is resolved and a long-term solution demands fairness and generosity for the Palestinians, as well as security for the Israelis.

A Kiwi view of Munster v. All Blacks

Early January always features a plethora of radio & tv programmes looking back on the highlights of the previous year. A guest on one such radio programme was Irish Times rugby correspondent Gerry Thornley, who singled out the recent Munster v. All Blacks match at the new Thomond Park as one of his major highlights of the year. Thornley talked about an article written by a New Zealand journalist/blogger named Martin Moody as typifying the Kiwi reaction to the match and the character of the Munster support. I googled it and here it is. Apparently, since publication of the article, there’s been a fatwah on stray dogs in the vicinity of Thomond Park.

Munster the (real) victors after epic sporting showdown

The BBC said Joe Rokocoko’s late, late try “spared the All Blacks’ blushes” against Munster last night.

Sorry, no it didn’t. There would have been no blushes in defeat because there would have been no embarrassment in losing to the inspired, electrified, relentless, passionate and ultimately magnificent team of Munster men on this unforgettable autumn night at the legendary Thomond Park.

This was one of those sporting occasions which transcends a game and makes bolder statements about humanity. That sounds perhaps a tad pretentious – but it is not. This match was that special.

As a Kiwi – probably one of only 500 in the 26,000 strong crowd – I was honoured to be present at such an event and deeply moved by the respect the Munster crowd showed for the All Blacks, for my country and for the game of rugby.

Take heed all ye around the world who care about this beautiful game. When ‘Smokin’ Joe’ scored that heartbreaking, game-breaking try in the 87th minute, Stephen Donald’s resultant conversion attempt, if successful, would have put the All Blacks out of reach of defeat by an even later drop goal or penalty.

It was the most crucial of kicks. In almost any other stadium in the world, at least outside Ireland, the booing from the home supporters would have been loud, venomous and prolonged.

Yet as Donald lined up his kick the only sound in the eerily still, and yet monumentally flattened crowd was the occasional “Shhhhh” as spectators reminded their compatriots of their great yet unwritten sporting code.

The kick missed – perhaps it was the silence that undid Donald on that and several other occasions during the evening (to be fair to the crowd at Croke Park last weekend, they did exactly the same when Dan Carter was kicking.

Again, he missed some sitters. Maybe a new weapon, the Sound of Silence, has been discovered that can finally stop the mighty Blacks).

During one of Donald’s earlier, and also crucial, kicks, the silence was broken only by the barking of a dog from outside the stadium.

That’s right – you could hear a dog barking in a backstreet of Limerick, such was the silence inside Thomond Park. You almost expected the crowd to collectively look in the direction of the dog, raise their fingers to their lips, and whisper “Shhhhh” in the direction of the hapless hound.

Every word, every gesture of the All Blacks Haka was met with similar silence, immense appreciation and total respect.

How different that is from the braying you will hear from the Barbour jacket brigade two weeks hence at Twickenham, who will no doubt successfully drown out the Haka with their symphony of boorish booing, thus denying themselves and all other spectators of one of the great moments in world sport.

Remember too that a goodly proportion of the folks of Munster had taken up occupation in the pubs of Limerick throughout the afternoon in the build-up to the 7.30 kick-off.

Some might have been four sheets and quite a few more pints of Guinness to the wind but that didn’t have the slightest impact on the levels of respect they showed and which, quite frankly, put any rugby crowd in New Zealand to shame.

So here’s a plea to all fellow Kiwis. Let’s learn from the dignity and grace of the Irish. When Ireland (especially, but also any other international side) play our teams back home, let’s banish the booing too.

Let’s take up the alternative cry of “Shhhhh” and show that at the rugby table of manners, the Irish are not the only diners.

And another thing. If any Kiwis reading this bump into a Munster man or woman in 2011
during the next Rugby World Cup in New Zealand, invite them back into your home.

Tell them you were moved by the respect they showed your nation, your culture, your rugby team. Tell them that the Munster class of 2008 – a supposedly ‘second string’ team – was every bit as heroic as their proud predecessors of 1978.

Tell them that Munster lost only on the scoreboard but won everywhere that it mattered most – in the hearts, minds and affections of all those privileged enough to be present, including crazily patriotic Kiwis like me who (almost impossibly) would not have been downcast at losing to such a side.

Tell them how you heard about those Munster men who hit rucks like there was no tomorrow (and for anyone standing in their way there might not have been).

Tell them how their own brand of passion somehow inspired several of the younger All Blacks – notably the magnificent young athlete that is number 8 Liam Messam – to reach deep, deep inside themselves to a place they perhaps did not recognise and play like men possessed in those final, pulsating 20 minutes, when bodies were strewn like corpses across the glorious battlefield that was Thomond Park.

Tell them that you heard about the ‘Munster Four’ – Howlett, Tupoki, Manning and Mafi – and how they, backed to a man by the rest of the team, laid down their own heroic Haka challenge to the Blacks.

And tell them so much more. Tell them it from me. Tell them how the crowd to a man and a woman stood and applauded the All Blacks after the game, despite having just swallowed the bitter, bitter pill of unexpected, agonising, death knell defeat.

Tell them how ruddied-looking Munster men came up and shook my hand after the game and said “Well done, you deserved it”, when in truth perhaps we didn’t.

Tell them most of all, that the name of Munster, even in defeat, is synonymous not only with the great rugby victory of 1978 but also the magnificence of the players and the crowd who graced the rebuilt Thomond Park some three decades later.
Martin Moody

The Indo subverting the Oireachtas?

If one is to believe today’s Irish Times, Sir Anthony may now have his own political party!
Reporting on an ESB refund for overcharging following a review of customer accounts, the IT said that it arose “as a result of a complaint made in 2007 by Independent Senator Shane Ross”.

http://www.irishtimes.com/newspaper/ireland/2009/0106/1230936699766.html

The report makes no mention of the other Independent Senator, Eoghan Harris.

This means O’Reilly’s Independent Party now matches the Greens and the (soon to be defunct) PDs in the Seanad and exceeds the Shinners. O’Reilly can claim a greater democratic mandate than either the Greens or the PDS as 50% of his members were actually elected!

Mind you, (old joke coming) that’s where Trinity College has surpassed ancient Rome. For while it’s only a myth that the emperor Caligula made his horse a Roman Consul, it’s a fact that Trinity College sent a complete horse’s arse to the Irish Senate.

Where will O’Reilly’s political ambitions end – President Sir Anthony O’Reilly in 2011? I know I said I’ve vote for ABBA (anyone but Bertie Ahern), but this would be a stretch too far, much too far.

