David Hall of New Beginnings Resigns Due to "Pressures from Outside Interests"

[C. Flower]

So how do you write down mortgage debt without hurting those who loaned the money?

A vast amount of the debt is unrepayable, so this is not an idle question.

Personally, I think that people should be given the option of staying in the house and passing ownership to the state, and paying off as much as their income allows in the form of rent.

The banking and international finance system is fecked anyway. It is far more important to think about how to keep people housed and fed than to indulge further in the illusion that if we are all melted down and turned into soap bars that Ireland's personal and institutional debt can be paid off and that this will "save the system".

[Baron von Biffo]

A vast amount of the debt is unrepayable, so this is not an idle question.

Indeed. You haven't answered my question though, how do you write down mortgage debt without hurting those who loaned the money?

Personally, I think that people should be given the option of staying in the house and passing ownership to the state, and paying off as much as their income allows in the form of rent.

Why do you think that Thomas McFeely should be allowed to jump the housing lists and have scarce state resources used to keep him in a mansion on Ailesbury Road for a few quid a week while homeless people sleep on the streets?

The banking and international finance system is fecked anyway. It is far more important to think about how to keep people housed and fed than to indulge further in the illusion that if we are all melted down and turned into soap bars that Ireland's personal and institutional debt can be paid off and that this will "save the system".

The Auschwitz allusion is quite offensive.

[bernadette]

I, reluctantly, agree with the Baron. Our houses have got to find the natural valuation, not one that is propped up by the state. That said our bankruptcy laws are draconian and I don't know why that should be so. British law is better and the US is better than the British!

People should not be too severely penalised for failing to be a success. At least they tried and those who were allowed/encouraged to borrow huge amounts by unscrupulous bankers should not be evicted if they can no longer pay, there should be a way of maybe transferring ownership so that they rent the house.

[C. Flower]

[quote]

Indeed. You haven't answered my question though, how do you write down mortgage debt without hurting those who loaned the money?

The idea that there is a pain free option to the present situation has never entered my head. All the present manoeverings are about trying to make sure that the rich (and connected ) don't pay.

When you lend money to someone, and they can't repay, you lose out. In theory. It is a very unfair system, full of risks.

Why do you think that Thomas McFeely should be allowed to jump the housing lists and have scarce state resources used to keep him in a mansion on Ailesbury Road for a few quid a week while homeless people sleep on the streets?

As the house would be State Owned, it would be reasonable to subdivide it and use most of it to house some of the homeless people sleeping on the streets, leaving Mr. Feely with reasonable accommodation of the normal size.

The Auschwitz allusion is quite offensive.

It is very offensive that some people are going hungry as a result of the economic crisis, and others considered in need of more that 10,000 a month to live on.

[ang]

Indeed. how do you write down mortgage debt without hurting those who loaned the money?

Those who lent the money are insolvent therefore already "hurting" it is thanks to the generosity of the Irish people and to the detriment of public services that these money sucking institutes are liquid.

The State needs to let private banks go bust.

Do you believe we can afford the cost of rehousing occupants of distressed mortgage households ? Immediately these people are on the streets the cost to the State rises and once the bank reposses we still have to cover the cost of mortgage via recap for banks. As unpalatable as this all may be the mortgage crisis will have to be addressed and the cheapest option may well be the "writedown" one.

[Baron von Biffo]

The idea that there is a pain free option to the present situation has never entered my head. All the present manoeverings are about trying to make sure that the rich (and connected ) don't pay.

When you lend money to someone, and they can't repay, you lose out. In theory. It is a very unfair system, full of risks.

When you borrow and can't repay there are negative consequences as well. Trying to eliminate the negatives for one party to the deal at the expense of the other only makes the more unfair.

As the house would be State Owned, it would be reasonable to subdivide it and use most of it to house some of the homeless people sleeping on the streets, leaving Mr. Feely with reasonable accommodation of the normal size.

What is 'the normal size'?

Would you move homeless people into every house that exceeded that size?

Why should McFeely get to jump to the head of the housing list?

Is it a sensible use of scarce resources for the state to provide extremely expensive housing for a few people on Ailesbury Road?

It is very offensive that some people are going hungry as a result of the economic crisis, and others considered in need of more that 10,000 a month to live on.

