Last year 76,300 people emigrated from our country. This is an average of 209 emigrating every day. Nine people left every hour. One person left every seven minutes. The people who are leaving are young, and well-educated. In the last great scattering of the Irish in the late-1980s, we know that a university graduate was four times more likely to emigrate than someone who left school before the Leaving Cert.
It was an enormous brain drain. However, for the first time in Irish history many came home in the late-1990s and early-2000s. As a member of that particular tribe being described one Christmas back home as a “financial navvy” for working in a bank in London, I am now a member of the first Irish generation that will emigrate twice.
In recent months, we are seeing something without precedent.
Emigration, which used to be the preserve of the young, is creeping up the age brackets. Now emigration of the middle- aged or the nearly middle-aged is becoming quite normal. People in their early 40s — who came back here to build their lives — are having to head out again looking for a second chance.
Today, a new type of Irish navvy — the “mortgage navvy” — has replaced the financial navvy. He is the Irish middle-aged man who is working flat out over there to pay debt over here. Years ago, we got the name “navvy” because our forefathers dug the canals in the north of England during the Industrial Revolution when the canals were termed “navigations”. Those who worked on the navigations were called navvies.
The new mortgage navvy is typically an Irish dad with a young family here in school, with a big mortgage in negative equity, who has lost his job here and has headed to London for work.
Many families are being torn as dad is only there at the weekend because he arrives in knackered on the Friday evening from London and then he is off again late Sunday night or first thing Monday.
In order to meet the big mortgage, he has to generate lots of cash and this means that even if he could find a new job here, which is unlikely, his cost base remains very high by virtue of the 2005 mortgage taken out to buy a family home, nothing special. He can’t sell the house because this will realise the negative equity and he is holding out, hoping that at some stage prices will rise so that when the ‘interest only’ loan is paid off in 2030, there will be some chance that the capital will equal the remaining debt on the place.
You will see him on the red-eye flight on a Monday morning, having spent the weekend trying to overcompensate for not being here with the kids all week. So he will be on the sideline at soccer, GAA or rugby and sitting in McDonald’s with the kids who know that dad will buy them anything and take them anywhere when he is home.
His missus, if they manage to stay together because they are apart so much, is a new type of Irish wife. She is a “mortgage widow”. She has been rendered a single parent by virtue of the size of the bloody mortgage. She lives alone in the family home, sitting in front of the TV when the children have been put to bed.
Typically a mortgage widow will have given up a career to have children in her early 30s and she fully expected to move back into employment after the initial early child-rearing years were over. The recession has put paid to that notion, as too have the demands of looking after three children by herself. By the time the mortgage navvy gets home on a Friday night, they are both knackered and whatever spark there was is quenched by the second bottle of red and the ‘Late Late’.
The other morning, this new reality for many of my own generation came to the fore as I was listening to John Teeling on the radio. Teeling is a businessman whose most recent and well-known success was the sale of Cooley Whiskey Distillery, but he has been involved in the mining and exploration business for years.
He made the basic point that this column has been making for ages: if you take more and more money out of the economy with expenditure cuts and tax hikes, the economy will shrink. He said, as any businessman would say, that if your balance sheet is broken with too much debt, you make it better with less debt, not more debt. He spoke of the Irish middle class being destroyed under the weight of too much debt and negative equity.
His solution is a debt deal, which involves a suspension of all debt repayments on a proportion of our debt for a period of five or six years. This would allow us to get back on our feet without the constant haemorrhaging of cash. Such a solution makes total sense because this is what a company would do which has a decent underlying business but has a balance sheet which is being weighed down by too much debt. To preserve the company you tell the creditors to wait.
The reason this idea struck a chord with me is that Teeling went on to talk of what he called Noonan bonds, based on the notion of Brady Bonds which solved the Latin American debt crisis in the 1990s. This column has argued for Brady Bonds to solve Ireland’s debt crisis for a few years now.
When I was a financial navvy in the 1990s I worked in the Brady Bond markets in countries such as Brazil, Venezuela, Russia and Argentina. All these countries recovered strongly after their defaults with the help of Brady Bonds. Not one of these countries had a debt/GDP ratio anywhere near as high as Ireland does now.