As for the soon-to-be-defunct PD senators Cannon & O’Malley, presumably they’ll follow the honourable example of Bev and stop taking their easy “walking around money” from the state?
I presume it’ll have to be voluntary, as someone said of Cannon – you couldn’t fire that man.

Shane Ross to lead bank shareholder revolt

In today's Sunday Independent, Shane Ross is hoping to reprise his Eircom success by leading a shareholder revolt at AGMs of the various banks.

http://www.independent.ie/opinion/columnists/shane-ross/banking-victims-fight-back-1591555.html

Would there be any chance the bould Shane would lead a shareholders revolt in Waterford Wedgewood and Independent News & Media.

Both companies, chaired by Sir Anthony – and he’s also the largest shareholder – have suffered a huge decline in value in recent years.
Waterford Wedgewood shares now trade at one-tenth of a cent per share! They were valued at over €1 within the past decade.
Indo shares trade at 42c, down about 90% from their 2006 high.

Shane will surely urge shareholders in both those companies to go to the AGMs and demand a boardroom clear-out, as Sir Anthony's enterprises now rival the banks when it comes to lousy share performance.

For some reason, I’m not holding my breath on this one.

Footnote: Aired by Marian Finucane on her RTE radio programme.

Launching the Corkage campaign

Tom Doorley's first Irish Times restaurant column of the new year looks forward to a very tough time for the industry in the coming months. There will be many casualties and Doorley "thinks aloud" about some measures that might help restaurants survive.

One aspect he comments specifically on is the price of wine in restaurants. For some time I'd been thinking about writing to him to see if he'd promote the concept of corkage - to give diners more choice and better value - so I've grabbed the opening offered by his column today and sent him the following email:

Tom,

As we lurch into recession and a New Year bloodbath for restaurants, you've finally decided it’s time to make a sensible comment about the price of restaurant wine: “We don’t want to be reminded, every time we go to the supermarket, how much we are paying for drinking such wines while eating out.”

The league of restaurant reviewers has been happy to report a 300% mark-up regime, to which we diners are expected to add a 10%-15% tip, without any adverse comment on this long-standing rip-off.

Routinely, the most expensive item, by some distance, on my bill is the item which has had the least “added-value” provided by the restaurant. (I dislike having my glass refilled by the waiting staff, I tell them [pleasantly] that I’ll take care of it myself).

Now that you’ve acknowledged the wine mark-up problem, what about starting a campaign to promote a reasonably priced corkage regime? It might help some restaurants get through the next 6 months, it would certainly encourage me to eat out more often (currently once a week with the missus).

Regards,
Mollox

Email response received from Tom Doorley on Sunday 4th Jan.

Dear Mollox

Good point! We (i.e the critics) have been too ready to accept the restaurateurs' arguments about wine. I have tended to object to wine prices when they go beyond the norm but the norm is too bloody much anyway! I have long argued that people should be rewarded for trading up, i.e. by way of a standard mark-up on all but the cheapest wines. In other words, if you pay, say €40 for a bottle in a restaurant this should be pretty well at parity with retail price while €20 could represent a hefty mark-up. Surely we would all be happy, occasionally at least, to buy Volnay rather than Wolf-Blass Yellow Label. And the restaurant would still make more out of the Volnay...

In an ideal world, a standard mark-up should apply to all wines but the cost of running a restaurant in Dublin is so much higher than in any other capital city in the EU (a situation that has to change and change rapidly).

The other thing that gets my goat is the way we tend to be penalised for drinking wine by the glass. Such has been the greed of restaurateurs that if you add up the number of glasses in a bottle it comes to way more than the cost of the actual bottle. I know that there are additional costs but I think the attitude is short-sighted.

Having said all this, I have to say that I'm glad I don't have to run a restaurant for living!

All the best

Tom

PS - watch out for a lunch campaign which will, I hope, offer two courses and a glass of decent wine for €20 - and all from very serious restaurants. I'm working like a demon on this at the moment!

David Begg is General Secretary of the Irish Congress of Trade Unions (ICTU). He is a consummate media performer, always coming across as intelligent, articulate, measured, moderate and calm.

Begg’s role makes him the highest ranking representative of the Union movement in Ireland but, in reality, his public persona is not at all representative of that body’s members in their modus operandi.

For a real insight into the mindset of Union activists, think SIPTU’s Patricia King or the ATGWU’s Brendan Ogle. These are traditional “not an inch”, “over my dead body” intransigent union reps – where the strike threat is the first rather than the last option put on the table. Change only comes when the business is about to close or a very large compensation payment is forthcoming.

It’s this bloody-minded approach, abetted by a supine Government approach to “social partnership”, which has ensured that the public services and semi-state companies are models of 1930s-style socialism in action – over-staffed, over-paid and under-delivering.

As long as David Begg continues to front the ICTU PR machine, the general public may well be fooled into thinking that the scope exists for real reform in the public services.

In reality, nothing will change unless the Government is prepared to tackle head-on the many deeply entrenched work practices (what an oxymoron that is) in the public sector and be willing to face a year or more of industrial unrest. Make no mistake - this will be politically difficult – disruption in hospitals, ESB, Bord Gais etc. will hit the general public hard.

Such action will require much more political will and staying power than has been evident to date from any FF-led government. In any organisation, major reform is most easily achieved in a time of crisis. When business is good it’s almost impossible to achieve major strategic change.

So the Government must grasp the opportunity which the current painful recession presents and force through the necessary reforms (always assuming that they have actually thought out what needs to change – which I doubt).

The first step should be to lock up (or banish) David Begg so that the “reasonable” mask is removed from the union movement. The public should be allowed to see the true face of trade unionism in order to galvanise public opinion behind the necessary, though temporarily disruptive, reform programme. SIPTU president Jack O’Connor, Patricia King or Brendan Ogle on the box every night will help convince the general public that the reform is worth the temporary pain and inconvenience of strikes, work-to-rules etc..

Israel's objective in current Gaza conflict?

A very interesting insight into the current conflict in Gaza today on RTE’s Morning Ireland.

David Landau of Haaretz, a credible journalist and commentator (well at least by RTE standards), was presented with a series of loaded questions which reflected the anti-Israeli preconceptions which are common in RTE, and the Irish media and population in general. (many of which I share when Israel is clearly heavy handed – with often fatal consequences for Palestinians).

Landau’s analysis of what Israel’s actual objective might be was very interesting.

The 2006 IDF invasion of Lebanon has been widely regarded as a military defeat for Israel and a victory for Hezbollah. However, that conflict ended with the insertion of an international monitoring force which has created an effective buffer zone. As Landau put it, since that particular conflict ended “not even a bow & arrow has been fired at Israel from Lebanon”. So the actual outcome was, however unexpectedly, quite favourable for Israel.

