Lois Kapila of the Dublin InQuirer: A Return to ‘old-fashioned shoe-leather reporting’

The Dublin InQuirer has raised some eyebrows since going live a few months ago. It has quite an interesting perspective including articles on the role of finance capital in the city and good critical coverage on the goings on in the city council. Coverage of the work of housing activists has been included and the site broke  the shocking story of homeless families being forced to use the side entrance of hotels. The web based publication comes out every Wednesday and as well as the what we would expect from a  local news site such a city desk, arts and cuisine articles and a what’s on section what really caught our eye is the  ‘unreal estate‘ planning and property section which as the name implies has a far  more critical outlook compared to the ubiquitous estate agent  driven property porn found  in  mainstream journalism. The site also includes interesting ‘long reads’, such as  one on the life and work of cat catchers in the city.  Columnists include Frank McDonald previously of the Irish Times, the aforementioned Andy Story who covers economics and Roe McDermott an advice columnist. The site practices what founder Lois Kapila describes as a more traditional approach to journalism and writing compared to the PR driven churnalism that has increasingly become the norm. We sent Lois some questions to find out a little more about Dublin’s latest media product who discusses issues such as funding models, journalistic style and practice and mainstream media plagiarism.

Lois Kapila

Lois Kapila

Congratulations on the new news site, the first question is why did you decide to set about establishing it?

Thanks! I set it up because I thought there was a gap in the market for in-depth city coverage, and that there were many stories that weren’t being told. Also, I was working as a struggling freelance journalist in Dublin before this, and I couldn’t find many places that would run the kind of stories that I wanted to write – in-depth local journalism.

I grew up in the UK and there, at least, local journalism seems to be looked upon as second-class journalism. It isn’t really respected as much as the nationals. In 2009, I interned really briefly over a summer for an alt weekly publication in the US called Washington City Paper, and what they were doing there really blew me away. That changed my idea of what local journalism could be.

As well as all that, I wanted to create opportunities for young reporters to go out and about and do what some might consider more old-fashioned shoe-leather reporting, rather than maybe rewriting press releases or sitting at their desks reporting on tweets. I hope that we’re going to be a good training ground for journalists who can then go on to grander places that can pay them more.

 logoHow long have you been up and running? Are you finding your feet?

We’ve been up and running since June this year and I think we are finding our feet. It’s taking us a bit of time to get to know our beats, and to become known on them — simple things such as being recognised as press at city council meetings.

The mindset that a reporter needs for a weekly publication, rather than a daily, or hourly, is different. You need to think a bit more about where the debate is headed, find stories that aren’t going to have been published elsewhere by the time you go to press, and justify having that bit more time to report. So that’s a learning curve too.

I feel like we’ve got the basics in place now, and there are different longer-term projects that we need to start working on, particularly using data, to make the most of being an online publication. We’re not exactly where we want to be yet, but I think we’ll get there.

Question three is of particular interest to media activists is how did you go about establishing it? And as much as you feel comfortable telling us do you have a particular funding model? We notice for example you offer editorial services and a shop, is this intention to leave you a little less dependent on advertising?

At the moment, it’s funded with some start-up funding that I have been extremely privileged – and am slightly nervous –  to have got from family. I did apply for, and continue to apply for, different grants but haven’t managed to bag one yet.

I obviously did a lot of talking to people and reading about different models for local media before we got set up, and I thought that we would find it really tough to survive if we were completely dependent on advertising. So we are trying to work on numerous revenue streams in addition to advertising, as you noticed: editorial services, an online shop, our membership scheme.

As a local publication, focused on the kind of journalism that we are, we’re never going to get as much traffic as a national with rolling breaking news and celebrity tidbits might. Perhaps I’m wrong, but I think it’s safe to work on that assumption.

So we’re working to build up a smaller core of loyal readers who spend more time on the website, and like what we do, and give what they can when they can. It’s healthy to have that focus on readers, I think, and in the future, I want to build up our membership scheme, so that those who donate to us do get more than a tote bag; I’d love to be able to give them discounts at different places in the city, and to run more events for them.

The danger of having all these streams, of course, is spreading ourselves too thin. We are a small team and so finding time to manage them all, and keep them moving, is tricky.

In the future, I’d love Dublin Inquirer to become a newspaper part-owned by its readers. I envisage some kind of equity crowd-funding model, where in exchange for a contribution, the readers become part-owners.

