The Irish Elections, and What it All Means…

Former Prime Minister, and former Fianna Fail head, Brian Cowen, in an unintentionally apt photograph

So, Fianna Fail, having been in government for 60 of the past 79 years, has been tossed out by a resounding margin.

They fell 59 seats to 18 in Parliament, and the Green party, its coalition partner, lost all of its seats, while Fine Gael picked up 19 seats to 70, the Labour Party picked up 16 seats to 36, Sinn Fein(!) picked up 9 to get 13, the United Left Alliance (a coalition of various socialist parties) picked up 5 seats, and the new "New Vision" Party picked up 1 seat.

This is obviously a crushing defeat for Fianna Fail, and for the bank coddling policies, where the indemnified not just the depositors, but the banks' bond holders, thereby committing the Irish taxpayers to what can only be called "debt slavery".

What is interesting here is that Fine Gael is actually a further right party than Fianna Fail, and what the voters were really calling for were basically three policies:

• F%$# the Irish banks.
• F%$# the foreign banks that hold Irish debt.
• F%$# the banks.

Whether this electoral landslide has any long term effects has to do with whether the people who voted for real change actually see it.

While there is both a moral and treaty obligation to make the account holders whole (up to something around €20,000), the idea that the Irish are impoverishing themselves in order to prop up foreign bond holders, largely British and German, who received higher returns than they would have at home because of the higher risk, banks is clearly something that the average Irishman finds unacceptable.

A lot of people are talking about how this is a seismic reshaping of the Irish body politic, but I doubt it.

My guess is that Fianna Fail will be back in the majority in the next election, because now that the opposition has control of government, we will see half measures, and coddling of both the Irish banks and their foreign creditors, which will result in a tsunami in the other direction in the next elections.

As has been noted, a, "deeply indebted economy with just 1.8 million people at work cannot underwrite private banking liabilities of €200bn."

If Fine Gael, (and one their likely coalition partner Labour) do not understand this, and do not force haircuts on the bond holders through threat of default (which has the added benefit of transferring the pain to the feckless Angela Merkel ), the voters will turn on them.

For a recent political case study on the wages of timidity in this sort of a crisis, one need only look to the US, and the Democratic Party under the leadership of one Barack H. Obama.