If Landau is correct, Israel is seeking to create a post-conflict situation in Gaza which mirrors that which now pertains on its Lebanon border. So the sooner the UN and/or EU puts such a proposal on the table the better.

Leadership - not always alpha

In the Irish Times of 31st December, under the headline “We are stuck with inept trio and a dismal alternative”, Vincent Browne disparages the credentials of the current troika leading the government (Cowen, Coughlan & Lenihan) and Enda Kenny as the alternative Taoiseach.

I would, in the past, have agreed with Browne, but Kenny’s performance as leader of Fine Gael, both electorally (e.g. +20 seats at the last general election) and in his ability to put together and lead an increasingly credible front bench, must surely suggest that he should not be so easily dismissed as a political lightweight.

Vincent Browne is (at least in Ireland) the ultimate alpha male commentator, and Brian Cowen is the ultimate alpha male politician.

As Taoiseach, Cowen routinely demonstrates that this isn’t always the most productive or effective way of providing leadership, while Browne’s career as a publisher and editor should surely, by now, have taught him a basic lesson about the successful building and leadership of a team-based enterprise: the brightest boy in the class does not always make the best leader.

Footnote: Published as a letter in the Irish Times 5/1/09

Editorial control in RTE

One of the side effects of the recent banking crisis has been to expose most clearly the innate tabloid nature of “talk” radio and the virtually complete absence of editorial control at RTE radio, the taxpayer funded and supposedly “public service” national broadcaster.

It’s like the feeding frenzy one sees on UK tv when a politician is wounded and the wolf-pack descends on his/her home baying for blood. “Will you resign today?” any wet-behind-the-ears cub reporter demands of a career politician with perhaps 20-30 years service. Blood-lust and seeking to make a headline replace any human consideration for the plight of the target (or his/her family) who may well be guilty of no more than a minor indiscretion or misdemeanour.

Hardly a programme passes without the presenter calling for the heads of the bankers (or, lately, the odd bishop) – the streets should be echoing to the sound of the tumbrils rattling to the guillotine, most suitably located in College Green, perhaps?

Nowhere is this more evident than on RTE Radio 1 where, from 7am (Morning Ireland) to 7pm (Drivetime) one can expect an “expert” opinion to be voiced on every programme (except, perhaps Ronan Collins from 12-1).

No politician, economist, broker or fellow media “talking head” guest can feature on an RTE “news” programme without being asked why the heads haven’t rolled in the big banks.

Much of the commentary is shallow and populist in nature (Shane Ross-type) and adds little or nothing to the public understanding of the complex and diverse origins of the problem, the multiplicity of players involved (including our own Govt) or the absence of certainty of success for any particular course of action.
It does, however, serve to stoke the fires of resentment in the general public and thus feed the beast that is talk radio – generating phone-calls, emails & texts to fill the broadcasters void and make their lives that much easier. Joe Duffy is probably the best example of how easy it is to feed off public anger, fanned by colleagues on other programmes. I hope Joe sends a very good “Xmas Box” to other presenters by way of thanks for their ongoing help.

Editorial Control (or rather its absence) in RTE

This brings me to the sensitive topic of editorial control and how one might implement something meaningful in an organisation whose culture doesn’t even understand, never mind tolerate, the concept.

As my current gripe relates to coverage of the banking crisis, it brought to mind the mandatory “health warnings” attached to all radio ads for financial products e.g. “values may go down as well as up”, “XX is regulated by.., etc”.
What if RTE was also required to attach a “health warning” to programmes, advising listeners of the limitations of what they may now be about to hear.

For example the Derek Mooney programme might be prefaced by the following health warning:

“Listeners are advised that Derek Mooney is not an expert on agriculture, banking, commerce, driving, education, food, green issues, health services, holiday travel, international events, insurance, justice system, loan arrangements, medical matters, noxious waste, opulence, politics, quandaries of any kind, relationships, religion, sex, stock markets, transport, tourism, urban renewal, voluntary agencies, welfare, x-rated topics, youth matters, zeitgeists of any kind or, indeed, a wide range of other topics.”

Pretty soon it should become obvious to RTE that such a warning would be
(a) very long and
(b) detrimental to any remaining vestige of credibility of the presenter.

RTE would inevitably be faced with two choices, perhaps opting to adopt both:
(a) limit the topic list for Mooney and enforce it and/or
(b) force Mooney to undergo a wide-ranging education programme.

Many RTE programmes could be much improved by such a regime.

Bank bailout - Ireland v. UK

There has been much misinformed media commentary on the failure of the Irish Govt to take ordinary shares in the Irish banks, unlike their UK counterpart.

The reality is that the UK government invested, in the first instance, in preference shares and only acquired ordinary shares as a result of acting as underwriter to major rights issues for RBS, Lloyds-TSB & HBOS.

For example, RBS sought to raise £20bn in new capital - £5bn in preference shares taken directly by the UK government and a £15bn rights issue to existing shareholders, the latter underwritten by the Government. When the majority of existing shareholders failed to exercise their rights, the government ended up buying most of those new shares and became the majority 60% shareholder in RBS. Does anyone actually believe that this was the outcome the UK government desired?

Lloyds-TSB & HBOS sought a total investment of £17bn between ordinary & preference shares and, as with RBS, the UK government ended up with most of the new ordinary shares and currently holds 40% of the stock.

Both AIB and BOI have indicated that they are likely to seek to raise additional capital through a rights issue, with the Irish government acting as underwriter. Should existing shareholders fail to take up their rights, it’s highly likely that the government will become the largest, if not the majority, shareholder in both banks.

In addition, should AIB, Anglo or BOI be unable to pay the annual coupon of the preference shares bought by the Government, the missed dividend must be paid in new ordinary shares at the currently prevailing market price.

Next - the Insurance Pyramid Scheme?

There have been a number of high profile pyramid schemes exposed in recent weeks. Internationally the Bernard Madoff scam which seems to have cost its investors up to $50bn. At home, the Breffni O’Brien scheme seems to be missing as much as €20m – more modest perhaps but involving a small number of investors who can probably ill-afford the deception.

Pyramid schemes have a long history and a simple attraction for investors – they appeal to people who expect high guaranteed returns with little or no risk. This combination is, unfortunately, not generally available. The schemes promise high returns and actually deliver them to early investors. They rely on this perceived high performance to pull in new investors to keep the cashflow strong. However, what’s actually happening is that the money put in by new investors is being used to pay “dividends” and /or capital to earlier investors. This “return” to investors has little, if anything, to do with actual investment income or capital gain earned by the scheme.

