The debate over whether the United States should “take back” its pharmaceutical and other industries from low-tax jurisdictions such as Ireland suggests a game of winners and losers. For years, it is alleged, the domestic tax code has been used to lure US companies to hoard their intangible and tangible assets in Ireland away from America.

Intangible assets include intellectual property or IP. An example could include a US tech giant’s parent company developing software and transferring ownership and commercial exploitation rights over to an Irish subsidiary, which then books the global licensing revenue at low cost. Tangible assets include big tech companies such as Meta choosing to locate their headquarters in the country or airliners transferring their airline portfolios to Irish bases to avail of the favourable environment for aircraft leasing.

Dubbed “leprechaun economics” by the New York Times’ Paul Krugman in 2016, after Ireland reported an over 20% rise in GDP in the space of a year, due primarily to the amount of intangible IP stored in the country via the Double Irish and Dutch Sandwich strategy, whereby companies would use Irish subsidiaries, Dutch shell companies and tax havens such as Bermuda to avoid tax, with profits recorded as Irish GDP despite going to foreign shareholders. This enabled Apple for instance to pay an effective tax rate of around 0.005% which was, according to the EU, eventually ‘owed’ to Dublin in the form of a €13bn back tax in 2016.

Caving to international pressure, this loophole was fully shut in 2020, seeing an explosion in more IP-onshoring along with surging corporate tax receipts, going from €4bn in 2014, around when the BEPS framework began, to €28bn in 2024. Indeed, MNCs now argued they were more present in the country by hiring local staff among other things.

While most of the attention has been placed on the benefits for Ireland of this arrangement, almost none of the analysis has factored in the benefits for America.

It’s easy to see why.

Ireland has enjoyed gargantuan corporate tax revenues as a result of its headline low tax rate of 12.5%, recently raised to the OECD unified rate of 15%, at over €30bn last year with a surplus of up to €12bn, over 1% of GDP. Indeed, as a result of massive FDI into Ireland, American multinationals, which account for over half of the overall investment into the country, support almost 200,000 jobs.

Meanwhile, we are told, America has suffered a loss of tax revenue and jobs. According to the chief critic of Ireland’s modern industrial policy, despite America’s size and strength, a kind of David vs Goliath scenario is playing out, with President Donald Trump suggesting a win-lose arrangement: “You took our pharmaceutical companies… This beautiful island of 5 million people has got the entire US pharmaceutical industry in its grasps,” he claims.

However, when examining this seemingly commercial strategy by multinationals, you realise the geopolitical nature of the investment.

The Dollar’s Exorbitant Privilege

It was the French Finance Minister Valéry Giscard d’Estaing who, in the 1960s, described the dollar’s status as the world’s reserve currency as America’s “exorbitant privilege”. What he meant by this was that, following the Bretton Woods agreement in 1944, in which 44 nations agreed to peg their currencies to the US dollar at fixed exchange rates convertible to gold at $35 per ounce, the US government could borrow money at cheaper rates as demand for the dollar would always be high as countries sought to maintain the peg.

Even as the US lost its trade surplus in the 1970s, and a floating currency was implemented known as the Nixon shock as not enough gold was available, due to its currency becoming overvalued, thus hurting its competitiveness, known as the Triffin dilemma, and as competitors such as China, Japan and West Germany became manufacturing powerhouses, it still maintained its dominant currency position.

This coincided with America’s shift from a manufacturing-based economy, which exported to the ravaged post-war world desperate for goods, to one based on Finance, Insurance and Real Estate or the FIRE economy, whereby foreign nations would use the surplus dollars they acquire from selling consumer goods to Americans to invest in these dollar-denominated assets as well as US treasuries. As such, manufacturing as a share of US GDP went from an immediate post-war high of 25-30% to less than 10% currently.

When Trump talks about American deindustrialisation in which jobs are allegedly shipped overseas to low labour cost regions including Mexico and China, he fails to recognise that this is not a bug but a feature of the rentier economy, where more value is placed on asset holders rather than productive forces.

Now you may think that its position as a net debtor, in which foreigners hold more US assets than it holds abroad, known as a negative net international investment position or NIIP, causes America to pay out more to those holders than it receives.

However, the opposite is the case.

Because while foreigners tend to hold US treasuries, which are deemed safe, meaning investors are happy with lower returns or low yields, America’s share of foreign assets is generally higher risk, meaning they demand more returns or a high yield to compensate for the risk attached.

These risky assets include FDI and private equity.

FDI

What makes FDI risky is fluctuations in government policy. Parties in Dáil Éireann claim Ireland’s low corporate tax model has contributed to wealth inequality and the neglect of indigenous enterprise. Indeed, with the leader of the free world along with the EU seeking to rein in the model, its volatility is without question. Private equity’s risk is, among other things, borne out by the large debt loads it piles onto companies during buyouts, with company underperformance making managing that debt much more burdensome.

If America invests $15trn abroad in these risky assets generating close to a 10% return, while Europeans invests even more at $20trn in US treasuries and other assets with a 3% return, the US receives an annual return of $1.5trn, while Europe generates $0.6trn.

So even as America invests less in Europe, it generates more due to these kinds of investments.

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While President Trump enjoys ranting and raving about being “losers” in the trade deficit position with countries like Ireland, which maintains a $50bn surplus with the US, this deficit enables America to generate a favourable return differential despite being a debtor nation.

When US MNCs establish subsidiaries in Ireland, including in med tech, pharma, tech, digital services, software and other categories, the earnings count as a return on US FDI. If a US pharmaceutical entity builds a plant worth $5bn, the subsidiary may earn $1bn in annual profits, which are recorded as a return on US FDI, which is fed into the US economic ecosystem regardless of where or when the cash moves.

Far from a win-lose scenario, this investment is a win-win. While Ireland gains from more US capital, IP, global prestige and R&D among other things, America benefits from a skilled workforce, access to the European market, low tax, common law and a stable political system in Ireland.

So while America exports its IP and capital, earning a steady stream of profits as a result, Ireland gains in employment, exports and revenue.

However, behind the facade of the colourful rainbow lies a sinister reality: many of these companies situated in Ireland do not hire locally but globally. For instance, over 70% of Google’s staff in Ireland are non-Irish, with FDI companies not beholden to the so-called 50:50 rule, in which 50% of an employers’ staff must be Irish or from the EEA before granting work permits. Indeed, the salaries earned by these workers far exceed the median Irish salary, meaning these workers have much larger purchasing power, which feeds into inflationary costs for housing in particular.

Private equity

This same dynamic is true for US private equity investment in Ireland, which exploded following the Global Financial Crash (GFC).

After the Irish housing bubble burst, in which cheap credit enabled by a confluence of low interest rates from the ECB and the international money markets fueled international borrowing for locally high returns on residential property, regulations placed on regular banks saw the rise of shadow banks such as private equity and/or hedge funds, which invested in build-to-rent developments offering stable returns.

The share of private renters increased from 11% to 18% of households between 2006-2016.

Several of these entities were invited into the country by the Irish State to provide liquidity and recapitalise prices following their rapid fall. US funds such as Cerberus, whose Chairman is former US Vice President Dan Quayle, and Apollo were incentivised to, in the words of the head of the State’s ‘bad bank’ NAMA, Brendan MacDonagh, “facilitate the investment of funds from abroad into the Irish property market.”

From 2014-16, NAMA sold over €50bn worth of distressed loans to investment funds, with over 90% of these loans sold to US hedge funds, private equity and/or vulture funds.

Various portfolios sold to NAMA included vast sites where apartments would be built, generating a high return due to the high rents charged.

As seen with US investment in FDI abroad, these investments represent yet another high-risk, high-return investment for America.

Recently, the US property investment company Kennedy Wilson invested €2bn on a plan to develop more than 3,400 rented homes in Dublin, including 1,100 on the Cherrywood site with Dutch pension fund APG asset management and 2,300 new private rentals planned for the Player Wills, Bailey Gibson and Clonliffe sites.

This investment would generally generate a return of around €140mn annually after expenses, which is then distributed to U.S. pension funds, university endowments, insurers, or wealthy investors who own the fund.

But while Kennedy Wilson has a minority stake in this plan with the returns shared with the Dutch pension fund, ultimately this represents yet another example of a high return accruing from investing abroad in high-risk assets.

However, the societal implications for Ireland are immense.

While Ireland should in theory benefit from a greater supply of houses during a housing crisis, along with more construction employment, ultimately these properties are significantly out of reach for the vast majority of Irish people.

As mentioned with the FDI case study, Irish median wages have failed to keep pace with inflation in recent years. As such, only the top 20% of earners can afford to rent the average apartment, with the price for a suburban two-bedroom apartment averaging €480,000 while an urban apartment costs around €650,000, with a combined salary of around €108,000-€146,000 required.

Many of these apartments are built for those on much higher salaries, mainly those working in the high-skilled tech and pharma sector where wages average €70,000-€100,000.

Indeed, with over 100,000 vacant properties scattered across the country, including over 14,000 in Dublin alone, if the apartment cannot immediately house someone, they are often left vacant, with high-end build-to-rent apartments scoring a vacancy rate of around 10% in the capital. This is a perverse situation during a housing crisis.

Which begs the question: is America’s “exorbitant privilege” the cause of Ireland’s rentier black hole?

Is the combination of US investment in the pharmaceutical and technology sectors, along with pension funds’ funding of property, generating high returns, contributing to Irish leprechaun economics and spiralling housing costs?

When the US talks of bringing some of this investment “back home” has it considered the implications of such a move?

Has Ireland factored in the risk of its exposure to US dollar-denominated assets as countries turn away from the once safe asset amid an escalating geopolitical conflict in the Middle East, the risk of an AI bubble and an economic war that essentially upended the hitherto unimpeded post-Cold War free trade model?

Ireland’s economic miracle has never been purely Irish but rather a mirage of American statecraft. It has been embedded within an American financial order that encouraged capital to flow abroad in search of higher returns, to the detriment of the US worker and benefit of asset holders. If that order changes either through geopolitics, protectionism or the erosion of dollar dominance, Ireland may discover that its greatest economic strength has also been its greatest vulnerability.

It’s safe to say that Ireland has largely benefited from Pax Americana, but it may soon wake up from its American dream to a pretty bad hangover.

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Farmers and adjacent supporters held the Irish economy hostage for five days last week, culminating in last weekend’s forcible removal of heavy agricultural machinery in the heart of the capital Dublin, as the government now grapples with the possibility of a motion of no confidence in their authority.

What began as mere internet chatter and under-the-radar WhatsApp text messages, as energy-induced inflation rose from 2.5% to 3.5% in the space of a month, led to some of the largest demonstrations in the history of the State.

Echoing the freedom convoys in Canada in 2022, when truck drivers, protesting what they saw as bureaucratic vaccine mandates on drivers, leading to a brutal state crackdown on the participants’ ability to transact bank payments, the use of tractors proved effective in halting road traffic and other strategic economic/energy sites.

From County Cork to Cavan, the farmers, armed with tractors and trucks drove towards the centre of power in Dublin, blocking the M50 motorway, which includes Dublin port, a vital hub accounting for over 30% of exports including 65% of petroleum imports, before going on to cordon off O’Connell Street in the city centre on the border between Dublin’s northside and southside of the River Liffey, which severely disrupted transport services from the Luas, bus and taxis.

Symbolically protesting near the General Post Office (GPO) during Easter, which in 1916 saw the Irish Volunteers stage a rising, similar to that rebellion, the ad hoc leaders called for a nationwide uprising, with the M7 bypass in Limerick, which connects the Mid West region to Dublin, being closed off. Indeed, Rosslare Port in Co Wexford, a key hub for post-Brexit trade to Europe, was blockaded by lorries and tractors, with essential pharmaceuticals and ferry passengers only allowed to pass by.

Apart from roads and transport hubs, key energy sites including terminals in Cork, Galway and Limerick were targeted by the protestors, blocking up to half of the country’s fuel. Indeed, the one oil refinery in the country at Whitegate in Cork, which produces 75,000 barrels of oil per day - 40% of overall fuel needs - saw protestors erecting barricades, with the Gardaí pepper-spraying and dragging protestors from their trucks as they forced tankers to pass through. Protests at Galway Port caused a Dutch tanker carrying six million litres of agricultural, white diesel, and kerosene to be prevented from offloading.

According to Kevin McParlatan of Fuels for Ireland, the disruption has caused 600 out of 1,500 gas stations to run out of supplies.

Whilst it may seem contradictory to cut off fuel and energy supply amidst the backdrop of heightened inflationary pressures, the protestors point to the fact that the government has added to increased costs through punitive taxation.

“The government has caused the price of diesel to go up 26c per litre — that is carbon tax, the better energy levy, the renewable transport fuel obligation, several different things,” McParlatan has said.

When taking into account all taxes and levies, including VAT, excise, the national oil reserves agency (NORA) and the better energy charge, the government accounts for 59% and 52% of the total cost for petrol and diesel, respectively. Separately, carbon taxes add approximately 20c to the overall cost. These taxes are currently €63.50 per tonne of CO2 emitted, which will rise by €7.50 per year until 2030 to reach €100 per tonne.

Even before the current crisis, Ireland was one of the most expensive EU countries to fill a car, ranking third for diesel and fifth for petrol, dropping to eighth and thirteenth, respectively, if government taxes are removed.

Getting ahead of an inevitable upsurge in discontent as a result of these government-imposed added costs, coupled with the global energy crunch, which has seen petrol rise to €2 per litre in some filling stations, the government announced a €250mn support package for households impacted by high energy costs in late March. This included cutting excise rates by 15c per litre on petrol, 20c per litre on diesel and 3c per litre on marked gas oil, as well as extending the weekly fuel allowance.

However, given that most fuel on sale was purchased in advance at the higher rate, these measures were slow to translate into lower costs.

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As such, farmers and truckers were staring down the barrel of exorbitant energy costs.

Bearing the hallmarks of the 16 points by Hungarian students during the 1956 uprising, the Irish truck protestors made several demands, including a fuel price cap, the suspension of the carbon tax, and more reductions in excise duty, along with energy subsidies for households. Some argued the initial demands were agri-centric as the protestors called for specific cuts to agricultural energy products. However, over time, the demands evolved to become broader.

But while these demands and the resultant industrial action, or in this case extreme civil disobedience, are part and parcel of a society based on unions and social partnerships, the leaders of this movement were largely an ad hoc, randomised assortment of decentralised players.

One of them is James Geoghegan, who commands a large following online, particularly via TikTok. He is the Public Relations Officer or PRO of the newly formed Irish Haulage and Farming Construction Amalgamation or IHFCCA. Following a meeting at a hotel in Portlaoise, Co Laois, last month, a committee of around 5 members was formed to advocate for agitation. “If you are a TD or senator… mark my words… they are ready to park up their trucks in the middle of roads”, he said at the meeting.

Following the meeting, various Facebook and WhatsApp groups were created, all spreading a message advocating for action in early April.

Without official sanction from the regular lobby groups such as the Irish Farmers Association (IFA) or the Irish Road Haulage Association (IRHA), the State argued it could not and would not yield to the demands of the unelected group without a clear mandate, basically adopting the ‘we don’t negotiate with terrorists’ stance.

When members of the group implied that a meeting with government officials would occur, about half a dozen of them were left outside the Department of Agriculture building as representatives from official farmer groups met with Agricultural Minister Martin Heydon alongside other cabinet members.

As government ministers lined up to harshly condemn the protestors, including Taoiseach Micheál Martin, who described their actions as “national sabotage”, almost all opposition parties backed the truckers.

Having long railed against carbon taxes, the main opposition party Sinn Féin demanded that the protestors be given a hearing with government officials, whilst the micro left-wing parties, including People Before Profit, demanded the same.

In a sign of how fractured Irish politics has become, with both the left and the right vying for the same working class constituents, Paul Murphy of PBP was hounded out of the protest by the right-wing Councillor Tom McDonnell and other supporters with accusations of spreading ‘gender ideology’ among other things hurled at him as he walked away flanked by his colleague and Dublin City Councillor Conor Reddy.

The narrative that elements of the ‘far right’ had capitalised and seized on the discontent quickly gained traction with Justice Minister Jim O’Callaghan claiming that the British right-wing influencer and former English Defence League (EDL) leader Tommy Robinson was “manipulating” the movement.

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However, given the fact that, as mentioned, almost all opposition parties, and indeed, members of the public strongly backed the protestors, suggests a stretch on the part of Minister O’Callaghan, unless he believes all such groups are under the hypnotic spell of the fringe anti-Islam guru.

All in all, the movement represented an organic upsurge of legitimate discontent over a government that has, in the midst of an energy crisis, refused to abandon regressive taxes on carbon or even consider exploring indigenous energy reserve potential.

The fact that the State feels compelled to impose taxes on energy at a time when prices are soaring makes a mockery of what the purpose of the tax even is.

Given its status as an inelastic product, meaning it is not responsive to price change, one rationale for continuing with this Green Party policy is to raise revenue to fund renewable alternatives. However, given the growing budget surplus generated from corporate tax receipts, soaring to €12bn last year, this also seems counterproductive.

Suggestions by some commentators that Ireland is constrained in cutting VAT and excise by EU regulations would be wise to observe how other Member States, including Poland, which temporarily cut VAT on motor fuels from 23% to 8%, as well as excise duties on gasoline and diesel to EU minimums, have managed to put the national interest ahead of supranational legalisms.

Indeed, if this crisis of stability teaches the powers that be anything, it’s that a country that does not prioritise energy security first and foremost has no claim as a sovereign entity. The fact that Ireland, a country heavily reliant on oil, has only one oil refinery, which was blockaded by protestors, makes it vulnerable to actual sabotage should more malign actors seek to do so.

One demand from the protestors that oil off the west coast be drilled and explored to increase reserves is worth pursuing: “One of the main demands is that the laws that Eamon Ryan passed to close down any exploration of oil off the west coast of Ireland,” Geoghan mentioned.

“Because we have been contacted by exploration companies who have told us how much oil is off the west coast of Ireland.”

Which companies he is referring to is unclear. But what is clear is that Ireland does in fact have tremendous energy potential, particularly off the coast of West Cork at the Barryroe site, which is estimated to hold more than 350mn barrels of oil and 207bn cubic metres of gas.

Former Green Party Minister Eamon Ryan’s refusal to grant an export license to energy company Providence Resources now looks like true ‘national sabotage’ to use the Taoiseach’s expression, as the country is now heavily reliant on imports and the goodwill of others.

Understanding this dilemma, some ministers have spoken praisingly about nuclear energy, reversing another Green Party mistake that bans the use of nuclear fission energy.

Too little too late amid the sounds of guzzling tractors on the main thoroughfare, as the world observes a government unable to prevent a form of economic sanctions being implemented by groups of people organising online.

While the protests in Dublin have largely subsided, there are expected to be renewed pushes for more trucker demonstrations in the days ahead, if social media speculation and postings are to be believed.

To avoid a storming of the Bastille, the government recently announced a hasty €505mn energy package including 2c cuts to green diesel and 10c cuts to a litre of petrol and diesel, as well as a delay of the carbon tax increase until budget day in October.

Insulting and not enough according to some protestors.

Let them eat cake seems to be the approach from the powers that be.

Gabriel Makhlouf, the British head of the Irish Central Bank (CBI), struck a positive note recently amid global uncertainty regarding energy supply.

In an interview with Bloomberg, Makhlouf stated that Ireland was better placed than other countries in Europe to weather the coming geopolitical storm as tensions escalate between the United States and Iran over the former’s attempt at regime displacement in Tehran.

“The main risks for Ireland actually are similar to the rest of Europe. It’s the impact on growth, the impact on inflation,” he stated with unabashed confidence.

While warning that he anticipates “some small changes”, his view of the Irish economy “has not fundamentally changed” as a result of the war.

And if anyone knows anything about potential economic headwinds, it’s Makhlouf.

Hailing from Egypt to a Cypriot-British father and Greek-Armenian mother, his early life remains shrouded in mystery.

What we do know is that his youthful globe-trotting was as extensive as his ethnic ancestral lineage, with his father’s position as an official at the United Nations (UN) affording the young Makhlouf many travel opportunities.

Achieving both an honours in economics and a master’s in industrial relations from the University of Exeter and Bath, respectively, Makhlouf’s obvious path was finance, becoming a tax inspector.

His career eventually elevated to that of technocrat, becoming principal private secretary to the Chancellor of the Exchequer, the man who saved the pound, Gordon Brown.

While he eventually jumped ship from the UK and transitioned to the New Zealand treasury as a chief executive and secretary, he proved that humorous quip from another principal private secretary Bernard Woolley who once said that “you only need to know things on a need-to-know basis”, as his time down under was scandal-ridden.

Following Dublin’s announcement of his appointment, or selection given he was the only candidate, to head the CBI in 2019, it emerged that when at the NZ treasury, he had inadvertently enabled sensitive budget material to be leaked.

Feigning ignorance of the leak, he claimed to be the victim of a hack, later unsubstantiated by the authorities.

His lack of experience as an economist and his incompetence as a treasury official left the European Central Bank (ECB) baffled as to why he was selected in the first place, with his appointment granting him a place on the Governing Council in Frankfurt.

Indeed, choosing a British national to head the CBI at a time of increasing trade tensions between Dublin and London during the post-Brexit period proves how truly postcolonial Ireland still is.

In the end, Makhlouf was appointed.

This backdrop is worth considering when listening to his bullishness on the Irish dimension to the ensuing energy crisis.

How exactly a country that is a major net importer of energy, specifically fossil fuels, and highly reliant on the two energy sources that are facing global pressure in the form of oil and gas, is somehow better managed than most to handle the situation is baffling.

Energy scarcity

Following US President Donald Trump’s unilateral decision to strike at Iran’s Islamic regime, killing the Ayatollah Ali Khamenei and other officials, along with strikes throughout the country, Iran responded in part by choking a key node in global energy supply off the Strait of Hormuz.

Previously handling 20% of global oil - 20 million barrels per day - and liquified natural gas or LNG, insurance premiums and threats from Iran’s Revolutionary Guard Corps or IRGC have halted ship passage.

Immediately following the closure, European natural gas prices reached their highest level since the invasion of Ukraine, rising by over 60%.

The impact on oil has been just as inflationary as the International Energy Agency (IEA) warns that the Gulf movements have removed 11mn barrels of oil per day from the market.

For context: during the 1973-74 oil embargo by the OPEC states to countries supportive of Israel during the Yom Kippur War, daily disruption was limited to around 2-3 million barrels p/d.

Brent crude oil, which accounts for around two-thirds of global supply and counts as a benchmark for the wider oil market, has already reached $118 per barrel this month, remaining just below $100 at time of writing.

IEA countries, which includes the US, agreed to release 400mn to temper the market. For its part, Ireland is set to release 1.6mn barrels - 10 days worth of supply.

However, several Middle East countries have cut their oil output by 7mn barrels a day, including the United Arab Emirates (UAE), Kuwait and Iraq.

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Beyond the Strait itself, several strategically vital energy facilities have been struck including the Qatari Ras Laffan gas facility by Iran which produces a fifth of the country’s LNG; the largest Qatari and Iranian gas site at South Pars; and the Kharg Island raid by the US Air Force which is home to 90% of Iran’s oil exports, producing 500,000 barrels of crude oil per day.

Despite what the CBI may say, Ireland is one of the most exposed countries.

