It’s
amazing how many people noticed the news reports of the outburst against
me by Taoiseach Bertie Ahern in the Dáil on Wednesday 21 June.
The vehemence of his verbal
attack surprised many people because Bertie Ahern’s usual
response to criticism is to reply in a very low key way.
It was no coincidence however that I was raising the government’s
failure to control house prices, and related this failure to Fianna
Fáil’s corrupt relationship with speculators and land developers.
I criticised the Taoiseach’s eulogy at the funeral of former Taoiseach
and Fianna Fáil leader Charles Haughey who was at the heart of
this corrupt relationship.
Obviously this touched a raw nerve and with good reason, because hundreds
of thousands of young working people are the victims of the obscene
profits of the speculators and housing profiteers. I was simply putting
responsibility for allowing this where it belongs – at the feet
of the Fianna Fáil and Progressive Democrat government.
A report on house prices had just been released by the Economic and
Social Research Institute, showing house price increases of 270% in
ten years. In reality, however, in Dublin the price of a modest semi-detached
home has increased five fold.
I was recently talking to a post office worker who bought a home in
the Swords area of north Dublin and was forced to take out a 39-year
mortgage. While preparing to tackle this issue in the Dáil, I
asked a friendly bank manager to work out the total payment over a 40-year
mortgage on a house costing €375,000. He told me that with interest
rates staying at 4%, the total would be €750,000 (three quarters
of a million euro), and if interest rates rose to just 6% the total
would be €1 million! Since many workers are now in their thirties
when they can manage to buy (if they can manage to buy), people will
still be chained to financial institutions into their seventies.
It is quite incredible that the "right" of speculators and
big developers to profiteer obscenely is given precedence over the rights
of ordinary people to acquire a home with reasonable comfort at an affordable
price. However, there is a conspiracy of silence about this in much
of the media. Where do you see banner headlines in the millionaire-owned
press denouncing this? Where do you see extensive investigative reporting
on the cost of labour and materials that go to construct a house and
how much of the cost accrues from the price of land and profiteering?
Such a survey could show that up to a half of the cost of a €375,000
home I spoke about in the Dáil is due to profiteering. What this
means is that the young people buying it will struggle for 20 years
of the 40- year mortgage just to pay off this profit and the bank’s
cut in interest.
This is all covered up in the media because the millionaire-owners of
the capitalist press are an integral part of the system; as are leading
figures and professions in the establishment. I highlighted in the Dáil
how a group of businessmen, doctors and lawyers bought an 11-acre site
in south Dublin for €32 million five years ago and sold it a year
later for €85 million – a speculative gain of €53 million.
Young working people will pay for this through mortgages or through
huge rents charged by the landlords who will buy up the apartments when
built.
Another factor that is never mentioned is that newspaper proprietors
make tens of millions each year from advertising placed by developers.
Most newspapers have bulky property supplements on a regular basis advertising
the exorbitantly priced houses that come onto the market. Obviously
such newspapers are not willing to bite the hand that feeds them by
exposing the profiteering racket that the construction and sale of houses
has become.
