I was thinking of Druids the other night on the summer solstice — the longest day of the year. The weather was wonderful and the last light of the day was gorgeous. In ancient times, people used to celebrate the solstice by lighting bonfires on hills — generally have a bit of a night out, carousing and having the craic. The winter solstice seemed to be a more solemn affair and if you have been to Newgrange you can tell the significance of these events to the ancients can’t be underestimated.
Newgrange is a most magical place.
I am fascinated by how they did it. How did they bring all the stuff up the hill? On the hill, looking down, you realise that the huge slabs of stone must have been dragged uphill by some means to Newgrange. Meanwhile, the stones used for the cairn, which together would have weighed around 200,000 tonnes, were likely taken from the rivers between Newgrange and the Boyne. According to the guidebook, there is a large pond in this area, which probably was the site quarried by Newgrange’s builders to use for material for the cairn. The sheer manpower and organisation needed to achieve this 4,000 years ago is mindboggling.
However, my dreamy Celtic twilight vision was interrupted by a headline in this paper on Monday about the banks giving out “negative equity” loans.
This is apparently the latest wheeze from our banking geniuses. A negative-equity loan means that if you are in negative equity but want to move house because, for instance, the family is getting bigger, you can carry the old negative equity on to the new property.
This is supposed to help people. I can see how it helps the banks, but how does it help the citizen?
Quite apart from the bonded indentured nature of carrying debt with you for a house that you no longer live in, this proposal is only of any value to people who qualify for a loan. But these are the people who are not in financial trouble now, so they are unlikely to use it. The people who are in negative equity and can’t pay their mortgages can’t afford such a product; and the people who are in negative equity but can afford it are hardly likely to want it.
We know that the problem in Ireland is a bad debt cycle where far too much debt, which was taken out in the boom, can’t be paid. It is plain and simple: debt that can’t be paid won’t be paid.
An EU survey published yesterday reported that 29pc of Irish households believe that they might not be able to pay ordinary bills, buy food or other important daily goods in the next 12 months. The survey also showed that 35pc of households in Ireland are having real trouble paying for healthcare for their family. Of those with children who use childcare, 25pc said they had problems with the costs. This is the legacy of the past few years and these people will soon begin to default on their debts.
It really doesn’t matter what we do now, if we don’t sort out a way of moving on from the debts of the past we are going to sink under the weight of past mistakes and any recovery — which we all want — will be choked off.
As I pondered the Druids, I wondered what they would have said about debt. What did Brehon Law have to say about debt and repudiation?
Brehon laws on debt are interesting. There is no mention of debt forgiveness, but the laws did have an interesting way of forcing someone to pay his or her debts. If a creditor is owed money by someone, he can seize their property if they refuse to pay. The only property people had at the time was cattle. Cattle was also the currency.
A person’s house could not be seized if they had bad debts. The idea that your house could be used as a debt millstone around your neck was totally alien to the Brehons. The concept of eviction did not exist. It was brought in on a widespread basis after the destruction of social infrastructure of Gaelic Ireland after the Flight of the Earls.
Our ancestors did have some colourful ways of getting their cash back. If he didn’t want to go to the trouble of seizing cattle, a creditor might sit outside the house of the debtor and starve himself. But the starving creditor was entitled to prevent anybody getting in or out of the house, so the debtor would starve too.
Most debtors quickly paid up under such circumstances, not because of starvation, but rather because of the shame of having a creditor on their doorstep. (This practice still continues to this day in parts of rural India.)
Of course, in Brehon days, the only debts that could exist would be rents or fines from the Brehon courts, so there would be no debt agreement that could be entered into like today. But I do find the vision of Seanie Fitz starving himself outside the door of Bernard McNamara or Paddy Kelly an interesting one.
Under Brehon Law, a woman was entitled to hold property in her own name — even if she was married. This is something that modern developers seem not to be very keen on, as they tend to transfer all their assets to their wives these days only after they get into trouble, not before!
The Brehons used asset seizure and shame in the community as their major tools to try to recover debts. Later, as Brehon Law fused with Christianity, the teachings of the Bible and the concept of debt forgiveness were incorporated into practice. The Old Testament is quite explicit on the need for a Jubilee year where, after a 20-year cycle, all debts are written off and we start again.