According to the Central Statistics Office (CSO), just over half of Ireland’s energy consumption relies on oil for everything from home heating to industrial use, well above the EU average of 37%.

Indeed, 100% of this oil is imported, making the country particularly vulnerable to global/external shocks, with the State refusing to grant drilling licenses to companies willing to explore Ireland’s vast energy potential.

However, while oil may be essential for primary energy use, natural gas is crucial for electricity generation, which was already under strain amid the war in Ukraine. Like oil, Ireland is a net importer of this energy source, primarily from the Moffat pipeline connecting Ireland and Scotland. Only around 20% of our gas is sourced domestically via the Corrib Gas Field in Co Mayo. In July last year, gas generated over half of Irish electricity.

But while energy prices are increasingly the canary in the coal mine for wider inflationary pressures, the impact this war will have on food production is just as immense, given the strait’s significance as a conduit for fertiliser supply.

Two key vital components for fertiliser, being ammonia and urea, are traded from the Gulf states, with a third of fertiliser passing by the strait, which will impact future high-yield agriculture.

As both a net exporter of food produced domestically - at almost 100% - and a net importer of vital foodstuffs, including fruits and vegetables, Ireland stands to lose out as global food production takes a dramatic hit.

With Irish agricultural exports reaching close to €20bn in 2024 - up 5% year-on-year - the country is particularly vulnerable to uncertain export markets.

It is not mere conjecture or hyperbole to say that this energy and food disruption will have just as much of an effect on Ireland as the Covid-19 lockdowns did. Indeed, given the scale of the disruption, which actually surpasses the suspension of regular activities during the pandemic in terms of vital components for the running of an economy, the impact could even be worse.

In a harbinger of things to come, several countries, including the Philippines, have instituted a four-day work week to help save energy. Indeed, in a similar way to the early advice from the World Health Organisation’s (WHO) pleas to stay at home during the early stages of the pandemic, the IEA have provided a list (below) of advice to the general public, including working from home where possible and to “increase car sharing and adopt efficient driving practices.”

AI bubble-induced recession

Another outgrowth of the energy-induced shock is the impact on the future of artificial intelligence.

AI is experiencing mega valuations as more and more industries adopt its usage. According to a recent study, 70% of Irish workplaces are using AI more than once per month - the highest usage among those regions surveyed.

Along with regular adoption, the country has also become a key hub for AI production, given the proliferation of data centres as a result of a large presence of big tech multinationals incentivised by lower corporate taxes.

These centres, numbering around 90 mainly in Dublin, are currently consuming around a fifth of overall energy whilst enabling AI’s meteoric rise.

However, a key component to continuing the AI adoption via data centres is in peril amidst the conflict in the form of helium. A byproduct of LNG in Qatar, responsible for 30% of supply, helium is essential for semiconductor production, which in turn powers data centres. But given the halt to LNG exportation from Qatar, the future of helium production remains uncertain. Coupled with the overall energy shortage, the lack of helium will certainly dent the trajectory of AI valuations, which are already in bubble territory.

And if anyone knows anything about a bubble, it’s Ireland.

Having built too many homes during the Celtic Tiger, it’s possible Ireland has constructed too many data centres on the false belief that AI valuations will continue.

Recent modelling by the Bank of Ireland suggests that once the AI bubble deflates, Ireland is headed for a major recession.

The lender also warned of the risks attached to the “shadow banking sector”, which involves credit intermediation outside the regular banking system, i.e., private credit, hedge funds, vulture funds, etc. Several of these entities surged post-GFC as Irish policymakers sought to utilise them to raise asset values, including homes, following their crash. As a result, Ireland has one of the largest shadow banking sectors in the world.

This has also enabled AI’s proliferation, with over 30% of the $1trn private credit market linked to AI. Already, several private creditors have blocked withdrawals amid growing uncertainty about AI’s future.

Bearing all the hallmarks of the last major bubble, which emanated from America’s subprime mortgage exposed Lehman Brothers, the bank warned that Irish exposure to AI could entail economic dislocation: “The risks associated with a rapidly deflating AI ‘bubble’ crystallise and while the epicentre would likely be the US, the significant exposure of major pension funds to US technology stocks impacts retirement savings and the cost and availability of finance for households and businesses.”

Having placed all our eggs in the housing basket from the late 90s to 08, it seems Ireland’s second bet on unproductive tech stocks will have similar implications.

If the AI bubble does pop, the Irish taxpayer will again be called on to bail out the shadow banking sector, given its connection to a whole slew of public products, including pensions.

The blockage at the Strait of Hormuz has unleashed forces and bottlenecks that the world thought confined to the turbulent period of the 1970s. Globalism hangs by a thread amid geopolitical agitation, with the fate of our increasingly interconnected world coming home to roost as nations reconsider the value of limitless free trade in the face of scarcity.

Ireland stands to lose more than most countries, given our lack of economic and resource independence contra our dependence on others, as a result of successive governments content to delegate decision-making to external bodies and technocrats even within the confines of domestic institutions.

As we grapple with the challenge ahead, Irish policymakers must reconsider these decisions and begin to prepare for the rupture, not transition, that Canadian Prime Minister Mark Carney alluded to in Davos not too long ago.

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Why aren’t Irish banks lending?

It’s a question that has nagged economic commentators who have questioned why Ireland’s domestic lending institutions have ceased doing their one job.

Banking 101 stipulates that when banks obtain deposits from customers who wish to park or save their money, thus accruing a rate of return, the banks in turn lend out to borrowers in a system known as fractional reserve lending.

Banks generally pay out a lower rate of interest to savers and impose higher rates on borrowers, pocketing the difference, with the deposit figure lower than what they lend out.

This system, by and large, works well, provided the right oversight and regulatory checks are in place, such as deposit guarantee schemes and other safeguards in case of a bank run.

However, in recent times, Irish banks have grown averse to lending, all the while being flush with savers’ cash whilst enjoying handsome profits.

In a recent piece, Irish economist David McWilliams sought to ask why this is the case.

He highlights how the ratio of deposits to loans has shrunk from 160% during the boom, with €160 lent out for every €100 on deposit, to 40% currently, meaning for every €100 on deposit, only €40 is lent out.

“The economic potential of the Irish domestic economy is trapped because the banks are not lending enough,” McWilliams warned.

Yet even as banks have stopped lending and engaging with the wider economy, there has been no economic contraction.

In fact, the Irish economy is, on paper, booming, well, at least when it comes to assets.

Nowhere is this more evident than in the property market.

According to the Central Statistics Office (CSO), the median price of a home in Dublin last year reached €500,000, representing a 7% year-on-year increase, rising by 178% since the troika departed these shores and 25% above the Celtic Tiger peak.

But how are prices rising so astronomically even as banks have virtually ceased lending?

By McWilliams’ assessment, this money is not domestic but rather foreign: “The reason that the economy is humming along is that international money has replaced local money” (my emphasis).

As I have highlighted here before, the myth that high house prices post-crash are somehow linked to a lack of supply ignores all available evidence to the contrary.

Those factors include the rise of cash buyers, which rose from a pre-crash rate of 25% to a post-crash figure of 60%, and the rise of institutional investors who were invited into the country to raise asset values.

While owner-occupier dwellings were the main source of return during the pre-2008 housing bubble, with mortgages repackaged into mortgage-backed securities offering a sizable rate of return, all facilitated by loose lending from the banks, this has since transitioned to build-to-rent projects facilitated by global private equity and/or hedge funds, unconstrained by the post-crash regulations imposed on ‘regular’ banks and borrowers.

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“Much of the wealth creation associated with the property boom is going into the pockets of private equity companies that are buying apartment developments to rent them out,” McWilliams mentions.

This is evident by the fact that out of over 4,000 completions in Dublin last year only 58 new homes and 150 apartments were actually sold to buyers.

In a recent vote in Dáil Éireann, Sinn Féin proposed a ban on institutional investors’ bulk purchasing of family homes, mirroring similar moves by US President Donald Trump.

“Ordinary workers and families have no chance of competing with these funds. They hoover up homes and they drive up prices,” the party’s finance spokesperson Pearse Doherty mentioned.

According to the party, ever since the Irish government’s imposition of a 10% stamp duty on funds that purchase 10 or more properties in 2021, over 2,000 homes have been bulk purchased by these sources.

Doherty mentioned how such purchases “drives up prices” along with a collapsing rate of “home ownership” as these funds generally rent out such properties to acquire a high rental yield.

With the ruling coalition managing to defeat this motion, it is quite clear that their sole aim in relation to housing is to facilitate this vicious rentier cycle, with Taoiseach Micheál Martin rationalising the recent reform to rent controls as based on providing “certainty” to investors as he decried the “tendency in the debate in Ireland to attack funds, for example, pension funds.”

In the government’s estimation: high rents are necessary to enrich foreign pension funds.

So, back to the question: why aren’t banks lending?

In the piece, McWilliams asks: ‘What is the Central Bank, which is supposed to run monetary policy in the country, doing about this.’

He further queries: “Have you heard the Central Bank commenting at all on the collapse of credit in the economy? Have there been any moves by the Central Bank to encourage lending?”

Unfortunately, like most commentators in Dublin, McWilliams fails to recognise that the CBI is a mere appendage in the wider 21-member Eurozone.

In a 2021 report, the Banking and Payments Federation Ireland (BPFI), when examining over 600,000 mortgages totalling over €80bn across the five Irish retail banks, mentioned how: “Retail banks in Ireland are required to hold about three times more capital for the perceived higher risk in their mortgage loans books when compared to average capital requirements in Europe.”

The lobby group, headed by former Fine Gael TD Brian Hayes, claimed this is “impacting the cost of lending and the cost of mortgages” with the extra capital amounting to over €2bn.

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While the group highlighted some of the burdensome macroprudential rules imposed on borrowers following the crash preventing them from borrowing more than 3.5 times their income, which has since been revised upwards to 4 times, compared to 6 times incomes in Austria or Belgium, as well as lower levels of recovery in Ireland relative to other jurisdictions, what is missing from this analysis is the stultification of the banking system overseen by Brussels following the crash.

In many ways, Ireland’s entry into the Eurozone helped facilitate the first property bubble, as Dublin could borrow cheaply on the international money markets in the short term to lend long term to property developers, which was facilitated by the European Central Bank (ECB), who wanted a depressed Euro to boost German exports.

When Dublin sought to burn the bondholders and punish those who placed their money in systemically vulnerable institutions, which in turn lent with little care, Frankfurt’s Jean Claude Trichet threatened a financial bomb and forced the taxpayer to bail out such careless lenders and bondholders to the tune of €64bn.

Following the crash, Brussels implemented a series of reforms on the banks of member states to ensure they did not become a source of financial contagion yet again - with a particular emphasis on the PIGS (Portugal, Italy/Ireland, Greece and Spain).

This included labelling certain banks as “systemically important”, a category that applies to Ireland’s three main banks, Allied Irish Banks (AIB), Bank of Ireland (BoI) and Permanent TSB, meaning they are subject to the EU’s Single Supervisory Mechanism (SSM), which was set up in 2014, which increases their combined capital requirements by 1.5%.

This not only prevents these domestic banks from lending to mortgage borrowers and SMEs but also precludes other entrants from establishing a base here, instead opting for larger EU member states such as Germany, where such designations do not apply, even as Ireland is home to over half of the world’s top 50 performing banks.

As a member of the EU banking union, Ireland is required to adhere to its decrees. Legislation governing this body includes the EU’s Capital Requirements Regulation and the European Union (Capital Requirements) Regulations 2014.

These rules were implemented as “Ireland’s banking crisis was at least partially attributable to the fact that banks were inadequately supervised in the years leading up to that crisis.”

Irish policymakers are rendered powerless in seeking to ensure highly profitable banks use their gargantuan deposits to lend to productive economic forces such as owner-occupying home building and small businesses due to regulatory burdens imposed by unelected technocrats.

This sad state of affairs is even more obscene when considering the fact that, as highlighted by McWilliams, Irish banks are offering little rate of return to depositors as they place such monies at the ECB, accruing 2% interest.

This mirrors the postcolonial state of Irish finances when Minister of Finance for the nascent Irish Free State, Michael Collins commented that, “Millions of Irish money are lying idle in banks”, with the Historian Raymond Crotty noting that, “Over half of the Irish bank’s total deposits were on loan to the London money market.”

100 years after independence, how economically independent is the Irish Republic?

Calls to reform these regulations, including by the BPFI, during Ireland’s upcoming EU presidency, are welcome in the short term.

However, in the long term, Ireland must consider reclaiming its economic independence contra the economic vassalage it is currently subject to.

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For example, someone who claims to be an environmentalist but flies regularly to conferences only to speak about the threat emanating from the emission of CO2 - not thinking of anyone in particular.

As such, to combat the external contradiction within the internal, cognitive dissonance forces the subject to align their actions with their beliefs.

The psychological trick was first coined by Leon Festinger, the American social psychologist.

A stark example of this phenomenon occurred when former Green Party Minister Eamon Ryan defended his use of almost 200 flights whilst in government by accusing the press and public of “putting a real guilt trip” on him, even as he decried cheap Ryanair flights, which he vowed to cosign as a thing of the past.

A recent example of mass cognitive dissonance occurred when news emerged that over 60 Dublin apartments, worth approximately €35mn, are lying idle amid a housing crisis.

37 of these apartments are located at Loreto Gate in Rathfarnham, with another 30 in Domville Crescent, Cherrywood, near Laughanstown.

These apartments, destined for desperate families on the council waiting list, are instead unoccupied.

In both cases, the apartments have been vacant for over a year, having yet to be completed.

The Housing Department mentioned that the Cherrywood development was supposed to be finalised by Q4 2024, with offers withdrawn as a result of failing to meet this target.

The Rathfarnham project is similarly beset by delays, as the flooring remains incomplete alongside required appliances in the kitchens and blinds by the windows.

This sorry tale has been repeated throughout the capital. Figures for early 2024 show that 56,208 out of 82,700 units - 83% being apartments - with planning permissions have yet to commence.

The idle apartments come amid a concerted effort by powerful vested interests, backed by the State, to clamp down on the ability of ordinary people to practice democratic oversight of their local area.

Late last year, the Accelerating Infrastructure Action Plan was outlined by Minister for Public Expenditure Jack Chambers, which aims to cut so-called ‘red tape’ and fast-track infrastructural projects.

In reality, the bill will aim to end the judicial review process by only allowing such an action if there is a guarantee of success or if an applicant isn’t directly impacted by what they are objecting to.

The rationale for such a massive overhaul of the planning system is predicated on the assumption that Ireland is somehow plagued by widespread objections to crucial infrastructural projects, especially housing.

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According to Taoiseach Micheál Martin, environmental and other regulations are preventing homes from being built: “There are important standards that we have to adhere to, but everything is being JR’ed (judicially reviewed)”, he claimed.

This narrative is a myth on an industrious scale, which seeks to scapegoat regular people - derided as NIMBYs - and lets developers - the real source of infrastructural delays - off the hook.

The Abundance Agenda Irish Style

In a recent article for the Irish Times, tech bro extraordinaire and Stripe co-founder John Collison presaged what the government is now in the process of rubber-stamping, coincidentally, of course!

In the piece, titled Ireland is going backwards. Here’s how to get it moving, Collison listed several key projects allegedly stymied by objections.

However, upon further examination by academics and others, it appeared that several of the cases contained willful omissions, presenting a distorted view to the wider public, even as government ministers lined up to praise the piece for its supposed lucidity.

UCD Professor at the School of Law, Andrew Jackson, was one such critic of the supposed modern-day Programme for Economic Expansion.

In a comprehensive rebuttal, Professor Jackson examined each of Collison’s claims and summarily debunked them one by one.

One such glaring omission in the original piece, somehow not picked up by the editor at the oft-noted ‘paper of record’, was the erroneous claim that over 200 homes “were blocked in Killarney because they would interrupt the commute of a roost of horseshoe bats.”

However, according to Professor Jackson, after receiving permission for the 224 homes worth €9.5mn from the planning board, An Bord Pleanála, the developer, Portal Asset Holdings, sought instead to flip the land.

Professor Jackson outlines: “Suggesting that 228 homes were “blocked” in Killarney because of bats, without mentioning the highly relevant and more recent context that the developer later received permission at the site and has since been trying to sell the land (now with planning for 224 homes), is remarkable.”

Remarkable indeed.

When examining the wider issue of judicial review and objections, it is clear that developers are some of the most serial litigants.

According to Fred Logue, a leading specialist and public commentator on the subject, last year, developers and landowners took 44% of all judicial reviews, with the public taking 40%, suggesting a predilection for such actions by the former rather than the latter - ironic how Collison never referred to developers as NIMBYs in his piece.

Indeed, when examining overall planning applications, 80% receive approval, with a mere 0.22% being judicially reviewed, negating the suggestion of some major upsurge in such applications in recent months, warranting a governmental clampdown.

The suggestion that deregulation will somehow ameliorate the woes afflicting the housing market is a smokescreen for the main obstacle, which is developer intransigence and the outsourcing of housing provision, in particular social housing, to private forces and other bodies.

AHB Bubble?

The idle apartments in Cherrywood and Rathfarnham will not somehow magically be filled with the latest planning bill proposed.

The approved housing body (AHB) involved in the Cherrywood project, Oaklee, claims that the developer, Neville and Sons - the same developer that galavanted at the Galway tent as it funded Fianna Fáil to the brim during the last housing bubble - has refused to hand over documentation to ensure the apartments meet required safety standards.

“These documents are necessary to confirm the homes meet the requirements for safe and lawful occupation,” Oaklee mentioned.

The Rathfarnham project saw the same AHB purchase the apartments from a developer without completion being ensured.

How exactly the confluence of AHB incompetence and developers skirting basic health and safety standards is the result of NIMBYs or environmental regulations is beyond comprehension.

According to TUD’s housing expert and Irish Times columnist Lorcan Sirr, the State has essentially abdicated its previous role in directly providing social housing via county councils to such AHBs and developers, with a mere 32% provided by councils and nine out of 10 supplied by AHBs via ‘turnkey acquisitions’ whereby housing is bought by developers before or after construction - all with a blank cheque from the State.

“Councils and AHBs are acquiring so many new apartments for social housing from developers who say they can’t afford to build them for private clients, the State is effectively propping the sector up to the tune of a children’s hospital, or nearly €2 billion, a year,” (my emphasis) Sirr mentioned.

To make matters worse, social housing of the kind provided contemporarily appears to be highly leveraged, mirroring the conditions before the last housing bubble, with AHBs owning over 60,000 homes at over €8bn, from just over €2bn in 2021, with €7bn in debt.

“At this level of borrowing (84% average, with some undoubtedly more leveraged), a small fall in property values would see many AHBs owing more money than they have in assets; negative equity, in other words,” Sirr said.

Are the idle sites in Rathfarnham and Cherrywood a repeat of the ghost estates that pervaded Ireland in the aftermath of the last banking crisis in 2008?

Will the Irish taxpayer be asked to bail out AHBs and the developers they are in bed with as they did to those exposed to Anglo Irish Bank?

How exactly does the Accelerating Infrastructure Action Plan deal with this issue?

Are people right to object to such developments if they remain idle and a source of potential financial contagion?

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In a recent statement, the new Minister for Foreign Affairs Helen McEntee expressed a newfound appreciation for the concept of sovereignty.

Sovereignty in what regard you may ask?

The sovereignty to regain our lost fishing waters?

The sovereignty to set our own interest rates?

The sovereignty to control our borders?

None of the above.

Helen wants Ireland to declare our sovereign ability to send Irish peacekeepers abroad in the middle of big power conflicts without the authorization of the United Nations (UN).

Currently Ireland is constrained in that regard by the ‘triple lock’ of the Government, Dail Eireann and the UN, which are all required to approve the deployment of 12 or more Irish peacekeepers abroad.

By reforming the triple lock, Helen claims, we would weaken the ability of rogue permanent members of the UN’s security council from vetoing missions abroad.

“It is quite simply the case at the moment that any one of five permanent members can veto and prevent any new peacekeeping missions from taking place, and because of that veto there has not been a new peacekeeping mission since 2014,” she said.

Those five permanent members include China, Russia, France, the United Kingdom, and the United States, with the first two presenting a particular headache for the West in its quest to utilise the UN to engage in impulsive militaristic ventures as well as seemingly the so-called neutral Irish government keen on doing the same.

Helen assures the public that Irish neutrality will not be trampled on with this new unilateral ‘reform’ mentioning: “We have a long-standing history, and a history we’re very proud of, providing peacekeeping troops on the ground. We should be able to continue that ourselves without others being able to veto it.”

Leaving aside the hilarity of the Irish Government running roughshod over an institutional cornerstone of the post-war apparatus in the form of the UN by claiming rogue elements within it maintain veto power over decisions, the idea the triple lock cannot coexist with Irish sovereignty is laughable.

When legislation underpinning the mechanism was first introduced in Dáil Éireann in 1960, then Taoiseach Sean Lemass, who fought during the 1916 Easter Rising, the War of Independence and the subsequent Civil War, mentioned that it is in the “national interests to support the growth of the influence and power of the United Nations.”

Indeed, by creating that third restraint on the ability of the government of the day to deploy peacekeepers, it keeps Ireland’s neutral stance intact, with attempts to do away with it a direct assault on that precept despite what McEntee claims.

This was the same view held by the Minister’s superior, then opposition leader Micheál Martin, who in 2013 in response to attempts by Fine Gael to adopt similar reforms said:

“Earlier this year, the Minister for Defence signaled that he would try to water down Ireland’s commitment to the triple lock, which is at the core of our neutrality. He presented the idea that it was contradictory and that we were giving unsavoury countries a veto over our actions. This argument has been behind the efforts of a wing of Fine Gael to erode neutrality over the years. My party and I completely reject this.”

The rationale for the reform flies in the face of another previous assertion by, yet again, one Micheál Martin.

Following the Brexit referendum, when the United Kingdom schismed from the European Union (EU), then Tanaiste Martin spoke before parliamentary guest and Brexit lead negotiator Michiel Barnier to outline Ireland’s opposition to the move by the British electorate.

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“Let there be no doubt about where Ireland stands,” he said before adding that, “We want nothing to do with a backward-looking idea of sovereignty.”

Now, one could argue that Martin was simply expressing opposition to a backward-looking idea to the practice of sovereignty as expressed by the British and that he otherwise adores the Westphalian concept in theory.

However, when examining the various governments which Martin has presided over, including the current one, proves that that statement is reflective of various actions.

Take one example.

CETA or the Comprehensive Economic Trade agreement between the EU and Canada.

Last week, at 1am no less, when the Irish public were tucked away in their beds, the Dáil amended the Arbitration Act of 2010 to ratify CETA.

Sounds fairly boring and non-consequential.

Alas, what comes across as an innocuous piece of legislation will have far reaching consequences for Ireland’s sovereignty.

Under the legislation, mining companies can sue the Irish State in private courts known as a private arbitration tribunal or Ibid if it fears legislation by the sovereign directly undermines their shareholder profits.

This means that if the government passes legislation to protect the environment to the detriment of the business model of a specific mining company, the latter can sue the sovereign forcing the legislation to die or receive a massive payout if successfully arbitrated.

A recent report examining so-called Investor State Dispute Settlement (ISDS) mechanisms concluded that “Britain is probably the least democratic of the world’s democracies” given how frequently fossil fuel companies use UK legislation to sue for lost profits.

Right now, the UK government is being sued following a High Court closure of a coal plant in Cumbria.

