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The fragile rule of law in Ireland by David Langwallner What is meant by the Rule of Law and is such a concept honoured in Ireland today? I believe that the rule of law though arguably an unqualified good is not being adhered to in this state save mostly by the judiciary and that the legal system and erratic observance of legality by state officials renders our democracy fragile. In my view Ireland draws close to that amorphous notion, a failed state that cannot in reality uphold the rule of law. This opinion piecewill not be a comprehensive pathology but will point out many of the salient practical features which show how the rule of law is breaking down. The Rule of Law: Theoretical Incoherence? We first need to probe the many senses in which the rule of law is described. Joseph Raz, a legal positivist who believes in “perfectionistliberalism” has suggested that the rule of law ismerely a kind of shorthand description ofthe positive aspects of any given political system. From a different vantage point the fundamentalist Christian legal philosopher John Finnis considers that the rule of law is: “[t]he name commonly given to the state of affairs in which a legal system is legally in good shape”. Another philosopher Brian Tamanaha chimes to negative effect that the rule of law is “an exceedingly elusive notion” which leads to “rampant divergence of understandings” and is similar to the amorphous concept of Good in that “everyone is for it, but has contrasting convictions about what it is”. At bottom,there is no consensus: itis elusive at best: a form of smokescreen or professional hypocrisy at worst. But let us endeavour to be constructive. For example Carothers, though sceptical, adds a worthwhile positive definition of the rule of law as: ‘a system in which the laws are public knowledge, are clear in meaning, and apply equally to everyone. They enshrine and uphold the political and civil liberties that have gained status as universal human rights over the last half-century. In particular, anyone accused of a crime has the right to a fair, prompt hearing and is presumed innocent until proved guilty. The central institutions of the legal system, including courts, prosecutors, and police, are reasonably fair, competent, and efficient. Judges are impartial and independent, not subject to political influence or manipulation. Perhaps most important, the government is embedded in a comprehensive legal framework, its officials accept that the law will be applied to their own conduct, and the government seeks to be law-abiding”. Now let us stress-test certain aspects ofthis detailed expurgation against the patient – in this context Ireland Inc. Yes of course rights exist in our still fine, if shopworn, constitutional matrix and are enforced by the courts inmany instances butthere is also an undue deference to the executive that has led to the non-enforcement of social and economic rights particularly the right to housing by the courts. There is an excess of judicial caution on otherrights-based claims, particularly where issues of financial iniquity and the countervailing amorphous blob, public policy, are implicated. There is also widespread violation of privacy by the state and its police force, in particular. The overly sanguine way we as a nation have accepted, in effect, what has been police and state criminality with respect to privacy for the last thirty years without wide spread outcry is baffling. At least there are signals of an upsurge in civil disobedience,which when peaceful, as Habermas,the German sociologist of critical theory and pragmatist, would contend, leads to a vitalisation of democracy. Not here. Further, the scandal that is our banking structures, the disgrace of the banks varying interest-rate repayments in breach of agreements, the sometimes unconscionable evictions, are not conterminous with the rule of law. NAMA is a mess formulated by the neo-liberal club which did its best to avoid a proper new deal for the Irish people. The banking inquiry was a poorly performed French farce. What is desperately needed is a rightto housing. Eviction should be rare, require rehousing, and should only follow meaningful intervention by an arbitrator who can determine whether the consumer can repay and whether the bank – with or without the enlistment of a vulture fund – is bundling the mortgage at a bargain-basement rate to private-law profiteers. Further, many of our state institutions have major structural problems. The Garda are not progressive in training and intent: they do not seek justice or the truth, but rather a result. They, attimes spin, embellish or atworst, manufacture evidence – and, to be candid, at times act criminally and in violation of the rule of law. Finally, there are limited independent checks and far too close a nexus between politicians and the police. The recent moving of the deckchairs by the Garda Commissionerwill not change the culture or training of the force, its group think or, arguably, its competence. It needs a radical ovehaul and a redirection so primarily promotes truthseeking, investigative process. The impartiality and independence of our judiciary needs at times to be severely questioned because there is far too close a nexus between politics and judicial appointments. Though most are appointed on merit, many of our judges are appointed for their proximity to political parties. Further, some judges have an aggrandised sense of themselves: certainly they are not servants of the state as that is not a judicial function, butrather,they are the servants of the constitution which is a bulwark to protectthe people against state excess. Judges also need, in the interest of public confidence as to their impartiality, to declare their shareholdings and indebtedness to the banks. Moreover, parts of the government left itself open to the accusation, during the bugging crisis, that it was also mired in corruption. In the strictest sense it observed the rule of law but, inmanner, itlaid itself open to the criticism levelled elsewhere by the late great Christopher Hitchens of being crypto-fascist, pursuing a form of fascist authoritarianism but seeking to conceal what it really

