Irish View

Great leaves the country

2007-08-15T15:44:00.000+01:00

The story of Great Agbonlahor seems to have reached an inevitable but still very sad conclusion, with the child and his family being deported back to Nigeria.

For those not keeping up, the family moved her via Italy a few years ago, and were appealing to stay under the grounds that Great has autism, and would be treated as a pariah in Lagos, as well as not receiving any treatment.

That the child has autism and needs help isn’t in doubt, and neither is the fact that he WILL face discrimination back home. But it’s disingenuous to blame ex-Minister McDowell for any of this, as when he ruled on the case originally, it wasn’t known that Great was afflicted.

The problem Minister Lenihan faced, and the tough call he had to make then was whether or not the family should be allowed stay in the country, and if a mental handicap is enough to warrant asylum.

The complicating factor is that Ireland wasn’t the Agbonlahor’s first port of call, that was Italy. This was probably the tipping factor against them. Great’s father (who remains in Italy) is involved in a war of words with some drug dealers there, and the rest of the family moved to Ireland out of apparent fear for their wellbeing.

The unfortunate fact, and one that the Agbonlahors wouldn’t have been aware of is that while the father will be eligible for EU citizenship in 2 years due to his working in Italy, the rest of the family now never will as they’ve been officially deported. The minister was in a terribly difficult situation, but he has to look at the bigger picture. Allowing Great to stay would have highlighted Ireland as a place that asylum seekers already in the EU could go to get an easier ride on the merry-go-round.

The solution of course is a uniform immigration policy across Europe, and a better organised group to help immigrants on their arrival. We’re a few years from that though, and even if it were to come through, it’s not going to be much comfort to the Agbonlahors.

Strikes and EGMs

2007-08-15T13:44:00.000+01:00

As is the story of anything that happens in Ireland and lasts for longer than a week, the Aer Lingus decision to leave Shannon is snowballing into a debacle.

First of all we have the pilots threatening to strike saying that management have broken Labour Court promises by employing pilots in Belfast on less favourable terms than those in Dublin. Which is probably true. Also true though is that the labour court agreements (And the Flynn report) specifically make mention that the company can open bases outside the Republic on local pay rates. This doesn’t seem to be deterring them however.

Now the last time I check Northern Ireland wasn’t quite part of the republic yet, and while I think we can all admire the pilots patriotic efforts to unite the workers of the island under the Republics laws, ruining 25000 people’s flights doesn’t seem to be the way to go about it. I’m sure they’ll get Sinn Féin’s support, but that’s about it.

The master of understatement Kieran Mulvey has come out and said that this 2 day strike threatens the very future of Aer Lingus. While this is utter rubbish, it’s still fun to hear a relatively neutral party sound off on the management, unions and of course everyone’s favourite shareholder, Michael O’Leary.

This brings us onto the second element of this debacle in the news today. Outside of the day he overtook Aer Lingus as the country’s number 1 airline, it’s hard to imagine a time when O’Leary’s had such fun. As 25% shareholder in Aer Lingus, he’s managed to put 2 guns to the government’s head, and is kindly giving them the option of choosing which trigger is to be pulled.

He’s called for an EGM to discuss the move away from Shannon, and has very publicly said he’ll vote to stop Aer Lingus taking the Heathrow slots to Belfast. Now obviously, combined with the governments 25% they’d have enough votes to do so, but the effect would be a body blow to Aer Lingus at this stage, and would send the stock price into a spiral when it’s obvious that the company can’t get anything done without the government or their biggest rival interfering.

The alternative is for the government to vote against the motion, guaranteeing the lost revenue for the Shannon area. You can just imagine Micko giggling to himself when he sees Willie O’Dea publicly disagreeing with the government’s stance on this. There’s still a lot of resentment on Mick’s part for the refusal to turn Dublin Airport into his own personal plaything, and he’s going to mess around with both Aer Lingus and Fianna Fáil for as long as he can.

