Sir, – Your correspondent, Simon Carswell (Business+Commercial Property section, April 4th), smartly distinguishes between how Eircom debt is been managed and restructured and how the Government failed to apply the “rigours of capitalism to the previous Anglo Irish Bank” thereby limiting its own powers of negotiation.
He claims, and I agree, that the absence of a guarantee, followed by an Eircom-style reconstruction would have saved the State a considerable sum of money. The figures are clear, as he shows.
In my view, the overwhelming mandate this Government has got from the electorate – the will of the people – meant it was not bound to accept any guarantees that a previous government had entered into. It had a clean slate, but it chose to ignore this fact.
As Carswell points out, the guarantee “up-ended the structures of capitalism. It erased the rules of the game”. This is something the Labour party should have been alert to, but it played dumb.
Even though the electorate failed to vote for a Labour government, which seemed logical in the circumstances, it chose instead a lighter version of Fianna Fáil, namely, Fine Gael.
Even so, Labour was still in a strong position, understanding the rules at play, to veto Fine Gael from acting in loco parentis of Fianna Fáil and to win concessions and to definitively reject the guarantee. In the end, its acquiescence was more rapid than was nice.
Did the spoils of office blur Labour’s vision? It is after all, its constituency that is paying the price.– Yours, etc,