As growth returned, people came back to these countries and, interestingly, none of them were permanently shut out of the markets for long. Only Argentina, which tried to take the US dollar — the currency of a much stronger neighbour — as its currency, got into trouble again. We are doing what Argentina did back then by taking the de facto currency of Germany — the euro — and pretending it is our currency. It is not. It can’t be our currency if we can’t print it or change its value. Period.
Teeling is right. A massive debt deal is the only solution. It is not if but when. The only choice is whether the deal should be such that it gives the thousands of mortgage navvies and mortgage widows a break and the chance to have a normal family life for the most important time in families when their children need to be reared.
What do you think? Do they merit a break? Or will we be the society that has a constitution, which says the family is protected but we put the interests of the ECB over and above the Irish family?
What do you think? Do they merit a break? Or will we be the society that has a constitution, which says the family is protected but we put the interests of the ECB over and above the Irish family?….
My answer would be…. look at Greece!
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It’s really a question of nationhood. Is Ireland a nation, and what does that mean today?
David – do you not read the news? Immigrants are far happier than the Irish living at home according to the offical media…http://www.irishtimes.com/blogs/generationemigration/2012/03/17/the-new-diaspora-speaks-have-your-say/ They have a fella quoted there, a Will Keena, recently moved to Melbourne who still hadn’t found a job yet and we was basking in the glow of happy immigration! Actually he is still in holiday mode as far as I could tell – so his depth of knowledge and opinion was completely shallow. He gave no context to his move eithier. This stupid feel good PR piece was presented as journalist evidence to support findings of… Read more »
Steve Keen has been saying this for ages – what the world needs is a Debt Jubilee. I’m reading his book,Debunking Economics, at the moment, and can only say it’s very informative.
I would say it is about perspective David You invented a persona for the article and it would be a strange person who did not feel sympathy for this hypothetical family In other hypothetical families you will find people who wanted to be the next Bernard McNamara and went mad with debt to buy property they and their families did not need. No sympathy for the greedy types I am afraid Then you see a three year old girl in Libya with half her face blown off and ask just where do our real priorities lie Time to get a… Read more »
Need to remember that there are many reasons that those like me in my late 40’s are working overseas. I luckily am not in negative equity but my pension fund is pretty shot – those “safe stocks” were not so safe after all and of course most of us knew “bricks and mortar” was also a safe bet !!! oh the Irish in us ! I am actually working on the other side of the world so can’t even travel home for the weekends (28 hrs each way) – I have a wife and two young kids at home –… Read more »
Excellent article, like the previous one on Japan.
Interesting portrait of the ‘mortgage widow’ (my best friend is in this situation back home).
It would appear that a lot of Irish people, with young families, have been moving to Paris in the past year or so. The Director of my son’s school (an international school) told me that they have never received so many applications from Irish families for their children.
David, This government and the one before have made a pastime of trampling on both the Irish people and Bunreacht Na hEireann, I know some people will be sick if hearing the following but I believe it is paramount: CONSTITUTION OF IRELAND — BUNREACHT NA hÉIREANN The Family Article 41.1. 1° The State recognises the Family as the natural primary and fundamental unit group of Society, and as a moral institution possessing inalienable and imprescriptible rights, antecedent and superior to all positive law. 2° The State, therefore, guarantees to protect the Family in its constitution and authority, as the necessary… Read more »
But David, where is breakfastroll man? He has had no work in Ireland now for about 3 years. He hasn’t turned up in London anyway. Romanians, Albanians, Poles and Portuguese that dominate the sites where I am. A few Irish engineers and quantity surveyors are here, but not BRM. He can’t get into Australia or Canada if he’s over 30, so he must be on the dole back home, devoid of any hope. Middle class Irish have always emigrated, and always will, the climate back home is good enough reason alone. Also, I’m sure there are plenty of Irish fathers… Read more »
Slightly off topic, but I think worth a mention: Thinking outside the Box — Kinda! Today I read a message from the guy’s over at OYM Radio and I thought it was so good, I had to share it with you. The beauty of this little proposition is the brilliance of its simplicity, as VIN over at TNS Radio says “It’s Simple Folks!” So, we the Irish people are going to hand over 3.1 Billion Euro’s to nameless and faceless people in Europe at the end of this month on behalf of the defunct Bank that was Anglo Irish, as… Read more »
Write down the value of mortgages by 50% overnight by using bonds would be the way to go. Money then flows back into the real economy
by 50% because even if the banks take your house and try to sell it they will only be able to get half for it anyway
Another thing to consider is a once off “lifetime mortgage” rather than fixing it for 35-40years i.e restructuring the debt…
Having lived and worked in London for two years there, I have bucked the emigration trend as I managed to get a job back home. Speaking about my experience, one thing that always struck me in London was the amount of Irish people of my age group (25-30) and older, that like the generations of old were pointlessly wasting their time and ruining their lives hanging around in pubs all weekend boozing and consistently blowing most of their hard earned cash. Our nation is self destructive in so many senses. The impressions I get is that the political, trade union,… Read more »
Just a thought: maybe people should email all their local politicians every time a friend or family member emigrates. It might be an effective way of getting the message across
*..the interests of the ECB…* dominate.