Pyramid schemes are naturally illegal and Messrs. Madoff & O’Brien can expect to do jail time for their financial exploits, though one suspects the US system will deal much more harshly with such frauds than the Irish legal system is likely to.

Insurance companies are, on the other hand, quite legal, but are open to being effectively operated as pyramid schemes unless they are closely supervised and scrutinised.

Insurance companies operate on the basis of collecting insurance premiums today to pay for insured events arising at some time in the future. This gives large insurance companies a huge cash float which they can invest to earn a return in the interim. Assuming the company’s investment strategy is sound, the bulk of the company’s profits are likely to come from this investment income, rather than any actual surplus of premium income over claim payouts.

In the current investment climate, with stock markets & property all showing major losses on a worldwide basis, it’s highly likely that any investment fund with an aggressive approach is currently nursing substantial losses in the past 12-18 months. Funds which invested in bank shares, property companies, building materials etc etc will be very badly hit.

So it could be that some insurance companies are effectively in “negative equity” on their funds set aside to meet future claims. This means that existing outstanding claims will also have to be partially met from the premium incomes being generated from new and existing clients, which are intended to cover future, rather than historic, claims. To keep the ball rolling, so to speak, such an insurance company has to maximise new business inflows and, to do this, will probably have to quote the most competitive rates in the insurance market. Which will, in turn, increase the negative gap between income inflows and future liabilities arising from claims.

Ultimately, unless there’s a dramatic turnaround in investment returns, the wheels will come off and the insurance company will go bust – leaving its policy-holders without cover and legitimate claimants unpaid.

Sounds like a pyramid insurance scheme to me.

So who are the most aggressively priced insurance companies in the Irish market and what have they invested their surplus funds in e.g. if Quinn Insurances, FBD, Hibernian etc have made substantial investments in Irish banks e.g. Anglo?

Internationally, where has Warren Buffet’s Berkshire Hathaway (owner of some of the largest US insurance companies) invested the surplus cashflow thrown off by those companies?

All we need to follow the international banking crisis is a similar collapse in the international insurance market. The complexity of the huge re-insurance side of the business means that, in the event of a loss of confidence, it will be virtually impossible to establish clearly who’s carrying what risk and how reliable any company’s re-insurance contracts are when it comes to settling liabilities.

Happy Whatsit

Wishing all my readers a Happy Christmas.

Well, ok then - Happy Christmas Bat.

Casting "Greens - the movie".

Watching Energy Minister Eamon Ryan on tv today, it struck me that if they ever make “Greens – the movie” they’ll have to get Nicholas Cage to play him. No-one does tortured sincerity like Cage – though Ryan could give him lessons. Honestly, sincerely!

Environment Minister Gormley might be played by Jim Carrey, though Carrey would have to restrict his performance to a two-faced effort.

Jon Pertwee could play Mary White in a reprise of his Worzel Gummidge persona, he may still have some of the costumes handy.

That leaves Paul Gogarty (as himself?), Trevor Sargent (Bruce Willis, in vegetarian mode?) and Ciaran Cuffe (Andy Serkis as Gollum with clothes?).

Any suggestions?

The Catholic Church & Sex

The Pope is at it again and the gay community worldwide is up in arms.

Apparently his “end of year” homily can be interpreted to mean that saving mankind from homosexuality is as important as saving the planet environmentally.

I’ve not bothered to read the offending script – but I have heard some of the media debates and the claims made by the catholic side that the Pope never said this, with the gays saying that it’s the only interpretation one can take from his sometimes oblique comments.

There’s no doubt about two things: Firstly the hostile position of the church with regards to homosexuality and, secondly, the highly insensitive, even if technically legal, language the Vatican routinely employs when discussing the topic.

One interview yesterday clarified, for me, the main problem the church faces in this “battle”. Matt Cooper on TodayFM was interviewing a catholic clergyman about the pope’s reported comments and the church’s position on homosexuality. The cleric explained that the church doesn’t condemn homosexuals, it’s homosexual acts which it finds objectionable. “What’s the difference?” asked a confused-sounding Cooper.

Therein lies the main problem for the church and it’s bigger than the gay community. It relates to all sexual activity – whether straight, gay or transgender.

Liberal western society no longer sees a distinction between the sexual orientation and the sexual act. We are now all deemed to be “sexual animals” - if you’re not expressing your sexuality in a physical way, you are not living a full life.

For the church, the act is the thing. Its condemnation of sexual acts between homosexuals is entirely consistent with its condemnation of sex outside marriage for heterosexuals and its demand for celibacy from its own clergy. (Though its language regarding homosexuality is routinely brutal and offensive when contrasted with any views it expresses on other sexual topics.)

However, liberal western society accepts sex as being nothing particularly sacrosanct. It’s somewhere in the realm of a sign of affection (not necessarily love), an entertainment, a leisure activity or even a form of exercise. As presented in the media (or, indeed, for much of the population) sex seems to have little to do with a long-term relationship or commitment.

The rise and acceptance of the so-called “sex industry” is a clear indicator of what is happening. When you get regular reports of people-trafficking into brothels with little apparent police action or public outcry, lap-dancing bars opening in rural “cities” etc, you know that sex is now a commodity/leisure activity of no great consequence. (Which must have consequences for the legal gravity of rape as a crime. Why should it now be punished at a tariff any greater than that applied to a serious physical assault?)

I’m not clear how much of this "liberal progression" is a willing choice of participants and how much is forced on people who want to be seen to conform to changing mores. Are parents always indifferently happy to their daughters living with boyfriends, and vice versa? Are parents always happy when presented with a grandchild whose parents aren’t married, or may no longer be together? If I had daughters I suspect (ok I know) I’d be strongly disapproving of their cohabitation and/or unmarried mother status.

Unless western society decides that the pendulum has swung too far to the liberal side and starts to move back to a more conservative attitude to sex, the church will continue to be “the voice of one crying in the wilderness”.

One cannot blame the church for maintaining its own moral position with regard to sex (of all kinds), even if it appears increasingly out of step with the world and its own membership, but one can demand that it speaks much more sensitively (i.e. far less offensively) to its own homosexual minority.

New fashion trend for World leaders

The recent trend for world leaders to allow themselves to be photographed topless must surely be putting pressure on Biffo Cowen to do the same.

It’s not a pleasant thought, and it won’t be a pretty sight, but perhaps if Biffo’s advisers get him a better pair of togs he won’t look quite as unsightly as Brezhnev.

Though I’m not betting on that!

