A kick in the Aras

Value politics and the Presidency

I have a very simple belief system when it comes to business or life in general.

The rules of the game are:

  • You create value
  • You distribute value
  • You capture some of that value for yourself
  • If you live a good life, you create more value than you capture

For my children, I want a state that provides the infrastructure physical and cultural that allows them to create plenty of value for their community.

I know that if they do, they will capture enough value to make the choices they need, and to offer their children all the choices they need.

Let’s leave the physical infrastructure to one side – that job is for government.

Let’s focus instead on the cultural infrastructure.

This is anchored by beliefs that are shared by the vast majority of a nation.

The beliefs we sign up to in Ireland include:

  • Equal rights regardless of birth, gender, race, creed or indeed access to dominant political organisations
  • Practical ethics in business and in private life
  • A commitment by citizens that balances personal liberty with the needs of the Nation and State

Its not a long list. There may be more but let’s consider the role of the President in regard to this list.

I have had a number of discussions on twitter and offline about Sean Gallagher.

I don’t know him from a bar of soap, and I have nothing against the man.

One business guy suggested to me that every businessman in Ireland would do exactly what it is being suggested SG did in relation to tax. “Ripping the arse out of the tax code is a key skill in Irish business” is exactly how it was put to me.

That is not a sustainable model of business ethics, and that will become clear when the cute hoors not paying their fair share of tax go looking for college places for their kids, or visit their mum as she lies in a corridor on a trolley.

http://www.irishtimes.com/newspaper/ireland/2011/0624/1224299525409.html

I don’t want to live in that country.

If a President does not sign up to the cultural infrastructure we want for Ireland, how can you expect others to do so.

We elect a President to reflect what’s great about our country.

Sean Gallagher’s campaign stood for “Hope” and “Positivity”.

Its what Ireland is crying out for, and its no surprise that he won a lot of support.

It is why Charles Haughey was elected, it is why Bertie Ahern was elected.

“Questions are like the knocks of beggarmen, and should not be minded.”
― Flann O’Brien

I don’t want to live in that country.

I was struck also by the €5k paid by GAA clubs to SG in order to copper fasten grant aid. “He was inside with Fianna Fail and the ministers and (he had) the inside track, he had been (Dr Rory) O’Hanlon’s secretary. Once you got him to do it, you were going to get the grant.” According to sources in this article.

http://www.independent.ie/national-news/presidential-election/gallagher-charged-gaa-clubs-up-to-euro5000-for-grants-advice-2915300.html

That’s the Ireland my Dad grew up in. Access to a small elite – not  your ability or your application decided your fate and the fate of your enterprise.

I have worked in developing countries where that logic reaches its inevitable end point, where corruption crushes initiative and turns good people into ex-pats.

It has a habit of breaking the people who stay and have the capacity to change countries like Ireland – I think of Noel Browne especially when I write this.

The human waste of our generations, the ‘40’s, the ‘50’s, the ‘60’s the ‘70’s, my own generation who left in the ‘80’s – is incalculable.

In this period, Europe rebuilt itself, America reimagined itself and our best and our brightest built rich lives invested in Nations far from home.

Ireland stagnated.

I don’t want to live in that country.

In business I have found myself in the company of what Flann O’Brien would call sleeveens.

I have seen close up the self delusion with regards to their ability; the cuteness built on a presumption that the rest of us are too thick to catch them out; the expectation that even though its wrong, they will get away with it, and there will be a great story to tell about that close brush with moral consequences.

Taking these guys down requires a lot of effort and personal sacrifice.

On Thursday, all you have to do is vote.

A vote for Sean Gallagher is a vote for the Ireland our parents grew up in.

I don’t want to live in that country.

32 thoughts on “A kick in the Aras

  1. Siun says:

    Very well put Frank, thanks for sharing.
    Small point – “Equal rights regardless of birth, race, creed or indeed access to dominant political organisations”
    I would also add gender to this.

  2. Teri says:

    I don’t think the hoo haw in the media defines Sean. It often presents a picture that doesn’t necessarily represent anything close to what the real candidate is or will be like.

    In the last presidential election, I was appalled at the thought of Mary McAleese being President. Her pro-choice stance, her links to Fianna Fail … it was all an awful thought. I was sure she was morally stunted. And what could she really do to advance peace in the North and South??

