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Irish govt fears rising anger after bank “treason”

Posted by smeddum on February 24, 2009


Mon Feb 23, 2009 9:05pm GMT


DUBLIN (Reuters) – Anger is growing among Ireland’s population over financial crisis and deepening recession, ministers said on Monday, with one describing the country’s banking scandals as “economic treason.”

John Gormley, leader of the Green Party which is a junior member in Prime Minister Brian Cowen’s coalition, however ruled out a snap election in the short term despite the pressure on the government.

“What I see at the moment is a perfect storm of anger,” said Gormley, who is Cowen’s environment minister and whose party’s support is essential for the government’s survival.

“You have middle-class people who are very, very upset by what is happening, people in business who cannot get loans from banks. Many people in working-class communities are also extremely angry,” Gormley told Newstalk radio.

He also said he was worried that police officers had joined recent demonstrations in Ireland.

In an unusually large protest, nearly 100,000 people marched through Dublin on Saturday, accusing the government of putting the burden of cutting the bloated budget deficit on ordinary workers and letting banks off the hook.

A strike is planned next weekend by Dublin bus drivers, who have threatened to extend their action indefinitely unless the bus operator backs down on proposed job cuts, fleet reductions and closure of some routes.

Cowen is under pressure from Brussels and ratings agencies to cut the budget deficit, but plans to introduce a pension levy on public sector workers and freeze their pay has sent his approval ratings and those of his party to record lows.

Another Green official warned last week the party could review its commitment to the coalition if any politician became implicated in the controversies surrounding multi-billion euro deposits and loans at now nationalised Anglo Irish Bank.

Gormley said an early election would not be useful.

“We’re a long way off that juncture. But unfortunately the situation is accelerating in a way that many people had not anticipated,” he said.

Gormley supported calls for an overhaul of the Irish financial regulation system in light of the scandals, partly by bringing in a new chief executive for the regulator from abroad.

“We have this cosy-dozy relationship between the regulator and the banks. That can’t happen any more,” he added.

The financial regulator is probing possible share price manipulation, window-dressing of deposits and directors’ loans at Anglo Irish Bank.

Transport Minister Noel Dempsey said wrongdoers in the controversies surrounding Anglo Irish should be punished but he asked for patience until sufficient evidence is gathered.

“It has been described as economic treason what happened and it is no less than that and people should pay a price for that,” Dempsey told public broadcaster RTE.

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