Lame duck Dux ducks

But how did Plunkett get onto the podium, when he can't even get into a Lotto photo?

Put the bite back into restaurant reviews.

AA Gill reviews Richard Corrigan’s latest London eaterie, Corrigan’s Mayfair, in today’s Sunday Times.

http://www.timesonline.co.uk/tol/life_and_style/food_and_drink/eating_out/a_a_gill/article5306823.ece

The review makes it clear that Gill is a genuine fan of Corrigan and he’s highly enthused by this latest culinary venture. He awards it 4 (out of 5) stars, a high mark from Mr Gill who’s not averse to awarding scores of one or two.

However, he did hit one bum note on the menu which is described hilariously, I think, as follows:

“Corrigan has occasional moments where the enthusiasm gets the better of him, and there was a fashion disaster. This was the linguine cooked in red wine, pecorino and bone marrow. It looked, smelt and tasted not a little like, not a bit like, not almost like, but precisely and exactly like drunk’s puke. I didn’t finish it. I didn’t want to meet it twice.”

Doesn’t it just make you pine for the return of Helen Lucy Burke’s razor sharp pen & tongue?

Someone should smart meter the Greens

The installation of smart electricity meters in every home in the country has perhaps been Green Party Minister for Energy Eamon Ryan’s biggest idea since he became minister 18 months ago. He rarely misses an opportunity to plug the initiative (pardon the pun).

In today’s Irish Times, Harry McGee reports on the appearance yesterday of the ESB’s chairman Lochlann Quinn and chief executive Padraig McManus before the Dail All Party Committee on Communications & Energy.

http://www.irishtimes.com/newspaper/ireland/2008/1211/1228864662534.html

“Senior executives of the ESB indicated publicly for the first time yesterday that the technology was not yet fully proven and that the case had not yet been made that such a substantial investment would result in commensurate savings.”

Mr McManus “said that the utility needed to take a prudent approach before making such a huge investment. That is why smart meters were being piloted over 18 months.”

“Mr Quinn added that rolling out smart meters would cost €1 billion and that would go on all consumers' bills.”

Thank god for a bit of prudence in the ESB on this one.
But isn't it just typical of the Greens – loudly promoting unproven, untested solutions. Throwing ESB/customer money at it to create the illusion that the planet is being saved and therefore Green sell-outs on social and ethical policies can be justified to their electorate.

Lisbon II - the headaches begin.

The thought of another divisive Lisbon Treaty campaign is giving me a headache already.

Assuming it’s the same text, with declarations attached and a promise to incorporate those declarations in the next EU Treaty, we’ll undoubtedly be subjected to the same conspiracy theories and threats – by both sides, though mainly the NO side. (I voted Yes first time, and will again.).

Presumably aircraft leasing mogul Ulick McEvaddy will again offer his assessment that the treaty is unintelligible gobbledygook and should be rewritten in plain English which the ordinary citizen can understand, as if this was the simplest of tasks.

If McEvaddy does surface, I hope someone in the media asks him for a copy of one of his company’s pro-forma aircraft leasing contracts and let us see just how plain and simple that is.
Then ask him if he’d expect one of his clients to sign one of these lease agreements without first having it vetted by an accountant and a lawyer? Or would he himself sign such an agreement without first getting professional advice?

I’ll bet the answer is no. If it’s not, he’s dealing with fools.

Tackling Feral Children

The callous murder of 50-year old East Wall resident Aidan O’Kane has led to media reports which refer to the murderers as “children”. That may be the legal definition based on age, but this is just the latest and most extreme outrage perpetrated by gangs of anti-social young thugs who seem able to terrorise neighbourhoods with impunity and with no credible legal deterrent. The general public feels helpless, not knowing how to deal with these “feral children”, despite this being a problem that has been widely recognised and growing for several years.

Former Minister for Justice Michael McDowell proposed the introduction of electronic tagging but, to date, nothing appears to have been done in this regard. Objectors to this scheme point out that it generally hasn’t had the desired impact in the UK and that such tagging risks becoming a badge of honour among these young thugs.

Could a variant of the UK scheme make a tagging scheme here something that these youths would wish to avoid, rather than becoming something to brag about?

If you attempt to leave a shop without the electronic tag being removed from an item of clothing, it sets off an alarm at the door. Why can’t we reverse this process and design a system where an offender’s electronic tag sets off the alarm when he/she attempts to enter a shopping centre, shop, cinema, pub, club, public building etc etc.? If entry to most such places was barred to tagged offenders, it might just take the hard-man gloss off having to carry the tag. It might also become a bit of a bore to hang around with a tagged friend who can’t get into such places.

Obviously tackling the underlying social problems will require a multi-faceted carrot & stick approach, of which tagging would be just one small element. But we need to make sure that the stick is effective when we choose to use it.

Irish Banks - do they need to be recapitalised?

Do the Irish banks actually need recapitalisation? Do we really need consolidation in the financial services market in Ireland?

In Friday’s (5th) Irish Times, Michael Casey, former chief economist with the Central Bank and a former member of the board of the International Monetary Fund, wrote an interesting opinion piece.

http://www.irishtimes.com/newspaper/opinion/2008/1205/1228337449605.html

Casey basically posed the questions outlined above. He pointed out that PWC inspectors had done a detailed examination of the loans books of each bank and given their individual capital adequacy levels a clean bill of health under current levels of loan impairment and, indeed, under a number of increased stress tests – albeit the levels of additional stress have not been publicly quantified.

He also pointed out that capital adequacy will, or should, not lead banks to make bad loans to companies struggling in a recession. The UK banks have been significantly recapitalised by the UK taxpayer, yet the SME & mortgage markets there continue to complain about the willingness of banks to lend.

Casey poses the question: “Is it conceivable that the Government wants the banks' capital to be more than adequate, as is now the case in the UK? What does "more than adequate" even mean? Is there a belief that additional - and unnecessary - capital is required to restore investor confidence in the banks?” This appears to be the perceived wisdom among the business commentariat in our media (much of which is woefully underqualified to comment).

He also concludes with, what I regard as, a perceptive comment: “In short, the consultants, Central Bank, Financial Regulator and the entire establishment, including the banks themselves, have now told us that there are no problems of liquidity or of capital. Why then are the meetings with the Government continuing? Either the good news is not quite so good or is there something else we are not being told about? It may all simply reflect a natural human desire to be seen to be doing something.”

