Message about Nama from Emer O’Siochru : Feasta Executive Member

Message about Nama from Emer O’Siochru : Feasta Executive Member

Democracy is a funny thing. A decision that will have far reaching implications has come down to a couple of hundred of concerned environmentalists meeting in a hall tomorrow. Pundits in the media say this is highly undemocratic, ignoring the fact that the alternative is a much smaller room full of politicians making the decision behind closed doors. The Irish people did not know that they were voting for Nama in the last election; – there was not even a banking crisis then!

So what mechanism do we have for people to have a say in really crucial decisions that spring up between elections? Referendums are a good way to do it to be sure, but we have seen the difficulty of understanding and deciding complex issues in the Lisbon vote. We need a way to disentangle the fundamental political issues from the technical and then a way to allow people to input in a more complex way than a simple yes or no vote.

Most any environmentalists amongst you will know that there is such a mechanism, the procedures for assessing the impact of policy on sustainability – the Strategic Environmental Assessment or SEA. Instead of adding to the pressure on hapless Green Party members to decide on Nama, I make a plea that they be permitted to pass that chalice – to an SEA process. That way we can all help to make the right decision. A compromised government and a lazy media is trying to tell us that there is “no other game in town” or that “Nama is a done deal”. This is because responsible Nama opponents stepped into the background to allow for a clean debate of the Lisbon Treaty. For their pains, their patriotic action has been spun as a capitulation by the anti – Nama movement.

To my knowledge, nothing has happened or been said that has changed their minds or mine. The 46 respected economists who signed the original article to the Irish Times still believe Nama is fundamentally flawed and unfair. They have been joined by many others including Nobel prize winner Joseph Stiglitz.

Most Irish environment activists are very concerned about Nama. Eight national environmental NGOs, members of the Irish Environmental Network called for a SEA or Strategic Environmental Assessment of Nama. Except for the veto of one NGO member, the new Environmental Pillar of Social Partnership very likely would have called for the same thing today. The NGO member used the veto, not because they supported Nama but because they were worried about influencing the internal decision-making of a Political Party. But I think most committed environmentalists, and such are Green Party members, would prefer to be fully informed (in the spirit of Aarhus) at this crucial time.

An SEA requires that a number of options for fixing the banking system must be researched – not just one; information must be shared with the social partners and civil society so people can participate fully and the impact of different options fully explored before a decision is made.

The SEA is an internationally developed protocol to make sure that decisions are not rushed – especially critical decisions in a time of emergency. Ignoring the SEA checklist is like a pilot in a jet aircraft ignoring established safety procedures when the engines cut out in mid flight. The fact that that ‘there is a crisis’ or that ‘there is little time’ would not be acceptable as an excuse from the pilot in that situation any more than it is an acceptable excuse by the current government – especially a government with Green Party Ministers.

The complexity of the issues is not a reason to take on trust any particular voice. I can understand how the the Green Party elected members got pulled down a particular path by the apparent confidence of senior civil servants, the experience of banking advisers and the panic of their partners in Fianna Fail. No less a man than President Obama got pulled into agreeing to the Tarp Plan in the US – a similar plan to Nama to purchase toxic assets. But as time passed, better judgement prevailed and a different path was taken in the US. Sadly, Green Ministers lacked the self belief to call a halt in order to fully examine other options before sealing this irrevocable deal.

So it is now down to ordinary Green Party members.

Tomorrow will decide whether €54 billion is paid for assets that can be had for €24 billion- without depriving bondholders of a penny. This is real money and will cost us real money in taxes for a generation. I believe that Nama is a sleight-of-hand gift to bankers and their friends, wrapped up in wishful thinking and sprinkled with threats. For the taxpayer to break even, interest rates must stay low and property values must rise in a truly fairytale fashion. It leaves nothing in the kitty to help with the unbearable debt of ordinary families and many businesses. It postpones the property price drop that the economy needs to restart. It blocks all reform of planning and taxation that might potentially reduce the ‘long term economic value’ of its property portfolio. That includes reforms that would divert investment into productive businesses that would prepare us for an energy scarce and climatically unstable world; reforms that would create jobs for our young people and a secure retirement for our old. The lame risk share and weak levy thrown in at last minute does not change any of this.

But why should anyone take my word for it? Nama is not the only worked-out solution to the banking crisis; all should be assessed under an SEA.

Doubts have been cast that ECB would give us the same deal as for Nama bonds for any of the competing options to Nama developed by non self-interested economists, bankers and businessmen. Why can’t we ask them as part of an SEA?

Fears have been expressed that the bond market will not lend to a government owned bank in the same way it would support the Nama buy out. Why not find out for certain as part of an SEA?

Taxpayers and citizens may be happier to face up to their loss of wealth in property if they were partly compensated by a gain in bank shares. Why not ask them as part of an SEA?

Instead, ordinary Green Party members are in the privileged but unenviable position to decide on a single option, Nama. This is not fair on them or on us. But if any are reading this, please decide so that we get a say too.

Emer O’Siochru

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