This is from the Associated Press –
Ireland’s international bailout boosted its bank stocks Monday, but outraged many hard-pressed taxpayers, who questioned why the government’s pension reserves must be ravaged as part of a deal that burdens the whole country with the mistakes of a rich elite.
Shares in Ireland’s banks rose sharply as markets were encouraged by the bailout’s immediate focus on injecting €10 billion into the cash-strapped lenders out of a total of €67.5 billion ($89 billion) in loans.
But the Irish were shocked by a key condition for the rescue — that the government use €17.5 billion of its own cash and pension reserves to shore up its public finances, which have been overwhelmed by recession and exceptional costs of a runaway bank-bailout effort.
Opposition leaders and economists warned that the EU-IMF credit line’s average interest rate of 5.8 percent would be too high to repay. They also questioned why senior bondholders of Ireland’s struggling banks — chiefly other banks in Britain, Germany and the U.S. — still weren’t being asked to bear some costs.
Here’s what’s been happening. About twenty years ago, the Irish bought in to the Friedman Economic Theories (FREE MARKET) and freed their system from the chains of regulation. After that, the economy took off like a rocket. Actually the economy did take off but only for certain sectors of the economy particularly the financial industry. All that rocket climb was just a bubble of speculation and when the cloud of dust settled the state banks were deep in the hole. The Irish nationalized the banks and have since bailed them out to the tune of 100 billion dollars. This is smaller than the the U.S. bailout (TARP) but from a very, very much smaller nation (4.5 million people).
They are getting to a loan to keep their economy afloat from other European nations. To get it, they have to put the nation’s pensions funds up as a guarantee. People are unhappy about this.
But here’s the kicker. This is what is really making people mad. The bondholders of these banks are not required to pay for any portion of this at all. Zero!
If they had turned away the huge profits made during the “Celtic Lion” period like a benevolent aristocracy, I might cut them some slack but they didn’t quibble about taking the money. And now the Irish people, in particular, the ones that never profited from the whole economic de-regulation, speculation nightmare, are going to pay for it.
James Pilant
Pilant's Business Ethics Blog 
Thanks for this James. It is not simply the fact that pensions are being used as collateral that has enraged the people of Ireland; this is only the most recent target of an on-going assault on the public. Over the past two to three years public spending has been axed to such a degree that there is now a real human cost. Education and Healthcare were the first targets. Social and unemployment welfare has been hit hard. The government has been consistent in its agenda of forcing the poor to pay.
The sad reality is that the Celtic Tiger happened only on paper; there has been little visible change to the issues of poverty in Ireland throughout this period.
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I didn’t want to complicate the issue by discussing the banking scandals. In fact, before you posted I was considering running the entry past you to see what you thought then I decided making you do my work was unfair. So, I went and read a bunch of articles and generally got the idea that I was roughly on target. But if you do want to look at my postings on the Irish debt crisis before I put them up, that would be very nice.
I am on your side of the issue. I’ll yell as loud as I can. jp
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