DublinInQ The site seems to have a particular interest in planning and housing, and it has to be said has a far more critical attitude towards it compared to what we are accustomed to, for example your ‘unreal estate’ section, is this area of particular interest to you, and why?

I think it’s of interest to us, because it’s something that our readers want to know about and we all struggle with issues like rising rents and substandard accommodation. If you live in the city, you can’t help but take an interest in the built environment.

As for taking a more critical attitude, to me that just seems the default approach that we should have to it. It’s also more interesting, I think, than property porn.

I genuinely don’t understand how you can have such blatant property porn, thinly disguised adverts, on the front page of the Irish Times website, for example. Sometimes, right up there at the top of the page. How can a national newspaper of record think that the potential sale of one multi-million-euro home somewhere in the country is deserving of that kind of exposure?

When I first moved to Ireland, the second apartment I lived in with my husband had mould all over and broken windows. The ceiling fell down and the landlord had complete control over the heat and left it off for the winter. And it’s really difficult to function and stay healthy when you’re living in those conditions. But if nowhere else will take you because there’s a shortage and you don’t have references and you’re broke, what are you going to do?

So, I do feel passionate about housing. Also, we are a city paper, and we aim to focus on local government. And housing and planning are some of the areas where the council does actually have influence. So that, too, means it’s a natural reporting area for us.

We have also noticed what seems to be wider range of opinion on your site compared to the mainstream, especially around property, is this a policy?

I’m glad you think that we have a wide range of opinion on the site! I guess it’s a policy to be open to submissions and have a wide range of informed voices. I don’t understand why any publication or editor would make themselves difficult to reach.

I would like us to have more diversity, though, in terms of ethnic minority contributors, for example. I think the media in Ireland does not reflect the diversity out on the streets. I know that immigration is newer here than in the UK, for example, and for some immigrants, language will be a problem, but I think we have to try harder to open up opportunities for people from new communities to get a break in journalism.

For those who worry that somebody from somewhere else can’t possibly understand what’s going on here, I would point out that our planning and transport reporter is from the US and his stories are smart and spot on.

Are you going to be engaging in investigative journalism on the site?

I would love to be able to do more investigative journalism on the site.

To me, investigative journalism is just great reporting that takes more time. At the moment, we’re a small team and so that’s a struggle. But I think we’ll get better at juggling longer projects with weekly pieces and that’s definitely something that we’ll be working on.

In any case, I think we should approach all stories with the mindset that you might associate with investigative journalism, and ask, “What do I want to know?” rather than, “What will people tell me right now?”

How would you describe yourself editorially?

I think that our mission, for want of a better word, is simple: to tell people stories that help them to understand what’s going on in the city, and present them in a way that’s enjoyable to read. And some of those will be the more medicinal, we-think-you-should-know-this stories, and some will be the softer, we-think-you’d-smile-at-this stories.

I don’t really give any thought to where we might fall in terms of “on the left” or “on the right”. To me, that’s irrelevant. We’re independent. When we’re reporting stories, our focus is simply to figure out what’s going on and tell our readers.

Our voice is more informal and, at times, some might say less measured than some publications. But I think there’s a danger with some publications that they confuse having a neutral voice with “unbiased” journalism and sometimes hide behind that style. It’s the reporting process, and being transparent about where information came from, that determines whether a piece is accurate and honest or not.

Are there any sites, papers or models from outside Ireland you admire or would like to emulate.

There are so many sites and papers that I read and admire and would love to be even a shade as good as, particularly in the US. I love the alt weeklies such as Washington City Paper  with their long-form narrative style and grit. I love regional publications like This Land Press which seems to be succeeding at building a sense of community around the publication, has a quality print quarterly, and is great-looking. And I love Tampa Bay Times, where even the simplest story is done with such care, such as this one about sports fans  or this one about an astronomer.  I also love Texas Monthly.  In India, Caravan  has incredible political profiles.

Do you intend to stay Dublin focused in the future, or do you have plans to publish national focused stories?

We’re definitely staying Dublin-focused. It’s a better use of our resources to keep our coverage tight and get to know the city as well as we can, rather than spreading ourselves too thin. I think this is where the gap is too. I’m not saying that there aren’t other Dublin-focused news publications, but I don’t think any of them are doing quite what we are.