Crony networks across borders holding hands looting the enterprise system all the while ensuring it remains a secret. The loot that is.
If I could give advice to any of these poor bastards who are suffering I would have to say this. Look at what you can realistically afford to pay on your mortgage and pay only that amount. Read that one again. If this were to happen en mass it would really shake things up. Think more “Don Corleone” and less “Paddy Maloney” i.e. Have the balls, I know its hard for some, to only pay what you can genuinely afford. If you cant pay the household charge, don’t pay the house hold charge. But don’t have SKY sports package and… Read more »
“A massive debt deal is the only solution” no David, it is just the only solution you will present.
The central bank control credit/debt monopoly has to go if are to have a middle class. But dont expect David to review/discuss anything outside playing with the current system. That’s just for quacks
Thankfully since I last commented on this blog a few more have called your bluff.
David you are right. Of course our families have to come before the ECB and the global banking elite that are running the whole show at the moment. What you suggest however does not go to the very root of the problem. I see this morning that stormtrooper Noonan is trying to postpone this debt in the form of sovereign bonds. But all this overlooks the crucial fact that all this promissory note debt is fraudulent debt and should be simply defaulted on completely. This debt has nothing whatsoever to do with the ordinary citizens of this state and there… Read more »
The comments are great esp Pauldiv “In other hypothetical families you will find people who wanted to be the next Bernard McNamara and went mad with debt to buy property they and their families did not need. No sympathy for the greedy types I am afraid” Damn right, remember all those BMW suvs that used to roam the land? All the brickies/plasterers/breakfast roll man types that had one? I drove a 10 year old banger with pride and i’ve even ditched that now for the Bus. Colin great comment re “divorce Irish style” a lot of truth in that. Grey… Read more »
+1,Cooldude.
Do you have an Email address I could contact you at?
I have some questions re US treasuries.
Grey fox sorry for the mix up my comment was not intended to offend either.
The whole circle of love via taxes & the multiplier does not work either I’m afraid.
It just misallocates capital.
A really good read that debunks all the Keynesian/multiplier claptrap that abounds .
http://www.amazon.co.uk/Economics-One-Lesson-H-Hazlitt/dp/0517548232/ref=sr_1_1?ie=UTF8&qid=1332413275&sr=8-1
Padraic Email sent & thanks!
Indeed a good article – I met one of these guys on a flight out of Knock recently, he had a small business with some earth moving plant that had gone belly up – borrowed up the hilt for plant now not working and therefore not earning. Bit like having a fleet or planes not flying. He was working in London, paying rent there and trying to live off nothing so he could pay as much debt off as possible. He was a sad young man in his late 30s he said ten years ago I was full of hope,… Read more »
I think this was a great article but I think the question really should be ‘ Why are the ECB and the Bondholders been given priority over our families? ‘ I do get what poster like PaulDiv are saying , some people did go mad buy ‘ investment ‘ properties and some people did borrow more than they knew they could afford. I don’t know how many people who borrowed their deposit from the Credit Union didn’t tell their mortgage provider and told them their parents gave me them a gift of 40k for the deposit. It was wrong of… Read more »
Hi David, “Teeling is right. A massive debt deal is the only solution” Teeling is WRONG. A massive debt WRITE DOWN is the only solution. “It is not if but when” Yesterday preferably. “What do you think?” Me personally? The bank managers who have consistently lied to the minister for finance (who has sovereign will) after the banks were nationalized should be tried for treason. Will this happen? No. The corporate psycho’s who controlled the various banking companies and who broke section 60 of the companies Act preventing loans from being procured to buy shares in the same company aka… Read more »
Not for the first time I come away from reading one of David’s articles with the slightly queasy feeling that the floppy haired one is bullshitting for Ireland again. But is he? What’s the ECB got to do with austerity? David says that the best solution for a heavily indebted nation is ‘not more debt but less debt.’ Surely if the government abandons austerity it will have to continue borrowing to pay day to day expenses.(Assuming it could find some idiot to borrow from). The 18,000,000 p.a. or so the Govt is borrowing won’t go away just cos we told… Read more »