    Fast forward 14 years and isn’t she lovely?? Who would deny the impact that she has made — and her integrity, honour and commitment to the office?

    The last few days in the media has been like a circus. Glenna reminds me of ‘Joe the Plumber’ from Obama’s campaign. And Hugh Morgan and ‘that dinner’ – well, it’s very much like Obama’s dinner with Bill Ayers, isn’t it?

    Look back at his presidency now and no one would question Obama’s commitment to the office, his work ethic, and his integrity. They might question his effectiveness for the office but they certainly wouldn’t question his moral fibre which represents the bulk of the attacks during his campaign.

    I’ve seen so many Presidential elections and so oftentimes we attack people on moral grounds – many of who are upstanding individuals who work hard to bring something to the community. If Sean were really that morally corrupt then, yes, that would be a problem. But it’s hard to see how much of this is really about him and his morals and how much has been blown out of proportion by the media and people who support another candidate.

    If you’ve been following Sean for months or years, he doesn’t just become a morally corrupt person in a few days especially when nothing but the media has changed. Sean stands for positivity and business. I think that does represent we do want for Ireland.

    • Thanks Teri – I agree with lots of your thoughtful comments.

      In regards to SG – I think he has a lot going for him – he is positive, pro business and promotes hope.

      I think the bar should be set high for the President.

      The media did not manufacture the stories about his business dealings, or his €5k GAA fees to use his FF position to ensure grants, or his poor memory about his dealings with Morgan.

      I think all three things put a doubt in my mind about him as a Presidential candidate.

      That’s more than enough for me. As he would say on Dragon’s Den….

      I am out!

      • Teri says:

        Hi Frank :D
        The media did not manufacture stories about Obama’s dinner with Ayers, his meetings with Jeremiah Wright, or the way in which he handled Joe the Plumber. It’s all about the lens by which we view these things and the way in which they are presented.

        If we truly only want a figure head then by all means Michael is the safe choice. If we want to face an uncertain future head on with the prospect of forging new business ties (which the office can influence), then Sean is a person who could make a difference. It is small business and innovation that will lead this country into a brighter future.

        We should meet up for a pint sometime! Best wishes — Teri

  3. iamreddave says:

    If “Ripping the arse out of the tax code is a key skill in Irish business” is true does that mean that only PAYE workers can ever become politicians?

    • Good question!

      I think most self employed people pay their way – its a small subset of sleeveens who give the rest of the self employed/business people a bad reputation.

      Its legal to avoid paying tax – just don’t subsequently ask to become my President!

  4. Frank & Teri,

    I used to think the same way about SG as Teri described – a good guy with vision and energy.

    But I am now of the view his interest is more in the revival of FF as opposed to Ireland – the approach to the Ent Board grant (this is the most uncomfortable piece for me), directors loan, and attempted light and fuzzy FF relationship (which the Morgan Dundalk dinner etc just highlights he was not low level grass roots) worries me – is he genuinely going to do the best for the country, or for his friends.

    Businesses/lobbyists/unions paying for preferred access to elected leader of the country is fundamentally wrong and corrupt, whether it is illegal or not, whether all parties do it or not. I have not heard SG articulate that this is an inappropriate way for a democracy to operate. If he did state that, I would be open to giving him a chance. Depressingly, none of the party linked candidates will distance themselves from this fundraising reality.

    I do not think SG is a bad man, and I think he has had to deal with an unprecedented storm of stuff this week, that probably no other Irish political candidate has had to deal with. I don’t like how it happened and how negative the tone toward SG has become. I think his qualities may be appreciated at local political level – councillor or TD – but the president, a person for my kid’s future, I don’t think so.

    Drew

  5. @Teri @Frank

    Business in the modern mature society I hope ireland to be someday part of is governed by a set of rules & ethics.

    The ‘Pro Business’ ethic that SG adopts is very clear:

    * His dealings with the Louth County Enterprise board are self explanatory.

    * Extortion of money from an Irish community oriented organisation, the GAA.