I hope that some of our stories will get picked up by nationals. Actually, a few already have, such as our story about the rules that homeless families in emergency accommodation have to abide by. RTE and The Mirror picked up on the issue, as did The Journal.

While RTE credited us, and The Mirror re-reported the story themselves, it was a bit frustrating to see The Journal pick up the story and use our reporter’s photos of the list of rules as source material and illustrations, and not give us even an “H/T”.

But it’s still great to see issues that we follow and think are important spread to a wider audience. And I think that even though we’re small, we can hopefully play a bit of a role at times in setting the agenda.

The Press, Market Ideologies and the Irish Housing Crisis

Henry Silke, of this parish, wrote a short paper for the newly founded Political Economy Research Centre at Goldsmiths University, London. The paper looks at the links between the media and the property industries and looks at the coverage of housing and property in the run up to the 2007 general election:

The time period was chosen for two reasons. Firstly the drop in house prices first began in the second quarter of 2007 and secondly because this coincided with the general election that year which was held on the 24th of May. This election was probably the last major opportunity for debate in the ‘public sphere’ on the property bubble before the crash, and certainly it was the last opportunity for people to vote before the crash.

The report looks at where the Irish Independent and the Irish Times sourced their information on housing; sourcing is an important issue in media as journalists depend on sources for information which is then further mediated to the public, often as fact. The results are stark: 

 In the coverage of property in the Irish Times and Irish Independent a key finding was the dominance of elite sources connected with the property and finance industries as compared to ordinary sources such as home buyers and renters. In fact, out of 800 articles, only one reflected critically the views of tenants. This is especially the case in the property and business sections. The greatest total single overall source on the issue of housing is comprised of estate agents, accounting for some 28% of total sources and 29% of sources by frequency. This high skewing of estate agent sources is due to the large number of advertorial articles in the property sections but nonetheless the lack of critique within the property sections even from a consumer perspective (never mind a public interest, business or societal perspective), still leaves much to be desired.

In the news sections official sources, especially politicians are most prevalent with 69% of total sources. This can be broken down to 29% government parties’ representatives and manifestos; 34% opposition parties representatives and manifestos and 6% local government and government agency sources. 17% of articles also included sources from the finance and property industries…

 

…the parties with pro-market polices make up the vast majority of sources in the papers although it may be argued this reflected party political support at the time. When compared, the Irish Independent and Irish Times have a roughly similar ratio of party political representation. Economically right wing political sources make up the majority with approximately 65% of representatives being openly free market parties (Fianna Fail, Fine Gael and the Progressive Democrats). If we include Labour who had a 2007 policy of subsidising the market by offering large grants to be used to buy private housing (the number would go up to approximately 77%). Representatives of parties that call for non-market solutions to housing make up just under 9% of sources (Sinn Fein, The Socialist Party and People Before Profit Alliance), while the Green Party, which called for stricter market regulation, come in at 10.5%.

The most striking figure is that of what we term use value sources, that is sources such as renters and home buyers who are interested in the property solely for its use, i.e. to live or work in it. Use value sources make up only 2% of total sources and appearing in only 2% of all articles. This compares to ‘exchange value’ sources (from the property and finance industries) making up 43% of total sources and appearing in 44% of all articles.

A key observation from this research is that statements from sources in private industry are generally reported as fact with little or no critique. There is an absence of critical engagement with the claims advanced by such manifestly partisan sources and the consequent lack of any independent or investigative journalism orientated to a wider public interest. This overly skewed sourcing could be described as a manifest ‘capturing’ of the press by property and finance sources and may help to explain the downplaying of the oncoming crisis, and the lack of critique of the massive inflation of the cost of housing as will be discussed below.

The report goes on to discuss some of the treatment and framing of the housing by the Irish Times and Irish Independent:

The key trends included an overall market-orientated frame: that is that housing was primarily looked at from the point of view of the market rather than society. Elements of this included the privileging of exchange value over use value, non-critical reporting of markets and market sources, and a ‘fragmented imagination’ – that is the artificial division of events. For example, while corruption on housing issues such as rezoning was heavily covered in the news sections on the political side, the industrial side of the corruption was completely ignored and corruption itself was not covered in business or property sections of the papers. The role of the state, following clear neo-liberal norms, is seen positively, as existing to serve the market, to return it to stability; or negatively as a malign force causing instability in the markets.

