FacebookTwitterGoogle+RedditEmail

Ireland’s Home Mortgage Crisis: No Debt Relief

by CAOIMHGHIN Ó CROIDHEÁIN

We are living in a society where the combination of fractional-reserve banking (lending out multiples of deposits) helped along by quantitative easing (printing almost unlimited quantities of money) based on fiat currencies (money without intrinsic value) has created exponential growth for the world’s financial elites. This led to unprecedented bubbles in the property market as banks made it easy for people to borrow more money  than they would have been allowed in the past when a conservative banker guideline for a home buyer was to have a two to two and a half times mortgage-to-salary ratio.

In contrast to these methods for almost unlimited sources of (false) wealth conjured up by financial elites, workers (borrowers) have only one source – wages – which are going into decline due to  government cutbacks and increased taxes. Yet despite this obvious anomaly, whereby the banks get bailouts with even more money, borrowers are expected to pay back, and in full, under threat of repossession, every single cent of the flawed money lent to them to pay exorbitant house prices inflated by excessive lending in the first place.

According to David Hall, Director, Irish Mortgage Holders Organisation:

‘The Irish mortgages crisis, now into its sixth year, is still raging beyond any control of the authorities. Per latest figures from the Central Bank of Ireland, 186,785 mortgages (including BTL) in Ireland are at risk (in arrears, restructured or in repossession), accounting for an unprecedented 25.3% of all mortgage accounts still outstanding.’

Hall goes on to state that ‘with some 650,000-750,000 estimated people residing in the households with the principal residence in mortgages difficulties, we are witnessing a wholesale destruction of savings, pensions and wealth of several generations of Irish people.’

As if that wasn’t bad enough the government is introducing property charges from 1st July. Media discussion of these issues revolve around valuations of properties and not around the huge amounts of tax already paid to the government when the houses were purchased or  the fairness of such a tax on properties which were bought during the bank-inflated boom, delusionally misnamed yet commonly known as the ‘Celtic Tiger’.

Media pundits, sounding like poodles discussing the length of their leashes, have not questioned the ethics of forcing people to pay back such huge sums of money under the rubric that allowing people to write-down a portion of the debt would cause a ‘moral hazard’ (as if the initial lending spree was itself moral). Similarly, there is little discussion of the property tax deferral option for low income persons, a sinister move, which implies, (like with the hard line taken on mortgage repayments) that exemption is not an option any more for low wage earners but only more accumulated debt (with interest) to be paid sometime in the future- further impoverishing those least able to pay.

Adding insult to injury, the Department of Finance secretary general John Moran spoke recently of an “unnaturally low level of repossessions” and that ‘homeowners could not expect the taxpayer to subsidise them to remain in a house “that is beyond their means”.’ It is interesting to note that ‘their means’ didn’t seem to matter at all when it came to lending out the huge amounts of money at the outset.

Credite posteri – Believe it, future generations (Horace).

Caoimhghin Ó Croidheáin is a prominent Irish artist who has exhibited widely around Ireland. His work consists of paintings based on cityscapes of Dublin, Irish history and geopolitical themes (http://gaelart.net/). His blog of critical writing based on cinema, art and politics along with research on a database of Realist and Social Realist art from around the world can be viewed country by country at http://gaelart.blogspot.ie/.

Caoimhghin Ó Croidheáin is an Irish artist who has exhibited widely around Ireland. His work consists of paintings based on cityscapes of Dublin, Irish history and geopolitical themes.  His blog of critical writing based on cinema, art and politics along with research on a database of Realist and Social Realist art from around the world can be viewed country by country at http://gaelart.blogspot.ie/.

More articles by:

CounterPunch Magazine

minimag-edit

bernie-the-sandernistas-cover-344x550

zen economics

January 17, 2017
Andrew Smolski
Third Coast Pillory: Politicians and Rhetorical Tricks
Chris Busby
The Scientific Hero of Chernobyl: Alexey V. Yablokov, the Man Who Dared to Speak the Truth
David Macaray
Four Reasons Trump Will Quit
Chet Richards
The Vicissitudes of the Rural South
Clancy Sigal
“You Don’t Care About Jobs”: Why the Democrats Lost
Robert Dodge
Martin Luther King and U.S. Politics: Time for a U.S. Truth and Reconciliation Commission
Jack Sadat Lee
I Dream of Justice for All the Animal Kingdom
James McEnteer
Mourning Again in America
January 16, 2017
Paul Street
How Pure is Your Hate?
Jeffrey St. Clair - Alexander Cockburn
Did the Elites Have Martin Luther King Jr. Killed?
Robert Hunziker
Global Warming Clobbers Ocean Life
Patrick Cockburn
The Terrifying Parallels Between Trump and Erdogan
Kenneth Surin
The Neoliberal Stranglehold on the American Public University
Lawrence Davidson
Is There a Future for the Democratic Party?
Douglas Valentine
Who Killed MLK Jr?
Robert Fisk
The Foreign Correspondent in the Age of Twitter and Trump
Dale Bryan
“Where Do We Go from Here?”
David Swanson
The Deep State Wants to Deep Six Us
Dan Bacher
Obama Administration Orders Speedy Completion of Delta Tunnels Plan
Mark Weisbrot
Obama Should Make Sure that Haitian Victims of UN-Caused Cholera are Compensated
Winslow Myers
The Light of the World
Bruce Mastron
My Latest Reason to Boycott the NFL: Guns
Weekend Edition
January 13, 2017
Friday - Sunday
Gregory Elich
Did the Russians Really Hack the DNC?
Jeffrey St. Clair
The President Who Wasn’t There: Barack Obama’s Legacy of Impotence
Anthony DiMaggio
Ethics Fiasco: Trump, Divestment and the Perversion of Executive Politics
Joshua Frank
Farewell Obummer, Hello Golden Showers
Paul Street
Hit the Road, Barack: Some Farewell Reflections
Vijay Prashad
After Aleppo: the State of Syria
John Wight
Russia Must be Destroyed: John McCain and the Case of the Dodgy Dossier
Rob Urie
Meet the Deplorables
Patrick Cockburn
The Russian Dossier Reminds Me of the Row Over Saddam’s WMDs
Eric Sommer
U.S.-China War: a Danger Hidden from the American People
Andrew Levine
Are Democrats Still the Lesser Evil?
Linda Pentz Gunter
What’s Really Behind the Indian Point Nuclear Deal?
Robert Fantina
Trucks, ‘Terror’ and Israel
Richard Moser
Universal Values are Revolutionary Values
Russell Mokhiber
Build the Bagdikian Wall: “Sponsored News” at the Washington Post
Yoav Litvin
Establishment Narcissism – The Democrats’ Game of Thrones
David Rosen
Return of the Repressed: Trump & the Revival of the Culture Wars
Robert Koehler
War Consciousness and the F-35
Rev. William Alberts
The New Smell of McCarthyism Demands Faith Leaders Speak Truth to Power
John Laforge
Federal Regulator Halts Move to Toughen Radiation Exposure Limits
Norman Pollack
Farewell Address: Nazification of Hope
David Swanson
Imagine the Confirmation Hearing for Secretary of Peace
CJ Hopkins
Why Ridiculous Official Propaganda Still Works
FacebookTwitterGoogle+RedditEmail