That doesn't excuse labelling anyone who doesn't agree with you a Nazi.

[Baron von Biffo]

Those who lent the money are insolvent therefore already "hurting" it is thanks to the generosity of the Irish people and to the detriment of public services that these money sucking institutes are liquid.

The State needs to let private banks go bust.

Yes we should have let the banks go bust but we didn't so we're now stuck with the debts. A debt forgiveness law would only make the situation worse. Not alone would it mean writing off billions of taxpayer money in the nationalised banks but it would see the taxpayer having to pick up the bad mortgages of the rest of the banks as well.

Do you believe we can afford the cost of rehousing occupants of distressed mortgage households ? Immediately these people are on the streets the cost to the State rises and once the bank reposses we still have to cover the cost of mortgage via recap for banks.

You're making the assumption that everyone who can't pay back a mortgage would automatically wind up on the street and need state housing if the house is repossessed. I don't accept that premise.

Just because someone can no longer service a big mortgage it doesn't follow that they couldn't afford rent a property.

As unpalatable as this all may be the mortgage crisis will have to be addressed and the cheapest option may well be the "writedown" one.

At the moment we're only on the hook for the bad mortgage debt of the banks we own but if we go the write-down road we'll have to take on the mortgage debts of the others as well.

There's also the issue of 'expedient default' when there's a chance of the taxpayer picking up the tab.

[ang]

Yes we should have let the banks go bust but we didn't so we're now stuck with the debts. A debt forgiveness law would only make the situation worse. Not alone would it mean writing off billions of taxpayer money in the nationalised banks but it would see the taxpayer having to pick up the bad mortgages of the rest of the banks as well..

Indeed the State should have allowed the Banks to go but since they didn't they have assumed the responsibility of mortgage debt. I'm not disagreeing with your argument on a debt forgiveness law but mortgage defaults are going to be paid for by the taxpayer anyway with or without debt forgiveness surely the more control we have over the process the better. Debt forgiveness does not have to mean we as a State assume the full debt we get restructures of loans and part ownership amongst other "terms" We also have the jumping over to the UK for bankruptcy to deal with adding a further burden. I agree that we will have to pick up tabs in "other" banks but that must have been foreseen when we decided as a State to intervene in private institutions.

You're making the assumption that everyone who can't pay back a mortgage would automatically wind up on the street and need state housing if the house is repossessed. I don't accept that premise.

Just because someone can no longer service a big mortgage it doesn't follow that they couldn't afford rent a property.

Well that again is debatable and you may well be right but this mortgage crisis is big be in no doubt.

At the moment we're only on the hook for the bad mortgage debt of the banks we own but if we go the write-down road we'll have to take on the mortgage debts of the others as well.

It is inevitable that bad policy has led us here. I don't necessarily agree that we would automatically be picking up the debts of bad mortgages in other banks but the EU would have a big say on that one. It would also depend on how exactly we legislate.

There's also the issue of 'expedient default' when there's a chance of the taxpayer picking up the tab

Totally agree moral hazard will be something that will have to be looked at and consequences severe for any "cheating"

[Baron von Biffo]

Indeed the State should have allowed the Banks to go but since they didn't they have assumed the responsibility of mortgage debt. I'm not disagreeing with your argument on a debt forgiveness law but mortgage defaults are going to be paid for by the taxpayer anyway with or without debt forgiveness surely the more control we have over the process the better. Debt forgiveness does not have to mean we as a State assume the full debt we get restructures of loans and part ownership amongst other "terms" We also have the jumping over to the UK for bankruptcy to deal with adding a further burden. I agree that we will have to pick up tabs in "other" banks but that must have been foreseen when we decided as a State to intervene in private institutions.

Because of the disastrous bank policy of the Cowen government (which its successor continues to follow) we will of course be stung for bad debts, including mortgage debts. What the government ought to avoid though, is aggravating the situation by exposing us to more debt than is necessary.

As for foresight, I doubt the last government could have foreseen that night would follow day.

Well that again is debatable and you may well be right but this mortgage crisis is big be in no doubt.

If we look at that couple that was much talked of in the boom, the Guard married to a nurse we see two people who could have taken out a hefty mortgage on the basis of pay, allowances/overtime and realistic expectations of promotion. Now they've both taken hefty cuts in pay and overtime and have much poorer promotional prospects. They could still afford to rent a home even if they could no longer service a big mortgage. Many couples would be in similar situations. The state wouldn't have to house everyone who defaulted on their mortgage.

