09.27.06
When is a loan not a loan?
I’m just curious.
“The difference of talking about somebody taking millions and somebody taking hundreds of thousands in exchange for contracts and other matters, and taking what is a relatively small contribution from friends who had a clear understanding they would be paid back. I do not equate those. If I was to take several hundreds of thousands of pounds or several million from people where I had no association with, or people that were totally business interests, that would be totally, totally wrong.”
Then he referred repeatedly as the money being “a debt of honour”. Then he says they refused to take the money back (so obviously there was no clear understanding that it would be paid back).
He knows he can’t say they were a gift cos then there would be tax owed. So he has to characterise them as loans. But the loans have not been paid back, so therefore they were gifts. I wonder does the tax code have a section for “debts of honour”.
Then I liked Pat Rabbitte’s repitition of Bertie’s response to the suggestion in 1996 that the money paid to Michael Lowry might have been a loan.
Mr Ahern told the Dáil that “there would have to be incontrovertible written evidence of that at the time and arrangements having been made for its repayment . . . The making of such a personal loan on more favourable conditions than would be available from any lending institution would clearly represent a personal favour that ought to be declared.”
It’s interesting that what will really haunt Bertie is what he said about Lowry and Haughey will harm him more than his own financial messing.
leon said,
September 27, 2006 at 11:22 am
Bertie’s daughter got a million quid for the film rights to her first novel.
Where is the movie?
Politicians should be like Caesar’s wife not Potiphar’s.
Mol said,
September 27, 2006 at 11:27 am
Hi Leon
If you read this weeks TV now you will see that both Hilary Swank and Lisa Kudrow have just been signed up for parts in this movie. Aparently (not sure of that is spelt right, spell check not working) shooting of the movie begins this Autumn.
Mol
leon said,
September 27, 2006 at 12:10 pm
Hi Mol,
You’re right.
http://www.imdb.com/title/tt0431308/
Good I am glad that it wasn’t a bribe. I am so not going to that movie unless I get ’something special’ for pretending to be sensitive.
Mol lets meet outside the savoy at 8PM on June 17 2008. I will talk about the film afterwards but don’t play the innocent.
petedg said,
September 27, 2006 at 12:12 pm
A loan is not a loan when it’s made to your girlfriend. Chances of getting it back (even in kind) are zero.
fmk said,
September 27, 2006 at 1:00 pm
i like the bit where he says he’s an accountant – “i said that i would take this as a debt of honour, that i would repay it, in full, that i would pay interest on it. i know the tax law, i’m an accountant.”
i know there’s (technically speaking) no legal definition of what an accountant actually is, but the normal usage of the word suggest you’re a *qualified* accountant.
i actually qualified as an accountant, but left the profession years ago, and today only describe myself as a former accountant when the issue is raised. i never describe myself as an accountant as, in my understanding, that would be wrong.
to the best of my knowledge, bertie never qualifed (though i think the brother is actually a cpa (also known as a car park attendant, it’s such a crap accounting qualification)). he might have read a dummies guide to double entry, but the main ain’t no accountant.
P O'Neill said,
September 27, 2006 at 2:36 pm
It’ll be interesting if one of the Twelve Apostles tried to take the unpaid loan as a deduction from taxable income.
fmk said,
September 27, 2006 at 6:22 pm
that would have required them to have declared the income it came from in the first place. not that i’m suggesting that they wouldn’t.
btw, how many tax amnesties have we had since bertie first became finance minister?
ang said,
September 27, 2006 at 6:35 pm
I truly love the bit where he appointed people to state boards not because they had bribed him but because they were his friends!!!!
Bock the Robber said,
September 27, 2006 at 10:46 pm
Well, he mightn’t be an accountant, but by his own account he went to the London School of Economics. (Maybe to deliver a pound of rashers). This is Bertie for you.
Joe Higgins is right: Bertie’s personal circumstances have nothing to do with it, and he shouldn’t have brought it up. He took the money, he was indebted, but he kept the Merc. And isn’t it amazing that Bertie sees nothing wrong with appointing his mates to jobs at public expense? I didn’t appoint them because I owed them money. I gave them public jobs because they were my mates! Eh? Wha’?
Stephen Neill said,
September 28, 2006 at 1:17 pm
Just a couple of thoughts on this issue:
1
Stephen Neill said,
September 28, 2006 at 1:30 pm
Oops misfired! I guess that’s premature something or other!