    * Slippery shady relationship with the ‘inner circle’ of FF

    * Illegal, yes ILLEGAL accounting procedures adopted by him regarding Irish Company Law

    * Unethical gargantuan payments to himself from his company while at the time pleading inability to pay subcontractors because of the ‘big bad developers’.

    * Claiming that the country ‘Cant afford to spend money printing election posters’ yet spending his election war-chest paying for Google Adwords (Google, is that a local Irish business?)

    * Track record of business success? Where is it? How many people do his businesses employ?

    SG spins that he doesn’t want to engage in a ‘negative campaign’ – he instead attacks any messenger – be they media or not – who queries his track record or integrity. SG was, is and continues to be cast from the same mould as the FF who have succeeded in bringing this country to her knees.

    We’re doing out best trying to recover from the injury inflicted on us ….. please spare us the insult!

    • Thanks Michael – but just a few points…..

      He did not extort money from the GAA Michael! They gave it willingly as far as I know – its the reason they gave it that is kind of worrying.

      Not sure he broke the law in terms of his accounting procedure, in fairness to the man.

      Good point about Google – first time I have seen that in print.

      I think that he deserves to be credited for the good work he has done as an entrepreneur. If he created 100 jobs and helped to build a profitable sustainable business let’s celebrate that…..

  6. The only problem is, all the other canidates represent the status quo as well! Lose lose.

  7. Kieran says:

    Just a brief comment on a very good post.

    “Ripping the arse out of the tax code … ” might very well be a key skill in Irish business. But practicing that skill should mean you dont have the utter gall to then stand for the Presidency of the nation.

    The President in reality is a relatively powerless position – but the President is out figurehead and should be above such murky business

  8. Alan Jordan says:

    “The gross and net result of it is that people who spent most of their natural lives riding iron bicycles over the rocky roadsteads of this parish get their personalities mixed up with the personalities of their bicycle as a result of the interchanging of the atoms of each of them and you would be surprised at the number of people in these parts who are nearly half people and half bicycles…when a man lets things go so far that he is more than half a bicycle, you will not see him so much because he spends a lot of his time leaning with one elbow on walls or standing propped by one foot at kerbstones.”
    ― Flann O’Brien, The Third Policeman

    Frank, maybe SG has just been up on that Bike for a bit too long? He didn’t handle the X Factor media scrum on Frontline well but I’m with Teri. However I think it has killed him.

    This is my sons first election to exercise his franchise. Its hard to get him engaged or energised about anything political.

    Anyway in the the early days we had a chat over breakfast ( one afternoon)about the election. The only person he knew was Martin McGuiness so he was all on for the Sinners.
    ( think he thinks that might shock us?) Michael D reminded him of Dobby out of Harry Potter and ” You have to be having a laugh if you think I ‘m voting for him”.

    Fast forward to today and I’m dropping him down to the railway station and I ask him who he’s voting for. “I’ll give Michael D my number 1, Norris my number 2 and I don’t know after that”.
    ” You’ve come full circle on Michael D I said”

    ” Yeah I know. I got to see him a couple of times hear him on the radio and he sounded ok and he was good on that last debate as was Norris”
    “Didn’t really believe your man Gallagher though ”

    So that’s one view from the younger generation.

    One thing is for sure though, that clip from Frontline will be in every PR Gurus Case study for the next 50 years. Brilliant implosion by GM and real squirmy stuff from SG with MMcG brandishing the smoking gun. You couldn’t make that stuff up.

    I suggest we put the one day course together and start flogging it next week.

    Any takers?

  9. Teri says:

    This is great. It goes to show (again) that much of what is happening comes down to spin — even the choice of words – to you prefer ‘extortion’ or ‘gift’? Maybe this election will be decided by who has best been advised by their campaign manager. This is the lesson Obama took from his Ayers/Joe the Plumber/Wright debacles. It didn’t change him as a person nor did it make him morally bankrupt as a President.

    We seem to want it both ways. We become incensed when we hear that Google makes obscene profits and pays so little in taxes (i.e., ripping the arse out of the tax code) and at the same time we cajole and do what we can to get them, and businesses like them, to setup and do business here.

    We may not like the way capitalism works (or doesn’t work) but these candidates are not on trial for that. No wrong doing has been done and, if I understand it correctly, people are not allowed to run for this high office if they have been convicted of major offences.

