When empires crumble

Whistleblower: An occasional column from our man around the IFSC, Jonathan Sugarman 

I am Jewish – half South African if you must know. I grew up in Israel. I have always been interested in empires, by which I mean countries that have found their moment in history’s sun and expanded on the back of it. I have a particular interest in Germany, lived several years there and was drawn to work in its Hypo Real Estate Bank in the IFSC. Hypo was infamously bailed out by the Bundesbank in 2008 with €35bn. It had catastrophically taken over DEPFA bank after DEPFA had moved its headquarters from Germany to Dublin for tax and ‘regulatory’ reasons. DEPFA became as Irish as Anglo was for a while. A twist of banking fate and Ireland, rather than Germany, would have been required to foot the bill. And girl, does Angela Merkel remember that.

Hypo drew me to Ireland and I became, in the end, more or less Irish. After Hypo I worked for UniCredit, Italy’s biggest bank, in Dublin, and the trouble started. As has been documented before in Village, UniCredit is where I was forced to falsify liquidity-ratio figures for the Financial Regulator, in an exercise that was replicated all over Irish banking until the government was spooked by incompetent civil servants into giving the bank guarantee that has bankrupted this country. I resigned from UniCredit and told my story to the Financial Regulator which, after advising that my information would be treated “in confidence”, then explained that this “confidence” would not preclude my whistleblowings being forwarded to the Garda; and in the end informed me over the summer, without deigning to concoct a reason, that it is not pursuing the matter. Anyway, after being shafted by Ireland it seemed the next most interesting place in Europe economically would be …Greece.

Empires, like many adventures in Irish banking, do not last forever. While they are on the rise, it seems that the good times will never end. In themselves they’re not much use, but rather a source of aggravation. The question in every case really is what legacy do these empires leave behind.

I reflected on this as I walked the streets beneath the Acropolis in late September. The cradle of democracy on one side, rioters with Molotov cocktails on the other. Perspective is everything.

The Celtic Tiger empire was not entirely surreal. Though essentially financial it was by no means a paper empire – it boasted very real manifestations. Irish people on median household incomes were developing property portfolios reaching from Bulgaria to Cape Verde. Many Irish people who should have known better were terribly proud of the fact that we, ‘the Irish’, now held the keys to the coloniser’s crown jewels like The Connaught in London. Before property took over there was even some real wealth created, albeit primarily by and for our tax-averse multinationals.

However, now that Ireland and its speculative colonies in Bulgaria, Cape Verde and Mayfair have crashed so spectacularly into the bottom of the Liffey, it’s time to ask how much of this will matter to the next generations. Did Celtic Tiger Ireland leave us with a legacy like Plato and Aristotle, Sophocles and Euripides and grand designs like the Parthenon? Is a port tunnel, two Luas lines that might meet one day (the Green Line comes to an abrupt stop at Stephen’s Green, from where it looks longingly at the Red Line), 400,000 plasticated one-off houses and a lot of anguish both during and after the Tiger (remember when the biggest thing on our minds was the scandalous traffic!) enough? Will future generations celebrate the Spire on O’Connell Street, which, being installed next to the GPO, effectively commemorates the Irish victory over the British empire (and, I fear, all subsequent comers and ideas)? The Spire is a soaring monument to everything and nothing.

Let us not be under any illusions. Much like the Calatrava-redesigned Olympic Stadium in modern Athens, the Parthenon was built with money the Athenians borrowed from neighbouring states and conveniently ‘forgot’ to return. Much like the Euro project and the NAMA bailout list, all the people scamming for the Parthenon are dead and buried. But at least, two-and-a-half millennia later, the Greeks have been left with a beautiful building to admire, and transcendent poetry to read at its feet.

Perhaps prefiguring the new Ireland, there is hardly anything that works properly in modern-day Greece. The duration of the train journey between its two biggest cities – Athens and Thessaloniki – is a rather variable quantity. Despite all the billions thrown at the train, the power supply is not to be relied on. At some point on the journey, the train stops as the locomotive has to switch from diesel to electricity. Much like the way the Luas comes to a stop at Connolly station, really. Yet, mysteriously in Thessaloniki, some things still work like they did in the good old imperial days.

There are entire sections in Thessaloniki’s water supply grid that remain unaccounted for; there are no maps that show where the pipes run. Drinking water has flown through them for hundreds, if not thousands, of years. It almost tastes as good as Irish tap water and is very healthy to drink. I know that as I drank a lot of tap water in Thessaloniki myself and am still alive to tell the tale – to the disappointment of the Central Bank of Ireland, UniCredit and the Israeli embassy in Dublin (since my days in the so-called Israeli ‘Defense’ Forces, I’ve not been sympathetic to our friends in Zion).



round the corner from where I stayed in Thessaloniki there looms the Hippodrome constructed in the fourth century AD. Around it the Roman Emperor Theodosius massacred 16,000 Christians in one day. Unlike Irish rulers who say a lot, but do very little, Theodosius put ‘his money where his mouth was’. But on my visit in the heat of the Greek autumn sunshine there was no residue of this incandescent ancient terror. Normality of a sort returned.

I am writing from Dublin in late October. The Hallowe’en bangers go off in the increasingly cold night air, reflecting – at least for me – fragility and volatility. There is a peculiar notion on Dublin’s streets these days that there will be a return to the ‘normality’ of the early 2000s. Forget it. Just wait for the next Budget. Ireland was not a wealth producer, but only a conduit for profit-seeking capital flows emanating from modern-day empires like the USA and Germany. Ireland was never the Ancient Greece of its time.

The horrible truth is that the Celtic Tiger empire has left us less than nothing. The real legacy of this illusionary Irish empire is that the country will be required to melt down its public-asset base in order to pay its debts. Starting with the national pension fund and moving on to forestry, electricity, gas and oil, the future of the country is being plundered. The current generation is already the victim of a diminished labour force, ever-decreasing pay, imploding public services. Many feel cheated out of a standard of living that is never to return.

In Thessaloniki, middle-class women in their seventies and men in pin-stripe suits beg on the streets. The rubbish goes uncollected. In compensation the quality of life, driven by low rents and fine weather, is good but Germany beckons ineluctably. And for this exhausted capitalist, China – the next ancient Greece, is an empire too far.