It’s the enormous debt, stupid

“Faced with the choice between changing our mind and proving the there is no need to do so, almost everyone gets busy with the proof.”

This wonderful quotation from the brilliant economist JK Galbraith sums up where most of the Irish establishment is with respect to the biggest question facing the electorate. The only question in this election is whether we default or not, how we do it and where we draw the line. Everything else is secondary because, unless we get this enormous debt monkey off our backs and devise a growth strategy, there is little point discussing the health or education service as there will be no money to translate aspiration into reality.

So rather than understand that the canard of paying back all the banks’ debts is futile and changing their minds, the establishment is trying to find more proof that the policy of keeping the banks alive is the right one.

This leads to “serious people” saying very silly things. “Serious people” is an expression used by the establishment and its media lackeys who have no mind of their own to describe people who we are told we should listen to. Typically these people are the classic insiders, people who have been inside the system for years. Usually they have never done anything but play the insider game and won’t countenance changing their minds.

So the establishment stick to their guns or, as Galbraith would say, “they get busy with the proof”. This is immature and this inability to change their minds leads so-called “serious” people to say things like Alan Dukes did this week, blithely plucking out a figure of €100 billion which he says is needed to keep the banking system afloat. Snap out of it! We should not pay another cent to this banking system. We simply do not have the money.

Who thinks it is clever that Ireland should spend €100billion buying a load of toxic bank rubbish when we only earn €31.7billion (ie Ireland’s total tax take from all sources in 2010)? This is not a serious proposal and makes us look silly and, more to the point, it leads to more capital flight because people realize that the establishment has lost the plot. Foreign investors are entitled to ask: “If they are prepared to put €100 billion into toxic banks, what would they do with investors’ money?”

Of course we are going to burn the bondholders; of course we are going to wind up the banks. Of course the ECB will have to take a big loss on the Irish assets it has taken on its books. Of course the Germans will have to put their banks’ expansion into Ireland via lending to the Irish banks up there with previous ill-fated German expansions in the past. That’s just life. We wish it wasn’t that way but it is.

The Irish establishment has got to stop looking for the proof that spending 100 billion euro in toxic banks is the right thing to do. There is no proof and it’s time to change your mind.

And if the establishment is not prepared to change their minds we should change it for them – after all, it’s our money, not theirs. The way we do this is by making available as much information as possible to avoid this catastrophe.

We all know that knowledge is power and we also know that if knowledge is power, those with power will try to limit the amount of knowledge disseminated. The easiest way to ration anything is to charge for it. So if you give something away for free, it empowers people and allows them to make proper choices for themselves. This rule holds for the average person as well as politicians.

The reason the establishment gets away with such flannel is that the average person doesn’t have access to the right information. In such an environment of suppressed information, certain economists or experts of all sorts play the role that priests played in the old days. The priest had the monopoly on information, interpretation and serious analysis. They were the “serious people” of the old days, a title bestowed on them by their position and their connections, their place in the system (and too often little else).

Fuelled by this sense of invincibility, they started making basic mistakes, such as selling indulgences and the like and there was a revolt called the Reformation where the experts were exposed and the myth of knowledge was broken. The people who dissented made the Bible available and declared that a personal relationship with God unmediated by priests was not only possible but was right.

In this election, economic knowledge is power and it should be made freely available to as many people as possible. It’s a democratic imperative.

I have just spent the most wonderful week working with people from all sorts of backgrounds to provide some economic information for free.

In response to requests for economic information from candidates – some from the main parties and others independent – we decided to create an economic information hub online. These candidates particularly the independent ones – the little guys – felt at a disadvantage because they couldn’t afford to pay for economic advice, which the big guys could fork out for. These little guys knew in their bones that the economics pedaled by the establishment made no sense but they felt powerless.

So two weeks ago today, on Facebook and Twitter we called for volunteers to help make some economics accessible on the net. To our surprise, dozens turned up to help. These volunteers, aided by a number of well-know economics professors, university lecturers and doctors of economics, have come together to make this happen.

The new website is called and is live now. The idea is to make economics – the most important issue in this election – accessible to all. Economics is far too important to be left to “serious people”; it affects everyone, it is our economy, not theirs. It is our money; not theirs and it is our future not just theirs. We hope you – whether you are a candidate or a citizen – find it helpful.

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