Co-incidentally, (also on Friday 5th Dec) Goodbody Stockbrokers published a briefing note which reported that Standard & Poors (S&P), one of the major international rating agencies, “produced a report, which highlights “significant inconsistencies” in how banks account for risks and how much capital they hold under Basel II, making it very difficult to compare banks capital adequacy levels.”

http://www.goodbody.ie/news/morn.html

It seems that S&P surveyed c.50 European banks and found that various interpretations of the Basel rules regarding capital adequacy can produce “four-fold differences in risk weights for the same underlying risks”. In other words, banks in the UK, Spain and some Nordic countries have used less conservative estimates of risk than those applied by the Irish banks and a direct comparison between stated Irish and UK capital adequacy ratios is probably invalid.

The Goodbody briefing note concludes that “although the market undoubtedly now requires banks to hold a higher level of capital, it seems unfair that they would also be expected to increase their capital ratios to the same extent as their UK peers.”

Meanwhile, the private equity sharks are cruising while the politicians, the media and the populace are all demanding that the bankers get in the water. (Indeed, the politicians are delighted to have the bankers as a lightning rod to deflect blame for our current economic problems. No mention is ever made of the fact that every budget is the past 10-15 years has contained measures to encourage developers, investors and, particularly, first time buyers to get into the property market.)

Perceived wisdom can be the most dangerous, least informed thought process with the greatest capacity for long-term, perhaps terminal, damage.

If the Irish banks are, in haste,
(a) forced into the arms of private equity at knock-down prices, or
(b) forced into unnecessary consolidations which make the market less competitive
we may all live to regret it at leisure.

Who can speak for the Greens?

Who is authorised to speak for the Greens?

In the recent controversy over Fás chief Exec Roddy Molloy, the Greens denied a media report that they had expressed confidence in Roddy Doyle. They got a retraction on RTE’s Morning Ireland to that effect.

In a subsequent radio debate, Green Cllr Niall O’Brolchain was adamant that “no elected representative” of the party had made such a statement of support.

However, the Indo’s Fionnan Sheahan claimed that the Govt Press secretary assigned to the Greens had made such a statement to the poll corrs, and he offered to produce many witnesses. Sheahan pointed out that this particular official is briefed by the two Green ministers and is mandated to speak on their behalf.

Today’s Morning Ireland interviewed Green Senator Dan Boyle who proposed an extended deferral of the public service pay element of the National Pay Agreement, while that same programme reported a Government denial that it is seeking such a deferral.

If this turns out to require yet another Green u-turn, will we be told that “no elected representative” of the Greens ever made such a call? After all Dan Boyle has been elected to nothing.

Having been rejected by the Cork electorate, he’s only in the Seanad as a Taoiseach’s nominee.

Freezing guinness

In tandem with their decision to freeze the price of the pint, is there any chance publicans might unfreeze the pint of Guinness?

The practice in recent years of chilling the famous stout to lager-like temperatures is akin to serving good red wine from the fridge. Usually a mistake.

When I challenged my local publican about this a couple of months ago, he responded “I don’t come in here to get hassled”. Helpful.

And there was me thinking I was the one who’d taken early retirement.

I've communicated by views directly to Guinness, but I'm not holding my breath. Their latest advertising campaign was themed "fridge magnet". They've clearly taken chilling to heart.

Footnote: Section in italics published as a letter in the Irish Times.

ABBA for President (No. 2)

In today’s Sunday Times, Matt Cooper raises the awful possibility of Berie Ahern in the park in 2011.

http://www.timesonline.co.uk/tol/news/world/ireland/article5257829.ece

This “campaign” was launched a couple of months ago when Cecilia Ahern expressed the view that her father would make a fine president.

We’ve now seen the Bertie series on RTE and the Drumcondra mafia has been exposed as a smug and unpleasant bunch of chancers.

The prospect of this lot partying up in the Aras doesn’t bear thinking about: “Jaysus lads, we done it! Hey gherkin,(presidential ADC) tell Fagan’s to send up a barrel of Bass and a couple of cases of Piat d’Or pronto and then eff off. Anything in uniform makes us nervous.”

And we’d have the spectacle of Bertie taking his current mot abroad on state visits. It was embarrassing enough when he did it as Taoiseach, we should never tolerate it again.

So it’s ABBA for President.
Anyone But Bertie Ahern.

Stopping the Barbarians at the gate?

I see in the papers that that one of the US private equity firms looking over the Irish banks is KKR( Kohlberg Kravis Roberts), who first came to public attention through their 1988 takeover of RJR Nabisco, in what was, at that time, the largest leveraged takeover in US corporate history.

The deal has become familiar to millions through the book & film “Barbarians at the Gate”.

The basic structure of such leveraged buyouts is that the buyer uses the assets of the target company as collateral, borrowing money against those assets in order to buy them. The general approach is to maximise the amount borrowed and minimise the amount of one’s own capital tied up in the deal.

Then typically, acquisition is quickly followed by slash, burn and asset strip. Reduce costs as quickly as possible, close loss-making or marginally profitable units, dispose of non-core activities and pay down the debt as quickly as possible. Get the business as lean as possible and sell it on for a handsome profit within 3-5 years.

Seeing that KKR name and remembering the movie, it put a mad idea into my head so I went to see my local Bank of Ireland manager.

“Look” I said to him “you fellows need a white knight. If the bank is prepared to lend me €2bn, non-recourse of course, I’ll invest it in the bank and that’ll take all the heat off. You guys can easily raise that money on the international money markets because you’ve got a Government guarantee. I’ll give you the shares I buy as collateral for the loan. With a bit of luck we’ll have turned the corner on the recession and the property bubble bust by the time the Govt guarantee runs out and my loan needs to be refinanced. If not, worst case scenario is the Govt ends up with my shares – still a much better outcome than having those US barbarians on the share register, don’t you think?”

Well I didn’t really know what to expect, but the BOI seem quite interested in my proposition and I’m expecting a positive decision from them within 7 days.

In fact, it all went so well that I decided to pitch the same idea to AIB, Anglo and PermanentTSB. As with BOI, I’ve gotten a very positive response from them all and should know within weeks which, if not all, are willing to play ball.

By Christmas, I may well be the owner of the 90%+ of the Irish banking system. Wouldn’t that be one hell of a do? I better start trying to lose a bit of weight – I’ll want to look good in the Louis Copeland tin of fruit for all those media appearances.

I can already see the headlines in the FT and the Wall St Journal:
Mollox 1 Barbarians 0.

The Government clutching at PR straws.

On Friday morning I heard Plutarchos Sakellaris, vice-president of the European Investment Bank (EIB), interviewed on RTE where he confirmed that four Irish banks are actively negotiating with EIB for access to a pan-European €15 billion fund for lending to small and medium enterprises (SMEs).