Here goes again:
Just a couple of thoughts on this issue – 1 The way people talk about politicians one would think they were a breed apart instead of just regular guys and gals who play by much the same rules as we do in our own private lives! The degree of indignation in some quarters is totally out of sync with the way real people interact with each other. We cannot demand standards of our politicians that we are not prepared to uphold in our own personal and largely private lives. There is a lot of hypocracy in the air.
2 I wonder if the public thirst for knowledge and the demand for transparency in every part of public life is always a good thing? One of the first casualties is trust and the implications of that should not be underated. There are times of course that trust is abused and betrayed as in the matters being investigated by tribunals and recent scandals in religious institutions. That said we cannot build a possitive society on a model which takes nothing on trust and subjects those who offer themselves in public service (and I am not sufficiently cynical to believe that there are no politicians with a sense of vocation) to a complete and retrospective dissection of their private lives. If this is what it has come to then we have failed. If we want to build some values and ethics into society then we have to start rebuilding trust and not constantly undermining it. Enough of deconstruction – Its time to do some reconstruction!
Stephen
Daniel K. said,
September 28, 2006 at 2:43 pm
Trust is a casuality of lying and those who abuse it, they are the ones responsible not those who come to distrust them.
Leon said,
September 28, 2006 at 2:53 pm
I don’t see why we can’t hold politicians to whatever standards we choose. After all those who have ‘offered themselves for public service’ have been corrupt since the foundation of the state.
Stephen Neill said,
September 28, 2006 at 6:55 pm
Daniel – point taken but does that mean we are going to let the ‘liars’ set the agenda? Do you really want to live in a world where someones word means nothing? Leon – a sweeping and cynical generalisation! Do you really believe that? It is my firm belief that politicans as a generic group are no more or no more less corrupt than the rest of us. The undeniable fact is that they are placed in situations where it is possible to be corrupt on a grander scale and in a more public way but I would be reluctant to tar them all with the same brush. This ‘them and us mentality’ is both simplistic and flawed and seems to me more about us putting all our failings onto our politicans so that we can have a clear conscience and blame others for our own shortcomings – I know that is equally a generalisation but no more absurd than cynicism which is an increasing characteristic of Irish society. Its easy to knock others – I wonder how well we would do the job and how we would cope with the temptations placed in our way?
Stephen
Sarah said,
September 28, 2006 at 9:18 pm
Lads, I don’t think there is any way to interpret this other than this:
He received money he did not earn.
It was not a loan as he didn’t pay it back and when he tried the people wouldn’t take it back.
Therefore it was a gift.
Therefore he should have paid tax on it.
HE WAS THE MINISTER FOR FINANCE. HE IS IN CHARGE OF THE REVENUE COMMISSIONERS.
Stephen Neill said,
September 28, 2006 at 10:53 pm
OK Sarah – He certainly made a grave error and may well have been guilty of a breech of ethics but does this mean we hang him out to dry? Or is it a case of one strike you’re out? That’s a very high standard to apply to anyone in any walk of life. Things have obviously moved on tonight with the distancing of the PDs from Bertie through the Tanaiste’s statement and it may well be that the Manchester payment will be the crucial issue which brings this to a head. I still think that we are allowing the agenda to be dictated by those who are using this for cynical party political gain. As for the PDs,they are not the party of principle that Des O’Malley founded – they are merely backing the winning horse! Politicians and politics and society at large have come a long way since the Haughey era and I think we are being totally unreasonable in applying the standards of today to a time when we all tolerated and often benifitted from the politics of nods and winks! I am not suggesting that the Taoiseach is blameless but I do wonder how we can in all conscience pretend that we are in a position to condemn him. Bertie Ahern is very representative of the man in the street -that’s why he is/was so popular. If we are going to jetison him at this point then we will need to be prepared to jetison a lot more besides. He is not that different than the rest of us!
Stephen
Andrew said,
September 29, 2006 at 12:56 am
Everyone has his/her own favourite line from Bertie’s apologia – and I did like the bit about state board appointments being for ‘friends’, not creditors – and mine is the assumption that we’ve ‘all’ been involved in a whip-round for a pal in financial trouble. Well, actually, Bertie, we haven’t. As with Charlie, so it is with Bertie: the unspoken factor in both their stories is class – the thing we can’t speak about in Ireland now that we can all speak about money and marital breakdown.
There is an Ireland – in many ways an admirable place – in which lads who worked their way up in the world, without the benefit of fee-paying schools and university degrees, look after each other through networks of their own involving the GAA, Fianna Fail, semi-state boards, weekends away for golf, soccer etc.