The recent history of Irish banking and its regulation is so comprehensively negative we should now look to community banks by David Langwallner As the latest banking fraud, ripples across the beleaguered public con-sciousness it is salutary to recall that the concept of banking has always been counter-intuitive, an artificial entity with legal personality that charges and awards once-Church-condemned interest, whose purpose is to protect the assets of its shareholders. It has never prioritised the protection of those who use it, the customers and deposit holders who fuel capitalism, whose interests banking is imagined to wholeheartedly serve. Of course the enthusiasm of a bank to a customer varies in proportion to the size of your account and whether you are one of the 20% of customers who yield the banks 80% of their profits – indeed apparently the 20% actually lose the bank money. This underpins their contempt for ordinary users, consigned to queues and machines. The 20% may find themselves served by the contrived joys of ‘personal banking’. Lorenzo De Medici pioneered banks in Florence in the thirteenth century. The bank (Italian banca – a bench) was where the activity took place on the market square and if it went wrong and the bank went bankrupt– the bench would be symbolically broken (banca rupta). It was perfected by mercantilist capitalism. Now banks have not always been pariahs and if you throw your mind back to Jimmy Stewart and ‘It’s a Wonderful life’, Frank Capra’s classic film of depression-era America the bank saves the community and invests in people’s hopes, dreams and of course homes. The local bank in particular had a sense of civic responsibility and pride absent today. The fundamental point to appreciate is that the nature of banking shifted with the ascendancy of neo-liberalism. The US ‘Glass Seagall’ Banking Act of 1933 had severed most of the ties between commercial and investment banking. However, it was repealed in 1999 under President Bill Clinton on the dubious basis that this would “enhance the stability of our financial services system” by permitting financial firms to “diversify their product offerings and thus their sources of revenue” so making financial firms “better equipped to compete in global financial markets”. Greater stringency, including higher equity requirements and demands for clearer data, was introduced under Basel3  following the financial and economic collapses n 2008. In the US President Donald Trump aims to reduce this regulatory burden. Europe seems more inclined to hold its nerve. Commercial or retail ‘high-street’ banks cater to the general public and provide services such as deposits, loans and the provision of basic investment products. Investment banks are financial institutions that assist individuals, corporations, and governments in raising financial capital by underwriting or acting as the client’s agent in the issuance of securities (or both). Thus the historic function was to facilitate depositors and to lend money to enable people to build their dreams slowly, wisely, incrementally – popularly represented by the self-congratulatory bankers’ song celebrating frugal fiduciary investment, in ‘Mary Poppins’. Once the bank is transformed into an investment vehicle and speculators become intrinsic then all changes. The high-street banks aim to glean money from people to use for investment purposes. They will as soon invest your money in pension funds, insurance companies or subprime mortgages as re-invest it in your community. The banks, operating in an insufficiently regulated market encouraged customers to buy sub-standard or over-valued stock and mortgages which they could not repay. ‘Triple A’ ratings were conferred in the United States on sub-prime facilities and money was handed out like confetti. This lending madness was promoted and controlled by the investment banks such as the vampire squid Goldman Sachs which fed people sub-standard information, and reinforced by delinquent ratings agencies. All of this is documented thoroughly in such filmic works as ‘The Big Short’. It’s useful to look at the history of one bank, Ireland’s biggest – AIB, over the post- Glass-Sea-gall-repeal period. It is representative, sustained and appalling. Around 2002, John Rusnak, a “lone wolf” currency trader at Allfirst, racked up losses of almost US$700 million. It was Ireland’s biggest banking scandal and the fourth-biggest banking scandal in the world, when it came to light. The €90m settlement that AIB reached with the Revenue Commissioners in respect of Deposit Interest Retention Tax (‘Dirt’) evasion in 2000 was the highest tax settlement in the history of Ireland. The bank’s internal auditor, Tony Spollen had highlighted a Dirt liability of £100m for the period 1986 – 1991 but the group CEO at that time rubbished this estimate, describing it as “infantile”. The 1999 Oireachtas Sub-Committee Inquiry into DIRT concluded that it was “extraordinary” when the CEO told the Inquiry that he was unaware of the scale of the DIRT issue. In 2006, the Moriarty Tribunal found that AIB had settled a million-pound overdraft with former Taoiseach Charles Haughey on favourable terms for the politician just after he became Taoiseach in 1979. It found that the leniency shown by the bank in this case amounted to a benefit from the bank to Haughey. It noted that the bank showed an extraordinary degree of deference to Mr. Haughey despite his financial excesses. In 2004 it was revealed that the bank had been overcharging on foreign exchange transactions for up to ten years. AIB set aside €50m to cover the cost of refunds. On 12 February 2009 the Irish government arranged a €7bn rescue plan for AIB and Bank of Ireland. The bank’s capital value had fallen to €486m. The following year the National Pensions Reserve injected €3.7 billion of capital into Allied Irish Banks, becoming the majority shareholder and effectively nationalising the bank This smokescreen of misrepresentations led to over-borrowing and the present virus of evictions, dispossessions and receiverships. Now it is noticeable that the bailing out of the banks in many countries served to protect the shareholders and to impose the burden on the customers or more scandalously the public who bore no responsibility for this nonsense. Socialism for

