Eamon Gilmore (photo), leader of Ireland's Labour Party, has again called for the temporary nationalisation of the country's main banks "as an alternative to the setting up of the government-proposed National Asset Management Agency (NAMA)".Speaking on RTÉ News, Gilmore said that "a mechanism should be established to write down bad debts, before returning the banks to the market when they are restored to good order".
The Labour Party leader also emphasised that "it is a necessity to get the banks lending to businesses again".
His proposal was not without cost, Gilmore added, but he claimed it would mean a lot less risk for the taxpayer than the government's plan.
Under the government's proposed legislation, NAMA would be taking over € 90 billion worth of debt away from Irish banks, so that they can start lending again.
The amount NAMA would pay for the debt has yet to be decided. But in an article, published in yesterday's edition of The Irish Times, 46 economists warned that NAMA might pay too much and thus create an extra burden for Ireland's taxpayers. (see yesterday's entry below)
Fine Gael has already stated that it will oppose the government's NAMA plan when the Dáil debates the legislation next month. Since Sinn Féin, which demands a referendum on NAMA, is against it as well, this means that all opposition parties in parliament are united on the matter, even though they do not agree on the details of possible alternatives.
The Green Party, who is the junior partner in the government coalition, will hold a special conference to debate the plan. (see my entry of August 25th)
The outcome of this conference is far from certain, and neither is the continuous support of the Green Party for the current government.
As things stand at present, anything is possible. A temporary nationalisation of our major banks - as demanded today and previously by Eamon Gilmore and his party, as well as by Sinn Féin and the Socialist Party in separate statements - would in my opinion be the safest and least costly option.
We can expect that the government will not listen and stick to its original plan. So I suggest that now is a good time to contact your local TDs, especially those from Fianna Fáil, and tell them in no uncertain terms what you think of NAMA. It might also be helpful to mention that their own seat will be in serious danger if they ram through a legislation that no one in the country really wants, but for which everyone would have to pay severely over decades to come.
The Emerald Islander
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