The report goes on the discuss the lack of critical engagement in the newspapers with issues such as house prices and the property markets:

The residential property supplement in both newspapers displayed an uncritical, aspirational and advertorial discourse when reporting individual properties. At times, advertorial type articles also find their way into the business and news sections. Not one article questioned whether an individual property may be overpriced, the minimum expected of even a consumerist publication. Overall in the newspapers, including the news sections, the key issue is of the market and ‘market stability’ rather than either consumer or social good. In the news sections there is an acknowledgement of a need for a second tier housing supply for those who cannot afford to purchase on the open market. But the third tier of private rental accommodation (beyond one article) remains invisible. In the property and commercial sections the rental property market is framed from the perspective of landlords and investors. Even second tier housing is framed on a market basis from the point of view of private companies or developers involved in the supply of public housing. In Op-Ed articles, market stability is the major issue again trumping the crisis of affordability or the social need for housing. The only questioning of rental prices is from the point of view of business focusing on the danger of wage demand inflation arising from higher rents.

On the role of the state:

The discussion around state policy played into the neoliberal trope of state ‘interference’ distorting a functioning market. Material issues such as overproduction and price inflation are ignored and assumptions of market self-regulation (without state interference) appear implied. This is an important finding as it reflects the neo-classical viewpoint that markets work and are self-regulating and that crisis came not from markets themselves but from behavioural, psychological and political interferences that cause irrational exuberance, crashes and crises. Again, given the non-critical sourcing of both papers from orthodox neoclassical economists and the lack of any evidence of independent fact checking or investigation, this is probably not surprising.

The report concludes:

There is ample evidence from the research to state that the role of newspapers when covering the property industry was not one of objective reporters or ‘watchdogs’ reporting on the issue of housing from the point of public interest. Rather, the newspapers’ key role was as advertisers for the industry, facilitating exchanges of uncritical information between industry players, and as an ideological apparatus. This apparatus acted to normalise the hyperinflation of housing, celebrate high property prices, downplay alternatives and, crucially, acted to play down the contradictions in the Irish system that were heading towards a crash.

And:

The newspapers did not act in accordance with the overall public interest in mind but rather narrow sectional and economistic interests. There were some exceptions to this, in particular in some opinion pieces. However, the main trends and frames point to a ‘captured press’; that is a press in the service of a narrow class-based interest. This does not represent an accusation of a ‘conspiracy’, as stated by Geraldine Kennedy (2015) in her evidence to the banking inquiry. Rather, this is evidence of key structural, institutional and ideological biases that were apparent in the analysis of the content. A key element to this process was the framing of housing not as a social need but as a commodity whose chief role was to create wealth rather than supply housing. This allowed for the celebration of the hyperinflation of housing and rental costs. The market-orientated framing also included the neo-classical and idealistic belief in market self-regulation, either denying or playing down the possibility of a crash. The lack of critique may well have helped to both build and prolong the bubble itself. That is not to say the media caused the crisis. There were long term material and political structural issues at its core. However, the newspapers did play the role of facilitator, supplying ideological and political cover to an economic elite who profiteered greatly from the hyperinflation of housing and the sale of financial products. This assisted in laying the grounds for the housing crash, the economic crisis and the subsequent financial bailout, alongside the severe austerity policies that then followed.

And finally:

There is little evidence that this framing of housing as a commodity rather than a social need has changed as most discourse continues to be around ‘fixing the market’ rather than thinking outside of it

The full paper can be found here.

‘Dail Eireann isn’t Exactly a Bling Ring’ says the Journal.ie

journalThe Journal.ie concludes that ‘Dáil Eireann isn’t exactly a bling ring’ having found three-quarters of TDs have another source of income/assets on top of their €87,000 salary and that 54% own shares and/or land, residential investment or commercial property. Also, both the Environment Minister, Alan Kelly, and the Junior Minister for Housing, Paudie Coffey, are landlords. In a previous article here, The Journal informs us Kelly is against rent control. And sure what harm is a little property speculation between friends.

 

Inside Bias – class representation in the Irish Times

blind_spot2A piece on the Irish Times new podcast series ‘Inside Politics’ on renting and property gives some revealing insights on continued class biases in the newspaper. The section included three guests, a TD from the Labour Party, a speaker from the Residential Landlord’s association and a representative from Mortgage Brokers Ireland (who is also  a landlord). Who’s missing from the picture? You guessed it a tenant.  The framing of rent reforms as unnecessary, counterproductive and politically impossible quickly follows:

Media, Crisis and The Making Of Common Sense – The Live Register

The Live Register hosted a podcast discussion on the Media, Crisis and the making of common sense between Henry Silke of this parish and Julian Mercille of UCD.