Such mechanisms, creeped into Irish legislation at the dead of night, run completely counter to the ability of sovereign States to enact legislation.

It enables unelected corporates the ability to veto legislation in the same way Minister McEntee claims Russia and China somehow do so over peacekeeping deployments.

So with the excuse of ‘sovereignty’ as the rationale for the government’s attempts to erode neutrality exposed as a smokescreen, what is the real reason behind the move?

In a few months Ireland will host the Presidency of the European Council.

This is the eighth time the country will do so with the stakes much higher than previous occasions with the continent deciding to go on a war footing.

In a recent statement, NATO general secretary and former prime minister of Norway Mark Rutte stated that, “Conflict is at our door... on the scale our grandparents endured”, with Europe “ready for war right now”.

“We are Russia’s next target. And we are already in harm’s way,” he mentioned in menacing Churchillian tones.

With Ireland standing out like a sore thumb due to our alleged defence incapacity - devoting 0.2% of GDP to defence compared to the EU average of 1.3% - Dublin wants to prove it has what it takes to flex its muscle.

It’s within this context that Minister McEntee, exuding the demeanour and eagerness for conflict as the EU’s foreign policy chief Kaja Kallas, announced a €1.7bn allocation to defence - a 55% increase.

This includes military radar and drone technology.

The spending announcement comes amid an alleged drone incursion in Irish skies right when Ukrainian president Volodymyr Zelensky’s plane was due to land in Dublin.

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Described as “dark vessels” with no transponders, their presence irked the political establishment amid the guest of honour’s red carpet welcome.

However, the story eventually stretched credulity as it emerged that Irish air traffic control were not informed of the drone activity with the Taoiseach stating the activity presented no threat to Zelesnky.

All this suggests the drone activity came at just the right time, providing the perfect pretext for further defence investment just ahead of Dublin’s EU presidential term.

Irish neutrality seems to be dying in the same way Ernest Hemingway described the process of bankruptcy - “gradually then suddenly”.

With little to no input from the public, the Irish State has actively taken sides in big power conflicts, thus negating our long-standing history of neutrality in the process.

As I said on RTÉ a few months ago: There does not have to be this binary between funding the defence forces and savouring neutrality; you can do both.

Neutral states can be, and in fact, should be well armed with Austria and Switzerland examples in this regard who devote 1% and 0.8% to defence, respectively.

The architect of Irish neutrality, who steered the country during World War 2 known in Ireland as The Emergency, Eamon DeValera spelled it out when he said: “The best way, and the way to secure our aim, is to put ourselves in the best position possible to defend ourselves, so that no one can hope to attack us, or violate our territory, with impunity.”

Small nations should not get entangled in the disputes of larger powers.

If attacked, Ireland should have the capabilities and willingness to defend herself.

The stance of the current government that we are being attacked, citing hybrid attempts in the realm of cyber, air and other spaces, as evidence ‘neutrality does not keep us safe’, only makes sense if one fails to understand Ireland’s potemkin neutrality adopted in recent years.

Ireland claims neutrality but actively takes sides in various geopolitical conflicts making us a target for larger more militarily advanced powers to strike.

By actually taking neutrality and defence seriously Ireland can play an instrumental role in the 21st century as a neutral arbiter and contributor to overall European defence.

The type of role played when viewed as a neutral arbiter such as when the Treaty on the Non-Proliferation of Nuclear Weapons or NPT, dubbed the ‘Irish Resolutions’, saw Minister for External Affairs Frank Aiken spearhead attempts via the UN to prevent the proliferation of nuclear weaponry.

By claiming that neutrality somehow undermines sovereignty, Minister McEntee would be wise to defer to decades of Irish statecraft since independence.

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Having spent his career ignoring his birth country, instead courting American capital from the likes of Palantir’s Antichrist-enthusiast Peter Thiel, Tesla’s bureaucracy-cutting, or DODGEing, extraordinaire Elon Musk, Collison is determined to import the very worst America has to offer onto the Emerald Isle.

In a recent piece for The Irish Times entitled, Ireland is going backwards. Here’s how to get it moving, Collison claims to have the answers to get Ireland back on track.

Already endorsed by the Irish deputy prime minister or Tanaiste Simon Harris as “thought provoking”, thus proving that the sentiments expressed are in no way a shock to the system or challenging to conventional orthodoxy but rather an acceptable form of feigned oppositional discourse.

But what exactly is imperilling Ireland, putting it off course you may ask?

Well Dr John has the answers!

According to Dr John, “Ireland can’t build quickly enough to keep pace with the demand to live, work and invest in the country.”

Waxing lyrical on the myriad problems his native land faces, the Tipperary-born co-founder of the e-commerce application Stripe lists them off one-by-one:

• “It has Europe’s second-fewest homes per person”

• “Dublin’s water network is going to reach its limits in the next three years, which will limit future housing construction”

• “Ireland’s household electricity prices are the highest in Europe”

• “It has 41 per cent fewer trains, roads and other transport infrastructure per capita than high-income European countries”

• “And it has the lowest proportion of electrified rail of any EU member state”

Oh boy, that is quite the handful, and I bet you read those problems out in his recently acquired American accent!

Collison summates these issues in a sentence stating: “We have not built enough homes or infrastructure or sufficiently developed our energy system to keep up with the radical population growth we’ve seen in my lifetime.”

Dr John has diagnosed the problem.

Now onto the prescription.

In order to solve the alleged “housing shortage” Ireland faces, the country needs a big dose of YIMBYism to combat the forces of its arch opponent NIMBYism.

The ‘Yes in My Back Yard’ brigade is a direct response to the smear of ‘Not in My Back Yard’, which refers to opposition by environmentalists and other local groups to proposed infrastructural developments, as is their democratic right to do so.

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These often powerless locals have become the bête noire of vested interests determined to impose brutalistic and substandard, often described as high-density and high-rise, accommodation onto communities in order to create a rentier society - where wealth is derived mainly from ownership and control of assets that generate income (rent) as opposed to production or labour - ensuring higher yields for property investors.

As one Irish housing expert stated: ‘The smaller the apartment, the higher the yield per square metre.’

Summoning the Orwellian vigor of the two-minute hate, Dr John declares in the piece that NIMBYs “deserve our scorn”.

For what you may ask?

NIMBYs, in Dr John’s world, “have “successfully blocked many thousands of homes and hundreds of megawatts of clean energy.”

Seemingly ignoring the fact that well over 80% of planning applications in Ireland last year were approved, why does Dr John feel the need to deceive his Irish audience with such exaggeratory claims?

Could there be a deeper agenda at play here?

NIMBYs have proven a useful scapegoat in recent years as a result of a well-funded lobbying campaign emanating from America.

The movement, largely astroturfed by big business who wish to quash local democracy, began in 2010 in California with the Collisons at the center of it.

They donated $1 million to a group named California Yimby.

But who are California Yimby?

California Yimby describes itself as a group dedicated to making, “California an affordable place to live, work, and raise a family”, adding that, “achieving our mission will put California on a path of broad-based economic prosperity, creating vibrant, livable, and inclusive communities for everyone.”

According to one of the founders of the group, Pantheon’s Zack Rosen, the organization’s basis for existing is a response to the Sunshine State’s over-regulation and the influx of tech jobs in the region which has increased gentrification with highly paid techies outnumbering existing lower earning tenants.

According to award-winning journalist and documentarian, Patrick Range McDonald in his book Selling Off California, an ulterior motive is at play.

For McDonald, Rosen and his ‘Abundance’ - after the bestseller by two neoliberal New York Times columnists who advocate deregulating California - crew’s real aims are to save the public image of Big Tech due to the impact gentrification in the Bay Area has had on affordability.

In other words: “Big Tech wanted to protect, and expand, its gigantic profits.”

Thus, Rosen, who said he would “certainly be willing to accept money from developers”, along with Microsoft executive Nat Friedman used their Yimby outfit to fund politicians amenable to their pro-Big Tech housing bills.

And what does a pro Big Tech housing policy look like?

In essence it is the belief that the only way to view the housing crisis is through the prism of demand and supply; anything less is derided as simplistic.

In the world of Yimby fanatics, there is no such thing as bad supply.

All supply is good supply.

If you disagree you are a supply denying Nimby.

This in essence is what the ‘Abundance’ narrative seeks to portray - quantity over quality.

As such, the bills indirectly backed by California Yimby have sought to ensure the construction of high-end luxury apartments at scale in the hope such massive supply will trickle down to regular tenants.

A slew of gentrification bills have followed including, but not limited to, one SB 827 by California State Sen. Scott Wiener which would have allowed for greater density high-rise housing.

While that bill was defeated, the momentum of the Yimby movement is indefatigable.

And the Collisons are determined to export it to Dublin.

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Further on in the Irish Times piece, Collison laments the explosion in so-called unelected Non governmental organizations or NGOs and other departments which have influenced and stymied government decision-making in recent years:

“In the past 25 years there’s been a proliferation of regulators, departments, agencies and NGOs. Since 2000 we’ve created 303 new government agencies, quangos or departments, compared to 74 in the prior 25 years. We got more new government agencies, and at a faster rate, than we got episodes of Top Gear.”

While Collison does speak to a broader truth about the proliferation of NGOs that have essentially enabled the Irish government and indeed governments worldwide to outsource decision-making and accountability, the irony of Dr John pointing this out does seem lost on him as earlier in the piece he praises the proposed ‘beds in sheds’ policy or ‘seomraí.’

The brainchild of the Irish think-tank Progress Ireland, who took inspiration from Los Angeles’ Accessory Dwelling Units (ADUs), this policy involves amending planning laws to allow individual households to construct sheds in their gardens to enable young people to apparently live independently.

‘I can’t wait to move out of my parent’s house and into their garden’, said no young person ever.

Indeed, among other measures the think-tank managed to successfully lobby the Irish government on included a recent deregulation of apartment standards to allow for higher-density, high-rise with no communal space of the kind seen in California at the behest of the state’s Yimby lobby.

For Collison, unelected NGOs which “aren’t directly accountable to the public” are bad, but astroturfed think-tanks lowering housing standards are good somehow.

However, Collison does make a point: despite being one of the most centralized countries in Europe, Ireland increasingly decentralizes decision-making to other organs - be they NGOs or departments of state.

This not only adds layers of bureaucratic complexity but allows politicians to avoid scrutiny and shift blame onto faceless bureaucrats.

But the alternative on offer from Dr John would only make the illness worse as he overprescribes a deadly dose of tried and tested neoliberalism of the kind afflicting Ireland for years, that has got the country in the mess of gridlock and delayed infrastructure to begin with.

For it was the deregulation of banking and the wider economy more generally which created the conditions for a heavily financialized system dependent, not on productive forces, but on parasitic rent seeking assets as exemplified during the Celtic Tiger boom and subsequent bust during the 2000-2008 period.

Ireland responded to that crisis by further financializing housing to the point that prices now exceed the so-called high of the boom period in which housing became, not a place to live in, but an asset for people to profit off of.

Ireland, and Dublin specifically, became the capital for international extractive hedge funds looking to make a quick buck, with rents in the capital now exceeding €2k as international real estate firms brag about these yields on their websites encouraging further investment.

It is a reflection of our heavily financialized economy that it is difficult to build a Children’s Hospital or Metro without costs skyrocketing.

To blame the shortcomings of the government, eager to outsource such building to private contractors, on ordinary people who raise objections is the height of ivory tower syndrome that US tech bros excel in.

However Dr John, and his assistant Patrick, try to frame it, what they are selling to the Irish people and policymakers is a rebranded version of the status quo, only this time they argue for less not more constraints on exploitative and non-productive market forces.

Despite the embracement of this deregulatory diagnosis from the political class, there is growing pushback to the current system from the regular public.

The ascendancy of Catherine Connolly to the Presidential palace or Áras an Uachtaráin, with over 60% of the vote, largely off the back of diseffected youth voters, speaks to the growing malaise young people in particular have with a system in which, despite meteoric GDP, they cannot buy a home or afford rent.

Nowhere does Dr John even attempt to address these concerns.

He simply argues for Abundance for the sake of Abundance.

Such enthusiasm for Abundance sounds more like a cornucopia of neoliberal embellishment than concern for the downtrodden.

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Thanks everyone for being here today.

It's an absolute honour and pleasure to present a report before members of Dáil Éireann here today, I feel as though roles are a bit reversed, because it's usually journalists listening to politicians pontificating, so it's great to lecture politicians for a change.

But in all seriousness, I really want to thank Mattie McGrath and some of the other rural independents for their tireless dedication and effort in highlighting the plight of homeowners whose mortgages were sold to vulture funds and for standing up for my generation, generation rent.

But this issue impacts not just urban communities, but rural ones too: the plight of indebted homeowners and left behind youths does not discriminate, and it's vital that we come up with solutions, but also understand how we got into this situation.

So just a bit of background on myself, I am a journalist by trade, and have written extensively about issues impacting my generation, from housing to an inability to move out of our parents house.

We all understand the struggles facing young people: people in their mid 20s to early 30s, equipped with a degree wealth and material items that previous generations would have dreamed of yet still cannot find a place to call their own and forced to either live at home with their parents or be afforded the privilege to pay sky high rents. Indeed, the figures speak for themselves: In 1993 over 70% of 25 to 34 year olds owned their own home, the majority with a mortgage. But in 2016 that figure fell to less than a third. As home ownership has plummeted for young people, the proportion of young renters has skyrocketed. In the early 90s a mere 15% 25 to 34 year old were renting. But in 2016 that figure increased to 60%. According to the 2022 census, over two-thirds of 18-34 year olds still live at home with their parents. Relative to average wages, Irish rents are some of the highest in the world: since 2013 wages have risen by 27% while rents have risen by 90% with property prices concurrently rising by 75%.

But how did we get into this mess?

You know, often we're told it's a lack of supply. If only we got the supply question sorted, we'd get to the bottom of our housing woes.

But anyone can tell you that during the Celtic Tiger, Ireland was building more homes per capita than any nation on earth, yet house prices still rose. Currently, we are facing a housing market in which a constant stream of build-to-rent properties is creating an underclass of forever renters who will own nothing and be happy.

Last year, over 90% of housing supply in this very city, Dublin was build-to-rent with average prices ranging from a grand to almost two grand. It seems government policy is currently facilitating the Generation Rent phenomenon. This is a far cry from years past, when Ireland was an outlier globally in home ownership. In 1971 home ownership in Ireland was 68% compared to 35% in Sweden and 50% in the UK.

So what happened? Loathe, as I am, to kind of morph into Vladimir Putin and impose a historic diatribe on you here today, I feel it's constructive to kind of briefly examine the history of housing in Ireland to contextualise the current situation.

So during colonial times, Ireland's land was seized and plundered through a series of land grabs from successive British administrations. The names stand out: Oliver, Cromwell, Henry VIII, and this led to a deep sense of housing and land insecurity on the part of Irish Catholics, accelerating their longing for autonomy within these isles.

The Land League and other grassroots rural and urban efforts to campaign for dispossessed landowners through agrarian upheaval helped accrue major concessions on the part of the British administration that saw previously indebted smallholders granted their lands with cheap loans from the British Treasury.

The early Free State was defined by this historic dilemma with a series of land amelioration measures such as the secession of land annuities, mass arrears forgiveness and other land acts, which showed what can be achieved with grassroots action and political will.

When Ireland did gain its independence, the state underwent a massive home building effort. Despite being a developing and poor country, the Million Pounds scheme saw the construction of 2000 homes nationally. The housing acts of 1931 and 1932 saw from the early 1930s to the 1950s over 100,000 social homes built.

But how do they do this?

How did we manage to construct more homes then than now?

By localising the provision of housing to county councils or corporations with the supplication of low cost loans to builders and low cost mortgages to purchasers, the Irish state fulfilled that vital social element to housing.

However, by the 1970s and early 1980s a major global shift in how housing was viewed would occur. No longer would a home be considered a mere home to start a family in or fulfill a social purpose for the common good, but rather, it would serve an asset function. Ireland was not immune to the end of society heralded by Margaret Thatcher or the non interventionist approach championed by Ronald Reagan.

Right to Buy in the UK would see social housing in private hands without being replaced. Meanwhile, Ireland had already adopted its own right to buy in 1966, however, had been replacing it for the most part, with extra social homes.

As such, successive governments would proceed to disempower the hitherto powerful county councils in providing homes and rely on private forces for the provision of housing.

In the early 1980s local government accounted for a quarter of mortgages, but by the end of the decade, this accounted for 2% and has not recovered since.

Most mortgages would be provided by banks. These mortgages were, in turn, heavily deregulated and privatised. Irish deregulation involved the removal of capital reserve requirement ratios and unlimited credit growth for banks and building societies and then eventually cross border borrowing meant that banks were no longer reliant on customer deposits to lend known as fractional reserve lending, but rather could borrow short term - one year maturity - from the international money markets and sell long term to customers.

Now, when Ireland joined the Eurozone in 1999 this asset function accelerated. Having been accustomed and used to high interest rates, the cost of mortgages dropped dramatically, making it easier to borrow for a mortgage with Irish banks offering mortgages almost 20 times people's income.

Bank lending rose from 60% of GNP in 1997 to 200% in 2008. This was a period in which housing supply was at its zenith. However, this supply was merely enabling the further financialization of housing through the expansion of credit by global hedge funds to banks, who in turn lent private mortgages to householders, which were then securitized in the form of mortgage backed securities, essentially homes traded on the stock market.

While not immune to the securitized mortgage phenomenon, loose lending practices by banks was the primary driver of the Irish property bubble. It was, in fact, ordinary people who engaged in or were mere pawns in this scheme, as the government encouraged the asset based function of a home which could be used to fund a person's pension, among other things. This is why, even as supply increased, home prices concurrently rose given the asset function it performed.

House prices were kept at high levels due to a constant stream of cheap credit provided by banks and the monopolised control of land by speculators. When that bubble burst, and the entire edifice of Ireland's so-called boom crumbled, the Irish state proceeded to bail out banks that misled them about their solvency, having exposed themselves to properties that were now considered worthless.

The housing crash in 2007/08 and the response to that crisis contextualises the current dilemma of an entire generation priced out of the housing market, along with mortgage holders beholden to vulture funds and non-bank entities.

The steps taken by the Irish government to increase property prices after the sudden plunge in residential values, simply continued the policy of financialising the housing market with little regard to the systemic issues that caused the crisis in the first place.

The invitation of vulture funds, the gifting of public land to private entities, the secession of domestic bank lending and the selling of property assets to private equity firms via NAMA, all contributed to the unaffordable housing and the creation of a new class of absentee, so-called credit servicers masquerading as mortgage owners. This was done through the establishment of a so-called bad bank known as NAMA, which disposed Irish lending institutions of their bad loans and the establishment of rates which would which would assist NAMA in deleveraging its portfolio to focus on residential property.

From 2014-2016 NAMA sold over €50bn worth of distressed loans to investment funds. According to the United Nations, 90% of these loans were sold to US hedge funds, private equity vehicles and vulture funds.

What is a vulture fund?

It's a word that gets tossed around quite frequently. As their name implies, vulture funds are investment firms who prey on assets, in this case homes with people in them, typically at low prices before flipping the land and properties. This scheme would be facilitated by NAMA who sold the assets or loan portfolios to these funds.

Meanwhile, private equity firms are private companies that gather investors’ money to look for something to invest in that's usually not publicly traded. The company then gathers these little sums of money into a giant lump sum called an investment fund, a bank containing a massive amount of money.

Hedge funds usually just manage their own money without the need for investors, and once the asset they invest in has been sold, a steady stream of income and profits flow as a result.

Now, many of these private equity vehicles would use a structure present within the Finance Act of 1997 that allows for the establishment of so-called special purpose vehicles. These SPVs would be granted so-called charitable status, allowing them to avoid paying Irish taxes such as VAT and capital gains tax.

The loan would be sold via a true sale in which ownership and all interest in an asset is completely transferred from the original owner, in this case the bank to another party, in this case, the vulture fund, the buyer. The vulture fund assumes all risks and benefits associated with the asset, and the seller, the bank no longer has any rights or control over their asset. The funds then acquire the property via the land registry, known as Tailte Éireann, by obtaining a folio on the property with the SPV then turning the portfolio of mortgages into a loan.

But because neither the SPV nor the vulture fund can service the mortgage, they transfer the legal rights of that loan over to a credit servicer, and this is where you get your Mars, your Start your Peppers, allowing them to initiate court hearings, even though the courts are left in the dark regarding the true sale.

Now with the transfer of such large tranches of loans over a period, many of those whose mortgages switched from a bank to a non-bank entity or vulture fund without their consent, or in some cases knowledge, found they had little to no security.

Hundreds of thousands of households now found that the bank they thought their mortgage was tied to had been allegedly purchased by a so-called credit servicer acting on behalf of a vulture fund and with these credit servicers. And when these credit servicers appear before the courts, they deliberately misrepresent themselves by claiming they are the owners of the mortgage with heavily redacted material which is taken as conclusive evidence before the judge.

In 2022, Pepper was responsible for 10% of repossessions with ‘ownership’ of 80,000 private mortgages in the state.

Recent figures from the Irish Farmers Association indicates that between 2500 to 3000 family farms may be seized by vulture funds of lands up to 150,000 acres.

The heavy handed tactics deployed by these vulture funds reveals what farmers may face or what they will face when push comes to shove. In December, 2018 the McGann family were evicted from their farm in Strokestown County Roscommon after KBC Bank hired a British security firm, GS Agencies to evict the tenants on behalf of the US vulture fund Cabot. The security firm, firm which included a former British soldier who served in the Ulster Defence Regiment, punched, pulled and kicked the family during the raid.

Now, as you can tell here, the numbers of orders for repossessions increased dramatically from 2014 onwards at the very time vulture funds were invited into the housing market.

Apart from vulture funds, the phenomenon of cuckoo funds, who buy up entire blocks of properties directly from developers, has increased dramatically in more recent years. Often, these funds will purchase properties meant for sale for first time buyers and purchase them as rental properties to gain a higher yield. And we know properties owned by funds are more expensive than normal properties. According to the Central Bank of Ireland, from 2007-2019, homes owned by institutional investors increased the level of rent by 4.1 percentage points more than other landlords with comparable properties following purchase. The study also found that landlords within 100 meters of an institutional investor raised monthly rents by 2.3 percentage points more than landlords who were further away after an institutional investor had moved in.

In 2021, 4000 newly built homes were purchased by investment funds representing 27% of all new supply in the country, with all non-household buyers buying half of new homes. Now that includes affordable housing bodies as well. That same year, the government implemented an increased stamp duty of 10% on investment funds that both purchased 10 or more properties, with exceptions for homes leased back to the state for social housing and apartments. However, these moves have proven wholly insufficient, as the rate of bulk purchases only increased since then, from 187 in 2021, the year was implemented, to 395 in 2022 to 623 last year. Last year, 40% of new builds were sold to bulk purchasers. In Dublin the situation is even more profound, with 3528 out of 5727 homes purchased by bulk purchasers, representing 60% of housing stock.

Many of these cash-grabbed funds brag about how high rents are in this country.

One such entity, Vanke, which is based in China, stated, ‘the Irish population is growing fast and the new land available for development are also very limited, meaning property prices in Ireland are set to continue rising’ before adding that ‘investment property in Ireland is certainly an attractive option, with smaller apartments located in Dublin earning gross yield of seven to 10%’. I mean, think of that statement for a moment, while my generation is struggling to pay rents working day in and day out, to stay in a property we’ll never own these funds are bragging about how beneficial it is for their balance sheets!

