NAMA: Rebadging Failure as Success

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Fintan O'Toole calls out the economic failure in Ireland in today's Irish Times (and, incidentally, in The New York Times also) and in particular those politicians who hold the country up as an example to others. The debt has soared, public services have been slashed, and quality of life has deteriorated for all but those who have emigrated in the last five years. Things are admittedly pretty awful, and made worse by rich men in expensive suits praising the country for its prudence and fortitude.

NAMA was actually designed to do this.  Its model works thus: you have a property worth $50m, for which a developer has a loan of $100m, you pay the bank $20 for the loan, re-capitalise the bank for the $80m shortfall (i.e. repay the German inter-bank lender) through off-books sovereign debt, then sell the property for $30m, making (ahem) a $10m 'profit'. So NAMA then is a success, because it drove a profit from its loan book. The State, meanwhile, is crippled.

Anyone can be successful if they are allowed to define the rules for success themselves.  Small minds are destroying this place.

The Culture of NAMA Stinks

Today, Brendan McDonagh announced with great glee that the National Asset Management Agency had made a profit of €247m for 2011.  In his interview on RTE Radio at One O'Clock, the smug McDonagh, who commands an austerity adjusted salary of €370,000 (having taken a voluntary 15% pay cut earlier this year) propounded that the organisation had breezed passed the cynicism of two years ago, and circumnavigated low expectation to deliver what were astonishingly good results, notwithstanding a write-down of €1.27bn in the value of its assets.  It was as if NAMA was just another Irish success story, and the Celtic Tiger was back again, and McDonagh was the new breed of entrepreneur, leading the charge out of depression!