January 19, 2009

Incinerator Promoters Credibility is an $8 Billion Question

Incinerator Promotors vs Anglo-Irish Bank

Poolbeg Incinerator Promoters Credibility is in Question

It is difficult to establish how credible the incinerator’s promoters are. Are the promoters of the Poolbeg Incinerator any more credible than the directors of Anglo Irish Bank? Some of the information the promoters have provided to the public, or possibly withheld from the public for whatever reason, combined with other possible elements of The Big Lie Technique do not tend to inspire confidence in the promoter’s credibility.

Why Credibility Matters

Anglo Irish has grievously damaged Ireland’s Global Trust Rating. The peers of the incinerator promoters include Anglo Irish Bank, FAS, The EPA, An Board Pleanala, The HSE, The DDDA developer’s autocracy, the NRA, Dublin Port Company and so forth.

At director level, this group appears to be strongly linked with Fianna Fail. Along with many others this insular group seems to be loosely referred to as the The Galway Tent. The Galway Tent culture associated with some of this group has apparently misdirected national resources for the past eight years, totally wrecking the potential of the economy for perhaps a further ten years.

Only one view on the Poolbeg Incinerator has been presented to the public at a cost to taxpayers of €19,000,000. The promoter’s reports and claims have not apparently been subjected to any due diligence or peer review by a credible independent authority. The EPA, the HSE and An Bord Pleanala appear to be driven at director level by political appointees of Fianna Fail, so it’s naïve to suggest they are independent enough to robustly protect the public interest. Entities within the incineration industry provide further employment to these director-level public officials, a brass-necked conflict of interest denied by the promoters. The industry has also placed its employees into director level positions at some of these bodies – the poacher becomes policeman. The expensive experts used by the promoters were paid by the promoters, so it’s also naïve to suggest they are independent.

A monstrous white elephant implemented in the form of an ugly waste-to-toxins factory sitting in Dublin Bay is a fitting monument to the possibly self-serving members of the Galway Tent.

Trusting the promoters is too big a risk - the Poolbeg incinerator directly threatens people’s health. BSEM and WHO data suggests this is perhaps 100,000 man-years of reduced life expectancy between 2012 to 2027.

America’s EPA prices a human life at about eight million dollars. Technology is rapidly developing – within 10 year it’s likely that health damage will be traceable directly to the specific signatures of the pollution pumped out by the Poolbeg waste-to-toxins incinerator.

The financial risk from incineration health claims(a) could exceed the billions in bad-debt write-offs currently hidden from public view at Anglo-Irish Bank.

Future Court Cases From Traceable Micron Particles: $8 Billion

Nobody Believed Anglo-Irish Either

a) Financial risk from incineration health claims: For 100 man-years per human life the taxpayer liability is eight thousand million dollars, or $8,000,000,000.
The Big Lie, Waste-To-Toxins, wastetoenergy, Dublin City Council, Poolbeg Incinerator, Dublin Bay Incinerator,

1 comment:

email: galwaytent@gmail.com said...

Piling Anglo losses on to national debt risks bankrupting the State

Tue, Jan 20, 2009

ANALYSIS:Anglo Irish is poisoning the banking system and is of no systemic importance. It must not be nationalised; it must be allowed to collapse and with it the developers at the heart of the problem, writes Morgan Kelly

YESTERDAY’S CATASTROPHIC collapse of Irish bank shares stems directly from the Government’s proposal to nationalise Anglo Irish Bank. With the Government’s finances already buckling under the collapse of our bubble economy, financial markets began to fear that with the added burden of Anglo’s debt, the Irish State cannot afford to finance itself, let alone support the remaining national banks.

Facing the imminent collapse of the national financial system, the Government needs to perform a ruthless triage. The worthwhile banks need to be maintained by any means necessary, including nationalisation, while Anglo Irish and Irish Nationwide must be allowed to collapse.

What began as farce has turned swiftly to catastrophe. Last September the Government casually decided to give a small dig-out to some developer pals by guaranteeing the liabilities of Anglo Irish Bank. This spiralled into a proposed nationalisation that would saddle Irish taxpayers with Anglo’s bad debts, which could easily exceed €20,000 per household, and starve the other, worthwhile, banks of the capital they need to survive.

At the original crisis meeting on September 29th, Brian Cowen claimed that the blanket guarantee to all six banks was given “on the basis of the advice from those who are competent to so advise the Government”.