So what am I calling for in this report?

I’m not gonna pretend I have all the solutions… You know, I can barely get myself out of bed in the morning let alone solve the housing crises. But there are a few recommendations in this report that I feel are worthy of consideration and discussion.

So first one is a ban on foreign purchasers. So what I'm calling for is the introduction of legislation that prohibits non-resident buyers from the from the bulk purchase of existing residential properties. Currently, investment funds who engage in bulk purchases of 10 or more properties face a stamp duty hike of 10%. This tax was implemented in 2021 following the bulk purchase by Round Hill capital of 170 units of social and affordable homes in a Maynooth housing estate. However, these measures have proven to be insufficient as in the two year period following the implementation of the tax, 4200 homes were bought by investment funds. Bulk purchasing has increased by 233% since 2021. In 2023 four in 10 new homes were bought by bulk purchasers, and the tax only applies to homes, not apartments or homes leased back to the state for social housing. I think what is required is an outright ban on these bulk purchasers by funds domiciled abroad. While some may argue the state may be constrained by EU legislation, the former EU commissioner for financial services, Mairéad McGuinness has said outright that the bans are justified and permitted in the general interest, and provided they are not discriminatory and are proportionate to the aims pursued. I think by implementing this ban, Ireland will be following several other English speaking common law jurisdictions, including Canada, Australia and New Zealand. Canada recently announced a two year extension to their ban on foreign purchases on the basis that ‘for years, foreign money has been coming into Canada to buy up residential real estate increasing housing affordability concerns in cities across the country and particularly in major urban areas. Foreign ownership has also fuelled worries about Canadians being priced out of the housing market in cities and towns across the country.’

I'm also calling for measures to increase housing supply, because while I feel like housing supply is this golden goose that sometimes we can't criticise, we just have to get the right supply. If we're putting out a constant stream of financialized housing supply we’re not going to address the elephant in the room, which is prices. So I'm calling for an increase in the provision of construction credit by domestic pillar banks. You know, the whole point of NAMA was so banks would start to lend again. But we know from recent research by Peter Ryan of Ryan Research, which has indicated that Irish banks credit to deposit ratio has declined dramatically, from 77% in 2008 to 38% in 2021, this is the second lowest ratio in Europe. Indeed, bank credit advanced by domestic lending institutions is down by 87% from its peak, while credit by banks in other eurozone countries has recovered and countries around the world, including America. Several reports from the Construction Industry Federation of Ireland, including one in 2017 and 2021 have indicated that the industry is finding it difficult to access finance for delivery of homes. These vulture funds are essentially fulfilling the role that the domestic banks should be doing. So what needs to be done? I think the Irish government should urge a relaxation on lending restrictions and capital requirement ratios, and set strict credit targets for the well capitalized domestic pillar banks to lend to construction development.

I'm also calling for a re-examination of the land registry, which I touched on in the report, because, as I said, Tailte Éireann is currently facilitating these fraudulent misrepresentations before the courts whereby credit servicers, who act on behalf of investment funds, present the folios that I mentioned indicating that they are the owners of mortgages when applying for repossession, which is presented, as I said, as conclusive evidence. And when credit servicers appear before the courts requesting evictions, they usually present heavily reductive material proving they are mortgage holders, when in fact, they are just mere legal title servicers. So what I'm calling for is to ensure that no credit servicers gain access to these Folios in the first place, and all sales of loans should be conducted through a synthetic sale, as opposed to a true sale, whereby the originator, the bank, still retains ownership of the securitized loan.

I'm also calling for an update to the EU forbearance directive. So this is a directive which was in 2014 the EU began legislating for forbearance to be shown in repossession cases before the courts, and initially the wording encouraged creditors to show forbearance to debtors, but then it was updated to in the legislation requiring such action, and then in March, 2016 the directive, called the mortgage credit directive, was passed by the EU Council, which came into force in December, 2021. Now this directive sought to mandate so-called forbearance guarantees for those mortgages in mortgage arrears facing eviction. This would be achieved through a series of guidelines, such as requirements for verifying consumers as income, documenting and retaining information, identifying and preventing misrepresented information, assessing consumers ability to meet their obligations under the credit service agreement, and considering allowances for consumers committed and other non-discretionary expenditures, as well as allowance for potential future negative scenarios.

Now this directive was transposed into Irish law in late December 2023, two years after it came into force, with the central bank acting as the enforcer. But I think to address some of the shortfalls in the current directive and how repossessions are litigated going forward, what's vital is that litigants in these repossession cases are entitled to free legal aid, which they are currently not entitled to. We must ensure that consumers are familiar with the directive before entering legal proceedings, because there's a lot of jargon in there that I feel like, you know, anyone couldn't really understand. And then I hope to apply the forbearance to non performing loans sold before the transposition of the directive in 2023 remember, that was only late last year, and to performing loans. Currently, the directive does not apply to performing loans originated by credit institutions or to the sale of non performing loans originated by credit institutions, which take place before the enactment of the law. And then we must ensure that the central bank, in its capacity as the enforcer and regulator of this directive, is equipped with the necessary regulatory tools and sanctions to ensure that judges abide by the directive and that credit servicers do not misrepresent ownership of mortgages, because right now, the Central Bank of Ireland seems to be relying on enforcing the directive on a case by case basis. This is wholly unreliable and will not provide sufficient safeguards for consumers.

I feel like there is no obstacle that the Irish people cannot meet. You know, we are a country who, despite the odds, has overcome many challenges and come out at the other end. Whether building a world class energy system in Ardnacrusha in the 1920s or a massive home building scheme in the 1930s, there's no reason why the quote on quote richest country on Earth cannot pull the rug from underneath the vulture funds preying on innocent homeowners and finally allow a Generation Rent to find a place to call home.

Thank you

Report here: The McDonald Report is available here:

The McDonald Report

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In the aftermath of the bursting of the Irish housing bubble, the State did something truly extraordinary—it demolished houses.

In 2013, then Minister for Housing Jan O’Sullivan announced that 40 housing estates would be bulldozed.

But why?

Surely the prophets of everlasting economic boom - and their lackeys in the financial press - who said that an endless supply of homes was needed to meet growing demand, weren’t wrong, were they?

It turns out they were, and the hollowed broken-down housing developments stand as a testament to the folly of unbridled property hype, which continues - after a pause - unabated to this day.

The term “ghost estates” came to define the aftereffects of the economic exuberance of the Celtic Tiger.

Coined by the economist David McWilliams to describe housing estates that were left empty, in 2010 there were over 600 of these idle estates, with 1 in 5 of all Irish homes unoccupied.

While the dismantling of Saddam Hussein’s statue in Baghdad following Operation Iraqi Freedom heralded the end of that oppressive regime, the demolition of the Irish ghost estates proclaimed the end of the Celtic Tiger’s roar.

Both regimes were known for an endless stream of chicanery.

Equivalent to Baghdad Bob telling the international press that, “There is no presence of American infidels in the city of Baghdad,” even as US troops were moments away from ending the Baathist regime, now part of the popular ‘everything is ok’ meme, the then Fianna Fáil government dismissed any concerns about the economy with equal audaciousness.

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When house prices began to fall in 2007, Taoiseach Bertie Ahern dismissed public concerns about a crash by asking why such people don’t just commit suicide.

As the subprime mortgage market burst in the United States, the man at the helm of the Irish Financial Regulator Patrick Neary acted as Ireland’s Baghdad Bob stating that Irish banks are “resilient and have good shock absorption capacity to cope with the current situation” with “very limited” exposure to the subprime market.

Talk of a ‘soft landing’ abounded.

Months later, Neary was out of a job and Irish taxpayers were left footing a €64bn bailout bill with gruelling austerity on the horizon.

Economists such as the aforementioned McWilliams and Morgan Kelly of UCD who questioned whether endless supply was the right answer were vilified by the media and government, similar to the US neocons’ demonising of those who questioned the now debunked Weapons of Mass Destruction (WMD) in Iraq narrative. The proponents of the groupthink of abundant housing supply were rewarded and still are by endless newspaper columns demanding the same; ditto the war mongers who promoted the WMD myth yet still enjoy columns in publications such as the Washington Post despite not apologising for their role.

Simply put: during the Celtic Tiger Ireland built too many houses as standards were relaxed and profit-motives took precedence over actual needs.

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There were virtually no constraints on what could be built.

Central government incentives to local councils and tax breaks for developers, little to no building standards/regulations, an endless stream of cheap credit, and an influx of foreign construction workers from Eastern Europe meant that Ireland was building more homes per capita than virtually any nation on earth.

This supply frenzy was driven via demand, not from people desperate to have a roof over their head, but from developers enabled by profit driven banks and the State desperate to fill its coffers from property derived taxes, which accounted for close to 20% of the total tax take, by offering generous tax breaks.

These motives meant housing supply was detached from actual household demand.

Between 1996-2005, 553,267 houses were built but the number of households only grew by 346,400 from 1996-2006.

Instead, the motives of existing homeowners who, armed with the ever increasing equity of their dwelling, were encouraged to purchase secondary homes, with investors incentivised to cash in on the lucrative buy-to-let sector: the number of mortgages held by private landlords jumped rapidly from 16% in 2003 to over a quarter in 2008.

Part V planning regulations which meant a certain proportion of developments had to be earmarked for social and affordable housing were relaxed allowing developers to provide money in lieu of such requirements meaning less than 6% of new supply constituted social housing during this period. Indeed, this move led to many of the planning scandals detailed in the Mahon and Moriarty tribunals, respectively.

Yet, despite the narrative that an increased supply of houses decreases their price, the opposite happened: from 1991-2007, the average price of a new home in Dublin rose from €78,715 to €416,225 - a whopping 429% increase; nationally, the price rose from €66,914 to €322,634 - a 382% increase.

But why was this?

Why did Ireland defy the normative laws of supply and demand which states that supply exceeding demand translates into lower prices?

A mixture of endless access to cheap credit and inflated land values enabled by the monopolised control of development land meant that even as supply increased house prices rose concurrently.

Indeed, Irish land was the most expensive in Europe at the time rising from €10,000 per hectare in 1998 to close to €60,000 per hectare in 2006 with land constituting up to 50% of a house's total cost compared to a European average of between 10-15%.

Now fast forward to the present and the same tired chorus of supply, supply, supply is flooding newspaper columns and other media sites. Whether the people repeating this mantra are beholden to some vested property interests or are simply imbibing propaganda is unclear, but like during the housing boom they get very upset and irate when questioned, often resorting to name calling their critics as communists or NIMBYs.

Yet, from 2011-2022 housing supply has mostly kept up with new households, when new builds and reoccupied vacant homes are taken into account: the number of households has risen by 187,000 compared with 184,000 units of total accommodation.

Despite the prevailing narrative, there is little evidence that household demand is vastly outstripping supply.

Indeed, as Professor John McCartney recently outlined in the Irish Times, State subsidies such as the Help to Buy Scheme and other demand-side incentives are done precisely to get more supply by propping up prices in the hope developers will build.

Likewise, rent subsidies such as the Housing Assistance Payment (HAP) have a similar inflationary impact when it comes to rental properties with a large proportion of beneficiaries non-national.

As such, house prices are once again completely inflated and are 10% above their 2007 peak.

So, besides government subsidies, what’s driving this increase in house prices?

The emergence of cash buyers in the market is a major contributory factor: data from 2022 shows that about 40% of house buyers are using cash which is inflating property values.

According to the Central Bank of Ireland (CBI), at the height of the property boom about 25% of property sales involved cash, but at the start of 2013 this rose to 60%.

These buyers include a mix of older households wishing to downsize but also a surge in private investors wishing to invest in property as an alternative to low-yielding deposits.

Many of these investors are also private equity firms who became a component of the Irish housing market after the crash following extensive meetings with the Department of Finance.

Private equity is often raised when investors are ineligible for a bank loan which places it in a much higher risk category often translating into demands for a high return which means higher costs for buyers and renters when invested in the housing market.

Another factor is the rise of the so-called shadow banking sector which has grown rapidly following the banking crisis as post-crash regulations have hamstrung the ability of the retail banks to lend.

Nature abhors a vacuum, and this vacuum of credit has been filled by this shadowy sector which is now worth over €3tn in Ireland — thirteen times the size of the real economy.

If there is a recession this sector is more than likely to be exposed having been allowed to grow unrestrained for years following the last crash.

The very same people that promoted the housing bonanza during the boom, whose after-effects have condemned my generation with little to no possibility of home ownership thus confined to high rents, are now promoting endless supply and a relaxation of building standards all in the name of deregulation and a laissez-faire approach as somehow the solution to the current woes.

In the immediate to long term, there is no need for major housing developments at scale beyond specific social housing allocation within local communities, and utilising existing vacant stock for a mix of rent and purchase.

This requires a greater enhancement of powers to local authorities who understand the needs of their communities better than detached officials at the Customs House or the Office of the Planning Regulator the latter of which was set up in light of the clientelism between developers and planners during the boom.

To avoid future cronyism, there needs to be greater oversight of local councils by central government.

Indeed, a greater alignment between actual demand and what is set out in local planning strategies and development plans coupled with greater powers to CPO land and replacing the current cumbersome four-stage planning process with the old one-stage process would allow for appropriate housing provision.

Councils are currently sitting on around 4,400 vacant homes but have little to no power to do anything with them.

According to GeoDirectory, the data company for AnPost, in Dublin alone there are 14,500 empty residential and commercial properties with 4,000 in the city centre.

The Housing Commission has called on the government to address all these vacancies.

Instead of repeating the same mistakes we should work with what we have.

In a recent interview with the Sunday Independent, the newly appointed housing minister James Browne mentioned that one of his key priorities is to get the private market back involved in the provision of housing to address supposed supply shortfalls.

Journalist Niamh Horan asked the barrister turned Minister with a remit for the most important issue facing the country about rental caps known as Rent Pressure Zones (RPZs), in which rents are capped at 2pc or inflation in specified local areas. While expressing concern about the lack of new rental apartments in Dublin City Centre, the minister mentioned that in order to ramp up the supply of apartments in the city private equity would have to be explored as a funding source.

“I’m also conscious of people who can’t get anywhere to rent and supply has completely dried up, particularly in Dublin, in terms of new rental apartments.

“So we need balance to ensure renters are protected but that we can get supply going again. We have to get private equity back in (my emphasis). That’s the key to it.”

But what is private equity and will it solve the housing crisis?

In short, private equity involves private companies that gather investors’ money to look for something to invest in that is usually not publicly traded. These investors can range but pension funds are the most popular income stream due to the high returns generated. Private equity also uses a little bit of their own money but the majority of funding is a lot of borrowed cash to buy up companies meaning they are highly leveraged. In private equity parlance that usually entails a leveraged buyout or an LBO for short. They then make financial and operational changes to the purchased companies to sell for a profit. Once the asset or company they invest in has been sold a steady stream of income and profits flow as a result.

If you are a bit confused as to why Minister Browne feels this investment strategy is appropriate for the provision of an essential public service such as housing you are not the only one.

Ever since the financial crash of 2008, the Irish State has crippled the ability of the domestic banks to lend credit to fund construction activities and has made it harder for ordinary borrowers to get on the property ladder. In the former’s case, this was due in the short term from bad loans on the bank’s balance sheets mainly from reckless lending during the Celtic Tiger, and in the long term from onerous legacy regulations from the European Union (EU) which compel Irish banks to hold much more capital ratios than other European lenders. Several reports from the Construction Industry Federation of Ireland, including in 2017 and 2021, have indicated that the industry is finding it difficult to access finance for the delivery of homes. For potential borrowers, deposit requirements ranging from 10-20% of the total value of a home along with loan to income constraints meaning buyers can only borrow a maximum of 4 times gross income for the first time and 3.5 times if they are a second time buyer, makes getting on the property-owning ladder a pipe dream. According to the Irish Central Bank under their so-called Macroprudential Rules: “A first-time buyer couple with a combined income of €100,000 can borrow up to a maximum of €400,000.”

According to analysis by KBC, the price of new homes being bought by first-time buyers has doubled from about €200,000 to €380,000 since 2012 which requires buyers to need an income of €98,000 for a 90% mortgage with two-thirds of Irish households having an income of less than €60,000. Unfortunately, only 14% have an income above €100,000.

Since 2013, house prices have risen by €200,000prices are now above the Celtic Tiger peak with the average price nationally at a whopping €327,500. According to the Irish Independent: “At the end of the year (2023) prices were 103.9pc of the 2007 peak and the highest on record (my emphasis). Increases last year were higher outside Dublin, up 5.7pc, compared to 2.7pc in the capital.”

But how have prices risen exponentially given the flurry of post-crash regulations imposed on banks preventing them from lending and individuals preventing them from buying?

Following the crash, the Irish government was desperate to recapitalise Irish property following their sudden plunge. This involved coordinating with various private equity companies to encourage them to invest in Irish assets and recover falling assets in commercial and residential property.

These companies vary from Apollo Global Management to Cerberus. The Minister for Finance Michael Noonan, dubbed ‘vulture’ lover, met with these entities on 14 different occasions while devoting little to no time meeting with mortgage advocacy groups.

The establishment of the National Asset Management Agency (NAMA) saw all the ‘bad loans’, those non-performing due to a failure by borrowers to repay loans, worth €70bn transferred into the state-backed bad bank.

Further pressure was heaped on Ireland by the European Bank Authority (EBA) to dispose of so-called bad loans by broadening what constituted such a loan.

From 2014-16, NAMA sold over €50bn worth of distressed loans to investment funds. Irish loans accounted for over one-third of all distressed loan sales in Europe in both 2013 and 2014 with Dublin at the epicentre of these transactions. According to the United Nations (UN), over 90pc of these loans were sold to US hedge funds, private equity and/or vulture funds.

Leading financial firms bought these properties when they were cheap, taking advantage of the tax-free incentives offered by the Irish State. NAMA’s role was to package these distressed loans into multimillion-dollar portfolios containing a mixture of commercial, residential and retail, to sell to investors.

Many of these private equity vehicles set up what are known as Special Purpose Vehicles (SPVs) to warehouse these loans in the International Financial Services Centre (IFSC) and declare ‘charity status’ meaning they were exempt from capital gains tax and VAT.

The IFSC

Far from reforming the hitherto Wild West of European property lending profligacy, post-crash measures to stabilise the banking sector and raise house prices have turned Ireland into the fourth largest shadow banking location in the world with private credit flooding the market.

This has spelt havoc for homeowners whose loans were sold by NAMA to private equity vehicles.

Take the case of an apartment block in Sandyford sold to Cerberus in 2016. Titled Project Gem, shortly after the sale to the vulture fund Cerberus started to evict several tenants while deploying debilitating tactics to remove the remaining tenants. This involved forcing them to pay over €200 per month to their existing costs in heating and hot water charges - a 20% surcharge.

These tactics are part and parcel of why private equity gets involved in the housing market. They view housing as an asset that generates high returns, thus they either leave properties vacant and speculate on high prices further down the line or evict existing tenants and wait for higher-paying ones.

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Take another example of a housing estate in Maynooth. In May 2021 the US investment fund with offices in London Round Hill Capital bulk purchased most of an 170-home estate that was meant for first-time buyers. The homes were not only designated for first-time buyers but also, in conjunction with the affordable housing body Tuath, for those on a social housing waiting list. Instead, the estate would be a source of favourable rental yield for the fund.

The week before the purchase was announced, the same group purchased an estate in Hollystown Dublin 15. The foreign fund bragged about the return on investment on their website stating that this was, “further evidence of the strong appeal of the Irish build-to-rent sector for institutional capital, attracted by its resilient, long-term yields.”

Internationally, private equity has spelt devastation for the industries and companies it has invested in.

A more recent example is the impact it had on the California wildfires that burned out the Palisades and Eaton neighbourhoods. According to the Chief of the Los Angeles Fire Department Kristin Crowley, nearly half - 100 out of 183 - of the force’s fire trucks were out of service amid the devastation. Why? Private equity massively inflated the cost of fire trucks from $300,000–$900,000 to up to $1m for pumpers and $2m for ladder trucks. Private equity also caused the cost of producing and delivering a fire truck from less than a year to between 2-4 years.

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The private equity firm American Industrial Partners (AIP) purchased multiple fire truck manufacturers controlling two-thirds of annual US fire truck sales and placed them into one single conglomerate named the REV Group which led to less competition exacerbating supply bottlenecks. As such, municipal fire departments found that they had to allocate “disproportionate resources to vehicle procurement, leaving less funding for recruitment, firefighter salaries and other critical needs.”

According to Marc Wells: “The societal need for functional emergency vehicles clashes with the financial interests of private equity.”

When the private equity firm the Carlyle Group purchased the Manor Care nursing homes for $6bn they managed to hollow it out. Several reports of health-code violations and negligent care towards the nursing home patients with several staff laid off emerged following extensive reporting from The Washington Post. Following the sale to the private equity company, that owned the series of nursing homes since 2007, in 2011, the number of violations went from over 1,500 in 2013 to almost 2,000 in 2017 - an increase of over a fifth.

The violations started after investors engaged in a sale-leaseback agreement which saw them recover the $1.3bn in equity they put into the original purchase in 2007. This meant Manor Care had to foot the bill to pay for property taxes, insurance, and general upkeep.

Indeed, according to the Washington Post, the company’s financial obligations rose from less than $1bn to over $5bn during the buyout by Carlyle, with ManorCare’s rent for the nursing homes rising by 3.5% at over $400m annually.

According to the CEO of Welltower Real Estate Investment Trust (REIT) Tom DeRosa, who purchased Manor Care from the non-profit ProMedica: “Because of the leverage that private equity firms who owned these businesses put on these businesses, the operations became unsustainable”.

If the Minister for Housing wishes to get these types of entities further involved in the provision of homes then he should resign.

Haven’t they done enough damage?

In 2008, the Irish people were made to pay an over €60b bailout to support the ailing domestic banks who had recklessly lent to developers and offered loose mortgages to borrowers.

While post-crash measures to avoid a repeat of these practices saw the imposition of lending requirements on banks and borrowing constraints on mortgage holders, the emergence of the non-bank sector not beholden to the same regulations has presented itself.

At the end of 2023, almost 40pc of all lending was conducted by non-banks. The Central Bank of Ireland has already warned of the risk of exposure of the Irish real estate market to the shadow banking sector. The Vice President of the European Central Bank (ECB) has warned it could trigger the next financial crisis.

The controversy concerning the sale and acquisition of Docklands Innovation Park in East Wall, Dublin, which was the subject of a judicial review in 2021, offers a microcosm of the wider phenomenon of the non-bank sector’s role in the type of reckless lending undertaken by regular banks in the past. Indeed, it highlights the failure of regulators and the State in tackling irresponsible lending offering an insight into the broader phenomenon of the lack of constraints in the non-bank sector.

According to a timeline provided by The Irish Times, in 1979 the Docklands Innovation Park was under the control of the inward investment semi-state agency the Industrial Development Authority (IDA). Fast forward to 1999, it was sold to a trust established by staff at the Technological University Dublin (TUD) then the Digital Institute of Technology (DIT) known as Bolton Trust. Initially conceived as Docklands Innovation, the trust describes itself on its website as an ‘independent voluntary trust actively committed to assisting people to create sustainable businesses’.