It seems that Finance Minister Brian Lenihan also heard that interview because he announced that same evening that he had asked the banks to submit to him their plans for making funds available to the SME sector. This ministerial initiative has received considerable coverage on RTE over the weekend.

It all smacks of opportunistic PR, with the minister attempting to claim credit for an initiative already in train. I suppose desperate times call for desperate PR measures.

Sunday Tribune Restaurant Reviews

I usually read the restaurant reviews in The Sunday Tribune magazine and have been impressed by the generous tipping regime of their current reviewer, Katy McGuinness. A minimum of 20% seems to be the norm, even where the service has been the subject of critical comment in the review. She recently reviewed Shebeen Chic in the company of two friends, was critical of the food, the service and the décor, yet added a €50 tip to a €230 bill.

This week (23rd Nov) she reviewed The Pig’s Ear, on Nassua St, in the company of her editor. The combined bill for the pair amounted to €126.40 to which she added a, for her, miserly 12% (€15) tip. The total amounted €141.40, an unusually modest outlay for this particular reviewer.

Yet she commented in her review that “when a casual early evening Tuesday supper for two costs €70 a head, there is clearly something amiss”. Isn’t it amazing how one’s perceptions and opinions can be influenced by the company one keeps?

Perhaps Fás isn’t alone in needing to review its expenses policy?

Sauvignon Blanc - Shelbourne style

Recent media reports about the legal action by the owners of the Shelbourne Hotel to remove the management company reminded me of my only visit to the hotel, a couple of months ago, since it re-opened.

The wife and I met her brother, Joe, in the front bar. We sat on stools at one of the high tables and waited for service. The bar area, which also serves food, was surprisingly empty for 1.15pm – prime lunchtime.

Service was slow and, when the waitress dropped her tray with a loud clatter while serving people at a nearby table, Joe got up and went to the bar to order a pint of Guinness and two sauvignon blancs.

Joe returned with a puzzled look on his face – “she asked if I wanted ice & lemon in the wine” he reported. All was explained when the waitress delivered the drinks – the pint of Guinness and two 7-Ups.

We laughed and explained the mistake to the waitress. She laughed and told us, in was heavily accented English, that the barmaid was both a bit deaf and didn’t have good English.

We concluded that, in this supposedly 5-star hotel, here was one explanation for the lack of customers in this landmark and centrally located hotel at lunchtime. It certainly didn’t augur well for the financial return on the huge money (c. €250m) spent on buying and refurbishing the place.

So it didn’t come as a major surprise to see that the hotel management is facing a possible eviction order.

Banking on the Barbarians?

The Irish Times has a couple of interesting and divergent takes on the proposed investment of US private equity groups in the Irish banks.

On page one, Simon Carswell (financial correspondent) describes it as “the Irish-led consortium of private investment firms seeking to buy into Bank of Ireland and possibly Irish Life Permanent“. On page 18 John McManus (business editor) sees the situation somewhat differently: “the barbarians are at the gates with their cheque books”.

Carswell reports the declared willingness of the Mallabraca consortium to lend up to €60bn to small businesses over 5 years through the banks. That may sound promising but surely there’s a reality check needed from Carswell? In a recession the increased risk of company failures and further bad debts will influence the actual volume of credit made available. No-one is going to throw finance at badly run or failing businesses.

McManus, on the other hand, reminds us that “you only have to take a cursory look at Eircom - and the destruction wrought by two bouts of private equity ownership”. It’s worth recalling that the initial privatisation battle was won by the Irish-led Valentia consortium, put together by Sir Anthony O’Reilly. The Fianna Fail Government at the time introduced special tax legislation to allow O’Reilly’s debt-laden bid to succeed.

So “Irish-led” does not necessarily translate into “barbarian-free”!

Until the economy comes out of recession, the main thrust of any private equity investors will be to cut costs as ruthlessly as possible and John McManus concludes his opinion piece with a very apt description of what is likely to come next: “One would not want to be a rural TD facing an election while fighting to save the local Bank of Ireland branch as Carlyle, JC Flowers and the like start cashing out”.
I'm with McManus on this one.

Sorting out this mess of a budget.

The Government seems determined to pursue the line that their current poll ratings are a result of a communications problem: to wit, we, the taxpayers, have failed to grasp the scale of the economic downturn and the consequent need to make painful budgetary cuts.

They are right that there is a communications failure, but that failure is mainly that the Government is not listening. We, the taxpayers, were well prepared for painful measures but they, the Government, chose many wrong targets and options. Targeting the over-70s for medical cards, imposing a 1% levy on those earning the minimum wage, penalising infants starting school and depriving 12-year old girls of a potentially life-saving vaccine was not what any of us was expecting. Surely the opinion polls are telling them that?

The budget was a classic mish-mash of mickey mouse measures with no coherent theme or evidence of any vision for economic recovery or for our society. Would the country be better served if they shelved their October “back of envelope” effort and produced a properly thought-out December budget, as originally scheduled?

The main opposition parties have promised support for the right corrective measures. Here's an opportunity for the Government to test their resolve.

Pres & Glasthule residents done by Dunne?

As a past pupil of Presentation College , Glasthule, I would like to express my concern and disappointment about the sale of the former Pres sports grounds on Hudson Rd to Ben Dunne, who proposes to build a fitness centre there.

It’s not that I have any particular objection to fitness centres, but anyone who has seen Mr Dunne recently could hardly argue that he is one of his own best customers. I have little doubt that, in the foreseeable future, this site will be put to a more financially productive, and probably less acceptable, commercial use.

In October last we spent a few days in the Abbeyglen Hotel in Clifden. The afternoon of our last full day there, a banner was hung above the main entrance – something to do with a Ben Dunne Gym in Clifden. On a spin in the car out to the Connemara Golf Club in Ballyconneely, we noticed a helicopter parked – with GYM-H stencilled on the tail. Then we saw Ben Dunne playing golf, a large, overly rotund figure getting out of a golf-cart and hitting a fairway wood.

Later that evening his helicopter did indeed land outside our hotel. As we had my elderly mother in tow, we didn’t stay late in the bar. The following morning at breakfast, who appeared but the bould Ben. He loaded a plate with fried food and regaled other diners with a story of his 3am session in the bar and a monumental hangover. Then he insisted on having Flora, rather than the standard butter on offer, for his "lashings of hot toast". He announced that his doctor had told him to cut out the drink and the butter, and "one out of two wasn’t bad".

I don’t know what age Ben is, but he’s unlikely to enjoy a ripe old age, the way he’s looking/going. Anyone assuming that he, or his proposed fitness centre, will be around in 10 years time is fooling themselves.