Shannon alternatives suggested

2007-08-13T14:11:00.000+01:00

Minister Dempsey's currently in talks with Cityjet about possibly linking Shannon and Charles De Gaulle.

This a great idea, and the reactionary response of the locals that "well Paris isn't Heathrow" is shortsighted. If Dempsey's smart, this is just the first effort to entice Cityjet into becoming a major player in Shannon by giving them discounted slots to Paris and London Airport.

The result of this would be a net increase in the amount of jobs in Shannon (remember only 45 have been directly lost by Aer Lingus's move), and the opening up of a new route to a major airport.

One of the many problems for Shannon is that the staff there are more expensive than in the UK. This isn't true for the French coming over here, and this may see new companies opening up in the area.

Again, I wouldn't be terribly optimistic about this. For one thing, we're only in the first stages, and Cityjet aren't even entertaining talk of giving one of their Heathrow slots to Shannon, rather the more remote London City Airport. We're also only talking about a temporary daily flight as a test as opposed to a fully fledged investment.

Kudos to Minister Willie O'Dea for describing Aer Lingus head Dermot Mannion as "a latter day Oliver Cromwell" It's an utterly random and meaningless analogy, but it's a great quote.

Mr O'Dea is representing Fianna Fail by the way, 25% shareholders in Aer Lingus. If he and the government felt this strongly about the entire affair, they could just push for Mr Mannion to lose his position. Ryanair, another 25% shareholder, have publicly backed such an idea. But then they'd be all for dumping the fiscally responsible CEO of a direct rival. It's harder to see what logic the government could use.

Stock Market Dip

2007-08-13T11:27:00.000+01:00

Like most of the recent stock dips, last week’s European stock market fall stemmed from uncertainty in the way we deal with the US market than anything inherently wrong with the current European model.

This time the problems arise from the amount of money European banks have been lending to US ones, money which is subsequently lent to people who have either bad credit history or low income. This tactic of subprime lending was was too heavily used by EU and US banks as a way of getting more cash from their then low interest environments. Unsurprisingly a lot of these folks couldn't repay the loans, but with property prices dropping in the States, seizing their property simply wasn't enough to redress the balance.

So now the race is on to see which European banks have overstretched themselves when it comes to these loans. French bank BNP Paribas have already raised their hands, but it's the German banks that appear to be in more trouble, IKB in particular. They're already requesting a bailout from the government before the smoke has really cleared on their exposure and there are now domestic criminal probes beginning in the the higher ups as to who decided getting involved in this minefield was a good idea.

The irony here is that Europe’s sensible decision to raise it’s rates may be one of the contributing factors here. By raising their interest rates, it’s less attractive for EU banks to lend to their US counterparts. However this now means the US banks have less to lend, which leads to fewer loans, which, combined with the inability of people to make their exisiting repayments, leads to what we saw last week.

The knock on effect of all this is a general loss of confidence in the market, which was due a correction regardless. The recovery has already begun in London and Tokyo, but it’s unlikely that the 10% wiped off the board last week will be regained in the short term, more likely a small retrieval of about 4%, which would seem to be what’s best for everyone.

From an Irish perspective, it’ll be the banks that suffer most. Even though the main banks have confirmed they’ve stayed out of the sub-prime lending collapse, AIB would seem to have been over valued to begin with, still high on good results and the bi-monthly rumour of a City Group takeover. The lack of a bid (again) and stories breaking about the pension deficit they’re suffering should see them settle at a more reasonable price for a while, although BOI would appear to be slightly undervalued with growing rumours of a possible takeover of Alliance & Leicester. Probably won’t happen as Alliance appear to be telling anyone who’ll listen that everyone wants to buy them, but at least it’s a new takeover rumour…

Shannon pull out update

2007-08-10T16:46:00.000+01:00

So now a group of disgruntled locals are talking about taking action against Aer Lingus. This is just doomed from the start. Now if the government wanted to and say that as a major shareholder they should have been consulted, then MAYBE they'd have grounds. As it is this is just a random collection of bods who don't like a private company's decision.