Bolton Trust’s Website

The sale was done on the basis that the site would be used for enterprise purposes with the trust leasing industrial units for start-up companies. During the economically buoyant period of the Celtic Tiger, when borrowing costs were low, the trust borrowed over €3m from Bank of Scotland (Ireland) in order to invest on the site. But following the economic crash in 2008, the trust found itself unable to make repayments and accumulated debts almost equal to the entire amount it borrowed. The woes afflicting the embattled trust heightened after the bank they borrowed from refused requests to halve debt payments from €25,000 to €12,500. This meant they were in breach of the original loan. The debt accrued was eventually transferred over to a U.S. investment fund known as Feniton Property, one of the many investment funds that entered Ireland following the crash to acquire distressed debt. As part of the agreement, Bolton Trust was required to sell the site which needed ministerial approval. The Enterprise Minister at the time Mary Mitchell O’Connor signed a consent order releasing the site’s IDA covenants in March 2017 as part of a “disposal of IDA’s residual interest”. According to the Irish Times: “The trust entered talks to the IDA and its advisers, leading to a deal to buy out the covenant for €350,000”. The estate agent Lisney carried out an independent valuation of the site and said the deal “represented a good and fair offer for the IDA” and advised the body to accept Bolton Trust’s offer to buy out the IDA’s interest in the property.

The sale required Government approval to proceed. Even though the sale was not made on the open market, Minister of State for Enterprise, Mary Mitchell O’Connor nonetheless approved the sale.

In April of that year, a newly established company EWR Innovation Park Ltd bought the site for €5.6m. Despite receiving government approval, Bolton Trust never engaged in an open tender process and refused to liaise with an estate agent. EWR is led by a man named Edward McHugh. Described by The Sunday Times as a “low profile Galway businessman”, he hails from Claregalway and has been involved in several business ventures including, but not limited to, the production of capsules and an antioxidant oil called astaxanthin. He is currently general manager of a Galway medical manufacturer Dawnlough Ltd according to his LinkedIn profile. On its website, the company states that they “provide a complete range of premium manufacturing solutions to a wide variety of companies in several sectors including MedTech, Aerospace and Automotive industries”.

Dawnlough Website

EWR was established on 10th August 2016 by Edward McHugh. According to The Ditch, EWR’s latest CRO filings show that it owes creditors almost €9.5 million. The company had less than €100 equity when it was founded. He was introduced to the Bolton Trust by his brother-in-law Henry Cleary who is a former member of the Fianna Fáil Ard Comhairle and chairperson of the Galway Races Ball described as the “hottest show in town” under the reign of Taoiseach Bertie Ahern. In May 2013, the Mayo Advertiser reported that ‘Mayo accountant Henry Cleary was elected to the Committee of 20 representing members on the Ard Comhairle, beating off stiff competition from other members’. He is currently a member of the executive committee of Barclays Bank Ireland and head of the bank’s structured finance and structured property finance. He was previously a senior consultant in auditing at KPMG.

While McHugh declared himself director of the company, businessman Christy Dowling, whose companies remain indebted to the State’s bad bank the National Asset Management Agency (NAMA), was named as the East Wall Road site’s “owner” and “developer” in a Dublin City Council SHD pre-application consultation (below).

McHugh, using an affidavit, denied Dowling’s ownership but an affidavit for the park’s tenants and leaseholder Atlantic Diamond Ltd said that Christy Dowling had claimed “myself and another lad” bought the site.

But who is Christy Dowling?

He is the Director of Vestry Limited Partnership and Co-owner of the Newlyn Group of companies, the latter of which had €22m in loans transferred to NAMA in 2011. According to the Irish Times, his latest employment was with Arrow Asset Management. On Newlyn’s summary, it states that it was set up in February 1997 with a partial address in Dublin 2. The company has a single shareholder. Dowling co-owns the company with a man named Robert Kehoe. They both made a €1,500 donation to Fianna Fáil TD Joe Behan in 2007. Dowling’s wife Hilary is a co-director in Newlyn as well as four other companies. According to the Irish Times: “Nama has charges over the assets of two other companies in which Christy Dowling but not Hilary Dowling is a director and shareholder – Newlyn Developments Ltd and Blossomglen Ltd.

“Accounts recently filed show the loan facilities of Newlyn Developments, which had €15.58 million in net liabilities in 2022, were held by Nama.” His other company Vestry Limited was founded by Dowling, Kehoe and the former CEO of Chartered Land Andrew Gune. The company is involved in purchasing homes and renting them out to tenants at extortionate prices. In April 2023, The Ditch reported that the fund, described as “one of the biggest landlords in the state”, had in the last six months bought more than 150 second-hand homes with one property advertised for almost €2k p/m. The previous September the same media outlet reported that Vestry Ltd “owned more than 850 second-hand properties it had bought in the last three years”. Outlining the company's net worth, The Ditch mentioned: “With a property portfolio worth well in excess of €200 million and claimed profits of more than €20 million for 2021, the fund itself doesn’t pay tax in Ireland, with its investment partners instead liable”. In June 2023, The Sunday Times reported that Vestry is backed by a Singapore sovereign wealth fund and had amassed more than 1,000 rental properties throughout the country having, according to sources, acquired a large number of properties from the controversial vulture fund Cerberus. In September 2023, The Irish Independent reported that Vestry owned more than 1,000 properties earning rental receipts of €25.5m between September and June 2019. The paper reported that some of their tenants had racked up arrears of close to €200,000 with the fund ultimately unsuccessful in enacting an eviction for failure to prove to the Residential Tenancies Board (RTB) that they had breached their lease contracts.

As such, McHugh financed the purchase of the site with a loan of €6.5m from a company named AS Limited based in the Isle of Man (below).

Having struggled to pay that loan they received a separate low interest loan with the partly state-owned non-bank lender Finance Ireland in 2019. The non-bank lender refinanced the original loan providing over €9m despite the site being bought for €5m and with EWR’s €100 equity remaining unchanged. Finance Ireland was founded in 2002 by Billy Kane and employs 170 people. On its website, it is described as “privately owned” and “the largest non-bank lender” in the State. The Irish Strategic Investment Fund (ISIF) held a 32pc stake in Finance Ireland from 2016 to 2022, which included the period of the loan in question.

Finance Ireland website

In a letter, sent on 21 October 2021 by registered mail, the Finance Ireland C.E.O. Billy Kane was advised that the person recorded on official documents as the owner was a front for the beneficial owners, one of whom was Christy Dowling. With no reply forthcoming the letter was subsequently sent to finance minister Paschal Donohoe. The contents of the letter were later reported on by The Ditch in March 2024: It is in public record that a private financial institution, Finance Ireland, provided a property-backed loan of almost €10m to a company with €100 equity and that the loan is secured against a site that was purchased for €5.6m two years previously. Why are the savings of Irish pensioners being used to support this type of lending, and what social good is achieved by it. The unnamed whistleblower later had a meeting with Fine Gael Councillor and then adviser to the minister Ray McAdam who was “taken aback” by the scale of the allegations. However, neither he nor Minister Donohoe followed up on the allegations. Cllr McAdam was contacted for comment.

Two weeks later McHugh transferred half his shares in EWR to Christy Dowling’s wife Hilary Ward who, according to the Irish Times, along with her husband, is co-director in four companies with charges on the assets in one of those Newlyn Homes Ltd and is owner of all the shares in Silk Shadows Ltd which is owned by Newlyn. Incredibly, Donohoe, fully aware of the alleged improprieties at Finance Ireland, later signed off on a deal that saw the non-bank lender as well as Dilosk share €1b in funding from Bank of Ireland following approval from the Competition and Consumer Protection Commission (CCPC) through the purchase of residential mortgage-backed securities to be issued in the future.

But how did EWR manage to acquire such a massive loan exceeding the land’s value?

Overvaluation ?

At the time, Christy’s brother, Willie Dowling, was a director in the commercial real estate firm CBRE. In a letter seen by this writer, dated 24th September 2018, Willie Dowling advised Atlantic Diamond Ltd that he was asked by the owners of the site to inspect the unit for an upcoming rent review.

In an affidavit cited in court orders for Atlantic Diamond, it was stated that Willie Dowling had visited the company premises on 12th October 2018 mentioning that the owners would like to buy the leasehold. It is said that he visited again on 25th October 2018 where he tabled an offer to acquire a leasehold interest from Atlantic Diamond. But throughout the early period of negotiations, Willie Dowling, it is alleged, failed to disclose who the estate owners were. According to the affidavit, it was later disclosed that the owner of the site was ‘Christie’ Dowling, described as his brother.

The affidavit mentioned that Bruce Campbell, described as a colleague of Willie Dowling’s, also of CBRE, calculated a valuation of €18m described as “more than three times the purchase price paid to the Bolton Trust… less than two years previously” which “has also been used in Part V calculations of the developer's planning application”. It is unclear whether this inflated figure was used to acquire the loan from Finance Ireland in 2019. In May of last year, The Irish Times reported that Dowling had moved from CBRE after 27 years to Colliers to take up the role of director.

Both Christy and Willie Dowling were contacted for comment.

Securitisation

In June 2019, shortly following the valuation, a securitisation was issued by Finance Ireland for 139 commercial and residential mortgage loans. These would be offered to 78 borrower groups backed by a diversified portfolio of 244 Irish properties. The originator and seller, Finance Ireland Credit Solutions DAC (FI), advanced the loans, each consisting of cross-collateralised credit lines advanced to a single corporate/retail borrower.

This would require independent verification. Barclays, who the initial conduit in the sale Henry Cleary works for, also played a role in the securitisation having acted as arranger and lead manager (below).

Planning Permission

In October 2019, EWR applied for planning permission on the site to include 336 apartments under the Strategic Housing Development (SHD) application which allows applicants to bypass local authorities and go directly to the planning board, An Bord Plenála (ABP). The planning included the “demolition of existing buildings, construction of 336 apartments, childcare facilities and associated site works”. As part of its Part V requirements under the Planning and Development Act 2000, EWR was required to sell 10pc of the units for social housing to Dublin City Council. But according to a report in The Ditch, EWR vastly overstated the cost of the development land erroneously increasing the valuation by €1.1m, as referred to in the affidavit, in order to extract more money from DCC and the taxpayer:

“EWR claimed in its application to ABP – using a single line, without supporting evidence – that land costs for the social units was €1,631,244. Though EWR had bought the site for €5.63 million, this new valuation would’ve put the full site’s value at €18.2 million. If EWR had used the figure it purchased the site for €5.63 million – the land costs would’ve been €493,000. The developer’s increased valuation would’ve resulted in an extra €1.1 million in costs to DCC”.

To add insult to injury EWR was not charged the mandatory €750,000 in statutory fees ABP should have collected despite the state agency for transport infrastructure Transport Infrastructure Ireland (TII) requiring such a charge. This was separate to the SHD application. Both the overvalued social housing and failure to apply statutory fees were approved by the same three members of ABP Michelle Fagan, Terry Prendergast and former deputy chair Paul Hyde.

In June 2023, Hyde was sentenced to two months in jail after he pleaded guilty to making false or misleading declarations of interest to ABP. He later avoided jail time on appeal.

In a recent scoping investigation into governance at ABP, Senior Counsel Lorna Lynch found there were no sufficient grounds to refer matters to the Minister for Housing to determine if there was "stated misbehaviour" to six governance areas, which involved reviewing 175 case files and interviewing 17 relevant people.

A judicial review for the planning permission involving the apartments was later initiated against the board with EWR as a witness party in the High Court by Atlantic Diamonds Ltd. Atlantic objected as they argued that heavy goods vehicles would come into the development area at “unsocial hours” which included the “operation of noisy industrial equipment outdoors”. In those proceedings, it was stated in an affidavit that Christy Dowling had said that “myself and another lad” bought the site in the East Wall Road. In 2021, the Court denied the planning permission. In the judgement, the presiding judge Richard Humphreys said that ABP displayed a “certain laxity in scrutiny, involving in effect the cutting and pasting of the developer’s materials, without adequate critical interrogation”.

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Web Summit CEO Paddy Cosgrave recently tweeted that Europe needs its own Declaration of Independence if it is to succeed in the 21st century. In a tweet he called for MESA or Make Europe Sovereign Again as a counterweight to MAGA - Make America Great Again.

But how do we make the continent sovereign again?

Cosgrave, whose successful international technology summit is currently undergoing a shift towards the Global South, outlined it in four steps:

- Remove US Deep State across Europe

- Stop flow of US “dark” aid money (USAID, NED) used to manipulate European elections & media

- Shut network of US military bases across Europe

- Stop being a vassal

- Educate yank-brained vassal MEGA supporters

It’s easy to see why a European tech bro is keen on ensuring some level of autonomy from Uncle Sam. Technology is now at the forefront of geopolitics. China and America are currently enmeshed in an internecine technology race in which the former is eating the latter’s lunch as proven by the reveal of the new AI model titled DeepSeek or R1.

Framed as the West’s Sputnik moment, in which the Soviets upended America’s underestimation of their technological capabilities by sending a satellite into space, Beijing has managed to produce a large language model (LLM) at a cost of only $6 million compared to OpenAI’s $600 million while requiring less than 10pc of its rivals’, namely Nvidia, Graphic Processing Units or GPU capabilities. It is also open source meaning anyone can use it. DeepSeek has the potential to completely upend the US Stock Market’s buoyancy which has largely depended on the enlarged bubble of AI. Nvidia, whose GPUs are currently under export controls to avoid technology sharing, previously made up 14pc of the index. Big Tech has already invested $1 trillion into AI technology with last year seeing Silicon Valley invest close to $200 billion into the futuristic technology. Shortly after R1’s launch $600 billion was wiped off Nvidia’s market value causing the Nasdaq to drop by 3pc. The waning crumbling edifice that is the US tech economy is hanging by a thread it seems.

The spectre of China excelling in this geopolitically sensitive technology has been a wake-up call to the tech bros at the helm of the White House’s Department of Government Efficiency or DOGE whose remit is to cut costs and streamline efficiency.

Recently, the tech bro extraordinaire offered Europe a path towards more sovereignty.

Elon Musk announced in a space on X - for boomers that’s a live chat on Twitter - that the US would dismantle the USAID or the United States Agency for International Development program effective immediately.

Describing the program as “beyond repair” both Musk and Trump agreed to end the decades-long strong arm of American foreign interference under the guise of humanitarian assistance.

The remaining staffers of USAID were informed not to report to the agency's headquarters in Washington and to work remotely. The website is currently down.

With a budget of over $ 50 billion and a staff of over 10,000 such a programme was inevitability heading for the chopping block with Musk’s henchmen successfully obtaining classified material linked to USAID which could eventually reveal a treasure trove of sensitive information about the operation revealing the agencies inner workings through the years.

Established in the early 1960s by President John F. Kennedy, USAID's purported purpose was to promote ‘global development, humanitarian relief, and democratic governance.’ Having branched out to more than 100 countries, under the auspices of tackling challenges to global health and economic growth, its critics argue that the organisation has a more ulterior motive.

Ever unabashed in his denunciations and edicts, Trump stated that USAID was “run by a bunch of lunatics” and that he was “getting them out.”

While many may be deceived by the latter three letters in the acronym to believe it is simply an aid program for impoverished children in Africa or some other region, USAID is about as involved in AID as the Democratic People’s Republic of North Korea is involved in enforcing an expanded franchise for its citizens.

According to former State Department official Mike Benz of the Foundation for Freedom Online, USAID was conceived to centralise the differing roles of various government departments and also to outsource the dirty work of the American security state: “When they are capacity-building activist groups in a foreign country, it is because the State Department wants those activists there.

“USAID for the first time in its history… was created because all the intelligence, statecraft, support, and logistical aid was tripping over itself. The military would run aid to certain groups, the State Department would run aid to groups in the region, and the intelligence community would too. There was no central coordinator of those operations.”

Far from simply an aid group the organisation was instrumental in covert coup d'états spanning from Havana to Kiev.

In Bolivia, USAID was expelled from the country for funding “democracy-building” in the lowland opposition stronghold to the ruling Socialist leader Evo Morales's regime in Santa Cruz.

In Haiti, following a devastating earthquake which rendered 1 million homeless with over 20,000 deaths, USAID filled the void by offering assistance. However, the group massively underperformed providing millions of dollars to build less than 3,000 of the 15,000 homes it promised. Many of the houses were also found to be faulty. Previously, in 1980, USAID exterminated several Creole Pigs to prevent Haitian farmers from competing with American pig farmers putting thousands out of business with no compensation. In 2004, following the coup of previous US ally and Libertarian Catholic Priest Jean Bertrand Aristide, the US installed a puppet regime led by US exile Gerard Latortue. USAID and other strategically aligned groups like the Haiti Democracy Project established NGOs to provide "primary care" and "child survival services” having established the first prison for children to create an open-air prison colony to make the country more amenable for business interests. USAID also set up a Western propaganda outlet called Radio Vision 2000, based on Radio Free Europe a radio station set up by the CIA to broadcast anti-Soviet messaging to Soviet Satellite States.

In Cuba, USAID built an alternative social media application called ZunZuneo - Cuban hummingbird - that emulated Twitter to circumvent the lack of access to social media platforms to convince the Cuban public to rebel against the ruling regime of Raul Castro. The app attracted tens of thousands of users but failed to initiate a Cuban iteration of the Arab Spring.

ZunZuneo was a highly sophisticated network that sought to elicit key information from its demographics including their gender, age, and political leanings.

According to the Associated Press (AP), Suzanne Hall, then a State Department official working with then Secretary of State Hillary Clinton’s social media efforts, helped spearhead an attempt to get Twitter founder Jack Dorsey to take over the ZunZuneo project.

But why would the US want Jack Dorsey of Twitter to own their social media puppet in Cuba? Well, the US has always viewed the internet generally and social media in particular as an arm of their soft power which they can utilise to achieve their aims.

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The internet itself is the product of a DARPA grant which is the Defense Advanced Research Project Agency, responsible for developing emerging technologies for national security and military capability purposes. In the 1970s, the agency linked four supercomputers to handle massive data transfers and later transferred the technology to the National Science Foundation (NSF) which proliferated the network across thousands of universities and, eventually, the public, thus creating the nascent World Wide Web. Indeed, the progenitors of the algorithm that created Google Larry Page and Sergei Brin received funding from DARPA as well as NASA and the NSF when they were pursuing their PhD at Yale Law School.

This gave the US security state unfettered access to the data of these technological behemoths which is why they were so keen to expand their reach to the rest of the world. Rogue states that did not embrace the free internet were cast as closed societies with censorship rife.

It may be hard to believe given the recent shift, but the US government was the biggest proponent of a free internet for political reasons. They encouraged social media usage without any interest whatsoever in regulation.

During the Arab Spring, several hostile regimes to the West including in Tunisia, Egypt, Libya and Yemen among other places were toppled with access to the internet and Facebook in particular playing an instrumental role. The number of Arab internet users hit well over 20 million people in 2011.

However, the internet soon became the US’s Frankenstein monster having enabled the public vast access to different ideas and narratives not suited to US interests.

In 2014, Assistant Secretary of State for European and Eurasian Affairs Victoria Nuland was instrumental in the overthrow of the democratically elected government of Ukrainian President Viktor Yanukovych under the so-called Gerasimov Doctrine named after Gen. Valery Gerasimov who in 2013 referred to an “expanded form of warfare” to include the transmission of narratives via the internet. Thus, groups such as the government-funded NGO the National Endowment for Democracy (NED), which is linked with USAID, set up in the 1980s to use NGOs to remove the stigma associated with overt CIA clandestine operations, spent over $ 30 million backing Ukrainian NGOs to promote “civic participation” culminating in the Euromaidan in 2014 that toppled the ruling government leading to conflict that persists to this day. NED also invested tens of millions into social media giants such as Facebook, Instagram and Twitter. Nuland for her part handed out cookies to demonstrators and was caught on hot mic the saying “fuck the EU” for not doing enough to back US interests in the region.

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Thus, the narrative of Russian hybrid warfare on the internet grew endemic in Western media.

However, a more recent outgrowth of USAID that has had major implications for free expression occurred in 2016 with the creation of entities such as the Global Engagement Centre. Founded by former journalist turned securocrat Richard Stengel who served as President Barack Obama’s Undersecretary of State for Public Diplomacy and Public Affairs initially as the Center for Strategic Counterterrorism Communication to fend off threats against ISIS and other extremist groups, during the 2016 Presidential election it changed its name to the GEC while maintaining its counterterrorism remit.

The National Defence Authorisation Act (NDAA) for the year 2017 expanded GEC's operations to include addressing foreign propaganda such as misinformation and disinformation.

During that election, particularly in the aftermath, those terms became weaponised to silence any dissent against all sorts of orthodoxies or taboos. Indeed, not only were some of the ideas that led to the democratic upheaval both in Britain - Brexit - and America - Trump - wrong but were part of a sinister fifth-column foreign political threat emanating from the Kremlin.

The recently watered-down Irish Hate Speech Bill was the perfect example of an attempt to silence not highly opinionated journalists, commentators or academics but ordinary people under the veneer of fighting misinformation or ‘hate’.

Aspects of that bill would have seen individuals targeted for expressing views considered ‘hateful’ even when hate was not defined. Even more egregiously the bill would have seen individuals sent to prison for up to 5 years for possession of subjective and ill-defined ‘hateful’ material.

This piece of domestic legislation was an outgrowth of attempts by the European Union (EU) under the Digital Services Act (DSA) to not only regulate and rein in big tech but to regulate people’s thoughts as expressed online or other alternative channels of communication.

However, the DSA is the brainchild not of European lawmakers but of NewsGuard the web extension rating system for news and information with its advisors a who’s who of the American Intel deep state including Stengel and former CIA director general Michael Hayden.

Before some of the offending elements within DSA related to censorship were announced, members of NewsGuard convened with European Internal Markets Commissioner Thierry Breton in a closed-door meeting on 15 November 2021.

Part of NewsGuard’s remit is to provide a list of approved sites for news consumption and to warn users before they click on disapproved sites of its alleged misinformation abuses. Approved sites include The New York Times and Buzzfeed while disapproved sites comprise the likes of Russia Today and Fox News among others.

The UK-based State Department-backed entity the Global Disinformation Index (GDI) also created a so-called ‘exclusion list’ of problematic media organs that supposedly spread misinformation.

Among the publications deemed problematic by this modern-day ministry for truth were publications including Unherd and the New York Post.

And on what basis were they listed?

For saying aliens landed on Earth?

For suggesting the earth is flat?

No, but for spreading information that turned out to be true.

Even reports that indicated that COVID-19 emerged from a lab in Wuhan, China were deemed misinformation when we now know, based on testimony from the FBI and the CIA that there is some validity to this theory.

When Joe Biden’s son's laptop was found in a café in Delaware and the New York Post reported on the contents within the laptop, which is totally ethical and allowed, social media companies blocked access to the link after pressure from US govt agencies that the story was part of a Russian disinformation campaign.

Not only did USAID adjacent bodies promote and enable egregious censorship legislation but USAID directly funded a musical in Ireland that promoted Diversity, Equity and Inclusion (DEI).

While defending the decision to end the USAID program the White House Press Secretary mentioned some of the wasteful spending associated with the program including: “$1.5 million to advance DEI in Serbia's workplaces, $70,000 for the production of a DEI musical in Ireland, $47,000 for a transgender opera in Colombia, $32,000 for a transgender comic book in Peru."