The problem is that such closed circles are as liable to corruption as the closed circles of privelege. The lads that Bertie had known for years gave him a dig out in the same way as the drinkers in a GAA club bar on a Sunday night would throw a few bob in a bucket to help out a neighbour in trouble. What could be wrong with that?
Well, for a start, these pals were millionaires. The assumptions of park football don’t obtain in the premiership: you don’t throw two grand in a bucket. More importantly, Bertie’s world view is not the one we expect from a 21st century prime minister. Has Michael McDowell or Trevor Sargent ever taken part in a whip round? I doubt it. The middle classes expect people to sort out their own financial problems and they probably don’t think that giving a pal a job on a state board is part and parcel of politics. I hope not, anyway.
If my financial situation deteriorated drastically, I would love to think that I’d have a friend or two that would offer to help. But twelve? No – and if people were queuing up, I’d be pretty worried about their motives.
The politics of the group of lads, the upwardly-mobile, hanging together and looking after each other in times of difficulty, is not despicable, but it is totally outdated. We are supposed to have a democracy now, where duty to your country is more important than loyalty to your mates. The very last people that Bertie should have accepted money from were his close personal friends. It would actually be more reassuring if he admitted just getting a fist full of fivers from a builder. At least we’d know their motives. I think that what people objected to most about Haughey was his sense of entitlement – I’ve worked hard to get here and now I deserve my share of the cake, and more – and we’ve always thought that the cake didn’t matter to Bertie. If you’ve grown up without much cake, maybe it does – even if it’s only something to share out among your mates.
fmk said,
September 29, 2006 at 12:59 pm
the point sarah makes above – that it was a gift, as the donors refused to accept repayment – is important. the man *should* have paid tax on it. especially given that he is an elected official. especially because he was a govt minister – the one with responsibility for finance. what sort of example is he setting? do as i say, not as i do?
going back to stephen’s comment, about it being wrong to hold elected officials to higher standards. that is just bullshit totally fails to undertsand the role elected officials play in a society. elected officials are the people who set the laws. they are people who are required to set an example. what example are we getting from them? that the tax laws are there for the dumb schmucks in the bewildered heard and that friendship is more important than ability when it comes to government appointments to public boards?
that this *is* the way business is run in this country is no reason to accept that this is the way it *has* to be run.
petedg said,
September 29, 2006 at 1:27 pm
I find it hilarious that McDowell is portraying himself as sitting on the moral high ground, demanding Bertie come clean or else. This the same man who, as minister for justice, deliberately gave confidential police files to the press in order to destroy the good name of a person that the courts had found not guilty, but who he thought was guilty. I’d say that makes McDowell a very, very corrupt person who is not fit to hold public office.
gerry said,
September 29, 2006 at 2:43 pm
you get some right weirdoes on this list Sarah. It’s a class thing? The middle classes are less likely to be corrupt? It’s great to see the petit bourgeoise feeling empowered but this is surely the most idiotic analysis yet committed to cyber paper.
Look the reason he didn’t pay tax on these “loans” is that he didn’t want to draw attention to their existence in the first place. But the only judgement you need to make is to what extent his personal corruption has affected his ability to perform in his job. IMHO you’d need your head tested to vote FF in the first place as this is a party with the mantra of enriching the TD and his mates at the very core of its philosophy. Pretending to be surprised that its leader has taken the odd bung over the years is like being surprised that a lion might attack a gazelle.
So spare us the outrage and let’s make the decision we have always made – is the level of corruption tolerable? I would think Bertie’s liking for the odd envelope is a far preferable weakness to the impeccably middle class McDowell’s obvious lust for power and status. I know nothing about the FG leader so couldn’t comment on what his vice might be; peace and quiet perhaps.
Andrew said,
September 29, 2006 at 9:11 pm
I’m confused. Gerry calls me a ‘weirdo’ – assuming that it’s my post he’s referring to – and then goes on to agree with me, except that he suggests that I say the middle classes are less liable to corruption than than others. I don’t, of course: ’such closed circles are as liable to corruption as the closed circles of privilege’ is what I wrote.
I was trying to point out a few of the assumptions behind Bertie’s defence that he took for granted we share: that friends give each other a financial ‘dig out’; that part of the point of political power is the chance to give friends jobs; that the financial obligations of government ministers are not compromising – if they say so.
In England, it’s a political cliché that Tory scandals are about sex; Labour ones are about money. Maybe Bertie is a socialist after all.