It is inevitable that bad policy has led us here. I don't necessarily agree that we would automatically be picking up the debts of bad mortgages in other banks but the EU would have a big say on that one. It would also depend on how exactly we legislate.

There are three things that lead me to think that picking up the tab for the other banks would be inevitable.

(1) If it was attempted to confine the debt forgiveness to just the supported banks, borrowers with the other banks would have very good grounds for an unfair discrimination action.

(2) If the scheme didn't extend to the non-guaranteed banks it could be viewed as an illegal financial support under EU competition laws.

(3) If borrowers with the non-guaranteed banks were getting their debt forgiven by law then those banks could seek compensation for their losses.

Totally agree moral hazard will be something that will have to be looked at and consequences severe for any "cheating"

That 'cheating' would be extremely tricky to uncover. How would we even go about defining what was a genuinely distressed mortgage or what was contrived to avail of a write-down?

For PAYE workers it would be easy enough to determine if there was a cut in pay but what of someone in a job that was barely covering the bills who did the sums and saw that it would be in their interests to lose the job to avail of debt forgiveness? What category would a truck driver who lost his licence for drunk driving fall into?

Self employed people could manipulate their income to put their finances into disarray for a time to get the mortgage marked down.

The rewards would be enormous for most people so great ingenuity could be expected.

[PaddyJoe]

Lest anybody think that David Hall is a cross between Mother Teresa and Robin Hood it's worth remembering that he runs the biggest private ambulance company in the country and is currently suing the state. He's not happy that the Air Corp has been given the contract to operate the Air Ambulance Service.

[C. Flower]

[quote]

When you borrow and can't repay there are negative consequences as well. Trying to eliminate the negatives for one party to the deal at the expense of the other only makes the more unfair.

What part of "can't pay" is so difficult to grasp?

What is 'the normal size'?

Big enough to swing 2.35 cats.

Would you move homeless people into every house that exceeded that size?

Yes, until everyone was housed.

Why should McFeely get to jump to the head of the housing list?

There would be no front back or side of the housing list, as everyone would be housed.

Is it a sensible use of scarce resources for the state to provide extremely expensive housing for a few people on Ailesbury Road?

Could always knock the lot down and rebuild at higher density

That doesn't excuse labelling anyone who doesn't agree with you a Nazi.

It certainly would not, and I would never do such a thing in a discussion. Unless they were one of course.

[C. Flower]

[quote]

When you borrow and can't repay there are negative consequences as well. Trying to eliminate the negatives for one party to the deal at the expense of the other only makes the more unfair.

What part of "can't pay" is so difficult to grasp?

What is 'the normal size'?

Big enough to swing 2.35 cats.

Would you move homeless people into every house that exceeded that size?

Yes, until everyone was housed.

Why should McFeely get to jump to the head of the housing list?

There would be no front back or side of the housing list, as everyone would be housed.

Is it a sensible use of scarce resources for the state to provide extremely expensive housing for a few people on Ailesbury Road?

Could always knock the lot down and rebuild at higher density

That doesn't excuse labelling anyone who doesn't agree with you a Nazi.

It certainly would not, and I would never do such a thing in a discussion. Unless they were a card carrying one of course.

[C. Flower]

Lest anybody think that David Hall is a cross between Mother Teresa and Robin Hood it's worth remembering that he runs the biggest private ambulance company in the country and is currently suing the state. He's not happy that the Air Corp has been given the contract to operate the Air Ambulance Service.

News to me, PJ. Where do you think he is coming from with mortgage debt relief then ?

[PaddyJoe]

News to me, PJ. Where do you think he is coming from with mortgage debt relief then ?

I've always thought that New Beginnings was the creation of well off professionals who punted on property during the boom and got badly stung. It seems to be mainly run by under employed solicitors and is primarily focused on debt relief for the middle classes.

[C. Flower]

I've always thought that New Beginnings was the creation of well off professionals who punted on property during the boom and got badly stung. It seems to be mainly run by under employed solicitors and is primarily focused on debt relief for the middle classes.

Darn. Another illusion shattered. But they are not alone. The ULA seems to favour mortgage debt relief too.