But what musical is she referring to?

According to accounts online the musical, done in partnership with the US Embassy in Dublin and the Biden White House, Other Voices, sought to highlight ‘Voices Towards a More Equitable Future’ at the Ambassador’s Residence as part of ‘the Biden Administration’s commitment to the principles of diversity, equity, inclusion, and access (DEIA)’, according to US Ambassador Claire Cronin.

Another performance to mark the centenary of Irish independence Styled ‘Ireland 100’ presented by the group South Wind Blows, its executive producer Nuala O’Connor explained to the Irish Examiner: ‘The idea behind the event was to show, through performance, songs, words, and music, “an appreciation of where we have come from, of what we have come through as a people and a State, and of our experiences living through the 20th and the first quarter of the 21st century’.

Many of the performances included critiques of the narrowness of Irish identity and revisiting Ireland’s shibboleths including Catholic-run Mother and Baby Homes.

USAID also collaborated with Dublin’s Department of Foreign Affairs to improve food security in Zambia. Led by then administrator for the agency and Irish-American Samantha Power and then Irish Tánaiste Micheál Martin the initiative sought 'to ‘focus on building sustainable food systems, improved nutrition, climate action and gender quality’.

In announcing his takeover of USAID US Secretary of State Marco Rubio said, “There are things that we do through USAID, that we should continue to do, and we will continue to do”, but that, “foreign aid is not charity… we must make sure it is well spent, but it is less than 1% of budget & critical to our national security”.

For years, USAID acted as a middleman to provide safe cover for American soft power through the carefully cultivated veneer of the promotion of democracy, human rights and freedom via NGOs. Far from isolating from the world, America is now quickly but incrementally respecting the sovereignty of different countries without importing foreign ideas and concepts.

Ireland has a perennial problem with monopolies. Whether it was Ireland’s reliance on potatoes as a source of sustenance and economic growth that led to two successive famines one from 1740-1741 killing nearly a fifth of a population of just over 2 million and the Great Famine from 1845-1849 which engineered the mass emigration of one million and the death of another million Irishmen and women which the British administration had long sought to carry out on providential grounds, the Island’s long-standing inflexibility towards diversification has proven its Achilles Heel.

When Ireland achieved Independence in 1922, and the Free State came into fruition, the country was almost wholly reliant on the British export market. Up until the 1970s, when Dublin entered the European Economic Community (EEC), alongside the United Kingdom, Britain was home to over half of Ireland’s exports. The failure to broaden that market made European integration inevitable and indeed vital to ween ourselves off our old colonial masters and to achieve independence, not merely an appendage of Britain within an autonomous arrangement.

Indeed, despite embracing Euro integration on the grounds of combating dependence on London, Irish policymakers continued to suffocate the public with State-backed monopolies. As Senator Michael McDowell pointed out in the Irish Times recently, this infected every facet of the public apparatus from airline costs to energy production feeding into grueling costs for the taxpayer:

- The State owned the only airline, Aer Lingus, and participated in a high-price cartel arrangement with British Airways to make Ireland-UK air traffic the costliest in Europe.

- The State owned two shipping lines, B&I Line and Irish Shipping Ltd. Irish Sea services were dominated by the State-owned B&I and Sealink, a nationalised UK operator until 1984. All ports other than Greenore port were State-owned.

- All internal transport – bus, train and road freight – was subject to a State monopoly in the form of CIE. The State had a monopoly of mail and parcel delivery, An Post and a monopoly on phone services, Telecom Eireann. Both of those companies were hived off from the earlier Department of Posts and Telegraphs. No private competition was permitted.

- All energy production in the form of electricity generation, mains gas supply and commercial turf production was owned by the State through the ESB, Dublin Gas and subsidiaries, and Bord na Móna.

- In banking, there was competition but the State owned two banks, ICC and ACC. It also owned Irish Life, the biggest life assurance company. Health insurance was the monopoly of the State-owned VHI.

- The State had a monopoly in radio and TV broadcasting called RTÉ. Privately run radio was illegal and was described as “pirate” radio. The only competition came from UK channels available in some parts of the Republic.

- The State also established companies to manufacture fertiliser, Nítrigin Éireann at Arklow, and steel, Irish Steel at Haulbowline in Cork. It owned the sugar business, Comhlucht Siúicre Éireann, and entered the processed foods market with Erin Foods.

While 1980s Ireland is considered a bygone era of economic backwardness among policymakers and social purity among the public, the mindset or indeed inertia of the State in managing the monopolistic tendencies of public bodies has long persisted to this very day.

Whether it’s in banking which is dominated by only three players being Allied Irish Bank (AIB), Bank of Ireland (BOI) or Permanent TSB (PTSB) causing a duopoly in commercial banking – AIB and BOI - and an oligopoly in mortgage banking – PTSB – or insurance in which a few players from health to childcare dominate the market and engage in anti-competitive practices increasing premiums as a result.

In the context of the housing crisis afflicting Ireland currently, the lack of competition in land acquisition has allowed two dominant market players to hike the price of land feeding into housing costs. In some cases land costs can reach €100,000 - nearly half the cost of the house! Attempts to capture the “betterment” increase in land values as a result of development of water and sewage have long been a source of concern when addressing land inflation.

For years, due to Ireland’s failure to get a grip on land costs house prices have remained stubbornly high and out of reach for ordinary buyers. Statutory obligations including Part V requirements under planning legislation to initially reserve 10pc to now 20pc of developments for social and affordable housing have gone some way in addressing the issue.

However, two major players continue to dominate the purchase of land for development.

Recently, the two biggest players in the Irish property building market announced record profits these being Glenveagh Properties and Cairn Homes.

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Glenveagh Properties released its trading statement for the year 2024. The homebuilder mentioned that they managed to complete and sell well over 2,000 homes – an increase of 77pc on the previous year. This amounted to a revenue rise of 43pc to over €800 million up from the previous €600 million with its profits before tax rising by over 100pc to €113 million from just over €50 million.

Meanwhile, Cairn Homes announced a rise in operating profits of €150 million – an increase of 32pc. The homebuilder completed 2,243 housing units – up 29pc.

In their statement announcing these gargantuan and, some may say, obscene profits Cairn mentioned the dilemma facing the “stuck middle” which sees ‘hundreds of thousands of young working people “desperately” trying to avail of housing’.

The irony of this statement is that Cairn Homes and Glenveagh Properties are contributing to the homeless plight of the stuck middle through their market dominance. Being the only major players in town has allowed them to hoard land with prices increasing dramatically in recent years as a result.

To examine this further it requires an overview of the history and recent controversies that have dogged these two entities.

Cairn Homes

Cairn Homes was established in 2014 by brothers Michael and Kevin Stanley. According to the Irish Independent, the Stanley family’s wealth stems from Shannon Homes, founded by the previous generation of the family in 1970 who were heavily involved in the Dublin housing market in the 1990s and 2000s. Michael became CEO of Stanley Holdings in 2005. Following the popping of the housing bubble in 2008, some of its loans ended up with the State’s ‘bad bank’ the National Asset Management Agency (NAMA) before being refinanced by Scottish financier Alan McIntosh of Sun Capital Management. They eventually set up Cairn Homes becoming the first listed housebuilder since the 90s. In 2015, Michael Stanley and McIntosh floated Cairn Homes plc on the London Stock Exchange and raised over €400million in equity. According to real estate services company Cushman and Wakefield, Cairn was the biggest purchaser of development land in 2015. According to Brian O’Boyle and Kieran Allen in their book Tax Haven Ireland, this allowed them to gift large amounts of land to private speculators thus controlling the building process and hoarding large amounts of land. Since exiting NAMA, the company purchased land that could accommodate 15,000 homes across 32 residential sites in Dublin. According to Colin Sheridan of Davy Stockbrokers, Cairn spent over €25 million on land acquisition in the first six months of 2024 adding to its already existing land banks of 17,200 plots. In 2017, Cairn acquired Montrose the land where the national broadcaster RTÉ is located for €107.5 million with the hope of commencing construction on the site by 2020. In July 2023, they applied for permission to build 608-unit of apartments for €345 million. In 2015, Cairn partnered up with Texas-based Vulture Fund Lone Star in buying the Project Clear portfolio from the recently exited Ulster Bank. This included 1,700 acres of prime residential land in west Dublin with the potential for 20,000 homes. According to Cushman and Wakefield, Ulster Bank “acted for Lone Star Funds on its joint acquisition with Cairn Homes of Project Clear from Ulster Bank for €503 million. Project Clear had a par value of circa €2 billion and comprised of approximately 20pc of the available residentially zoned land in the Greater Dublin Area”. The overall project included the disposal of land in Stillorgan that was supposed to go towards housing but instead would see the building of a sports hall leading Councilor Melisa Halpin (PBP) to question why Dún Laoghaire-Rathdown County Council was disposing of public land in the middle of a housing crisis: “This site is zoned for housing and we need every inch of land available to deal with the housing situation… by disposing of this site, we are increasing the value of the land for developers.” The other site included in Project Clear was a site in Blackrock for 355 built-to-rent apartments under the strategic housing development (SHD) scheme, which allows developers to bypass local authorities, which was denied planning permission for contributing to an “over-proliferation” of BTR in the area. In 2019, The Ditch reported that Cairn sought permission for 385 units in Marino, Dublin 9 while the inspector of the land Sarah Moran was in a relationship with Paul Hyde of the planning authority who approved the site. The site was given the green light without input from the local council with residents’ objections ignored. Much of the site was eventually sold to US asset manager Greystar which manages over $50 billion in assets. In another damning report The Ditch revealed that the recent planning reform bill titled the Planning and Development Bill 2023 was altered as a planning developer for Cairn was denied permission for a development in Co Wicklow. The changes would’ve prevented planning authorities from refusing permission because housing growth targets in a specific area had already been reached. Then Housing Minister Darragh O’Brien met with the strategic delivery and policy director for Cairn on four different occasions since the denial in May 2023 before the amendment was introduced into the Irish parliament, Dáil Éireann, with the Attorney General Rossa Fanning warning that the government was “being led by developers” in unpublished advice.

Glenveagh Properties

Glenveagh Properties was founded by private equity firm Oaktree’s Justin Bickle, developer and current head Stephen Garvey and former Chief Executive of global real estate company Jones Lang LaSalle and current Chairman John Mulcahy in 2017. But its origins lay bare the scale of monopolistic control it has over the planning process leading to sky-high profits and thus high house prices. Following his exit as Chief Executive of Jones Lang LaSalle, Mulcahy was instrumental in the State’s ‘bad bank’ known as NAMA. NAMA was set up following the crash to transfer distressed debt in residential, commercial and retail over primarily to private equity and/or vulture funds. These funds purchased this debt at rock-bottom prices and were facilitated by government-backed tax alleviation legislation to earn mega profits. Mulcahy was head of the asset management side of things at NAMA. Eventually, he became chairman of the Irish Property Investment Trust (IPUT) which is set up under the Qualifying Investor Alternative Investment Fund (QIAIF) model which allows it, under The Taxes and Consolidation Act 1997, to declare as ‘tax neutral’. He eventually transferred over to the Targeted Investment Opportunities (TIO) group on their Board of Directors as part of their strategic investments of development sites on the City Quay alongside Oaktree leading to the creation of Glenveagh with, as mentioned, Oaktree’s Justin Bickle. But who are Oaktree? Oaktree is a capital management company which following the Great Financial Crash (GFC) invested in distressed property with the hope of earning profit. Post-GFC the Irish State partnered Oaktree with the National Pension Reserve, which was raided to pay for the €64 billion banking guarantee, providing over €100 million to the company’s so-called Opportunities Fund V11 which bought distressed assets – homes – at low prices. Oaktree was just one of many purchasers of distressed residential, commercial and retail debt sold to them by NAMA facilitated by government-backed tax dodging schemes. According to the Irish Times, Mulcahy’s salary is now €300,000 per annum. Like Cairn, Glenveagh similarly tapped into the growing build-to-rent market which promises high returns via high rents. In 2019, Glenveagh sold the Herbert Hill development of over 80 apartments near Dundrum to a German investor for €55million. According to a report by the Irish Independent, Dún Laoghaire-Rathdown County Council had signaled its interest in securing the entire 90-unit development for use as social housing, but Glenveagh stopped this in its tracks. Eventually, Realis property entered a 25-year lease with DLRCC to rent properties at €3,000 p/m for social housing. Its most recent land acquisition includes close to 10,000 plots at an average cost of over €30,000 per unit. In September 2022, Glenveagh sold a development in Blackrock with permission for over 100 homes to a cuckoo fund based in Germany Union Investment with The Irish Independent reporting that the fund “has stirred protest in Ireland for displacing individual buyers in an extremely tight property market as they buy entire schemes before they are even built, meaning potential owner-occupiers never get a chance to bid for the homes”. In an embarrassing scandal for the developer, The Ditch reported that Meath County Council’s Chief Executive Jackie Maguire signed off on a development for Glenveagh for 138 homes while her son worked for the company. Nonetheless, the development was eventually denied planning permission as there were not enough homes being built on the site.

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These litany of scandals and obvious displays of market dominance contextualize the negligence of the State to get a grip on inflated land values which makes solving the housing crisis an elusive pipe dream all the while developers and the investment funds they collude with laugh all the way to the bank with their high yield or what John Stuart Mill described as “unearned increment”.

Recent moves by the incoming government under the Programme for Government to grant greater Compulsorily Purchase Order (CPO) powers to local authorities and the Land Development Agency (LDA) may take the wind out of the sails of private developers and speculative overseas investment funds who profit off of high land values, however, the solution was spelt out in 1973 in The Kenny Report.

In 1971 the Minister for Local Government Bobby Molloy set up a Committee with Judge John Kenny acting as Chairman with a remit to come up with possible measures for controlling the price of building land in the interest of the common good as set out in Article 43 of the Irish Constitution Bunreacht na hÉireann. This eventually culminated in a report under the Chairman’s namesake which produced a majority and minority report.

The Majority Report suggested the creation of Designated Areas of land by the Irish High Court on the edge of urban areas which local authorities would compulsorily purchase at agricultural values, plus 25pc, which could be managed directly, or sold on to developers, thus reducing land costs for housing.

Meanwhile, the Minority Report by two representatives at the Department of Local Government suggested a pre-emption and levy scheme based on a Danish model with the land subsequently designated by the City or County Manager. The local authority would have first refusal on any land being sold in that area at market value with a number of levies attached.

Unfortunately, the majority opinion was declared unconstitutional in 1980 with the report largely shelved. However, given the scale of the housing crisis facing Ireland, the exercising of property rights on the principles of social justice and the common good as set out in Bunreacht na hÉireann must supersede the desires of speculators and land hoarders.

The 34th Dáil should dust off the contents of the Kenny Report and address the systemic issues outlined in land acquisition to combat the central issue facing heightened housing costs which can be found underneath us.

The move, if enacted, would see the imposition of a 100pc tax on the purchase of homes in Spain by those outside the European Union (EU) to prevent speculative buying which sees homes not as social goods but as investment assets leading to sky-high prices.

“For non-resident non-EU nationals the tax burden will be up to 100pc the property’s value,” Spanish Prime Minister Pedro Sánchez said when announcing the proposal.

“In 2023 alone non-residents from outside the EU purchased 27,000 houses and flats, not to live in them because mainly they bought them to speculate, to earn money with them, which is something that in the context of the problems many people are experiencing is something we can’t permit.”

Among other moves considered by the Socialist-led government, which consists of the far-left parties PSOE and Sumar, includes the transfer of over 30,000 homes by the country’s ‘bad bank’ over to a Public Housing Company. This is on top of the handing over of more than 3,000 homes and close to 2 million sqm of land zoned for residential housing to the same company.

Indeed, in prioritising the incentivisation of public housing Sánchez unveiled the unlocking of a new legal mechanism whereby all housing built by the State will remain in public ownership ad infinitum.

“Whatever is built or rehabilitated with Spanish money will always belong to Spaniards, for their children and grandchildren, rather than end up in the hands of vulture funds and big speculators", he added.

More recently, Madrid indirectly tackled the scourge of foreign home purchasing through the abolishment of the “golden visa” scheme which granted residency to those who purchased a property worth over €500,000 with 5,000 people availing of this scheme since it opened in 2013.

In many ways, Spain typifies the housing crisis afflicting the Western World.

In the past decade house prices have surged by 48pc; social housing is less than 3pc of the overall housing stock compared to the EU average of close to 10pc; last year, rents rose by over 6pc with a flat in Madrid now costing €1,500 per month compared to average salaries of €23,568.

Indeed, the idyllic country’s housing woes have pitted Zoomers against Boomers with the latter category basking in their high-flying assets while the former are languishing with either sky-high rents or static mobility confined to their childhood room: The number of employed young people aged 25-to-34 still living at home with their parents has risen from 35pc in 2017 to 42pc in 2022 while the number of young people owning their own home has dropped from 66pc in 2002 to 31.8pc in 2022.

Meanwhile, rents have risen by 16pc between 2014 and 2022 with the ‘overburden’ rate - those who allocate more than 40pc of their income on housing-related expenses - hovers at over 30pc compared to the EU average of 20pc, while the overburden rate among homeowners - mainly older generations - is slightly below the EU average at 4pc.

All of this has created a cocktail of societal upheaval which played out on the streets recently with mass demonstrations characterised - rather foolishly - as ‘anti-tourist’.

Late last year, thousands protested at a holiday resort in the Canary Islands to highlight the influx of tourism which locals argued has priced them out of the housing market.

Between January and September up to 10 million tourists flocked to the holiday hotspot, an over 10pc increase year-on-year. With a population of less than 3 million, this has understandably caused angst.

While tourism is in many ways a boon for Spaniards accounting for roughly 13pc of its GDP, the rise in short-term lets by companies such as Airbnb and Vrbo has accelerated pre-existing rental issues. For instance, in Barcelona - a population of 1.6 million - there are over 20,000 listings for Airbnb and Vrbo. In 2022 and 2023, rents rose by 12pc in the city while incomes rose by a measly 2.6pc. Over the past decade, average rents in the city have risen by 53pc. With the 290,416 rental apartments in the city almost 4 in 10 are owned by what Catalans call ‘grans tenidors’ or people or entities with ten or more properties compared to only 4.4pc owned by public administrations.

“Whatever is built or rehabilitated with Spanish money will always belong to Spaniards, for their children and grandchildren, rather than end up in the hands of vulture funds and big speculators” - Pedro Sánchez

To tackle this, Barcelona has enacted a long-term measure recently announced by the city’s Mayor Jaume Collboni which will ban all short-term letting by 2028, and a short-term measure to ramp up inspections of properties.

The national government under Sánchez specifically hit out at short-term lets by tourist bodies by proposing the implementation of a tax on tourist rentals ‘on par with other economic activities’. Madrid also mentioned increased regulation on tightening the prosecution of fraud in so-called ‘seasonal rentals’ with the accompaniment of a fund that regional and municipal governments can tap into to reinforce inspections.

But what really stood out and generated headlines was the above-mentioned 100pc levy on foreign non-EU purchasing of homes.

Seldom shy in displaying post-imperial victimhood, the English press was rife with speculation that such a move was directed at Britons.

Spain plans to hit British expats with a brutal tax hike in row over second homes ran an Express headline.

While 300,000 Britons reside in Spain, the non-EU aspect of this proposal may irk this sizeable cohort. However, the move by the Spanish is part of a trend among Western nations who understand the glaringly obvious: that overseas buyers, mainly investment funds, are distorting the housing market by financialising housing and turning it into an asset class with no amount of supply reducing prices as a result.

Canada recently announced a two-year extension to their ban on foreign purchase which it passed in 2022 under the Prohibition on the Purchase of Residential Property by Non-Canadians Act to ban foreign investors from buying residential property.

In 2018, New Zealand’s then-governing Labour Party passed a law that prohibits foreigners, with the exception of Australians and Singaporeans, from purchasing existing homes with Australia enacting similar measures.

Several European countries have either proposed or banned foreign purchases. In Portugal, an opposition party presented a bill to ban foreign purchases to “combat rising housing prices” having already banned its golden visa property purchase scheme. In Austria, foreign purchase is prohibited unless certain criteria are met including a residency permit in the capital city of Vienna. In Denmark, those who have not been resident for five years must apply for permission from the government when purchasing a property. In Switzerland, the different Swiss cantons have specific quotas for foreign purchasers with the maximum being 1,500 per year.

Many of these bans were implemented on the basis that they increase the price of housing. Speaking on the proposal the recently departed Canadian finance minister Chrystia Freeland mentioned that, “For years, foreign money has been coming into Canada to buy up residential real estate, increasing housing affordability concerns in cities across the country, and particularly in major urban centres”.

She added: “Foreign ownership has also fuelled worries about Canadians being priced out of housing markets in cities and towns across the country”.

Indeed, this has been borne out by research from the Republic of Ireland. According to the Irish Central Bank, from 2007-2019 homes purchased by institutional investors increased the level of rents by 4.1pc more than other landlords with comparable properties following purchase. The study also found that landlords within 100 metres of an institutional investor raised monthly rents by 2.3pc more than landlords who are further away after an institutional investor moved in.

In a display of brazenness on a monumental scale, one such foreign entity which engages in such investment based in China named VANKE brags about the high rent thus high-yielding Irish rental market when encouraging investors to capitalise on Dublin: “The [Irish] population is growing fast and the new land available for development are also very limited” meaning “property prices in Ireland are set to continue rising”, before adding that, ‘investment property in Ireland is certainly an attractive option with small apartments located in Dublin earning gross yield of 7-10 percent’.

Indeed, before Dublin closed its Immigrant Investor Programme (IIP) due in part to the disproportionate number of applications from China, VANKE encouraged investors to invest in social housing: “Social housing is provided by the Irish government to low-income or unemployed people.

“In Ireland, solving the shortage of social housing is listed as the country's top priority. The Irish government plans to deliver nearly 50,000 social houses by raising government and personal funds. As one of the top local developers, our social housing project will be long-term leased by the government.”

Currently, Ireland has no restrictions on foreign buyers with 4 in 10 homes in the country ‘bulk purchased’ in 2023. While this also includes domestic housing bodies, many overseas investment funds have used their capital to purchase entire housing estates meant for first-time buyers but instead rededicated as high-yielding rental properties.

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Irish Property Advisors Savills reported that 2023 was a bumper year for foreign purchasers in rural Ireland: “Transactions totalling €190.6 million were conducted last year for country homes… valued at more than €1 million”, according to the Irish Times.

While it may be easy to dismiss Spain’s move as that of a scandal-ridden socialist government attempting to generate favourable headlines, particularly with the youth, and stick it to the Brits, governments worldwide should explore enacting outright bans or restrictions on foreign purchasers who are exacerbating housing affordability issues.

Instead of scoffing at this move, Britain should take inspiration from Spain, particularly in light of statistics that in Prime Central London in 2023 the proportion of homes purchased by an international buyer reached 45pc.

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Given how decentralised Spain is with 17 autonomous regions enacting different policies as it relates to tax and spending, the government’s radical housing proposals may encounter democratic hurdles to get past the finishing line.

But one thing is for certain: the deglobalisation trend is only accelerating and is impacting almost every facet of public policy including housing.