That does not appear to have been the case.

According to a source of mine very familiar with what happened at the meeting, extending the liability guarantee to Anglo Irish and Irish Nationwide was strongly opposed by representatives of the Central Bank and the Department of Finance (who reportedly came into the meeting with a draft Bill to rescue only four institutions). However, I am told they were overruled by the Taoiseach and the Minister for Finance, who were supported by the Financial Regulator and the Governor of the Central Bank on the grounds that a sudden liquidation of Anglo’s assets would not be in the national interest.

It is still worth asking what would have happened if Brian Cowen had listened to the Department of Finance and allowed Anglo Irish to sink? The answer is: very little.

Developers would have gone bust and commercial property would have become more or less worthless, but that is going to happen anyway, with or without Anglo Irish. Depositors of Anglo Irish would have been paid off in full, and the hit would have been taken by the international financial institutions that hold around €22 billion of its bonds.

These bondholders are professional institutional investors who signed up for higher returns on Anglo debt in the knowledge that they were facing higher risks. They are, moreover, insured against their losses through insurance contracts called Credit Default Swaps.

This is the central point about the bailout of Anglo Irish, and one that has not received any attention: the only effect of a bailout is that the Irish taxpayer will make up the losses of Anglo Irish’s bondholders instead of the insurers who had already been paid to underwrite the risk.

Why it is necessary to transfer Anglo’s losses from the writers of Credit Default Swaps to the Irish taxpayer is something that the Government has not thought to justify.

Indeed, what has been disturbing about the entire Anglo affair is that at no stage has the Government felt it necessary to explain why any bailout was needed, beyond inchoate mutterings about the “systemic importance” of Anglo Irish.

The reality is that Anglo has no importance in the Irish financial system. It existed purely as a vehicle for a few politically connected individuals to place reckless bets on the commercial property market. These property speculators may be of systemic importance to the finances of Fianna Fáil, but their significance ends there.

In ordinary times, piling €30 billion of Anglo Irish losses on to the national debt would be painful and pointless but not impossible. These however are not ordinary times. International debt markets are flooded with governments trying to borrow. The other Irish banks are dangerously short of capital. Most importantly, the Irish economy and government finances are collapsing.

Ireland’s growth during the last decade was largely illusory, generated by a property bubble fuelled by reckless bank lending. In 2007 an incredible 20 per cent of our national income and employment came from building houses and commercial property. Next year, the percentage will be approximately zero.

The only industrialised economy that has endured a property and banking crash remotely comparable to what we are beginning to experience was Finland in 1991, where national income fell in total by 15 per cent and unemployment rose by 12 percentage points. As the private sector haemorrhages jobs it is hard to see how Irish national income will fall by less than 20 to 25 per cent in the next few years. Unemployment will easily reach 15 per cent by the end of the summer, and 20 per cent by next year, and will not start to fall until recovery in Britain and elsewhere permits mass emigration to resume. The economy will not begin to grow until real wages fall to competitive international levels, a process that will probably take a decade.

In other words, the Irish economy is facing a decade of stagnation and mass unemployment of the same magnitude as the 1980s, with the difference that the unemployed now have mortgages, car loans and maxed-out credit cards. Faced with an irreversible contraction on this scale, the Government will have grave difficulty borrowing to fund its ordinary expenditure, even after draconian cuts in spending and increases in taxation. In the view of international investors, piling Anglo Irish’s gambling losses on top of a spiralling national debt could easily suffice to sink the Irish State into bankruptcy.

In this national crisis, what should be done? The answer is simple. The State must do everything to rescue AIB, Bank of Ireland and Permanent TSB, and let Anglo Irish and Irish Nationwide sink.

The Government must continue to guarantee all deposits at Anglo Irish while announcing that, in the light of continuing revelations of misconduct in the bank and shortcomings in its auditing procedures, it will enter into negotiations with senior and unsecured bondholders.

The proposed Anglo nationalisation marks a decisive watershed in Irish democracy. With it, an Irish government has coolly looked its citizens in the eye and said: “Sorry, but your priorities are not ours.”

It is to be hoped that the collapse of other bank shares will serve as a warning to deter the Government from this catastrophic course. I would therefore urge any TDs and Senators who still believe that the Irish State exists to act in the interests of its people to vote against the nationalisation of Anglo Irish and do everything to protect the other banks.

© 2009 The Irish Times