When we see the huge debt overhang here in Ireland, it is hard not to see two paths for the economy — one involving “moral hazard” and the other involving “real hazard”. Moral hazard is where we give debt forgiveness to people in debt and risk encouraging further bad behaviour. This is what we are doing to the banks. The other is real hazard, where we compel the people to pay all the debts of the boom, and risk that the economy contracts further. I know which hazard I’d prefer to avoid — the real one.
We need to adopt the US model on bankruptcy here. The banks own the house, not the person. If the houses fall in value, the banks get the keys and the person moves on. This change, called co-responsibility — where the lender and the borrower are equally to blame — was brought into the US after the Great Depression, making it easier for the citizen to recover from bad debt. At the core of this is the realisation that the citizen, not the property, create wealth. Thus the citizen needs to be liberated to try again. This is the type of second chance thing we need here.
There will be a ‘moral hazzard’ with Brian ODriscoll during the match as the Ozzis try to remove our national currency from the game .At that stage the Irish should ‘walk off’ to become bankrupt rather being indentured to a foreign power.
David, when you suggested the need for some kind of debt forgiveness here a couple of years ago or so it provoked a vehement reaction from quite a large number of posters, many of them new. They argued, reasonably, that those who refused to get involved in the property bubble should not have to carry the can for the greedy and stupid. And it is galling if that is what happens. On the other hand we are as a nation a collective and our collective ‘decision’ was to be complicit in the election of gombeens and to turn a blind… Read more »
DMcW is quite wrong about not repaying debts, people who borrowed money to buy houses and cars got wealth up front instead of working, saving and then buying. They benefited and took a punt on the value of housing, DMcW is a populist not pragmatic. Money borrowed is always repaid, there is no debt forgivness never has been not in Ireland anyway. We are in an age of austerity people must learn basic housekeeping, to live within a budget. I have a spreadsheet where I download my bankstatement and work out where I spend my money, I also have a… Read more »
David, surely your Cork cousins have told you about “Bona night”? You don’t need to go back to the time of the Druids to see people light up the sky during the summer solstice. You also don’t have to travel as far as rural India to find creditors or their representatives shaming debtors. El Cobrador del Frac is a debt collection agency in Spain whose employees dress up in Top Hat and Tails and follow debtors around like a bad smell. The embarrasment usually forces debtros to pay up, or at least pay what they can. http://www.independent.co.uk/news/world/europe/boom-time-for-spains-costumed-debt-collectors-922500.html?ref=patrick.net I am totally… Read more »
Ah yes….for the last twenty years…all that hot air….built into a cruscendo….a new system of beliefs emerged. Evident from the phraseology. “We are significant…look at us….overwhelmed with pride….proud of ….surpass (should that be surp ass)….defining moment….greatness….big….massive…..enjoy….thrill….excitement…..granduer….excellence….homes of disctinction….vision…a vision of grandeur….a purchase to be envied….brand names to die for….and retail space….loads of retail space….”. And the Dithering one gave his blessing…”the boom is getting boomier”…”We have arrived”…..”I am expecting great things”….”I am committed”…. And to every naysayer the Dithering One replied “Why not”. Ah yes, all that talk about how sophisticated we have become…and the entitlement to believe that financial… Read more »
England look like they are going to leave the World Cup. I don’t know which is worse, watching Irish people laugh at the disaster that happened to the French, or watching Irish people laugh at the bumbling that is going on England. By the way folks, these two countries are our largest and third largest export markets. They provide a steady stream of tourists to the South Leinster and Munster for six months of the year, doing more for isolated rural communities than all the effing quangos, departments, and useless politicians in D2. The people who will provide the most… Read more »
David – Excellent article.
David, I like this article a lot. I dunno about Druids and Brehon law and so forth but: At the core of this is the realisation that the citizen, not the property, create wealth. Thus the citizen needs to be liberated to try again” This is absolutely key and far too philosophically profound for Ireland. We think we have no ideology, when in fact we have only one. Incorporating new ideas and ways of thinking is sadly, something I have discovered the Irish are consistently terrible at. You can pick up pretty much any of Deco’s posts on the Irish… Read more »
Hi everyone
First time poster been reading the blog for last few months and always impressed by the different views and opinions shared on it and think David writes some great ideas up here.