From the Live Register:

Why is the vast majority of Irish media dominated with an undoubting and uncritical attitude towards a single theory of the ‘crisis’? What role does it play in legitimising, rather than challenging, the structural causes of growing inequality? And what does this mean for radical interpretations of democracy, public space and the remaking of common sense?

In this Live Register podcast, we’re joined by Julien Mercille and Henry Silke, two academics who have been carrying out separate research relating to the Irish media.

Julien Marcille lectures at the School of Geography in UCD and has recently published research on how the Irish mainstream media have covered the Irish “crisis” from a pro-austerity position over the last five years. Henry Silke is a postgraduate researcher at the School of Communications DCU, who has been examining the political role of the Irish press during the crisis.

We used their research to frame a wider discussion of the real role of mainstream media in Ireland today, exploring how market ideology is central to how mainstream media frames public discourse, very much at odds to the perception of mainstream media holding truth to power.

Journalism, Ideology and the Markets: The Irish Media and the Property Crash

The role of the Irish media in the property crash and following economic crisis is again hitting the headlines with a Sindo special edition promised this Sunday (10/11/2013); the Irish Left Review has also recently published an interesting piece on the role of the media by Bryan Wall on the fifth anniversary of the banking guarantee, while research from UCD’s Julien Mercille into the media’s role in the property crash continues to attract interest here. In light of this renewed interest CMR will post an article previously unavailable online on the role of journalism, ideology in market crises published in Look Left. This article considers the role of communications and media in crises of capital focusing on the Irish crash. Other articles on the property crisis by the author are available here.

First Published in Look Left magazine, September 2012

Click on the images to enlarge

look left cover housing article cover

Silke 2012 Journalism, ideology and the Markets  pg 1

Silke 2012 Journalism, Ideology and the Markets pg2

Silke 2012 Journalism, Ideology and the Markets pg 3

John Bellamy Foster: Use Value, Exchange Value and the Communication Revolution – IAMCR Dublin 2013

John Bellamy Foster speaking at the IAMCR conference in Dublin. Foster discusses the issues of finacialisation and the ‘communication revolution’. Of particular interest to this blog is his discussion of the privileging of exchange value over use value; something this blog maintains is intrinsic to the Irish housing bubble and ideology surrounding it and is a central plank  to research being carried out by the author into the media and the financial crisis in Ireland.

Inception or Deception – Japlandic

Republished courtesy of japlandic.

Notes on the data: the number of houses sold isn’t factored, just the total sales price for 6 months. The volume of sales are so low at the moment that any houses at the far end of the bell curve will skew the picture. The thing that made japlandic doubt the Daft figures is the numbers for volume and value of mortgage approvals have been constantly falling – so rising prices are not being facilitated by bank lending. It would seem cash sales is the only other financing that can drive prices higher – and these are only captured in the Property Price Register, all other property stats available don’t capture cash sales. More expensive properties could skew the data – but the most significant factor at the moment is cash sales – and these aren’t being properly tabulated anywhere. Thanks to japlandic for that.

The newspaper treatment is at best an overly positive framing of the property market with  inconclusive data. At worst and probably most likely it is business as usual for the Irish press, in the week of back slapping over the anglo tapes it is worth remembering the structural role the print media has played and continues to play in the Irish economic crisis CMR.

Strategic Ideology – Preparing the ground for Repossessions?

Pat Kenny (on evictions) –  ‘Will we see more people on the side of the road literally, soon?’

IBEC economist  –  ‘Look, I think all the options will have to be looked at’

Prime Time (RTE  Current Affairs) 4th April 2013

Introduction

Ideology in its popular sense is seen as something akin to identity and something we are very much aware of, one has an ideological political position, usually some ‘ism’ or other. While true to a small extent the real secret of Ideology is the insidious nature of what becomes ‘common sense’, and how this ‘common sense’ may go on the frame narratives, agenda and discussion. This ‘common sense’ may or may not have any basis in material reality and it may or may not reflect an overt political movement. But scratch the surface and there is inevitably some class interests at stake. If one thinks of the inevitability of cuts as opposed to the impossibility higher corporation or wealth  taxes as expressed by the mass media we can see that point.

