Sean Quinn and the Lowry effect

The continuing travails of Séan Quinn are continuing to be portrayed by the media as just that - travails, inconveniences, challenges - and remain of interest to the country while becoming something of a cause for his followers in the border region. Of all of the major figures to be "caught up" in the banking crisis and the "travails" of our nation, he alone retains the sympathy of many people, and seemingly suffers only from the ill-judged accusations of the Financial Regulator, and some revisionist appraisal of his dealings with Anglo Irish Bank. He is not a banker, or a builder, or a politician. In that, therefore, he is unique.

Today (Saturday) it was reported that he was refusing to give Anglo information about what he owns, and what he owes. During the week two very straight looking accountants very matter-of-factly told business journalists that the Quinn Insurance business had lost €700m in the year prior to the administrators being called in. This is despite Mr Quinn himself telling the regulator that the business was hugely profitable, and that it would be through the several hundred million euros in annual profit that he could repay the debts owed to Anglo.

Now - step back a moment and consider the debt he owed. It became clear as Anglo fell apart in early 2009 that there were serious problems, and that Quinn was at the heart of it. Much of the commentary centers on Quinn's catastrophic €2.8bn punt that went wrong, but it was merely the inevitable end of an appalling sequence of decisions where Quinn made poor investments, managed his companies terribly, and piled up losses upon losses. This was not just one bad investment, but the inevitable consequence of failure being rewarded again and again and again by the banks, the state, and the infrastructure in Ireland. Either Quinn was stupid, badly advised, or reckless. Given his position in Irish life and society, his responsibility required that he act far more prudently than he did, and he failed.

Was that bad enough? No, of course not. Emboldened by the myopic sheep of Cavan, the defenders of the man who gave them work when none was going, in a Lowry-esque descent into economic ostrich politics that eschews solidarity and national interest, Quinn fights on. He has been slighted. The Quinn Group showed no losses when he was in charge, but now that the administrators are in, they've destroyed the company (he skirts around the fact that he didn't employ a single actuary in his insurance business - go figure).

There was a point when Seán Quinn was a young man with a farm, from which he quarried stone and made a small business a big business. He hired people. He helped people. And they remember him for that. But he crossed a line when he diversified into other segments. When he went into insurance, the Quinn group was certainly a conglomerate. When he took over the former BUPA business, he was hailed by the establishment as a saviour of competition in the health sector. My sense is he began failing almost immediately after that. The extent to which the State facilitated Quinn's takeover of BUPA was extraordinary, though not unexpected. There were some echoes of the Russian oligarch's enrichment in the 1990's with the distribution of former state assets, though in this case it would have been difficult to line up a buyer for a business that was pulling out for legitimate commercial reasons (the community rating issue and all that jazz), notwithstanding the fact that Mary Harney had been fighting this issue through the courts for a number of years at that stage. The thought has to be that BUPA called Harney's bluff, and she got found out. With few people to turn to, Quinn was probably on a shortlist of one (the alternative being nationalisation or merging with the VHI) to take on the alternative healthcare supplier (with apologies to Vivas). Getting into the healthcare business was enormous for Quinn, and made him politically significant if he was not already that.

Having significant interests then in building materials, and by extension the property market; and in the broad insurance business at home and abroad, Quinn set about leverage his systemic importance in Ireland to bail himself out of every increasing debt. While any normal business faced with compromised positions would scale back, lay people off, take losses and move on, he buried them in a sea of credit, and the Quinn group became a black hole into which massive losses mounted, millions, then tens of millions of euros, suddenly a hundred million euros, then more, and still more, and ultimately almost three billion that we know of, tied up in a twisted, gnarled series of cyclical transactions in, with and of Anglo Irish Bank. Quinn couldn't face the prospect of admitting failure, and he compromised all of those businesses, the Irish health service, the competitiveness of the insurance market, and thousands of jobs, in order to save face. That's what all of this was about - saving his reputation.

And so still today he protests, it wasn't me. I was a victim. The regulator is wrong. By implication, there's a conspiracy. He is insidious in his manipulation of those in Cavan who support him, because they believe he's been unfairly treated, and he does nothing to disabuse them of this. They are following a lie, and he fosters the lie. Sean Quinn crossed a line some time ago when he abandoned all propriety, and compromised the interests of his employees, his companies, his bank, and his country. He should be ashamed of himself, and he should be in jail.