Donald Trump’s impressive electoral feat in 2016 can be boiled down to several competing objectives: more jobs particularly in manufacturing, less immigration both legal and illegal, and asserting American hegemony by countering China. Trump, under the banner of ‘America First’, vowed to onshore American industry exported to far-flung regions, mostly in Asia, and deport migrants who, for the most part, were brought in to fill in for native workers who had specialised in manufacturing but are now deemed redundant in a services dominated economy. For years, American elites turned a blind eye to the aftereffects of globalisation in which jobs were siphoned off to China by avaricious domestic industrialists desperate to cut costs and realpolitik politicians eager to counterbalance lingering threats in a geopolitical powerplay against the Soviet Union which included democratising China through integrating them into the global economy. This birthed a new disenfranchised domestic political group in the U.S what we know now as the ‘Rust Belt’ – spanning from Baltimore to Rochester – a socially eroding metaphor that refers to the decrepit urban milieu of a once bustling and robust manufacturing sector whose demise has meant decay. But as Trump failed to bring those jobs back and halt Beijing’s meteoric rise in his first term, he has now started listening to tech moguls who have convinced him that the only way to revitalize U.S growth is by importing more workers from other countries to kickstart emergent and futuristic tech-industries including semiconductors and Artificial Intelligence (AI), thus backtracking on his previous pledge in 2016 to curb all forms of immigration. This, he’s told, will see America ahead in the technology race. While the Cold War against the Soviet Union was fought over ideology the battleground in this latest geopolitical skirmish against China is tech with the tech overlords or ‘tech bros’ wielding tremendous influence in the incoming administration to see through their overriding ambition - the nationalisation of Silicon Valley precepts.

The Rise of China and Fall of the Rust Belt

Every facet of America’s managerial and political class played a role in the decades-long betrayal of the U.S. Rust Belt. Successive administrations from Jimmy Carter to Bill Clinton embraced the cuddly Chinese Panda Bear believing it to be tame relative to the Russian Brown Bear. The confluence of of big business desperate to cut costs by importing cheap goods produced by low-wage Chinese labour and the U.S government whose geopolitical ambition at the time was to sidestep the Soviet Union by pushing Beijing and Moscow further apart, or what national security adviser Henry Kissinger referred to as “triangular relations” which involved opening relations between China and the West as Sino-Soviet relations deteriorated, in time would see America grow ever more reliant on China. Writing for Livemint, Diva Jain outlines how instrumental Washington was in the economic rise of China by granting the country Most Favoured Nation (MFN) status which enabled its access to global banking credit alongside a vast export market in the form of American consumers all facilitated by U.S mega corporations. The U.S., she says, would look away as China flouted World Trade Organization (WTO) rules and human rights violations most notably the student-led Tiananmen Square protests in 1989. From a commercial perspective, the facilitation of cheap goods from abroad was articulated by Adam Smith in his seminal piece of work The Wealth of Nations (1776):

“If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them …. In every country it always is and must be the interest of the great body of the people to buy whatever they want of those who sell it cheapest. The proposition is so very manifest that it seems ridiculous to take any pains to prove it; nor could it ever have been called in question had not the interested sophistry of merchants and manufacturers confounded the common sense of mankind. Their interest is, in this respect, directly opposite to that of the great body of the people”.

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At the time of writing, China is the world’s largest economy on a Purchasing Power Parity (PPP) index metric. Indeed, those bearish on China including Peter Zeihan and Michael Pettis among others insist China’s twin ‘crises’ of demographic decline and a property crisis spell demise but have yet to be vindicated. Despite these doomsday prognostications, China still manages to achieve its yearly growth target of 5pc with its property woes easily alleviated through the utilisation of Asset Management Companies (AMCs) which simply eliminates all ‘toxic’ property loans off the balance sheets of the state-run banks.

China’s rise was aided and abetted by the West and the country is not going anywhere anytime soon.

Two case studies typify corporate America’s commercial decision to enable China’s rise to raise their profit margins: the Walton family and Tim Scott, owners of the cheap and cheerful American retail corporate giant Walmart and the CEO of Apple Technology, respectively.

Walmart is nationally renowned for its wide range of cheap products and services that suit Americans’ propensity for gratifying retail decisions. Offering everything from groceries, gas and home furniture, Walmart has it all. Having lived in America for a few years and occasionally venturing into Walmart, scanning across the aisle in the advanced mega convenience store, I was rarely left wanting upon departing. However, my cart was usually filled with useless items. Clearly, the business model is a catch for consumerist Americans with Walmart recording over $100b in sales in Q3 this year. However, behind the façade of inexpensive shopping lies a sinister mercantile deceit. In 2013, Walmart purchased close to $50b worth of goods from China accounting for over 15pc of America’s trade deficit with the country and has only increased since.

The quid-pro-quo involved in these massive purchases suited American elites: China would sell Walmart cheap goods - with cheap labour - that ordinary Americans would purchase. Beijing would use their dollars to purchase U.S debt or bonds and other assets so it can keep those exports competitive as the renminbi’s value would remain low relative to the high demand dollar. Bond prices and yields have an inverse relationship. So, when demand for bonds is high their yield falls. This low yield allows America to sustain such a high debt rate – if demand for U.S. debt is high it means, inter alia, lower mortgage costs for American homeowners and they also get cheap goods!

That low debt servicing cost also allows America to fund public infrastructure such as roads and bridges. China currently holds $1t of the over $20t U.S Treasury market. But while this may benefit families like the Waltons and some mortgage holders this devil’s bargain took the above-mentioned Rust Belt as collateral damage. From 2001-2013 over 400,000 jobs were lost because of the Walmart-based trade deficit mainly in manufacturing.

In the generationally charged book Boomers: The men and women who promised freedom and delivered disaster Helen Andrews outlines how Tim Cook, in contrast to his predecessor Steve Jobs, welcomed Chinese input into Apple with open arms: “It was Cook who cultivated Apple’s close relationship with Foxconn, the Taiwanese company that is now the largest private employer in mainland China”. She further highlights how “Cook’s first overseas trip as CEO was to Beijing” and was crucial in Apple’s moving production to Asia at the turn of the 21st century. According to Forbes Magazine, Foxconn’s factories in Shenzen southeastern China have up to 500,000 workers with over 90pc of iPhones, AirPods, Macs and iPads made throughout the country. Taken as a whole, job losses in the computer and electronic industry account for 1 million of the more than 3 million manufacturing job losses since U.S. companies shifted operations to China.

The Rust of Flint

Nowhere else embodies the Rust Belt more than Flint, Michigan as outlined in broadcaster and author Dharshini David’s book The Almighty Dollar. Home to General Motors (GM) car manufacturers the town once boasted the namesake “Vehicle City” on account of its teeming automobile industry with an 80,000-strong labour force. Now the town is in the headlines for all the wrong reasons.

Whether it’s the public health crisis from 2014-2019 in which lead contamination in the water supply led to an outbreak of Legionnaires’ disease or its spiraling crime rate, Flint is a test case in what Americans may call fly-over states left behind by globalisation. Since the onset of globalisation, that 80,000-employment figure has shrunk dramatically by 75,000 leaving rust in its wake as America has opted for cheaper manufacturing in China and Mexico

The left-wing filmmaker and Flint native Michael Moore, who sought to rationalise Trump’s appeal from a left-wing perspective, produced the documentary Roger & Me that explained the predicament faced by his hometown. Named after the CEO of GM Roger Smith, the documentarian attempts to confront the cost-cutting industrialist as he did the NRA CEO the late ‘from my cold dead hands’ Charlton Heston in Bowling for Columbine. Having failed in his pursuit he remarked, “As we neared the end of the twentieth century, the rich were richer, the poor, poorer. And people everywhere now had a lot less lint, thanks to the lint rollers made in my hometown.”

Tariffs: A Silver Bullet?

Donald Trump’s signature campaign pledge in 2016 was to onshore these industries from abroad back home. In 2016, voters in the top 25 manufacturing-heavy U.S. states gave up to 80pc of their votes to Trump. He vowed to deploy several mechanisms to achieve that end including using tariffs – duties on imported goods – and trade deals. Trump has seldom hidden his lust for tariffs once saying: “To me the most beautiful word in the world is tariff.” But why is Trump so infatuated with tariffs? It all goes back to his obsession with closing America’s trade deficit especially with China. Since 1982, America has been a trade deficit nation.

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The U.S. trade deficit with China in particular has widened dramatically in recent years. In 1985, shortly following Deng Xiaoping’s economic reforms which began in earnest in 1978 and eventually saw 700 million Chinese come out of poverty, American imports from China were worth $2.7b while exports to China reached $2.4b. This is technically a trade deficit on America’s part but not by much. However, by 2022, imports from China totaled $500b with exports reaching $200b meaning a trade deficit in goods and services of $367.4b. But does this even matter? In theory, given America’s current status with its currency the dollar as the reserve currency it shouldn’t. Economics 101 tells us that when a country has a current account deficit the value of its currency falls making its imports more expensive and exports cheaper; on the other side of the coin, if a country is running a current account surplus their currency should rise in value making exports more expensive and imports more cheaper. However, even with America’s perennially high trade deficit its currency has risen. It’s what former French Finance Minister Valery Giscsrd d’Estaing referred to as America’s “exorbitant privilege” being the reserve currency meaning it will always be in high demand regardless of its current account balance, at least as it remains the reserve currency. Indeed, according to the St Louis Federal Reserve the U.S. earns a higher rate of return on its overseas assets such as private equity and Foreign Direct Investment - high risk ergo high yield - than it pays on its liabilities to other countries guaranteeing net inflows despite being a debtor country. But Trump and other economic nationalist conservatives are worried that in the long run, the growing trade deficit will make other countries lose confidence in the dollar and hinder economic growth accelerating calls for an alternative to the dollar. In his first term, his tariff policy failed to yield any significant results. Despite performative stunts such as announcing the return of manufacturing to specific localities including 13,000 jobs in Wisconsin at a Foxconn plant, which remains empty to this day, his protectionist policy failed to materialise sufficient gains.

Despite singling out China as a ‘currency manipulator’ and placing various tariffs on Chinese imports, not only did the dollar rise but the trade deficit with China widened during his first term in office. While there was an uptick in manufacturing from 2016-2019 in the order of 500,000 jobs this was simply the continuation of a trend that began under his predecessor Barack Obama. Adding insult to injury, while there was no net return of jobs Americans nevertheless felt the pinch: According to the left-leaning economic think-tank The Journal of Economic Perspectives, ‘import tariffs cost US consumers and the firms that import foreign goods an additional $3.2 billion per month in added tax’. Simply put, the Trump tariffs raised the price of everyday goods without addressing the underlying problem causing the trade deficit which is an appreciating dollar relative to the yuan which keeps China’s exports dominant. Instead the Trump administration should have taken a leaf out of the Reagan administration’s book when America sought to rebalance its trade deficit with Japan - then the dominant exporter - under the Plaza Accords. Named after the hotel in New York City where it was negotiated this agreement saw the U.S devalue the dollar relative to the French franc, German deutschmark, British Pound and Japanese Yen to restore its exports.

But how did America become the reserve currency? And what have tariffs historically set out to achieve?

History of Tariffs

While Trump may defy the free trade consensus of his predecessors, particularly within the Republican Party, tariffs have long been advocated throughout U.S. history to protect native industry. The first American Treasury Secretary Alexander Hamilton once stipulated such levies were required to ‘break the nation’s continued dependence on British trade and manufacturing’ with the U.S constitution specially sanctioning such trade policy. At one point, tariffs were as high as 50pc representing 90pc of the U.S’ tax revenue. Generally, it was the industrial North that favoured tariffs to the detriment of the agricultural and export-heavy South. But as America implemented new taxes including income tax in 1913 it gradually lessened its reliance on this revenue-raising mechanism. In the aftermath of the 1929 Wall Street Crash, the prelude to the Great Depression, the Smoot-Hawley tariffs were implemented which saw imports to and exports from Europe fall by around two-thirds. These punitive measures would be the last major tariffs enacted by the American government. In 1944, as war continued to rage across Europe, the Bretton Woods Agreement saw 44 countries namely Western Europe, the U.S, Canada and Australia convene in New Hampshire which saw them agree to peg their currency to the U.S dollar-convertible to gold which was now cemented as the world’s reserve currency meaning all these nations would have to hold dollars in reserve. In 1972, Richard Nixon ended fixed exchanges and the delinked the dollar with gold but the dollar remained the reserve currency.

So confident was the U.S in its newfound economic dominance it vetoed a proposed international currency and global bank called ‘Bancor’, the brainchild of John Maynard Keynes, which would’ve seen trade imbalances ameliorated but because America was, at the time, a trade surplus nation it nulled such a proposal. The General Agreement on Tariffs and Taxes (GATT), the predecessor to the WTO (1995), in 1947 saw 23 countries agree to eliminate tariffs, quotas and subsidies thus ending centuries of deploying tariffs as an economic policy.

The Second Trump ‘Tech-Bro’ Term

The incoming Trump administration seems determined to continue de-coupling the U.S. from China. Trump has already announced plans to impose tariffs on China 10pc above the 25pc proposed tariffs on all imported goods from Canada and Mexico. However, in Trump’s rush to upend China’s hitherto unfettered rise to the top he has been listening to various technology gurus dubbed ‘tech bros’. Many of these tech bros have influence within the upper echelons of the incoming administration most notably Tesla CEO Elon Musk who bankrolled the successful campaign to the tune of $277m and is head of the incoming administration’s Department of Government Efficiency (DODGE) which seeks to eliminate what the tech world deem cumbersome and unnecessary regulations. In many ways, it was big tech that got Trump elected particularly the medium of Twitter which enabled him to circumvent traditional media. When Musk purchased the social media product and rebranded it X to enable free expression this crystallised his newfound role as a key propagator of this latest iteration of Trump’s MAGA movement. So what are these tech bros telling Trump? They’re telling Trump that the only way to combat the rise of China is by investing in futuristic technology including AI and semiconductors. According to the International Monetary Fund (IMF), AI could impact 40pc of global employment which rises to 60pc in advanced economies. Meanwhile, semiconductors are a vital component for almost all electronics including smartphones and laptops, and with China increasingly offering alternative products to Western-dominated companies including Huawei in lieu of Apple, the U.S. feels threatened by being overtaken in the electronics market. While the rise of China was facilitated as part of a Cold War with the Soviet Union that saw the two ideologically competing geopolitical rivals export ideas namely communism and capitalism, respectively, this time around the battle is over technology with the U.S. seemingly intent on putting China down a peg or two having hitherto enabled their economic ascendance. But how might America do that you may ask. Under Joe Biden’s administration, the U.S. has attempted to protect its semiconductor industry through industrial policy and import restrictions via the Creating Helpful Incentives in Producing Semiconductors or the CHIPS Act. According to the Council on Foreign Relations (CFR), in the 1990s the U.S. produced 40pc of the world’s semiconductors compared to the current measly 12pc with Taiwan vastly surpassing at 60pc which rises to 90pc when taking advanced semiconductors into account. The CHIPS Act offered over $50b in federal funding for domestic companies that invested in semiconductors along with a 25pc tax credit. Musk’s own company Tesla, which specialises in Electric Vehicles (EVs), has availed of these credits and has also benefited from restrictions on EV imports from China. While these domestic incentives were largely successful and an example of effective industrial policy, given the interdependency that the semiconductor industry has with the wider world many of the import restrictions were negligible at best and damaging at worst. To examine this let’s take the case study of Micron Technology. Based in the U.S. State of Idaho Micron’s semiconductor technology was banned from entering China for allegedly posing “serious network security risks”. This was part of a series of tit-for-tat moves including the U.S. ban on Gen-Z’s favourite app TikTok for supposedly being a front for Chinese espionage. While the hope was that China would be isolated in cutting itself off from a major U.S. chipmaker Beijing simply substituted Micron’s technology with similar components in South Korea despite Washington’s protestations to the latter. According to the Macroeconomist Philip Pilkington, “The only way America can make its trade war work is to convince a substantial slice of the world economy to put in place similar restrictions to those being imposed by Washington”. But while export controls and industrial policy may play a role in the second Trump administration the aforementioned tech bros have also convinced Trump that by allowing legal migration to flourish, particularly via the controversial H-1B Visa Scheme, the U.S will have the labour talent needed to staff the strategically vital industries needed to fuel the tech economy.

The H-1B scheme has long been prominent in America’s polarised immigration debate. The H-1B scheme is a non-immigrant visa which allows employers to import workers from abroad in so-called ‘speciality occupations’. The applicant is sponsored by an employer and must possess the necessary qualifications with a bachelor’s degree in the specific field at a minimum. Applicants can stay in the U.S. for up to six years with many using the scheme as a gateway to a visa with caps set at 65,000 applicants per annum with an additional 20,000 for those who have graduated with a postgraduate or a higher qualification from a U.S.-based college or university.

While it may sound analogues to a well-intentioned scheme to fill labour gaps in much-needed industries it has been heavily criticised by employers groups, commentators and even then-candidate Donald Trump in 2016. Writing for UnHerd, Lee Fang mentions that the scheme has evolved through the years to incentivise workplace exploitation of foreign labour:

“Originally designed in 1990 to plug a gap in scientific and technological knowledge, and to bring over foreigners of “distinguished merit and ability”, there are safeguards which are supposed to prevent corporations from exploiting the H1B visa to harm American workers. But inevitably, these loophole-ridden rules are easily manipulated by employers who favour foreign workers, and are using them to undercut American wages.”

According to one estimate 80pc of H-1B visas go to computer programmers who earn $20,000 less than the average American would make. Indeed, the industry is dominated by a few players including the Indian firm Tata Consultancy accounting for over 16,000 applicants offering salaries under $70k. In the past, there was bipartisan consensus that the scheme was facilitating worker exploitation with the most infamous case being outgoing laid-off qualified workers at Walt Disney being forced to train incoming workers with the same qualifications. In 2016, Sen Jeff Sessions of Alabama and Texas’ Ted Cruz introduced legislation into the U.S. Congress requiring companies to pay H-1B applicants at least $110,000 in salaries. On the left, Senator Bernie Sanders criticised the H-1B programme for enabling worker exploitation. In 2017, Trump signed an executive order suspending for up to 6 months all expedited or premium processing of H-1B petitions. Speaking on the proposal he mentioned that:

“Right now H-1B visas are awarded by random lottery and many of you will be surprised to know that about 80pc of H-1B workers are paid less than the median wage in their fields”.

The latest controversy erupted after Trump’s pick to head the White House’s AI task force mentioned that he would like to raise the current cap of 65,000 H-1B workers per year. Musk has been adamant about how essential the H-1B scheme is for the tech sector tweeting in response to critics of the scheme: “The reason I’m in America along with so many crucial people who built SpaceX, Tesla, and hundreds of other companies that made America strong is because of H-1B.” Musk, playing the role of the painter of the animal constitution in Animal Farm who changed “four legs good two legs bad” to “four legs good two legs better”, managed to secure an 1-80 from the incoming president of Orwellian proportions. In an interview with the New York Post, Trump sided with Elon Musk and the other tech bros in claiming to always have been a fan of the scheme: “I’ve always liked the visas, I have always been in favour of the visas. That’s why we have them,” he said. “I have H-1B visas on my properties. I’ve been a believer in H1-B… it’s a great program.” This has caused divisions within the populist right wing in America. Several figures including former Governor and US Ambassador to the UN Nikki Haley have criticised Trump’s stance with Musk getting into several heated X spats with detractors of his stance on H-1Bs. The debate surrounding H-1B goes to the very heart of the rot that has been allowed to flourish in America’s tech space allowing greedy conglomerates to undercut American workers by dampening their wages. In the book Lab Rats: How Silicon Valley Made Work Miserable for the Rest of Us Dan Lyons of Newsweek, who used to work for a tech startup, highlights how toxic and downright contemptible the industry heads are with 24/7 enthusiasm along with stress mandatory. He also mentions the impact the industry has had on wages which remain static, particularly for young people:

“Real wages (adjusted for inflation) have been flat or down for decades. Millennials earn 20 percent less than their parents did at the same stage of their lives, according to a 2017 study by Young Invincibles, an advocacy group”.

According to one study from the University of Michigan, tech wages would have been 5.1pc higher in the absence of the H-1B scheme. On top of suppressing wages the tech world is full of mediocre and self-centred individuals who look down on others despite their inadequacies:

“A warning to young entrepreneurs: take money from a venture capitalist, and you’ll end up working for some smug, sarcastic, know-it-all prick… who will constantly tell you that you’re not working hard enough while he spends his days getting into arguments on Twitter” - remind you of anyone?

This subset of people have managed to maneuver themselves into a U.S. administration providing them free rein to set forth their edicts. Trump has quite clearly taken a side in the MAGA civil war and it’s not with MAGA 1. 0 but with MAGA 2.0: those who co-opted the movement having previously been more aligned with left-of-centre politics.

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A second Trump term will see a continuation of the policies enacted in the first term. However, this time around the three core pillars that defined the movement being onshoring jobs, cutting the trade deficit and combating irregular migration have been realigned to suit the needs of the tech bros.

Ireland is at risk of a Truss-Style mini-budget financial shock that could mirror the banking crisis of 2008 due to the sheer scale of the unregulated shadow banking sector. While many, including the Irish prime minister or Taoiseach’s economic adviser, have warned that an exodus of multinational tech and pharmaceutical companies could spell the death knell for Ireland’s economic growth this is only scratching underneath the surface. Shadow Banking is an umbrella term used by the Financial Stability Board (FSB) to describe “credit intermediation involving entities and activities outside the regular banking system” such as private equity vehicles, non- bank lenders etc.

In contrast to normal banks which, according to the FSB, ‘issue short-term deposits and invest the money in long-term assets such as loans, leases and mortgages’ the shadow banks fund themselves ‘wholesale through deposit-like instruments and securitization of long-term assets’ with ‘loans, leases, and mortgages securitized and thus tradable instruments.’ Post-crash, Ireland became one of the largest sellers of distressed assets in Europe with the The National Asset Management Agency (NAMA) acting as the bad bank which disposed of the ‘toxic’ loans off the domestic banks’ balance sheets and sold them on to private equity and other vehicles. Many of the transactions and asset transfers conducted by the Irish State via NAMA following the financial crash have ballooned the shadow banking sector: According to the FSB Ireland is home to the fifth largest shadow banking industry holding some €3.5 trillion in assets - thirteen times the size of the real economy. The industry has grown by over 40 per cent since the financial crash accounting for almost half of the global financial sector, according to the United Nations (UN). The worldwide industry is estimated to be worth over $200 trillion. The “core” figure which the FSB says is vulnerable to “bank-like financial stability risks” and “liquidity stress” is worth approximately $67 trillion.

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While the shadow banking sector may, as its name hints, lurk in the shadows away from the ‘real economy’ I.e. domestic lenders such as banks, the contagion impact, should these ‘stability risks’ and ‘liquidity stresses’ occur, is a huge risk to financial health. More recently the impact of the Truss-Kwartang mini-budget proved that despite the nebulosity and opaqueness of these financial instruments the impact on wider society can be profound. What happened in the aftermath of the mini-budget was the collapse of British pension funds’ Liability Driven Investments (LDIs). Following the announcement of unfunded tax cuts, which were criticised by the International Monetary Fund (IMF) among others, bond yields rose with a resultant fall in their price which the pension funds needed to make sure their assets, which included bonds, generated enough cash to meet liabilities - the monthly payouts guaranteed to pensioners. As the funds struggled to acquire cash - which acted as collateral - they sold gilts putting further downward pressure on the bond market.