I think the big problem facing the country is the banks and goverment want things to go back to they way they were to keep the staus quo and Im not sure the general public have the stomach for the big changes our socitey needs
I think the bretons might be horrified that we protected the hoarders and the speculators at the expense of investors and borrowers. This absolute attitude to debt is ridiculous. Money is there to be used, if someone has over 100k in the bank, they should take a hit on that money in a recession, just like everyone else. Instead the system is designed to protect people who made fortunes in the boom and can hive it off somewhere else. The recent financial crisis has been called the greatest transfer of wealth ever seen. In an era of widespread deflation, the… Read more »
David. Interesting article and introducing realigned ideas to open up the debating of ideas and solutions going forward. My take on the crux of the article, which is debt and its true nature and reality, is the following. PROPERTY BELONGS TO EVERYONE. EVERYONE HAS A GOD GIVE INALIENABLE RIGHT TO A PATCH OF LAND TO LIVE ON FULL STOP. PROPERTY BEEN SOLD ON TO ANOTHER FOR TO BE ABLE TO HAVE A HOME IS A PERVERSION AND A DISGUSTING DEFILEMENT OF WHAT IS NATURALLY A PERSONS GOD GIVEN RIGHT TO OWN AND BE THEIRS _ A PATCH OF LAND TO… Read more »
Watching from afar , I really think you people are nuts . Over 20 billion has gone into Anglo ( dead parrot sketch ) on a one way ticket . The banks are still broke and good businesses are going under for the want of a bit of cashflow . Personal debt must be massive and is sitting on the banks balance sheets . Can somebody please answer me this . Why is it that the only time I hear about moral hazard is when it relates to personal debt ? What about the moral hazard of bailing out Anglo… Read more »
Flaiths in Brehon Law are non professional lawyers .Next time you meet your friend ‘Flaherty’ remind him of who he is.
Clan System of Marriage
Marriage under Brehon Law had ‘an offering for men ‘.A Man could have three legal wives in a relationships as follows :
1 First Lawful Wife; and
2 First lawful adaltrach -woman ; and
3 An adaltrach -woman of abduction.
Do we need to reconsider this again .How many men have left the family homestead to go elsewhere .Would it not be better to incorporate an extended family .Economically it would work.Sharia Law recognises this.
Bull Rock : Given that the word Taurus means a Bull and that cattle were a recognised currency in an older time can we not say that the word Tara comes from Bull thus the Hill of Tara really is Bull Rock.
To support Davids good article I can reveal that currently I use the Brehon Laws where it relates to taxation , property, and culture for Irish Minority Ethnic Clans.
Deputy Cody : Our lives are deeply encoded with the laws we have inherited and they will never leave us no matter so we must try to learn to understand them and use them to take us to our next destination .It is important to include that the language of Atlantian ( Irish Gaelic ) is also an expression of pure nature where we live in and especially the heavens and galaxy an inheritance from our earlier family the Phoenicians.Atlantean to Astrology is liken as Latin to Medicine.
