Crony Ireland - - the toxic nexus of business and local politics, in a system
of limited accountability - - maybe about to make a comeback with the election
of a Fianna Fáil property services insider as the next Irish head of state.
Meanwhile, the opposition of eight former attorney generals to proposals on
judges' pay and Oireachtas inquiries - - all of the individuals likely
multi-millionaires and two who have served as chairmen of Allied Irish Banks (AIB)
- - confirms again how difficult it is to bring about change in such a
A vote for
Seán Gallagher on Thursday would be even more of an endorsement of the
Fianna Fáil system that brought the Irish economy to its knees than a vote for a
Celtic Tiger era developer in NAMA's gallery of leading borrowers.
Gallagher was the quintessential cavalry insider in the machine politics of Fianna Fáil;
on the public payroll as secretary to a Fianna Fáil minister; on the payroll of
a public enterprise agency; becoming a property services entrepreneur during the
boom but still acting as a Fianna Fáil director of elections in Louth during the
2007 general election and joining the ruling national executive in 2009.
He went with the flow during the boom and picked up State quango appointments -- all boosting his insider connections.
As was the case with many communist apparatchiks in Eastern Europe after the
fall of communism, Gallagher now wants the past to be inoperative.
The questions about business transactions in themselves are enough to
disqualify him for the office of head of state.
The Irish Times
says today that issues have been raised about aspects of Seán Gallagher’s
business record, including: the loans he has taken out of his company as a
director; other drawdowns from the company such as patent royalties, rent and
directors’ fees; and the level of State support for his company.
Corporate governance expert Prof Niamh Brennan has said there is a “bad vibe”
about these aspects of Gallagher’s record, while Glenna Lynch, the Dublin
businesswoman who tackled him on television and radio in recent days, has
accused the Dragon’s Den panellist of “raiding the coffers” of his business,
thereby weakening it.
The Irish Times also
Seán Gallagher has refused to answer questions about his €82,829 company loan
which breached company law.
It seems weird that the self-proclaimed guru for entrepreneurs would have been unaware about the focus on the abuse of director loans following the revelations about Seán FitzPatrick of Anglo Irish Bank in Dec 2008, that he had hidden large director loans over an eight-year period.
Last Saturday, The Irish Independent reported that Gallagher's company
Smarthomes benefited from public grants totalling €830,000.
On Tuesday, Glenna Lynch from Stillorgan, Dublin, who runs the interior
design shop Mimosa Interiors, raised with Gallagher on the Today with Pat
Kenny programme on RTÉ Radio One the issue of the very high level of grants paid
to a domestic services company. He did not reply to the issue.
It's a question that many business people have wondered about including
myself, as apart from county enterprise board supports and a number of job
promotion schemes, public agencies generally provide only significant support to
businesses that are exporting.
There is no suggestion that there was anything underhand in the grant
applications by Smarthomes but the public agencies involved should clarify why a
company with about 70 employees providing a home-market property-related service
during a housing boom, was given such a large amount of public funds. It is also
a fact of life that having connections with agency staff is a plus for
Attorney Generals for the comfortable status quo
years ago last August, the music stopped on international credit markets. Weeks
before, in July 2007, Chuck Prince, then CEO of American banking giant Citigroup,
famously dismissed fears about an early end to the postmillennial debt
frolics. “When the music stops,” he told The Financial Times, “in terms
of liquidity, things will get complicated. But as long as the music is playing,
you’ve got to get up and dance. We’re still dancing.”
Chuck Prince may do his dancing these days on golf courses and in the interval
of four years, much appears to have changed in both the global economy and
Ireland. However, it's also striking how little fundamentally has changed in
Ireland despite the swift transition from boom to bust.
decades, change in Ireland has happened at glacial speed, if at all. Since 2007,
there has been little interest in reforming broken systems and the new
Government hasn't accelerated from the default slow-motion mode. In contrast,
there appears to be a significant constituency that sees salvation from shifting
responsibility for our travails to Europe. It is part of the evident delusion
among those who wish to retain bubble gains that the status quo can be
The eight former attorney generals
wrote to the national newspapers can always find reasons not to change and
none of them have saw fit to push for reform of the system that made all of them
very rich in a small country.
Dermot Gleeson and Peter Sutherland are former
chairmen of AIB Bank.
So our parliament should not have
the power to investigate issues of public importance such as the banking crash
while the referendum on judges pay may undermine the independence of the
Any number of things can happen and
a failed system which they were part of for a span of three decades has
destroyed the lives of tens of thousands of their fellow citizens. However, that
system remains today essentially unreformed and a Fianna Fáil
insider may well become the head of state of what is currently a bankrupt
country and the calamity was mainly self-made at home.
Michael McDowell, a former attorney general, presciently said his party, the
Progressive Democrats (PDs) had a choice of being radical or redundant.
Today despite the crash, the conservative
mode remains the default one and both the election of Gallagher and the rejection of the referenda would leave no room for doubt or hope of meaningful change.
Peter Monahan, of Mornington, Co
Meath, frames the issue very well in The Irish Times today.
"The dramatic intervention by eight former attorneys general is a shameful
effort to protect the most profitable and cossetted profession in this
broken and bankrupt republic. Crying wolf with regard to our citizens’
constitutional rights really takes the legal biscuit. Let us recall their
interventions on our behalf during the disgraceful governance by government and
banking regulators during the Celtic Tiger years.
Where were they when their learned colleagues negotiated huge and immoral
tribunal daily rates? Racking up over €300 million to be paid for from the
public purse. The net result for such huge cost is nothing, no one found
Perhaps the politicians should be given at least one term to see if they can do
better than our super- paid and selfish barristers. I of course recognise that a
large amount of solicitors and juniors work on the clippings of tin to survive,
but surely this shows how their cosy self-regulation needs to be radically
changed. Vote Yes to both amendments at least we can change the politicians and
monitor their wages."