@Michaelcoughaln “Eiruba” lovin it, except it’s too damn cold here
G-Sucking across the Universe, On the starship G-Sucks, Under captain Jerk, G-Sucking across the Universe, Things aren’t getting better, Things are getting worse! Greetings to my fellow Clingon’s clinging onto the belief like Emanon Gimmiemore that things are getting better (things aren’t getting better, things are getting worse) I invite you all to peruse at your leisure the following links one by no less an organisation than the new York times and the other our own NAMA; http://www.nytimes.com/2012/03/14/opinion/why-i-am-leaving-goldman-sachs.html?_r=1 http://namawinelake.wordpress.com/2012/01/14/the-vampire-squid-goldman-sachs-selected-by-nama-to-advise-on-loan-sales/ Hello Suds, Looks like another guy who wanted to do his job properly just like McWilliams wasn’t good (bad) enough for… Read more »
When I was living in London last year I knew a load of those Irish dads who worked in the City financial district, flew home at the weekend on a Ryanair flight and back again early Monday morning, had a mortgage and family at home and bills to pay in the UK & Ireland.
I was younger and had no mortgage or anything but they were really pushing themselves to the limit for their families.
desperate stuff
One thing alluded to in David’s article is how Economics has been hijacked by Accountancy. Economics is actually a social science, dealing with people rather than just material things. Many of the arguments presented as economics in the debate about the current state of the world economy are actually book-balancing exercises which ignore the political element of economics entirely, presumably because those presenting them see no alternative to their own views. Economics deals with “the relationship between ends and scarce means, which have alternative uses”.
http://online.wsj.com/article/SB10001424052702304636404577297182754696876.html?mod=googlenews_wsj
Ireland “back” in recession
The title of David’s article says it all. Why must Irish families be shanghaied into carrying on their backs the vast stones that might (or might not) re-build Pharoah EU’s pyramid? Aren’t there more liberating things to be done?
Prosper Australia’s video/doc “Real Estate 4 Ransom” suggests how we might exit the financial morass if we have the wit. http://realestate4ransom.com/
@Paul Divers something for you.
http://www.vice.com/en_au/rivals/rangers-celtic-part-1
This is a very interesting discussion between David’s old friend Max Keiser and Mark O Byrne from Goldcore in Dublin. Well worth a watch. The interview is the second part but the first part is vintage Max in full flow about the banksters and is worth a look also.
http://maxkeiser.com/tag/keiser-report/
Money we the Irish people don’t owe should not be payer in any shape or form,noonan putting what we don’t owe into a bond so as to become even more money we don’t owe further down the line is crazy insane .
According to Max Keiser,Central Banks have bought up to 3 tonnes of gold in the last two weeks
Check out Max Keiser on the 22/3/12.
The issue of debt and how it will be managed or otherwise is a side show to the what has really happened – i.e. the hollowing out of western economies by cheap labour and lower worker rights from the east. The rush is on now to chase that labour or manage it from one of the power centres/ big cities. Make no mistake though – if you are blue collar/ shop floor and over 30 you are out of a job and long term unemployed. If you are middle management, or in a service industry, you’ll do better in a… Read more »
David the article reminds me of a story I read in a book about the famine The huns went to the house of a man named Diver (same name as myself) near Laghy in Donegal and lit a torch threatening to burn the house down. The man could not pay the rent and said ‘feck it give me the torch’ and burned it down himself rather than let those buggers do it He maybe went to Glasgow on a cheap ticket and like many Donegal people would have found a home from home in Clydebank. I often wonder what happened… Read more »
Hi,
I enjoyed the article David, as I enjoy most of them.
A lot of the time I read the argument that Ireland needed a bailout regardless of the odious bank debt being attached to the state.
My understanding is we ran a (however boom fuelled) surplus pre fiasco. Can anybody tell me, what the fiscal gap was before we bailed out the banks?
harry
Can we afford the “rich” anymore ?