Honesty, Openness, Fair Play, “The Right Thing”, Tolerance and Charity are attributes of an ethical society. Maybe the loss of our link with the Brehon laws created a disconnect or inability at a genetic level to recapture the essence of these ethics. Ethics lacks equivocation, but leverages our ability to empathize with our fellow man and creatures to make our judgments be based on thinking rather than black and white laws. Maybe lack of memory of our Gaelic heritage is an issue. But, I think the guidance for a good life are found in countless other places and cultures which… Read more »
The GP are rumoured to be driving hard to instigate a property tax. It will be across the board. And presumably, it will provide cashflow for auctioneers, architects, and layabouts working for the local authorities. As well as GP activists looking for permanent state jobs, so that they will be permanently indebted to Gormless. This will facilitate their political activities, and so that they will go around like gobshites knocking on doors telling you about the greatness of Gormless. (Gormless gave wasters like me a job working for the state, to be paid for by new taxes on you-so that… Read more »
Here We have it again ” spin the bottle”. We were all blind but some were more blind than others. ” the Central Bank which is made up of our former bed-fellows was asleep at the wheel” and they were out smoking behind the bicycle shed…. bullshit and bolloxology to all that. The Dept. of Finance is rotten to the core , it is beyond saving in terms of its culture and incompedence. It needs to be cleared out from top to bottom as the Country can no longer afford their uslessness, end of rant. Here’s what got my dander… Read more »
Here’s a good article by Michael Hudson http://michael-hudson.com/2010/04/the-coming-european-debt-wars/ Here’s a chunk. It’s mainly about eastern Europe but it’s relevant. “Austerity plans” IMF and EU style is an antiseptic, technocratic jargon for life-shortening and killing impact of gutting income, social services, spending on health on hospitals, education and other basic needs, and selling off public infrastructure for buyers to turn nations into “tollbooth economies” where everyone is obliged to pay access prices for roads, education, medical care and other costs of living and doing business that have long been subsidized by progressive taxation in North America and Western Europe. The battle… Read more »
Here’s an interesting footnote from Hudson’s “Latvia’s Cruel Neoliberal Experiment”: Readers of the Bible will recognize this as the essence of the Jubilee Year of Leviticus 25, which Jewish religion took out of the hands of rulers and placed at the center of their religion as a covenant under Mosaic law. And when Jesus gave his first sermon in the synagogue, Luke 4 describes him as unrolling the scroll of Isaiah and saying that he had come to proclaim “the Year of our Lord,” that is, the Jubilee Year, deror. This Hebrew word that the prophets and Leviticus used was… Read more »
Furrylugs – come back and re-allign your soltice circle .My coded language ‘hell on high water ‘ is coming true near Dun Aengus .Water not to be found anywhere on Inis Mor and soon to be a Desert Island.The Wobble has arrived.
Newgrange: They got the megaliths up the hill using logs as rollers most likely.
Brehon law: Hmmm women and property, remember that property was in the form of movables (cattle, soldiers for example) and they were severely limited when it came to passing them on to someone else. David if you are interested in ancient Irish law and women, check out the laws on women and contracts – interesting stuff.
The concept of this article is TIME .We need to devise our own Newgrad that measures the balance of what we want in our lives and what we give in our lives .Days will need to have meanings and purposes and weeks to have completion in itself.Where does the beginning of a day start and where does it end.Part of this implementation can include : Days of Paid Employment reduced Days of Social Duties introduced Everyone to have a right to work Dual Currencies Hard/Soft Compulsory Military/Civic Duties Home Loan Partnerships Increase Retiring age Guaranteed Work for Ages over 21… Read more »
USA Today June 22 editorial debates issues re foreclosure programs in the USA. One, Obama foreclosure program being a relative failure, gives homeowners a federal refinancing deal, but failed because lots of homeowners unable to declare their income. Also, even with a deal, up to 50% availing of still got into trouble. Another, The Home Affordable Modification Scheme, HAMP, is accused of driving up home prices and promoting irresponsible borrowing and lending. Major arg and subsidizes the rich needs to be rethought. Argument against is that it applies to houses up to 1 million giving already rich Joe’s assistance they… Read more »
Can someone dig up that article that by Sept 2010 about 30% (yes Three Zero) of the Irish Households will not be able to make ends meet. People are no longer going to the doctor, dentist etc. Kids are more neglected than ever before. Anyone see NewsNight on Sierra Leon? Shape of things to come, but I’m afraid, the weather is not part of the package.
@Furrylugs.
Thanks for nod furrylugs. Say hi too Tull.
@colm brazel.
Go to ‘in – out burger’ in LA if you get the chance cbweb.
Noonan – noonan should not be elected to the front bench by enda – this man is an old dog with same spots and pulverises vulnerable women on their death bed.There is thick blood on his hands.
Hi Folks, I’m just back from seeing David live in the Outsiders. It’s a fantastic show ending on an optimistic note with a 4 point plan of: 1. Close Anglo 2. Close Nama 3. Harness a fraction of the €780 bilion deposits sitting in the IFSC in US dollars (because it can’t be repatriated without paying huge tax) for a venture fund for Irish startups 4. Use the Diaspora. All very convincing and workable but the problem is time is running out! Our government is hell bent on saving Anglo and bailing out the insiders with Nama. How do I… Read more »
Please posters, someone else put pic up on avatar or will be compelled to pull mine, not ‘avin just my *ugly mug* plastered on the web page.
