Looks like Nama’s starting to get going. Good stuff. Now we find out how much we’re going to be paying. Then I suppose we can start planning. If it’s €10bn over ten years, that’s €1bn per year, is it? And if it’s more likely to be €30bn over ten years, then that’s €3bn. But, sure, isn’t the €30bn estimate more on the optimistic side of the realistic/pessimistic view? Could it be that we’re in for €40bn?
Let’s say the inward investment doesn’t arrive and unemployment doesn’t fall. Let’s say the brain drain continues. And that many of the skilled migrants who came here for work – and who gave Ireland a decent subsidy while here (because, make no mistake, skilled migrants are a subsidy to any receiving country) – head off. Let’s also say that interest rates rise and our public debt balloons; that mortgage arrears become defaults; and that the state keeps cutting back and still doesn’t do anything about material inequality, which means the haves keeping having and the have-nots keep having not (make no mistake here, either, by the way: the trend is for unequal societies to become even more so. Think USA). Finally, let’s say the (crazy?) property values never again scale such heady heights and we really end up paying the penalty.
And so it’s €40bn over ten years. Now we’re talking. OK, with rising interest rates it works out at well over €4bn a year, but who’s counting at this stage? And, anyway, who can remember what €4bn a year would have got us? How many hospitals or schools or public transport projects? How many miles of motorway?! Ah, Nama. Shucks, at least we’ll own some crackin’ ole (demolished?) sites around the place.
Alistair Fraser
Ireland after NAMA 
March 23, 2010 at 7:27 am
Yes these are scary times and NAMA should be viewed as part of a continuum which started with the guarantee and will end (hopefully) with the recapitalisations. The exposure of taxpayer’s wealth is €11bn (recap and nationalisation of Anglo) plus c€60bn (NAMA) plus c€15bn (future recapitalisation)plus any costs that arise when the guarantee is reviewed in September 2010 – that excludes any call on the 2008 guarantee. Yes, scary times and big, big numbers for a small country.
As a society, the best we can do is demand detail from our leaders that we chose and then test that detail against reality. Our leaders did not sleepwalk into NAMA or the forthcoming recapitalisation though arguably they were caught on the hop with the original guarantee. They (and remember we collectively voted them in) have indicated an openness to a degree of consultation and constructive contribution. I would guess that they also want to move on quickly with NAMA and the recaps.
So we have a duty here and it’s not to stand like rabbits in the headlights. There is no perfect solution, either in principle or implementation, to our crisis and mistakes WILL be made. Especially on here where there is a wide audience of academics who understand the frameworks, there is a duty to ask questions, research, constructively criticise and in some cases shout from the rooftops.
March 24, 2010 at 8:42 am
Kondratieff!
Every 60 to 80 years, with the smart alecks manipulating to maximise their profits.
There will always be theft by inflation and corrective deflation.
Let us learn to enjoy both?