In fact the entire notion of austerity itself is an ideological and class based construct, and yes, thus far, it is working very well for elite power. The ideology of austerity has become a default and assumed reality across much of the political spectrum. The only remaining questions being sectional and localised.

Within the mass media there is a tendency for dominant political and social ideas to become ‘common sense’, in other words assumed to be true while anything contrary to this ‘common sense’ is deemed political, ideological and not rational. This type of thinking allows someone like Karl Deeter, a constant and deeply ideological champion of the Irish Property market system, to proclaim:

‘…that Flac and New Beginnings “have an ideological view of the world. I don’t’. “Maybe that makes me soulless but I believe my research is good. They can dismiss my research and rubbish it but what have they done? What research have they put together. They have done nothing. I am certainly not going to back down just because people disagree with me.”

In other words those who are in any way critical of the premises of the market system are ideological while those who support this system are, in their minds, entirely rational. In the upside down world of newspaper and media, treatment of property heterodoxy is ideological while orthodoxy – even after the collapse of the property market – remains the only truth. The depth of ideological thinking within the Irish media can be seen in that even now, five years after the event, there seems to be no conception of the possibility of supplying housing outside of an unregulated market system.

Preparing the Ground – Identify the Enemy

Anyone who was in Ireland as the economy collapsed could not have missed the public-sector/private sector ‘debate’; which in reality was a class offensive which prepared the ground for huge cuts in pay and conditions in both sectors. The public sector were framed as lazy and overpaid as well as ‘holding the country to ransom’; their unions as old fashioned and corrupt. The private sector worker for their part were lionised for their perceived self sacrifice. Of course few in the media actually spoke to private sector workers or even their representatives and tended to speak to either private sector owners, managers or human resource ‘experts’, (which often meant highly paid private consultants). When private sector workers became unemployed they could be either used as a weapon to attack other workers pay and conditions or denounced as dole scroungers. This also played into the equally ideological ‘common sense’ viewpoint that anything organised in the private sector was efficient and well run, while anything not privately run was inefficient with the logical conclusion that privatisation would be a preferred option. This was particularly ironic at the time because the bulk of the collapsed private banking system (and more importantly its debts) were on the road towards nationalisation.

While not proposing there was a media conspiracy around this period, certainly there were structural and deeply ideological issues in effect, which again were affected by material conditions, identities, the class nature of journalism and journalists, working practices and ownership and the power of advertising (especially property).

The New Enemy Within?

So the question is have we reached another such point? Are we witnessing the softening up of the population for repossessions, evictions and a new class offensive. Well first we have to meet our new national villain – step forward the ‘strategic defaulter’.

Step forward the new villain 'the strategic defaulter'

Step forward the new villain ‘the strategic defaulter’

When developing a new ideological offensive what better candidate than Colm McCarthy to step up to the plate: in a number of recent articles he discusses the idea of the ‘strategic defaulter’.

…it appears that some people who have gone into arrears have been choosing to do so, in the sense that they do not lack the financial capacity to make repayments on schedule. Some arrears can be termed ‘distressed arrears’, in the sense that the borrowers simply cannot pay, but others, so-called ‘strategic’ arrears, arise through borrowers choosing not to pay, presumably in the hope that some debt forgiveness scheme will ultimately emerge, or that they can cod the bank into believing that they are suffering genuine financial distress.

McCarthy (and much of the media) have been citing Gregory O’Connor from the National University of Ireland Maynooth:

Mr O’Connor reckons that these strategic defaulters constitute at least 35 per cent of the total, based on statistical studies of strategic default in the United States, where re-possession is easier for the lender. Despite the greater severity of the housing downturn in Ireland, there have been far fewer dwellings re-possessed, relative to the volume of arrears, than in the USA or the United Kingdom.

