Watching the “deal” on Anglo being done over the past few days has provoked some pretty awful feelings in me and I imagine I’m not alone in this – certainly if my facebook news feed is anything to go by. The copper-fastening of the promissory note debt by converting it into a sovereign bond represents a significant move in the wrong direction. The government has actively maneuvered to limit even further any possibility of default on that debt.
In terms of the realpolitik of this, it makes a certain degree of sense. By transforming the promissory notes into government bonds the issues has been kicked to touch – no doubt the possibility of defaulting on this debt will be completely removed from the political agenda. In other words, this technical operation will depoliticize the Anglo debt and therefore consign to history one of the most contentious elements of the legacy of the ‘financial-real estate complex’.
Moreover, the government spin has been quite effective. They have managed to sell the line that this will cost us less because it is stretched out over a longer period and that this ‘bookends’ the Anglo chapter, thus providing a sense of resolution or closure. The support of the media for the government position, even for those of us who would not be enamored with the media at the best of times, was striking. On Wednesday evening it seemed the media were struggling to find their take on the whole issue. By lunchtime on Thursday Sean O’Rourke on RTE’s lunch time news was cheerily declaring a “breakthrough in Ireland’s attempt to lift the debt burden”. Today’s Irish Times (February 8th) features an entire promissory note section, most of which reads like a press release from the Department of Finance.