There is this great schism between the investing class – and the rest of us.
Guillotine the investorati ?
Georg, where are you when I need you? Tell me again how it’s just one big Opus Dei conspiracy. What new privileged information has been brought to your attention? Tell us what we must do, Teacher.
And where’s Colm these days? Last time I looked he was over on irisheconomy, crunching numbers and getting all technical: “Agreed, however…” Come back Colm and lead us towards the light.
The cost of Anglo promissory notes.
The government is on the hook for €3.1 billion every year until 2023, with smaller annual outlays due until 2031. This year’s sum, due on March 31st, represents around 2% of GDP. From next year interest payments on the debt are due to be counted against the budget balance. To meet its deficit targets the government will have to make further cuts. Hence rising pressure in Dublin for a deal to restructure the payments.
http://www.economist.com/node/21551066
The latest thing I found strange was I rang around to get the best quote for my car insurance and I got a good deal only if I payed there and than no hp over the year this makes me think that big insurance companies are low on cash reserves ,there customer base must be getting smaller with the domestic economy in free fall and there was me thinking exports and farmers where going to save Ireland.
Try to “cut a deal” with Euro ideologues? Look at what happened in Berlin. Merkel has become a classic ’68er and it is all just a matter of opinion! Merkel Meets Greek Trade Union leaders, and Expresses Fear of Being Attacked March 23, 2012 (EIRNS)–German Chancellor Angela Merkel was confronted with the ugly consequences of the brutal austerity being forced on the Greeks in a meeting with Greek and other European trade union leaders today. Ioannis Panagopoulos, the head of Greece’s General Confederation of Greek Workers, who attended the meeting held in Berlin, confronted her with the “disastrous effects” that… Read more »
Remember all that printed money recently? Where is it going to indeed. This is why we must have murderous austerity? ECB: Money Injections Not Intended for Real Economy March 22, 2012 (EIRNS)–In an interview with {Bild Zeitung} today, ECB President Mario Draghi answered objections that his EU1 trillion liquidity injection might cause inflation, by saying that “to a large extent the banks which borrowed money from the ECB did not put it into the economic circuit, but used it to meet obligations.” Thus, Draghi admits that the ECB wants the banks not to use liquidity for productive purposes (“economic circuit”),… Read more »
Another bright idea, likely to be peddled and copied. London Announces a New Stealth Bail-Out: “National Loan Guarantee Scheme” March 22, 2012 (EIRNS)–The March 21 British government Budget Report, besides proposing ho-hum killer austerity, announced yet another killer bail out, in the form of the new National Loan Guarantee Scheme. Chancellor of the Exchequer George Osborne presented the details. It amounts to a stealth bailout of select banks, which are to be able to run a type of carry-trade operation, with guaranteed returns. The banks which have so far signed up to participate are Barclays, Lloyds Banking Group, Santander UK,… Read more »
Thank you Phil Hogan. Criminals must be wringing their hands. Phil Hogan has just given them license to go and intimidate elderly people to pay the “Household Charge” by Knocking on doors of those who havent paid. Starting April 2nd they will be on the streets with “proper identification required”. You must be joking, does this guy not realize the amount of thieves who will be posing as “authority” from the council with fake credintials? They are on a looser on this one. How much is it going to cost to collect this money in petrol,wages, admin., badges? Visits by… Read more »
The size of bankers bonuses is a measure of how aware they are of the collapse that is coming to the monetary systems.
It is clear they are trousering every cent they can extract – question is where are they putting it?
Property?
Gold?
Diamonds?
Guns?
This is a time for credit unions to offer an alternative to the banking elites. Our Polticians need to be hanged alongside the bankers and wise-guy developer scoundrels.
A rope is bio-degradable and re-useable. Its the gift that keeps on giving!!!
The thrivemovement.com site has had a million+ hits and there have been many comments suggesting that the Thrive DVD be made available free in the hope it will go ‘viral’ as the ‘Koni’ Youtube video has, resulting in 85 million hits. Kimberley Gamble has responded saying they are considering all the suggestions as to how to reach more people more quickly. I was thinking of ordering the DVD and showing it in the local community hall also car boot stickers?! Any other ideas out there? I like the Thrive movie as it is very inspiring and optimistic about the future.… Read more »
Next chapter worth a calendar entry:
Short after April 22nd