So there you have it no less than 35% of defaulters and arrears are from strategic defaulters who are choosing not to pay. McCarthy is citing a blog post by Gregory Connor of the National University of Maynooth on The Irish Economy.  There are however some serious issues with this blog post which becomes evident even after a brief reading. In effect the blog post boils down to saying that in the US there is X amount of strategic defaulters, Ireland has had a worse crash, therefore there must be Y amount of strategic defaulters here. It is also an entirely market based approach concerned with market values and negative equity.  By using a market based approach it focuses mainly on those who purchased property as an investment, while ignoring those who bought property as a home. Moreover, it doesn’t deal with the issue of what happens to debt after a default is ignored. Under Irish law even if the property is re-possessed and sold, the remainder is still owed by the borrower, (however unrealistic the opportunity of return). In an Irish Times article Gregory O’Connor discusses his thesis further with some remarkable and what could only be describe as ideological oversights:

The classic source of distressed arrears is loss of employment. A Central Bank sample study showed that 32 per cent of residential mortgage holders in serious arrears were unemployed, or had a mortgage co-payer who was unemployed. Unemployment does not explain the remaining 68 per cent of arrears cases.

Unemployment may not account for the other 68% of cases, but what about pay cuts, pension levies, universal social charges, household taxes, loss of hours for contract workers, full time work reduced to part time? Not to mention other issues such as the cost of fuel (for those in the commuter belts), the cost of childcare, medicine etc etc. In simple terms a couple who may have bought a house they could barely afford in 2006, can quite reasonably, after losing the 15-20% of their income, having children or becoming sick be unable to afford that mortgage today. And in structural terms what about the unsustainable inflation of housing cost from 4 times the average wage to twelve times in less than a decade?

O’Connor also cites recent legal decisions which may well have had an impact:

The legal block on repossessions arising from the 2009 Land Conveyancing Reform Act is another obvious potential driver of strategic arrears. Starting that same year, the financial regulator imposed the Code of Conduct on Mortgage Arrears, limiting banks’ ability to scrutinise arrears cases. Combined with troubled banks’ natural tendency towards “extend and pretend” on delinquent loans, this created a tempting environment for mortgage holders inclined towards strategic default.

While there is quite possibly merit in this argument again it ignores everything else that happened in 2009.

In other words O’Connor’s work is simply speculation and pretty poor speculation at that. What is of interest is how a purely speculative blog post can then be then quickly reproduced in the mass media as peer-reviewed scientific fact:

Recent surveys suggest that at least 35pc of those who are in mortgage arrears may be unwilling, rather than unable, to pay. This figure is based on statistical studies of strategic default in the United States, where re-possession is easier for the lender.

For his part   McCarthy hammers home some anecdotal evidence:

There is anecdotal evidence from bankers that some people are meeting all sorts of payments (direct debits for utilities) and also clearing credit card balances monthly, while failing to meet mortgage repayments.

Where to begin with this? While one can go into arrears with a mortgage and hope to work one’sway back in the future, one cannot, for example, stop paying electricity and gas bills without facing immediate cut off and losing the ability to heat your home. Not to mention the fact people may raise the €200 or €300 for a bill, but not be able to raise the €1,500 for the mortgage payment. The fact that McCarthy’s banking friends see this as a great immorality says much about their mindset. Likewise not paying a credit card minimum rate sees massive interest payments follow.

I am not arguing that there are no so called ‘strategic defaulters’, there may well be, certainly the developer class has had no qualms about such issues. Within working people there may be some, and I do not see any particular moral issue with it. After all the property market was overpriced and working people through taxation and cutbacks have already paid for much of the default within the system.  In fact  ‘strategic defaulting’  if done at a collective level in the form of a mortgage strike would be a legitimate and probably very effective form of class struggle. The point of this article is to consider why is this  becoming a household term. Does it form part of the new mood music of banks ‘getting tough’? Is it recognition that the short term strategies of the banks and state are running out of steam? In short, is it a softening up for repossessions and evictions? This is not to be conspiratorial about the media; but at certain times media framing can become so commonplace that it seeps into the consciousness as ‘common sense’, and once a group is effectively demonised, actions considered abominable a short time before is suddenly not only acceptable but expected and even demanded.

Eviction in Ireland (Vandeleur Estate, County Clare. Circa 1880s or 1890s). National Library of Ireland

Henry Silke is a PhD candidate in the School of Communications, Dublin City University. For more blog articles on the media treatment of the property crash see hereherehere and see here for an article on the conceptual basis of the research.