In other news, I'm considering taking action against McDonalds for withdrawing their Rib Steak Sandwiches.

There is an obvious compromise here, if Aer Lingus wanted to follow it. Aer Lingus have 4 slots in Heathrow. When the floatation occurred, the only stipulation around the slots was that they couldn't be sold. Now more thought should have put into this, for instance, there's little difference to me between leasing the slots out to other companies and actually selling them, but it's too late to fix that now.

Anyway. Aer Lingus have leased 2 of their slots to other airlines, one of these expires next year, the other in 3 years time. There's a break clause in both these contracts, if IBEC and the unions feel that Shannon is a viable operation, and will be around in 5 years time, let them pay the break amount and come up with a package to entice Aer Lingus back. Or make a similar offer to another airline.

The problem is that even if this happens, Aer Lingus won't go for it. The board members are taking the long view here and it's hard to blame them. The Open Skies agreement dooms Shannon to being a back water airport come 2009. Shannon Industrial Estate, the business park that sprung up due to the airport's existance has seen numerous manufacturing firms leave them over the last 5 years. And for 20 years Shannon Town failed to attract a major manufacturer, like a Dell or an Analog.

The larger problem for Shannon is that it's simply not an economically viable entity. Aer Lingus's decision to leave is a symptom of that larger problem, not the cause.

Race for the Pres: Obama

2007-08-10T11:17:00.000+01:00

Obama's the most interesting candidate of either party. Forget about the "Poor son on immigrants" thing, he's a very bright guy who's managed to keep his name ahead of Clinton a lot of the time, despite trailing her so badly in the polls. He's managed to raise a huge amount of cash (all the more impressive given how much money was already ceded to Hillary) and he's making some great public speeches, even if these haven't quite transferred into his debate performances.

His major handicap is the experience thing. He's a first term senator, and as such has to answer "How are you qualified" questions in every interview. He also has managed to get himself into some very hot water by making some incredibly ill worded comments in an effort to talk up his Defence capabilities.

It's not an extremely popular time to be threatening unilateral action, and if you're going to do it, why on earth would you threaten your one true ally in the middle east? Obama talking about attacking Pakistan was just poorly thought out from the get go. Pakistan's people don't like the US all the much and don't think the Taliban in neighbouring Afghanistan are all that bad. So threatening to bomb them at a time when their (admittedly illegitimate) president faces internal challenges and dropping approval rates is astoundingly stupid.

Musharraf said as much that Obama's comments " has started alarm bells ringing and has upset (the) Pakistani public." Anyone who believes setting alarm bells off in a country with nukes is a super idea please raise their hands.

It would have been far better to have made the same speech and inserted Syria's name, but that boat has now passed. He's now getting lampooned by pretty much every other candidate, and it's being held up in the States as the equivalent of Dean's yelp or Bush Snr's "No more Taxes" line.

I don't think it's crippled him, but the fact that his people allowed him make the statement, the fact that the damage control has been so poor and the fact that he's actually ramping up his rhetoric rather than doing the smart thing and rewording it doesn't bode well for the future.

That being said, all the polls have thus far been good for him. He consistently beats Giuliani and McCain in the surveys, and an Obama/Edwards ticket really seems to have the mass appeal the Dems need in order to be sure of the White house. But it's unlikely at this point. In the all important opening states, he's actually behind Edwards in 2 of them and behind Clinton in the other. His openness about the fact that he's not going to accept a VP role may seem churlish, but it makes a degree of sense. The only person who's going to beat him is Hillary, and America needs a white male on the ticket somewhere.

The latest polls haven't come out yet, but the last week has undoubtedly hurt him. A lot of people don't necessarily like Hilary Clinton, but no one thinks she's stupid. And now they're not sure they can say that about Obama. There's a sneaking suspicion beginning to creep in that he really does lack the substance needed to win, and that this would become exposed as the race wore on.

Race for the Pres: Hillary.

