It’s baffling, truly baffling.
Today our media discusses the
outrage over the possible (and this
is still not locked in) payment of €280m to junior bondholders in the two
wound-up banks – Anglo and Irish Nationwide – that were combined to form IBRC.
Meanwhile, there is absolute
silence from the same media on the scheduled definite destruction over the coming years of €28bn, legacy debt from the same two banks.
That destruction begins in 2014,
continues until 2032; under the
schedule, €28bn in sovereign bonds that
replaced the old Promissory Notes (remember Noonan’s widely hailed ‘deal’ of February
2013?) will be sold by the Central Bank, then those borrowed billions destroyed, every cent – that’s 100 times the amount causing so much
outrage at the moment.
The destruction of those billions
is only half the story, however; immediately each of those bonds is sold and
the money thus raised destroyed, for the full lifetime of each of those bonds we
pay interest to the new bondholder (rubbing salt in the wound, perhaps it will
even be one of those same bondholders bailed out by us in the first place).
In 2038 the bonds start ‘maturing’,
meaning the new bondholders – thanking us I'm sure for the interest we’ve paid –
now come looking for the principal back.
In 2053 we have the scheduled
final payment, €5bn – if we can afford it even then. The possibility exists
that we won’t, that the debt will be rolled over, meaning we’re not just
debt-slaves for the next 40 years, but that this could go on into perpetuity. And
for what? To bail out back in 2010 the failed European big-bank bondholders and
creditors of two bust Irish banks.
How much will it all eventually
cost? The €28bn in sovereign bonds now about to be sold and destroyed is in the
ha’penny place – between interest and principal over the next 40 years, that
€28bn, along with the €3bn paid in 2011, is going to cost us at least €80bn, an
average of over €2bn/yr. And that in itself is less than half the full story of
the Irish bank bailout (the full figure is €69.7bn)!
I suppose when you read it like
that, written down in black-and-white, the fact our media is absolutely silent
on it is understandable. If the people are reacting as they are now to the
water-charge attempted robbery, how would they react if they were fully aware
of this?
Regards,
Diarmuid O'Flynn.
A SCREEN GRAB OF MINISTER NOONAN'S PARLIAMENTERY QUESTION REPLY
TO PEARSE DOHERTY (SINN FEIN) IN EARLY 2013