The only question about the long-term use of those playing fields is this: will it be LIDL or Aldi?

Shane Ross exposes himself!

Finally, Shane Ross comes clean!

On RTE’s Morning Ireland today, Ross admitted he didn’t understand some of what BOI CEO Brian Goggin had said in an earlier interview, regarding the bank’s half-year results, because “ he disguised it in language no layman could understand”.

But Shane Ross isn’t supposed to be a layman, he’s the business editor of the Sunday Independent and a regular loudmouth commentator on radio & tv, supposedly a business specialist, as he was with on RTE this morning.

I’ve always regarded Ross as a light-weight populist chancer when it comes to business journalism. Now he’s finally admitted it live on air.

It’s only a myth that Caligula made his horse a roman consul. But it’s a fact that Trinity College elected a horse’s ass a senator!

Trinity students and graduates please note.

Wanted: Dunphy's bite back.

Eamon Dunphy’s weekly programme has just started on RTE.

Each week he interviews some well known politician, businessman or celebrity for the guts of an hour. It’s supposed to be in-depth stuff but Dunphy usually manages to give his guests a complete tongue-bath by the end of the show.

Lest we forget, Dunphy was a much feared interviewer in his TodayFM heyday. Now his interviewees face all the menace of the Andrex puppy.

Go back on the drink, Eamon, please.

Barack Obama - Offaly's 2nd current world statesman

Barack Obama’s election as next President of the USA is a welcome and truly extraordinary event – almost no matter how his term in office actually turns out in practice.

Less than 50 years ago, negroes were still legally deprived of many basic civil rights in many US states, so this is a genuinely seminal moment in the history of the USA, probably almost unimaginable for many living African-americans.

On the radio tonight I listened to U2’s “(Pride) In the name of love” – their 1984 tribute to Martin Luther King who was murdered in 1968. For all the ordure heaped on Bono for his good works, this is a song which, both musically and morally, delivers on highly challenging aspirations.

It will be interesting to see how, in the coming years, the example of President Obama, an educated, articulate, well-grounded black man, is reflected in the young black population. Let’s hope for the best.

Currently, black male role models appear to consist only of bling-draped rappers and sports stars, blabbering a largely unintelligible rap patois which mainly focuses on sexism and violence (let’s hope Obama never feels the need to tell us anything about his “bitch”), coupled with ill-matched and badly fitting clothing, particularly the desire to show knicker elastic above jean waistline. Can’t these “stars” afford jeans that actually fit??

So roll on January and the inauguration of President Obama. Big promises to keep, and miles to go before he sleeps. The best of luck to him.

PS: The other world leader with family roots is Offaly is, of course, Ireland's Taoiseach Brian Cowen, aka BIFFO.
In Obama's case, BIFFO stands for "Black impressive fellow from Offaly". Cowen's variant is somewhat less polite.

Sean O'Rourke disses Enda Kenny - again.

Sean O’Rourke has always failed to hide his contempt for Fine Gael leader Enda Kenny. This is probably because he makes no effort to do so.

On RTE's “The Week in Politics” last night when he challenged Kenny with the unsubstantiated anecdotal claim that even long-standing FG supporters roll their eyes to heaven at the thought of Kenny as Taoiseach.

O’Rourke followed this up with speculation that the FG backroom suits might approach Kenny before the next election and ask him to step down as leader.

Surely it is the function of the FG party to select its leader, not the role of RTE or Sean O’Rourke, who exceeded even his own high standard of disrespect and rudeness last night.

I don’t know what O’Rourke’s objective is or what his personal political affiliations are, other than his complete antipathy when it comes to Enda Kenny.

But let the FG party and the electorate decide the fate of Enda Kenny and let O’Rourke learn some bloody manners.

Footnote: I've sent the above complaint to Sean O'Rourke and RTE.

Getting it up for over-40 men!

It may be because I’m in the target age group, but I’m conscious of hearing a plethora of radio ads in the past month on the subjects of "Erectile Dysfunction" and "Testosterone Deficiency" in the over-40 male population. The claim is that 50% of us are suffering from some degree of droop.

It’s a surprise to hear ads relating to what is supposedly a male health issue – the health media is traditionally dominated by female concerns and complaints. Indeed, it has been a cause for complaint that male health matters seem to come a very poor second to those of women.

It strikes me that “erectile dysfunction” may not be on the list of dangerous diseases; I find it hard (no pun intended) to believe that it’s a life-threatening condition. Why aren’t other major men’s health concerns e.g. heart disease, blood pressure, cholesterol, obesity, Type 2 diabetes, colon and prostate cancers etc. etc. the subject of such intensive advertising campaigns?

Is it just possible that this ad campaign may not be intended for the benefit of men at all, but rather it is aimed at fixing a female complaint: they’re not getting enough sex. Middle-aged women, the long-time wives of those over-40s men, are avid viewers of “Sex in the City” and consumers of mountains of chick-lit novels. All of these share a common theme – sexual satisfaction is the right of women – “because you’re worth it”.

However, before any of those 50% of 40+ male sufferers of erectile dysfunction are subjected to any form of medication or medical treatment, I demand that they be subjected to a simple test:
Place the subject, naked, alone in a bedroom with a nubile, naked 18-year old au pair. I’ll wager that most of them will have a miraculous and immediate recovery.

Which reaction may, of course, raise awkward questions, and possibly nothing else, in the marital bed.

On Her Majesty's Service - Halifax, Ulster Bank etc

Following the decision not to participate in the Government Guarantee scheme, Halifax/Bank of Scotland (HBOS) ran full page press ads during the week to reassure customers and to promise to utilise the freedom from the scheme constraints to bring innovative and better value products to the Irish market.

The latter point was the key message from motor-mouth Mark Duffy, HBOS MD in Ireland, in a series of media interviews following the announcement of the decision not to participate.

It’s worth recalling that HBOS, both here and in UK, would now be defunct if the UK government had not stepped in to save that bank. It is still likely that the UK Government will end up as the largest shareholder in a combined Lloyds-TSB/HBOS merged bank.

When the Irish Government announced the bank guarantee scheme, originally confined to six Irish-owned institutions, the UK government protested to Dublin that it would seriously disadvantage UK banks operating in Ireland, while simultaneously giving an unfair advantage to Irish banks operating in the UK market.

Is it safe to assume that the Irish government will be raising similar concerns with their UK counterparts, particularly if Ulster Bank/First Active also opt to stay outside the scheme?

In effect, two UK state-owned banks, themselves recent casualties of the financial services meltdown, will be handed a competitive advantage in the Irish market, potentially damaging the recovery prospects for the Irish financial system.