The debate takes another tactical shift: Is 20% expected losses reasonable?

I’ve just been listening to Morning Ireland discuss the NAMA Business Plan published last night.

I’ve been questioning RTE’s objectivity and journalistic integrity for several weeks now, so it was no surprise to hear the first ‘expert’ reaction this morning praise the plan. Why does Prof. Ray Kinsella consider it an impressive plan? I wasn’t convinced but then I wouldn’t be an impartial observer. In the interest of impartiality on the part of our national broadcaster, a second commentator with a more critical view would be the least I could expect. But Business reporter Emma McNamara, insisted we focus on the positive. Indeed, Emma, lets, and disengage our brains completely from reality. To be fair to Prof. Kinsella he did warn of the opportunity cost associated with NAMA and the consequent reduction in public services that will naturally ensue.

The debate between Richard Bruton and Frank Fahey was suitably partisan and not likely to help the general public make an informed decision. With the publication of the NAMA business plan, the unsinkable HMS NAMA gets a significant step closer to completion. And the focus of debate now shifts onto a single number: 20%

Experts will be rolled in, and government rhetoric will hang on, the ‘reasonable’ and ‘prudent’ assumption that only 20% of the 77bn in loans being transferred to NAMA will not be recovered. I humbly suggest, that if one was being prudent, one would look to recent cases such as the Zoe Group and the Dublin Glass Bottling site, the former losing 85% of its value and costing the State €90m in so doing.

77 TDs voted for the NAMA Bill last night, 71 against. To overturn the Bill will require 4 TDs to vote for a General Election, knowing that probably half of their colleagues won’t be coming back. The chance of that is probably the same as NAMA only losing 20% of its loans, practically zero.

Unlike its predecessor, which disappeared into the icy depths of the North Atlantic in just a few short hours, we will have to watch the HMS NAMA slowly, and painfully, sink over the next ten years, bringing much of the real economy in its wake.

God save this ship and all who sail on her.