You might have thought that the last decade, and back in the 1980s, were the first occasions that banking in Ireland lost the run of itself, throwing our collective future in jeopardy. Not so. Or that the decade to 2008 was really the first time brashness and lust for material things rose in Ireland with abandon. Again, not so.
For Irish agriculture the Great War, 1914 – 1918, was a boon. Exports to Britain soared: with imports from anywhere but Ireland severely limited, the price of Irish produce was bid up accordingly.
In and around 1930, John Nix, a relative of mine born in 1884, penned a book and I’m giving my cousin, Des Nix, a hand with editing, (and yes, we’re on the look out for a publisher!).
Des describes John as one of the old-type gentlemen journalists, a scholar of Greek and Latin. Over his life he worked for the Carlow Nationalist, the New Ross Free Press and was a columnist with the Irish Independent, writing under the pen name of Sean Sneachta. His earlier years he spent in Clare and Limerick.
In the extract below John discusses the role of banks in the Ireland of 1914 to 1921. Historical comparisons are tricky but it was a time when agriculture would have held a position in Ireland even more central than the role construction came to play in the ten years to 2008.
The piece goes some way to explaining why Ireland never had a roaring twenties. More pertinently, it makes us question for how long more we will enslave our society to a banking system prone to inflict such damage. Given the striking parallels with today, I came away thinking: for how long more will we permit this?
While the extract below ends darkly, elsewhere John Nix is upbeat on the prospects for the young nation saying “the Celt has qualities not unlike the camomile flower – the more it is trodden on, the more it grows”.
Extracted from Chapter 3 –
“The long-dreaded landlord is, or soon will be, a thing of the past, but the joint stock banks are taking their place. During the war, and in fact till the great slump came in the May of 1921, the price of land increased five-fold because bank managers went about to sales and auctions pressing money on would-be purchasers.
Many of them sold out their small places and bought big farms, making up the difference with money pressed on them by the banks. As we are tied on to the English money system, we suffered tremendously when that country embarked on a policy of deflation.
The prices of livestock and farming produce fell to less than half inside of a year and continued to fall until the present time. The result of all this is that the farmer who is stuck in a bank finds it two or three times more difficult to pay interest today than during the boom years. The position is really desperate at present for the vast majority of our farmers.
… the farmers lived up to their means and even beyond it during those boom years. They bought motors, spent tons of money on drink and abandoned themselves to a life of dissipation generally.
… They thought the boom years would last forever, especially as they lasted for two and a half years after the Great War.
…Every scraggy farmer having more money than he ever thought he would have looked out for the time when he would be a great territorial magnate. They began to ape the landlords – what was left of them – and the gentry.
Sudden wealth is a dangerous thing. The farmers had seven glorious years. They lived a sort of earthly paradise and now they are cast into the outer regions, pervaded as they are by doubt, debt, depression and disappointment.
In fact , some of them go so far as to say now that it would be better that they never saw such boom years. They have unfitted them for the stern struggle of today.
If the banks really wanted to do it they could put half the farmers of Ireland on the roadside nowadays they owe them such a pile of money.
… has it ever struck you that when a man owes you too much money that he becomes in a sense your master. If you come down upon him like a load of bricks you scotch him altogether and you get no more out of him. These creditors will have to wait and see and in any case a lot of their money will be irrecoverably lost in the long run.
… banks, unlike private traders, never die, and debts owing to them never grow stale. They are continued in their books from one generation to another. Many an ambitious man has tied a millstone of debt around the necks of his children as won’t be paid to the banks for the next fifty years.”