Sarah said,
October 1, 2006 at 11:57 am
Middle class or not, I will repeat an observation I’ve made before – and this ties into something Stephen said: politicians accurately reflect the will of the people. By the time we have the next election, FF will have been in government for 18 out of the last 20 years. The people know perfectly well that they break the rules and they don’t seem to care because they appear to believe that this is the only way that you can get ahead in this country. In fact, a lot of them appear to think that *not* breaking the rules makes you a fool. They didn’t care that Haughey had a fabulous lifestyle clearly not based on his earned income and they sneered at Garrett’s basement flat living. Even in the 90’s I remember incredibly snide comments by Angela Phelan about John Bruton and Finola flying Ryanair to Paris – an example of how cheap they were. Of course, she was angling for upgrades from Aer Lingus but the fact that she could get away with those comments shows that Irish people assume that only fools and people who have no other option try and save money. Anyone with any brains finds a sneaky way to get ahead.
Stephen is also right when he says that the corruption of politicians is simply a matter of scale. From signing on and working, to taking cash for a job, to PAYING cash for a job, to finding tax havens for your capital gains – tax evasion is a national pastime and the only people complaining are the ones who can’t do it.
HOWEVER Stephen is wrong in one important respect: this does not mean that those of who do not ascribe to this manner of doing business have no right to call politicians to account. ESPECIALLY politicians who have made grossly hypocritical speeches about members of the opposition in the past.
There is a basic standard we should expect politicians to meet – paying their tax – ESPECIALLY if the politician in question in a Minister for Finance.
Furthermore, the sheer stupidity of Ahern has to be taken into account. It would have been so easy for him to sort this out when the Tribunals were set up. The fact that he didn’t says two things:
- he’s thick
- even if he didn’t do any favours for these guys, he is so inherently morally corrupt he couldn’t see that there was anything wrong. He STILL can’t see that he’s done anything wrong. He believes he’s a victim in this – not a criminal who got caught. (and yes not paying your taxes is a crime). THAT speaks volumes.
Stephen Neill said,
October 1, 2006 at 6:06 pm
>HOWEVER Stephen is wrong in one important respect: this does not mean >that those of who do not ascribe to this manner of doing business have no >right to call politicians to account.
Sarah – I will concede your point above but I would also suggest that this group forms a tiny minority of any society – a lot of us, myself and I am sure yourself included have high ideals but that is not to say I always live up to them!
Another interesting dimension of this issue is the emergence (rubber-stamping) of another arm of the judiciary, and no I am not talking about the Garda Reserve but rather The Irish Times! I am all for investigative journalism and would be the first to applaud the heroic efforts of Veronica Guerin and others like her who have paid the ultimate price, but if the Media in general are going to become more prominent in exposing criminal activity, as seems likely, then we will need to find mechanisms to ensure that the various arms of the media are not used and abused by those with vested interests in selective targeting which could distort and undermine the whole judicial process. It is a huge power to hold to be able to decide what is or is not in the public interest to know, and bearing in mind the private ownership of many organs of the media this has huge implications. I am not suggesting gagging or censorship but a responsible approach to the release of sensitive personal and private information. There seems to be a widely held view that all information is of public interest and in the public interest to be released. The reality is that if this line of thought is taken to its logical conclusion many individuals and organisations who deal in sensitive issues and situations will be effectively paralysed. Sometimes it is not in the public interest to know everything. I am not familiar with the minutae of the proposed Privacy Bill which looks set to be shelved on the back of the Ahern affair but I can see that there is a need for some paramaters to be drawn.
Stephen
Stephen Neill said,
October 2, 2006 at 11:20 am
Just watching a webcast of last night’s Panorama report by Colm O’Gorman and having serious second thoughts about my comments on press controls! Maybe it is a case of the lesser evil to let the Press have free rein so that such systemic evil as portrayed by O’Gorman’s report can be uncovered and the vulnerable protected – even if it means occassional intrusion in the lives of those who do not deserve it. I am horrified at what I am watching. Available at http://news.bbc.co.uk/2/hi/uk_news/5397346.stm – Incidentally not suggesting this sort of thing does not happen within the Anglican Church but I genuinely think it is less prevalent due to a less repressed attitude to sexuality in our structures. But we could always do better.
Stephen
fmk said,
October 2, 2006 at 12:27 pm
wrt the right of the press to publish stories such as this. what i find interesting is that there are currently three bills in circulation – a defamation bill, a privacy bill and a broadcasting bill – which add up to major changes in the media landscape, yet they are hardly evening been mentioned in the irish media, let alone the blog o’sphere – certainly if the lack of comments on http://www.mediaforum.ie/?p=43 is anything to go by. my impression is that, by and large, not only do the public not care whether bertie took a bung, they don’t care whether the media should be able to investigate it.