    As for being morally deficient in some way, I just don’t believe this to be the case. There is so much spin out there that, if the people doing the spin were trying to market Ireland as a country, they could nearly convince you that it was a sunny place to live. :D

    As I say, Mary McAleese, with all her strong ties to Fianna Fail, associations to Haughey and Reynolds, and her stance on abortion, I really thought she was going to be terrible – not just as a president but for the country. And look at us now. Aren’t we all so very proud of her? And why shouldn’t we be??

  10. 40 Shades of Green says:

    Frank,

    I enjoyed your post.

    A couple of points.

    1 – Where is the evidence that Sean G tore the arse out of the Irish Tax Code. I am genuinely interested so if anyone can provide links, I would appreciate it.

    2 – If receiving patent income tax free qualifies, then explain why SG is at fault for doing what the government wants citizens to do.

    3 – If renting a business premises from yourself is tearing the arse out of it, please explain why and what he should have done instead.

    4- I think it is fair to say that he maximised the state supports for Entrepreneurs. Does anyone have a problem with that. If so, should they not be campaigning to have Enterprise Ireland and the county Enterprise Boards abolished.

    4 – Re charging for filling out GAA club forms. I am with you on this.

    A final point is that there are other things you can tear the arse out of.

    For instance various Gold Plated State Pension Schemes. I actually find it hard to believe that Michael D has four under his belt, including a teachers pension when he hasn’t thought in 35 years. And as I understand it, this pension was “earned” by Michael D paying some junior person to do the work he was supposed to do. I find it so hard to believe that I would appreciate it if anyone can point me to where they are documented.

    From a morality perspective, Sean G’s sins pale by comparison to this.

    At least Sean’s businesses contributed monies to the state that went to pay Michael D’s pension.

    I think a constitutional amendment to say a person can only suck at one Public Teat at a time is called for.

    40 Shades

    • Thanks 40 shades

      Here is my response to your questions – others may have more to add – but I would ask that they stay within the law otherwise I will have to remove comments!

      1- There is no evidence that SG broke Irish Tax code, as far as I know. If evidence comes to light we move to a far darker place.

      His explanation leaves me with the impression that he was attempting to break the law in terms of Director loans – but that is all as far as I am concerned. Its enough to make me doubt his credibility.

      He could be completely snow white, but the way he handled this and other issues leaves me with enough doubt to publish this blog post.

      2- The scale and timing of what he did was inappropriate. Here are a couple of links.

      http://www.broadsheet.ie/2011/10/25/glenda-lynch-and-the-dragon/

      http://www.independent.ie/national-news/gallagher-shared-in-payout-of-euro860000-2913915.html

      3 – Renting to himself – don’t know the details here I am afraid – someone else might explain how this is inappropriate if indeed it was….

      Agree with you completely on the pension schemes. Incredibly irritating.

      I very much doubt SG’s businesses made a net contribution to the state from the little I know!

      Very much appreciate you reading this blog and your comments.

      Thanks

      Frank H

      • Kieran says:

        Just to add to Franks reply to 40 Shades above and why there are serious concerns about SG’s conduct (concerns which he could have cleared up by publishing accounts):

        2. At the time of receiving tax free patent income, there was nothing illegal in doing so. However, SG and his partner would appear to be the sole recipients of the patent royalties. His company had taken on a large number of small investors under a BES scheme and those investors did not share in the same patent income. The prospectus given to those investors apparently referred to patents held by the company and it would have been a reasonable expectation of those investors to benefit accordingly.

        3. The issue with the rent in my opinion is totally inappropriate conduct. Again I need to refer to the investors in the BES scheme, a large number of small investors who rightfully hoped to make some return for their investment. While the company was losing a large amount of money due to the collapse of the building trade, SG was receiving the full and some would say excessive rent for the premises. Again the BES investors would feel tha they were pumping in their hard earned cash that was being removed from the company at the same time by a director. At the very least, highly questionable practice.

        4. State supports. No issue with SG receiving state supports. However, again questions need to be asked about the tangled involvements between SG and the organisations supporting his business e.g. is it right and proper that Intertrade Ireland supported a business while he was a member of the same organisation? Ditto with the local Enterprise Board?