Still Playing that Property Game – The Irish Media, Economic Ideology and House Prices

Property is back on the headlines this week due to a report from the Irish Central Bank entitled why are house prices still falling.  The report is a pretty standard and non critical look at the Irish housing market pointing out that:

the severe downturn in the Irish residential property market has already become one of the OECDs largest and most protracted  Meanwhile estimates of asking prices, from sources such as Daft.ie and MyHome.ie were also indicating substantial falls from peak, of 51.8 per cent and 43.1 per cent respectively at the end of 2011. Despite the evidence from these indices, many wonder whether they are a true reflection of where house prices are currently at, pointing to the results of recent property auctions which suggests house prices may be as much as 70 per cent down from peak levels.

The report goes on to consider what the true value of housing should be. It does so by looking at four models which

 …are a form of inverted demand function where house prices are expressed as a function of key market fundamentals

Market fundamentals? Where have we heard that before?  Back in 2007 one of the key arguments of neo-liberal economists who played a deeply ideological role pre-crash was was ‘the fundamentals are sound‘.  The Report Concludes:

The persistent decline in Irish house prices and,
in particular, the acceleration, relative to that in
2010, of the fall in 2011, poses a significant financial stability concern. This note has, using standard models of house prices, examined where actual prices are, at present, compared to fundamental levels. Most of the models suggest that Irish prices have now overcorrected by up to 12 to 26
per cent.

And interestingly the report puts some blame on low prices on the lack of mortgage availability:

A growing array of evidence suggests that
the difficulty in providing mortgage finance in the
Irish market is having a contractionary impact on
market activity and price levels.

Now it goes without saying that the report at no point considered any approach to housing outside the market, but to be fair if the brief was to investigate why house prices continued to decline in the market that might be understandable.  The report however does not seem to take into account the political economy of the wider crisis, (national or international), the political side to the crisis including government policy and certainly there is no consideration of any extra-market possibilities. The report also seems to be predicated on a recovery that is forever just around the next corner.

Now how does the media deal with the report? With critically minded reporting treatment the wider issues, problems with the report and indeed the source itself?  Or how about:

In a front page piece of entitled ‘Houses 50,000 below their true value – bank’ the report is  treated by the Irish Independent without any critique and indeed as uncritical as the report itself is of orthodox economics the Independent’s treatment seems to pick an even more optimistic tone. While leaving out much of the report dealing with the crash itself the Indo tells us that:

 But the new research suggests that house prices could begin rising again if the banks begin lending, or new lenders come into the market.

Inherent in this is the assumption that house price rises are a good thing which of course no suprise as the Irish media see housing through a market orientated framethat is that the primary role of housing is as a commodity to be bought, sold and speculated on  rather than actually house people. Beyond this of course is the solution that ‘all we need is a few banks to lend and or some new entrants into the lending market.’ Now is it just me or are we not in the grips of the bursting of a massive international credit bubble, and such simple market orientated solutions may not exist.  The article continues to tell us that:

…the report warns that the “logical” price of a house will only be realised again when buyers regain their confidence, and banks have the money to be able to lend again.

Again this is the idealistic framing of confidence being the problem, rather than the materialist framing of half a million people being unemployed and those in work having suffered vicious pay cuts alongside the austerity measures taking billions out of the economy.  Though at least they seem to acknowledge that the banks may have a slight material problem of being stone cold broke. This is coherent with the market framing as again confidence is most important for housing speculation rather than those who buy or rent a house as somewhere to live. Banks we are told:

…are only giving out about 10pc of the mortgages compared with the height of the boom. They are struggling to find the balance between beginning to give out more mortgages and not being seen as lending recklessly again. They are also coming to terms with a massive lack of funds.

And when considering who might be the expert to call on to discuss this, let’s see we have an excellent group of Geographers in NUIM who have written numerous reports on the housing collapse, some of their work can be seen on the life after NAMA blog. Or on the other hand why don’t we ask a stock broker?

Analyst Brian Devine of NCB Stockbrokers said the report was right to emphasise that Ireland’s rising population and relatively young population would lead to a stabilisation in prices.

So there you have it, the fundamentals are sound.

What neither the original report or the Irish Independent’s treatment consider is  the tens of thousands of empty houses nor the tens of thousands of people on the housing lists.  Nor indeed that there may be a fundamental problem with leaving housing to an unregulated market, or indeed a market at all. This is because in the market framing of housing it is the market that is key rather than social need.  RTE in a similar frame states Irish property prices have overcorrected – Central Bank while the Irish Times in its uncritical treatment of the report declares house prices undervalued by 26% says bank. The media treatment of this report showing little change to media reportage or treatment five years into the property crash.

Henry Silke