As the latest banking fraud ripples across the beleaguered public consciousness it is salutary to recall that the concept of banking has always been counter-intuitive. Artificial entities with legal personality that charge and pay out interest, but whose purpose is to protect the assets of its shareholders. Banking has never prioritised the protection of those who use it, the customers and deposit holders who fuel capitalism, whose interests banking is imagined to wholeheartedly serve. Of course the enthusiasm of a bank for you the customer varies in proportion to the size of your account and whether you are one of the 20% of customers who yield the banks 80% of their profits – indeed apparently the 20% actually lose the bank money. This underpins their contempt for ordinary users, consigned to queues and machines while the 20% find themselves served by the contrived joys of ‘personal banking’. Lorenzo De Medici pioneered banks in Florence in the thirteenth century. The bank (Italian banca – a bench) was where the activity took place on the market square and if it went wrong and the bank went bankrupt– the bench would be symbolically broken (banca rupta). It was perfected by mercantilist capitalism. Tellingly banks have not always been pariahs and if you throw your mind back to Jimmy Stewart and ‘It’s a Wonderful life’, Frank Capra’s classic film of depression-era America, the bank saves the community and invests in people’s hopes, dreams and of course homes. The local bank in particular had a sense of civic responsibility and pride absent today. The point is that the nature of banking shifted with the ascendancy of neo-liberalism.  The US ‘Glass Seagall’ Banking Act of 1933 had severed most of the ties between commercial and investment banking. However, it was repealed in 1999 under President Bill Clinton on the dubious basis that this would “enhance the stability of our financial services system” by permitting financial firms to “diversify their product offerings and thus their sources of revenue” so making financial firms “better equipped to compete in global financial markets”. Greater stringency, including higher equity requirements and demands for clearer data, was introduced under Basel 3 following the financial and economic collapses in 2008. In the US President Donald Trump aims to reduce this regulatory burden. Europe seems more inclined to hold its nerve. Commercial or retail ‘high-street’ banks cater to the general public and provide services such as deposits, loans and the provision of basic investment products. Investment banks are financial institutions that assist individuals, corporations, and governments in raising financial capital by underwriting or acting as the client’s agent in the issuance of securities (or both). Thus the historic function was to facilitate depositors and to lend money to enable people to build their dreams slowly, wisely, incrementally – popularly represented by the self-congratulatory bankers’ song celebrating frugal fiduciary investment, in ‘Mary Poppins’. Once the bank is transformed into an investment vehicle and speculators become intrinsic then all changes. The high-street banks aim to glean money from people to use for investment purposes. They will as soon invest your money in pension funds, insurance companies or sub-prime mortgages as re-invest it in your community. The banks, operating in an insufficiently regulated market encouraged customers to buy sub-standard or over-valued stock and mortgages which they could not repay. ‘Triple A’ ratings were conferred in the United States on sub-prime facilities and money was handed out like confetti. This lending madness was promoted and controlled by the investment banks such as the vampire squid Goldman Sachs which fed people sub-standard information, and reinforced by delinquent ratings agencies. All of this is documented thoroughly in such filmic works as ‘The Big Short’. It’s useful to look at the history of one bank, Ireland’s biggest – AIB – over the post- Glass-Seagall-repeal period. It is representative and appalling. Around 2002, John Rusnak, a ‘lone wolf’ currency trader at Allfirst, racked up losses of almost US$700 million. It was Ireland’s biggest banking scandal and the fourth-biggest banking scandal in the world, when it came to light. The €90m settlement that AIB reached with the Revenue Commissioners in respect of Deposit Interest Retention Tax (‘Dirt’) evasion in 2000 was the highest tax settlement in the history of Ireland. The bank’s internal auditor, Tony Spollen had highlighted a Dirt liability of £100m for the period 1986 – 1991 but the group CEO at that time rubbished this estimate, describing it as “infantile”. The 1999 Oireachtas Sub-Committee Inquiry into DIRT concluded that it was “extraordinary” when the CEO told the Inquiry that he was unaware of the scale of the DIRT issue. In 2006, the Moriarty Tribunal found that AIB had settled a million-pound overdraft with former Taoiseach Charles Haughey on favourable terms for the politician just after he became Taoiseach in 1979. It found that the leniency shown by the bank in this case amounted to a benefit from the bank to Haughey. It noted that the bank showed an extraordinary degree of deference to Mr. Haughey despite his financial excesses. In 2004 it was revealed that the bank had been overcharging on foreign exchange transactions for up to ten years. AIB set aside €50m to cover the cost of refunds. On 12 February 2009 the Irish government arranged a €7bn rescue plan for AIB and Bank of Ireland. The bank’s capital value had fallen to €486m. The following year the  National Pensions Reserve injected €3.7 billion of capital into Allied Irish Banks, becoming the majority shareholder and effectively nationalising the bank. This smokescreen of misrepresentations led to over-borrowing and the present virus of evictions, dispossessions and receiverships. Now it is noticeable that the bailing out of the banks in many countries served to protect the shareholders and to impose the burden on the customers or more scandalously the public who bore no responsibility for this nonsense. Socialism for the rich and capitalism for the poor. The culprits with a few exceptions got off scot free and of course used Nama, Ireland’s (very) bad bank,