Vidal talks about the 1% who own America, Hudson about the 90% in debt to the 10% globally speaking. DMcW, Tull and others say Follow the Money. “In another place” however (irisheconomy.ie) the majority view (this is some months ago, mind you – someone who overstepped the mark by mentioning the “default” word was advised to have a little lie down) seemed to be that there is no wealth to tax in Ireland, and Sarah Carey in the IT confirmed this, with some irritation it has to be said as it was all so obvious really, having been told this… Read more »
Even the hawks over at the IMF think that struggling homeowners in Ireland could do with a break, not that the IMF could give a flying … about the little people in Ireland and breaks of any kind. No this is macroeconomics at play here with the IMF and they are seeing down the line, into the future. They estimate that we will only have growth rising to 3.5 % by 2015 and they estimate that unemployment will still be sticky at around 9/10% right up to and including 2015. They also know from talking to various groups that emigration… Read more »
David, how is it that I have not seen Michael Hudson referred to in the Irish media at all? He has been advising the Icelandic and Latvian Govts on how to deal with their crises. For my money, he’s making a lot of sense. See this article –
http://www.counterpunch.org/hudson06252010.html
or his homepage;
http://michael-hudson.com/
Any comment David?
ONE PERSON ONE CENT ONE ACRE
‘Why speak to the Angels when we can speak to God.’ We should take a leaf from Woulfe Tone ,Kerry and The French Revolution.We must seek our own Emancipation from the Dog House we find ourselves in.Like before Catholics in the Bar formed a Committee at a meeting at Taylors ,Dublin and decided to bypass the Irish Parliament and go to England to lay further demands at the feet of the King .It is a case that the Legal Profession act as a conduit of Revolution for all of US ( the beatles) and travel to Europe as the Provisional… Read more »
US warns of double dip recession, think we can take the warning as a fact…………….
http://www.guardian.co.uk/world/2010/jun/25/g20-summit-double-recession-warning
NEGATIVE EQUITY: TEMPLATE OF LETTER FOR ASPIRING INSIDERS IN A TIME O’ CHASSIS — OR, as I am in Sicily at the moment, “ON MAKING SOMEONE AN OFFER THEY CANNOT REFUSE”; without forgetting to use CÚPLA FOCAIL! To: Brian Lean-a’-Cháin, Mandarin-of-Mandarins, Department of Finance, Merrion Street, Dublin A Chara, I admire your presentation style and the terms under which you have taken a 51% controlling interest in the Educationally-challenged Bulldozing Syndicate (EBS) in May. I aspire to a similar level of achievement and am starting today by joining the PARTY and offering you the opportunity to take a majority stake… Read more »
“”McWilliams slates Ernst & Young forecast
Sunday, June 27, 2010 – 02:06 PM
Leading economist David McWilliams has slated last Thursday’s Ernst & Young forecast report for the Irish economy.
The report, which received huge praise by the Government and business groups, predicts that Ireland will have the greatest recovery of any of the Eurozone economies.””
Good man David. It must be a lonely furrow you plough, debunking all the trash and tripe.
The Furry Family are with you all the way.
It also concludes that Ireland’s recovery will be ‘largely jobless’, however.
Read more: http://www.irishexaminer.com/breakingnews/business/mcwilliams-slates-ernst-young-forecast-463251.html#ixzz0s3vnfXAw
Stiglitz and others have said it, you can’t have a recovery with high unemployment, but all the ‘agencies’ and buddy firms are being called upon to give optimistic but unrealistic accounts, these in turn will be spun by Mary Hanafin and others on talk shows………totalitarian.
“……slashing spending in the midst of a depression, which deepens that depression and paves the way for deflation, is actually self-defeating……….And who will pay the price for this triumph of orthodoxy? The answer is, tens of millions of unemployed workers, many of whom will go jobless for years, and some of whom will never work again – Paul Krugman
http://www.nytimes.com/2010/06/28/opinion/28krugman.html