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I agree with you on the treatment of Ireland, and the subsequent criticism of the country over corporate tax issues, often implying that the country was implici
by alphadevx 12y ago
I agree with you on the treatment of Ireland, and the subsequent criticism of the country over corporate tax issues, often implying that the country was implicit in this, was rubbing salt in the wounds. Those tax structures were in place long before the crisis.
I'm torn on whether Iceland's approach was better however (for them), time will tell.
- innguest 12y agoYou have to admit it was at least more fair, as Iceland punished those that are really to blame (bankers) instead of the innocent (citizens). Whether it was "better" or "worse" is a discussion I'll leave to the consequentialists.
- alphadevx 12y agoThink about what default means: someone lent you money, and you never gave it back. Now think about that it terms of fairness. Sure the bankers lent money and never got it back, but who gave the money to the banks in the first place? Lots of private individuals were hurt: http://en.wikipedia.org/wiki/Icesave_dispute http://en.wikipedia.org/wiki/Icesave_dispute No clear-cut good/bad guys in this mess, lots of moral hazard.
- innguest 12y agoI'm confused. If someone lends me counterfeit money, I don't have to give it back. Banks don't lend real money, they act with the government to legally leverage their deposits and lend out leveraged money. This money is created in the books and did not come from production in the real economy. If private individuals' deposits were hurt then all the more reason to arrest the bankers. The moral hazard comes from government guarantees like FDIC that discourage banks from investing prudently.