Pubs replaced banks in Ireland for several months in 1970 (2016)

https://www.businessinsider.com/pubs-replaced-banks-in-ireland-in-1970-and-the-economy-was-fine-2016-1

by moat • 3 years ago

83 94 3 years ago

[...] almost the entire banking system of Ireland went on strike after an industrial dispute in 1970. The strike lasted nearly six months, yet the economy escaped unscathed.

Getting people to strike isn't trivial, but this is the first time I learn about bankers striking.

Spooky23• 3 years ago

It’s uncommon in the US for reasons. It’s a thing in Europe.

1970 Ireland isn’t exactly an example of a modern or booming economy.

But… what happened there should give pause when financial bros get weepy and pat themselves on the back about their sacred duty to provide liquidity at all costs. (And take a vig)

digdugdirk2• 3 years ago

A perfect example of my favourite part of any "class warfare" talk. Even for the "capital" class, the system isn't necessarily in their favour. It's only when you're at the absolute peak that you get the benefits. Everyone else is perfectly disposable, society just runs smoother when society believes that 6 figure salaries puts someone on the other side of the fence.

becquerel• 3 years ago

The class divide isn't based around an arbitrary salary, or specific job positions. It's whether you have hire/fire powers and you make money off of other people's labour, rather than selling your own. Hollywood actors and famous football players are often very rich, but they sell their labor to get by. They don't own the means of production

pavlov• 3 years ago

The banking system in 1970 was much more labor-intensive. This was before ATMs and online banking, or even computers — a small local bank in Ireland probably didn't have an IBM mainframe at that time.

So there were clerks and cashiers at every level pushing paper, crunching numbers, handling cash. These people were clearly working class, not the later Wall Street image conjured by the word "banker".

neilwilson• 3 years ago

Bank underground view

https://bankunderground.co.uk/2016/01/20/the-cheque-republic...

terminous• 3 years ago

"I deal only with my regulars … I refuse strangers."
‘They are mostly strangers to us, and we just have to play it by ear in deciding whether to accept a cheque’, said an official.”

Sounds like a recipe for discrimination and inequality, which isn't mentioned in either article.

version_five3• 3 years ago

Right, much better for everybody to be screwed in the name of equity.

garba_dlm• 3 years ago

and this is probably why and how it comes to pass that the taxpayer of the future is left holding the bills

mlyle3• 3 years ago

While keeping something running via an informal system is better than nothing, and most people might be okay... if you're just kinda shifty looking or unpopular at the moment in your local pub and have a much harder time than everyone else, that's not exactly great.

That is, it's not only the common experience that matters, but the outliers too. The basic tools of society should be available even if you're ugly, annoying, or a minority.

dang2• 3 years ago

Could you please stop taking HN threads further into ideological battle? We had to warn you about this just the other day: https://news.ycombinator.com/item?id=37699522.

It destroys what this site is for, so we end up having to ban accounts that keep doing it.

If you'd please review https://news.ycombinator.com/newsguidelines.html and stick to the rules when posting here, we'd appreciate it.

tekla2• 3 years ago

This seems like a very very good argument against decentralized currency.

ehnto• 3 years ago

1970s Ireland was very homogenous, which is to say white. It wasn't until the 90s that immigration began flowing in the other direction to a meaningful degree. So while I agree with you, it was unlikely a problem at the time.

Although that doesn't cover gender or class discrimination so I suppose that was still an issue.

kmonsen• 3 years ago

Or more importantly in Ireland, religions based discrimination

rsynnott8• 3 years ago

Oh, we absolutely still had discrimination, particularly against Travellers, but also there was very strong though largely unacknowledged classism. And then of course there were _women_; after a good start (Ireland was one of the first countries to grant equal universal suffrage), we spent the next few decades barely acknowledging that women were people.