2007-08-10T11:14:00.000+01:00

As the race (or slow crawl) for the presidential candidacy nears the beginning of it's end, it's still a surprisingly open field. I have a bit of time on my hands so I'm going to post my thoughts on the major contenders.

The Democrats are overwhelming favourites for the 2008 election. They control the house, the senate and are riding high on the tsunami wave of Not Being Bush. So obviously being the Democrats they need to find a way of ruining this. Infighting the day after Nancy Pelosi took over didn't quite do the trick, nor did constantly presenting meaningless and unwinnable bills to the Senate. They seem to have come up with a winner though by edging towards putting forward their only main democratic candidate who has been shown to lose EVERY race in their own focus groups.

Hillary's an incredibly divisive character, even within her own party, but her conduct so far has been presidential if not exactly exciting. Everyone knows pretty much everything about her, and there's no skeletons left in her closet.

Her pros are obvious: She can bring out the most popular living president along with her everywhere she goes, She does appeal to the soccer mom factor and she's bringing more money than God to the gig. She's constantly ahead in the fund-raising stakes, and the polls of the democratic faithful have her a massive 22% ahead of her nearest rival, Obama. She's also acting like a president. She's calm and authorititative, which none of the other candidates have managed thus far.

Her cons are the fact that she's still not an electrifying speaker, a lot of people in America are wary of another dynasty appointment, and the inescapable fact that every time she makes a public speech, no matter how good, the audience just want the fat guy sitting behind her eating that cheeseburger to be in charge.

Her more complex problem is the appeal she has to the wider audience. While she's way ahead in the party polls, on the national front it's a different story. Less than half the voting public view her as trustworthy. Only 59% of voters find her likeable. Bush has better numbers than that. Compare that to 76% likability for Obama and 62% trustworthiness. That's a big difference, and it does highlight her major flaw: She can't get cross party votes. She's also been shown to lose presidential polls to both Giuliani and McCain, an issue Edwards and Obama don't have.
Hillary's the favourite for the nomination, and she's probably going to get it, but she's going to find that's the easy part of the exercise.

Aer Lingus to abandon Shannon

2007-08-10T10:56:00.000+01:00

The fallout from the Aer Lingus withdrawal of the Heathrow route continues to grow. It's not hyperbole when the area's planners talk about the end of an era when established companies like Element 6 are talking about pulling out, and Dromoland Castle puts it's expansion plans on hold.

One interesting thing coming out of the affair is the hopeless situation the government finds itself in as part owner of AerLingus. You can't argue with the business decision of the company. You also can't argue with the detrimental effect that decision will have on the area. The word "Conflicted" pops into mind.

Forget about what Aer Lingus does, and what it means to the country for a moment. The government has a large share holding in a private company, a company big enough that if they make choices like this it affects whole counties. It's a recipe for disaster.

Eventually the EU are going to make Bertie sell the shares anyway, the smartest thing to do is to sell them off to someone who hates Michael O'Leary enough that he'll never sell to him.
Denis O'Brien springs to mind. That way you get a bit of revenue in a year we're going to need it, protect Aer Lingus from Ryanair and save yourself from having this headache every time the airline decides to close a route.

I really believe the government when they say that Aer Lingus didn't warn them in advance of the closure. Mannion's not an idiot, and if he'd told me last week "Hey we're cancelling one dead end set of runs to open up shiny new ones in a city people actually want to go to" I'd have been back in to buy more shares of the company. And been arrested for insider trading. Similarly he couldn't have warned a minority stake holder of changes to the route plans which could have affected the share price. Just because Jim Flavin is still inexplicably walking about, doesn't mean that CEO's weren't paying attention to the DCC judgement last week.

The blame here is with the local and national government for neglecting Shannon's development for the last 20 years. The stopover was a boon, and nothing was done with the rewards it brought. Even in a time of unparalleled growth in property prices, Shannon's remained stagnant. Aer Lingus "owe" Shannon nothing, and blaming a company for leaving due to better opportunities smacks of securing the runway long after the plane has taken off.