        I agree with 40 Shades regarding pensions etc. However, is this a valid criteria for electing a President i.e. a competition to see who has sinned the least, surely we deserve better than that

  11. Alan Jordan says:

    It’s funny Frank, but if you look at all of the comments we are using phrases such as:
    – I’m not sure but,
    – there is no evidence but,
    – should be above such murky business,
    – It puts doubts in my mind.
    – he could be completely snow white but,

    Perception is fact!

  12. Frank I whole heartedley agree with your sentiments expressed here. They have been a long time coming from the obfuscation and confusion that has developed over quite a few years.
    The biggest disappointment I’ve seen from this last electoral campaign was that someone once again attempted to ‘pull the wool ‘ over our eyes as in the old way. It treats us with high disrespect : as a people that can be fooled, a people who are not demanding or intelligent as to where their money is spent. Mr. G’s aspirations to be our President have been shown to be completley self serving. How disappointing from an ‘entrepeneur, mentor’ and ‘responsible’ person
    Time to grow up Ireland..I think.
    I also think that if we give our hard earned money to people who work for us ..they should have respect ..and work for the people who pay them…that’s across the board……time to honest up! and get the finger out..or perhaps we could swap jobs for the holidays and see if we can understand each other a bit more
    By the way both M Mc G/SF and S Gall did themselves no favours by hanging around with fuel smugglers

  13. 40 Shades of Green says:

    Frank,

    Thanks a bunch for the links. A particular interest for me is how much money he took out of the business. I read all the articles and initially, I was thinking yeh, he ripped the company off, and then I did some sums.

    According to the Indo, the two partners took out 860K over two years. Based on the numbers in the press articles, the premises was 30,000 square feet being leased at €6 per square foot. That is €180K a year so €360K for two years. So excluding the rent, the two boys took out €125K per annum each.

    Now if I have my accounting hat on correctly, legitimate expense payments would be included in that 125K so the actual salary could be of the order of €110K. The question then is, does this seem excessive?

    To get back to my comments on pensions. A secondary school teacher with 15 years experience earns around 60K. The value of the pension is another 50K. So did the boys deserve a salary of a secondary school teacher for working 60 hours a week and building a business that employed a lot of people. If not, what should they have been paid. €€50K, €30K, nothing?

    The rental payments are a red herring in this. I am speaking as someone who had to pay 110K to buy my way out of an extortionate lease so I know what I am talking about. The kind of extortionate lease agreements and Director’s guarantees that are required to rent good premises are a major impediment and risk for entrepreneurs. As a BES investor, I would prefer to invest in a company that rented premises from one of its directors than one that has to rent the premises from a judge or a solicitor. A proprietary director is more likely to be flexible than an aforementioned fat cat Judge.

    To be honest, the most interesting thing about this whole episode is the inability of Either Gallagher or any of his supporters to do some simple mathematics just like I did.

    Gallagher could have used this as an opportunity to attack upward only rent reviews and to wheel out entrepreneurs who have been crucified by the Rachmanism that passes for commercial rents in this country.

    End rant

    40 Shades

    • Alan Jordan says:

      “The party had a viable candidate in Brian Crowley, likeable, able and appealing. He was turned down in favour of Sean Gallagher” Bruce Arnold

      Is that really the inside story? Did Martin and the FFers meet with Gallagher and tell him he would get discreet backing?

      Now that would be a story!.

      • Kieran says:

        In my view, yes – SG the ultimate Fianna Fail trojan horse. I have a sneaking suspicion all along that Gaybo, Micheál Ó Muircheartaigh et al was a smoke screen – they knew full well that anyone running under the FF banner would be decimated by the electorate.The charade of SG the independent would mean that someone from their national executive could win the race to the Aras – how else could you explain M Martin refusal to allow Brian Crowley to run, Crowley is after all reasonably well respected nationally but poisoned by the brand.

        Pure conjecture I know but in my opinion, a not untypical FF stunt – sneaky … and just a little bit brilliant :)

      • Kieran says:

        PS did you see any of the photo’s online from the Entrepreeur of the Year shown on RTE recently, SG and MM going from table to table together working the room?

  14. Teri says:

    Congrats to Michael D! :D

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    keep doing what you’re doing!

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