To stem the impact the Bank of England engaged in a £65 billion bond-buying scheme to stabilise gilts. LDIs were sold by major asset managers including Blackrock and reached a whopping £1.6 trillion by 2021. The impact on the real economy was immense. 10-year gilt yields rose from 3.5 per cent to 4.3 per cent before falling back to about 4.05 per cent which saw a surge in mortgage costs for struggling homeowners with monthly payments rising by over £200. Indeed, food price inflation saw a major surge rising to over 10 per cent.

Why do I bring this up?

What the mini-budget debacle proves is that any shock, from any source, can have a wider contagion effect. In 1998 the collapse of the highly leveraged American hedge fund Long Term Capital Management required a $3 billion bailout due to the wider contagion effect. Ireland is particularly vulnerable to these shocks given the sheer scale of the shadow banking presence. In 2008, the State was asked to bail out overseas depositors and bondholders due to their exposure to domestic lending institutions. In a recent assessment of the shadow banking industry, the Irish Central Bank Governor Gabriel Makhlouf said that there are “systemic risks” associated with the shadow banking sector.

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To avoid potential economic uncertainty what is required is a reassessment of the overall shadow banking system including what these banks have invested in including property. Right now, there are over 100,000 loans held by non-bank entities in Ireland – 16 per cent of all households in the State - with many of these home loans securitized in wholesale money markets.

When a bank disposes of mortgages off their balance sheets normally they are sold to a US private equity and/or hedge fund who in turn set up what is known as a Special Purpose Vehicle (SPV) which is usually defined as a holding company for the securitization of debt but off the balance sheets of the parent company. As such, the SPV turns the portfolio of mortgages into a securitized loan which is warehoused in Ireland.

This scheme has made Ireland’s International Financial Services Centre (IFSC) the third-largest global shadow banking centre. Under Section 110 of the Taxes Consolidation Act (TCA) 1997an SPV is given charity status which allows them to claim tax neutrality and thus pay no tax on capital gains or VAT. More worryingly, according to the Irish Department of Finance, none of these entities are subject to prudential regulation by the Irish Central Bank (CBI) despite Ireland having the largest securitization sector in the euro area by assets under management. Indeed, the department has also stated that non-Irish registered SPVs are not subject to data regulation. For context, according to IDSA Securitisation securitization in Ireland is predominantly international, with 86 per cent of Irish SPVs set up on behalf of non-Irish sponsors with the US and UK accounting for almost half of all Irish domiciled SPVs (45%), according to CBI statistics from Q4 2015.

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Discussion on directly regulating the sector is futile given the inability of regulators to access these opaque structures. However, by regulating some of the methods by which the sector has been allowed to flourish such as Special Purpose Vehicles (SPVs) which are the core of the deeply unpopular ‘vulture fund’ phenomenon the State could clip the wings of this unregulated and volatile sector.

Ireland’s International Financial Services Centre (IFSC) is the third-largest global shadow banking centre

A recent amendment to the Finance Bill proposed by Independent TD Mattie McGrath sought to address the systemic issues with SPVs. The bill aimed to ‘reclassify Special Purpose Vehicles (SPVs) utilizing Credit Servicers – who service loans for investment funds - as ‘investment undertakings’ which would enable ‘Credit Servicers to deduct tax at source and serve as local agents for SPVs in their interactions with Revenue’ and would aim to ‘prevent these entities from evading tax responsibilities.’

He also called out ‘the lack of transparency behind Central Bank closed doors raising significant concerns about potential undisclosed activities.’ While this amendment was defeated, at some point official Ireland will have to address the elephant in the room before America starts calling on us to bail out their hedge funds in a similar way Jean Claude Trichet of the ECB called the Irish government to bail out European depositors in 2008 to the tune of over €60b.

The election of Donald Trump could not have come at a worse time for America’s 51st State in Europe which is in the middle of an election of its own.

The Republic of Ireland is awash with cash off the back of mega-corporate tax receipts, including a one off €14b of backdated taxes from Apple. The incumbent government is splurging the largesse of a €25b surplus like there’s no tomorrow, ahead of an election which is due to be held tomorrow, November 29th.

Irish political parties are promising the sun, moon and stars during the campaign. The ruling coalition of Fianna Fáil, Fine Gael and the Green Party’s recent budget was described as a giveaway given all the perks and subsidies attached including a one-off baby boost of €420 which will be given to parents in the new year as well as generous tax cuts. Overall, the budget cost €8.9b, raising spending by 6.9%, above the 5% spending limit advised by the budgetary watchdog the Irish Fiscal Advisory Council (IFAC). However, these giveaways may prove episodic as storm clouds gather across the Atlantic with the incoming Trump administration smelling blood.

Howard Lutnick of Cantor Fitzgerald and co-chair of Trump’s transition team was recently appointed Commerce Secretary. But far from just overseeing the commerce department, Lutnick is set to lead the administration’s tariff and trade agenda, with “additional direct responsibility for the Office of the United States Trade Representative,” Trump said in the statement announcing his appointment. In the past, he has questioned America’s growing trade deficit with the Emerald Isle once tweeting that, “It’s nonsense that Ireland of all places runs a trade surplus at our expense. We don’t make anything here anymore—even great American cars are made in Mexico. When we end this nonsense, America will be a truly great country again. You’ll be shocked!”

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A senior fellow at the Council of Foreign Relations (CFR), a highly influential think-tank in the Beltway, Brad Setser recently tweeted that he is, “Happy to see that the impact of Ireland on the US corporate tax base is slowly becoming a point of consensus,” along with a graph showing Ireland’s net corporate tax revenue.

In a similar vein, Jason Miller, a Senior Adviser to the incoming President, tweeted an article in the Wall Street Journal highlighting the country’s corporate tax bonanza mentioning that, “Ireland, which now offers a headline 15% corporate tax rate to big companies compared with 21% in the U.S., expects in 2024 to have raked in $39.6 billion in corporate tax revenue…

“The Irish Gov’t Is Unbelievably Rich. It’s Largely Thanks to Uncle Sam,” he said.

Currently, Ireland is America’s 7th biggest deficit nation. In 2023, Ireland exported €54b worth of goods to the United States, over twice the value of imports, giving a trade surplus of just over €30b. Most of this trade consists of intangible assets including Intellectual Property such as software and patents. However, US companies currently employ directly and indirectly 15% of the Irish workforce meaning any disruption would impact employment massively and potentially spark a recession. Trump has indicated he plans to deploy all sorts of mechanisms to close deficits with other countries having already announced tariffs of up to 25% on Mexico and Canada and is set to impose even harsher duties on China. The idea that his administration won’t utilise these or similar punitive measures on Ireland is laughable.

Back in 2017, Trump singled out Ireland when higlighting American companies who offshore to low-tax jurisdictions stating that: “For too long our tax code has incentivised companies to leave our country in search of lower tax rates. It happens – many, many companies. They’re going to Ireland. They’re going all over,” he said.

During his first term, Trump attempted to undercut Ireland’s innovative low-tax model by signing the Tax Cuts and Jobs Act (TCJA) into law. As a result, America lowered its corporate tax rate from 35% to 21% and ended a deferral of US tax on foreign income. Through these measures, America hoped to dissuade their companies from offshoring and incentivise them to return. However, the bill had little impact on trade between the two countries.

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But this time around is different. Trump has vowed to drop the US corporate tax rate even lower to 15% matching that of Ireland’s which recently raised theirs from 12.5% after agreeing to Pillar 2 of the OECD tax harmonisation agreement.

All this hangs over Irish political parties like the sword of Damocles. All parties, both ruling and opposition, have vowed to increase spending on a range of public services from housing to health and education with a massive overspend in all these sectors including an incomplete children’s hospital costing over €2b and a bike shed outside the Irish Parliament costing over €300k. All these promises are reliant on continuing corporate tax receipts coming into the exchequer which reached over €26b last year - currently over 20% of the total tax take. While currently basking in the glory of a budgetary surplus, the Irish State faces a €31b deficit by the end of the decade if corporate taxes fall back to 2020 levels at just over €11b. Indeed, the well-capitalised sovereign wealth fund, currently cashing in at €8m, could reach a deficit of €14b under the same 2020 levels projection. IFAC has in the past warned the Irish government not to devote so-called windfall taxes to permanent spending.

And then there is the elephant in the room that has made Ireland stand out like a sore thumb in the Western World - Palestine. Earlier this year, the Irish government recognised the State of Palestine. Some have suggested this was done for political purposes to outflank the opposition Sinn Féin’s pro-Palestine stance ahead of local elections in June. Almost all the political parties in Ireland backed this measure with some suggesting such gestures don’t go far enough.

The issue has featured prominently during this general election campaign with the topic given more airtime during a party political debate on the state broadcaster RTÉ than immigration - which is above the list of concerns expressed by voters. Recently, a bill that would prevent Ireland from trading in goods emanating from the West Bank was blocked after pressure from the US Democratic Party and an intervention from the US Ambassador in Dublin. According to an Irish Minister of State Ossian Smyth, the bill was blocked “because the Democratic Party in America asked them [the Irish govt] to block it” as “Ireland has a lot of investment from American companies, who spend a lot of money here and employ a lot of people.” All this suggests America opposes Ireland’s posturing on the issue adding yet another layer of concern for the country.

Ireland is stuck between a rock and a hard place between maintaining amicable relations with America while also trying desperately to squeeze revenue out of its corporate tax coffers. Ireland was hoping and preparing for a Kamala Harris victory, with incumbent Taoiseach Simon Harris referring to the President-elect as a “gowl” - an Irish pejorative - and tweeting a picture of a Harris/Waltz hat seemingly endorsing the failed candidate.

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Despite riding high in the polls earlier in the election the Fine Gael leader’s fortunes have dipped somewhat, falling third in public polling amid several public follies including walking away from a disability carer on the campaign trail, with echoes of Gordon Brown’s Gillian Duffy moment.

While this year’s elections across the globe have spelt trouble for incumbent governments including in the US, U.K., France and Japan Ireland’s duopoly of Fine Gael and Fianna Fáil may defy this trend due in part to a lack of cohesion among opposition parties and the aforementioned spending sprees.

However, any incoming government will have to contend with an increasingly assertive America and a resultant protectionist European Union with Ireland caught in the middle.

Referencing the McDonald Report, Mattie McGrath, Teachta Dála for the Tipperary constituency, has directly challenged the Irish Government to explain what it is doing to deal with the housing problems created by Vulture Funds. 

Speaking in the Dáil yesterday, Thursday 19th September, he said:

“I am glad the Minister, Deputy O’Brien, is here. I have just come from the audio-visual room where the McDonald report on housing and vulture funds was launched.

I hope the Minister will be able to read it. Mr. Edmund Honohan, former Master of the High Court, Mr. Cormac Butler and others spoke. 

Critical, independent analysis was carried out, and not by NGOs. It is found, and Mr. Edmund Honohan pointed out also, that many areas of legislation are flouted and broken daily in regard to the Land Registry, the vulture funds in the courts and the repossession of homes, farms and property. 

It is outrageous the Government is allowing this. Some judges, in fairness to them, are waking up to the fact the Land Registry papers that are being offered are totally invalid and fraudulent. The vulture funds do not have any access. They buy the keys of these properties and homes, but they have nothing else. They have no documentation. 

When is the Government going to act? The Minister should read the contents of this report. The problem with housing is not supply, but rather that the Government is allowing vulture funds and other people are allowed to break the law and victimise people and families.”

Deputy Darragh O’Brien confirmed he will review the report and reply.

The Report was written by Theo McDonald, who later explained what the Report was all about:

“I was delighted to present my report to members of the Dáil yesterday. I hope members have the chance to read and review it. It was the culmination of research and analysis from the perspective of a young person who has written about issues impacting my generation - Generation Rent - and those left to the mercy of vulture funds.”

Cormac Butler, expert witness who has given testimony to the Oireachtas Finance Committee on several occasions stated:

“The McDonald report has exposed the dangers of Irish courts relying on land registry records as proof that loan purchasers are entitled to repossessions. Some judges have also failed to recognise their obligations to expose unfair terms in loan contracts. Mattie McGrath TD is therefore quite right to raise these matters in the Dáil.”

Andy Agathangelou, founder of UK-based Transparency Task Force who led a protest march in Dublin about the miscarriages of justice being caused by the incorrect interpretation and application of the law relating to Vulture Funds and other matters said:

“Now that the hard evidence gathered by the McDonald Report has been gathered and provided to Deputy Darragh O’Brien, the people of Ireland should now see their government working to remedy the many problems identified; problems that have been causing widespread suffering for many years - from unlawful repossessions, to consequential family break ups and even suicides. 

There can be no excuse for the Government to not act now that it has the data and the analysis - the McDonald Report is just too compelling to be ignored.”

Michael Fitzmaurice TD, said:

“I attended the launch of the McDonald Report yesterday, alongside several other concerned TDs, because many of us politicians are being contacted by constituents where they allege they are not getting fair procedure in courts in relation to vulture funds. 

What the McDonald Report now gives us is a reliable, credible account of the details - the facts and the figures, the hard data. It will help us all understand why we have such a huge and worsening housing crisis in Ireland, and the Vulture Funds are a big part of the problem - the proof is all there to see now. 

It’s obvious that drastic and urgent reform is needed; and if this Government won’t drive through the changes that fair-minded people will demand, the next one better commit to doing so.” 

Brian Reilly, Founder at Right2Homes & Access2Justice added:

“This Report expertly explains in layman’s terms what has been happening with the Vulture Funds here in Ireland, and I compliment Theo on his excellent work. It’s a great big ‘well done’ to Mattie McGrath TD from all the concerned campaigners who are working hard to raise awareness of the issues, for bringing this topic directly to the attention of Deputy Darragh O’Brien. 

We hope all politicians will now work together on this.”

1)    The McDonald Report is available here:

The McDonald Report

Edited 22501 Mcdonald Report Final A4 V3 1

1.89MB ∙ PDF file

Download

Download

2)    The Parliament TV clip of the dialogue between Mattie McGrath TD and Deputy Darragh O’Brien is available here: 

3)    The transcript of the dialogue between Mattie McGrath TD and Deputy Darragh O’Brien is available here: 

https://www.oireachtas.ie/en/debates/debate/dail/2024-09-19/31/#spk_261

For Written Answer on : 09/07/2024
Question Number(s): 177 Question Reference(s): 29666/24
Department: Finance
Asked by: Mattie McGrath T.D.
______________________________________________


QUESTION

To ask the Minister for Finance if he will consider enacting laws to restrict vulture funds’ activities, akin to the UK Parliament’s legislation that prohibits vulture investors from exploiting its courts for their gain; and if he will make a statement on the matter.

REPLY

The activities of non-bank entities are already regulated by the Central Bank in Ireland under the provisions of the Consumer Protection (Regulation of Credit Servicing Firms) Act 2015 as amended. The legislation ensures that relevant borrowers whose loans are sold to non-bank entities maintain the regulatory protections they had prior to the sale, including the protections provided by the Central Bank’s statutory Codes of Conduct and Consumer Protection Code.

As of 30 December 2023, non-bank entities are also subject to the European Union (Credit Servicers And Credit Purchasers) Regulations 2023 which transposes the EU Credit Servicing Directive into Irish law. 

It is a matter for the Courts to determine whether a particular litigation constitutes a malicious abuse of court process.

______________________________________________
For Written Answer on : 09/07/2024
Question Number(s): 209 Question Reference(s): 29660/24
Department: Finance
Asked by: Mattie McGrath T.D.
______________________________________________


QUESTION

To ask the Minister for Finance the number and value of Irish mortgages currently held by non-bank entities; the level of risk analysis his Department has conducted to the significant volume of Irish mortgage debt in the possession of these entities; and if he will make a statement on the matter.

REPLY

The Central Bank of Ireland publishes quarterly statistics on the number and outstanding balance of mortgage accounts in Ireland. They are contained in the publication Residential Mortgage Arrears and Repossessions Statistics. The most recent statistics for the first quarter of 2024 were published on 5 July.

At end March 2024, there were a total of 703,308 principal dwelling house (PDH) mortgage accounts outstanding  in Ireland, with a value of just over €101 billion. Non-bank entities held 116,342 PDH mortgage accounts with a value of approximately €19.8 billion.

At end March 2024, there were a total of 61,445 buy-to-let (BTL) mortgage accounts outstanding in Ireland, with a value of just under €9 billion. Non-bank entities held 24,019 BTL mortgage accounts with a value of approximately €5.1 billion.

The activity of non-bank entities in Ireland is regulated by the Central Bank of Ireland under the provisions of the Consumer Protection (Regulation of Credit Servicing Firms) Act 2015.  As regulated firms, non-bank entities and the relevant credit agreements serviced by these firms are subject to the consumer protection regulatory framework. Thus, the consumer protection framework provides the same protections for borrowers regardless of the regulated entity with whom a consumer is dealing with, be that a bank, retail credit firm (RCF) or credit servicing firm (CSF).

The Central Bank is also responsible for maintaining monetary and financial stability and ensuring the financial system works in the interests of the community. The Bank conducts a regular Financial Stability Review to evaluate the main risks facing the financial system and assesses the resilience of the financial system to those risks.  The most recent review was published by the Central Bank in June 2024. 

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Imagine this scenario. 

The Irish government calls snap elections in, if predictions are to be trusted, late October of this year in order to build on the momentum of recently successful local elections. 

However, polling indicates that local victories for the ruling parties appear to be confined to regional councils with national polling implying a swift victory for Sinn Féin and other micro left leaning parties to earn a sizeable portion of the vote to possibly form a government.

Thus, it appears likely that Sinn Féin may have a chance to nominate their preferred candidate for Taoiseach and secure the votes necessary. 

Ireland's populist moment, that it was until recently immune to, beckons. 

However, Ireland’s economic masters at the European Central Bank (ECB) have different plans. 

Adhering to the, probably apocryphal, quote that “he who controls the money supply of a nation controls the nation”, Frankfurt seeks to strike a preemptive coup de grace at the far left party’s momentum. 

‘Ireland risks a Truss moment if Sinn Féin gain power, warns ECB’, runs the headline from the Financial Times ahead of the election.

The headline is of course referring to the fallout from the short-lived - 44 days - U.K. prime minister Liz Truss and her ‘mini-budget’ in which unfunded tax cuts spooked the markets causing mortgage rates to soar, a run on the pound sterling and a gilt market free fall. Truss has since blamed her downfall on technocrats within the Bank of England who refused to buy up British debt to restore confidence in the markets. 

The Irish press proceed to have a field day with such a startling pronouncement. 

Headline after headline from The Irish Times to the Irish Examiner takes the Frankfurt line for gospel with one elderly Liveline caller speaking for the nation when she tells Joe Duffy, “Joe, you know, I don’t want to see the economy suffer, sure my grandkids would emigrate, that wouldn’t be good at all.” 

The damage is done. 

The further politicisation of the financial system will have major repercussions for democratic participation and usher in a class of faceless ruling technocratic elites holding EU member states to ransom with their thinly veiled threats of economic destruction

The narrative that a victory for Sinn Féin could jeopardize Ireland’s financial standing is seared in the minds of the wider public causing voters to abandon the party and vote for a safer pair of centrist hands instead. 

Such a scenario sounds implausible and perhaps even a case of obscene and inappropriate political interference from unelected bankers and their enablers in the financial press. 

However, this very situation is playing out in France right now. 

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Following a disappointing European election for the current Élysée occupant Emmanuel Macron and his Renaissance party, Europe’s quintessential centrist dad has dissolved the National Assembly and called snap elections in order to, as some analysts suggest, clip the wings of France’s right-wing National Rally under Marine LePen, and form a German style coalition with more moderate parties. 

Such a gamble is easier said than done. 

When Jacques Chirac attempted the same in 1997 he was left with an undesirable cohabitation arrangement with the socialists. 

Meanwhile, polling suggests a clean sweep for LePen’s party. 

Preempting the possibility of a right-wing government in Paris the ECB has all of a sudden, right before an election no less, sought to penalise France for its soaring deficits. 

Just two weeks before elections are set to take place a headline from Bloomberg read: 

‘The European Union is set to admonish France for breaking the bloc’s deficit and debt rules, triggering a process that can lead to onerous fines and complicating campaign priorities’ (my emphasis). 

The FT followed suit in a conspicuous article outlining, ‘Why France’s Far Right is Spooking Markets’ which ‘could turn into a ‘Liz Truss-style’ liability on the campaign trail.’ 

French Finance Minister Bruno Le Maire joined in on the apocalyptic economic predictions saying that a victory for LePen would see France “experience the same dire consequences that followed a spending plan presented two years ago by then-UK Prime Minister Liz Truss, which resulted in her almost immediate downfall.” 

The message from the financial elite is clear: vote the way we want or your economy will collapse. 

The “spread” between French and German bond yields or cost of borrowing - a good bellwether for general economic health - is the largest it has been in years following the sudden snap election announcement. Yet the ECB refuses to intervene to correct this which they have the power to do.

Ireland’s man in Frankfurt, former Irish Central Bank Governor and current ECB chief economist Philip Lane, playing the role of general in the tentative economic coup, said that the ECB would not purchase French debt in order to calm market volatility. 

France is on buying time: Wait until the electorate give the French and European financial elite what they want and then swoop in to relieve the economic system. 

Such a blatant attempt at utilising the Euro to engineer a political outcome or maintain the status quo seems to be a recurring theme in the late stages of the world’s second largest currency. 

Eurozone countries that dare express their sovereignty or independence are swiftly reminded of who is really in charge. 

When Italian prime minister Giorgia Meloni clinched the top job on a populist agenda the ECB allowed interest rates to soar making Italy’s perennially heightened public debt costs unsustainable. 

Only when Meloni caved on EU economic reforms did the ECB intervene. 

This is not the first time Rome was made to toe the line. 

Back in 2011, amid the fallout from the 2008 Financial Crisis, when Bunga Bunga prime minister of Italy Silvio Berlusconi refused to impose crushing austerity, under the terms of an IMF bailout, the ECB under super Mario Draghi discontinued the central bank’s Italian bond purchases thus raising interest rates. This helped usher in his downfall and the elevation of the former Goldman Sachs technocrat Mario Monti. 

Indeed, closer to home, when Irish finance ministers Brian Lenihan Jnr and Michael Noonan, respectively, sought to burn the senior bondholders at the banks that had lent recklessly to developers during the Celtic Tiger fuelling the housing bubble then ECB president Jean Claude Trichet threatened that a “financial bomb” would go off in Dublin upsetting the stability of the Eurozone as a whole. 

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Both men caved and the Irish taxpayer was left to foot the €64 billion bill and other bruising cuts for such profligacy. 

The social fallout from the crushing austerity that the EU forced upon member states has contributed massively to the current European populist wave, both from the left and right, enabled by voters who feel left behind economically. 

From Berlin to Dublin national governments are warning that rising populism will upset the delicate stability of centrist governance that in actual reality has brought nothing but instability. Whether it’s a banking crisis, refugee crises, an energy crisis, rioting and an escalating war on the continent Europe has not screamed stability for a while now. 

To avoid the massive backlash to the economic and social unease since 2008 the very institutions that contributed to such instability are pulling monetary tricks to quash a democratic and peaceful backlash at the ballot box. 

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The further politicisation of the financial system will have major repercussions for democratic participation and usher in a class of faceless ruling technocratic elites holding EU member states to ransom with their thinly veiled threats of economic destruction.