However, in 1970, people here just weren’t all that ‘banked’; when I was a kid in the late 80s/early 90s, it was still fairly common for people to not have bank accounts, and certainly in 1970 postal savings accounts would have been more common than bank accounts. Today they’re ~universal (very few employers would consider paying by any means other than bank transfer) but it was a different story 50 years ago.

version_five3• 3 years ago

Lots of decisions in the last 50 years have made "the system" more fragile. This makes me realize that outsourcing trust is another one. This would never happen now because businesses have no connection to their customers, either a payment provider or credit bureau does the vouching which becomes meaningless when things don't operate as usual and human judgement is needed

Kalanos• 3 years ago

i don't get it, but it sounds like narrowly skirting by disaster

throw0101a• 3 years ago

Patrick Boyle did a video on it a little while ago:

* https://www.youtube.com/watch?v=mFIQWWt4UaA

* https://en.wikipedia.org/wiki/Irish_bank_strikes_(1966–1976)

yosefjaved1• 3 years ago

For 21 minutes and 53 seconds, I highly recommend this video. It gives so much context and describes the situation in as neutral of a tone as it's possible with a sprinkle of dry humor. Also, Patrick takes it a step further by answering the question if something like this could work again as well as discuss how this system that emerged compares to modern day cryptocurrency systems.

wodenokoto• 3 years ago

The article really wants to imply that because this worked, we shouldn't be afraid of "too big to fail", but it doesn't dare say that and kinda of ends up sitting between two chairs.

"I'm not saying that banks crashing isn't bad, but it wasn't a problem for Ireland to have banks disappear"

but the thing is, according to the article, trust in banks never disappeared, neither did the banks. People kept writing cheques against their bank accounts. There was a clear expectation that banks would open with all money intact and cheques would be processed.

That is a very different scenario from a bank failing.

harpiaharpyja• 3 years ago

This is a huge equivocation by TFA. When we think of banks failing we typically think of situations where banks can no longer honor deposits.

What the article describes is nothing of the sort. It was a strike, which is a breakdown of operations, not insolvency.

corethree4• 3 years ago

How were bankers not skinned alive?

If someone owes you or I money and then suddenly they go on strike there will be a vicious reckoning.

rsynnott8• 3 years ago

Most people, presumably, aren’t as bloodthirsty as you; strikes, no matter how inconvenient, rarely result in mass murder of the strikers by the general public. Sometimes by the state, in totalitarian systems, but not by random people.

fullspectrumdev6• 3 years ago

There were a lot of strikes in Ireland in the 1970’s, including a rent strike at one point.

pjc50• 3 years ago

50 years after the civil war, Ireland would not particularly keen to start up the random violence again.

I suspect everyone assumed normality would resume "tomorrow", for a lot of tomorrows. Which is the other reason you can't just start up the lynchings, this isn't America and you'll have to live with these people and their families on a comparatively small island.

NikolaNovak• 3 years ago

The link is extremely light on detail so in skeptical

1. What was the extent of the strike? Did salaries still get deposited? Did inter company transfer go through? Did exchanges stay open? Did lines of credit for businesses small and large stay open?

2. The whole "we knew who had money and we didn't deal with strangers" makes me suspect there's a whole other side of this particular story.

barrkel• 3 years ago

Back in the 90s in Ireland, my mother would occasionally cash a cheque at the pub - if it's not crossed payee a/c only, the bearer can generally cash it themselves.

Going further back, pubs were the local shops for general dry goods, particularly in rural communities. I recall some dusty window displays in some pubs even in the 1980s, when I was a kid.

fullspectrumdev6• 3 years ago

Recently I found that in a few of the more touristic areas in Ireland (which I rarely visit, being from here, was showing friends some places), a lot of pubs will offer a foreign exchange service of dubious legitimacy with debatably fair rates.

Same thing in the border counties up north - you can often spend or exchange Sterling and Euro currency, but the rates will suck.

In the 1990’s where I grew up, one of the two shops in the village was basically a room off one of the pubs. The other, larger shop was also the post office, hardware store, etc.

rsynnott8• 3 years ago

This is common in tourist-y areas everywhere. I was in Lisbon recently, and saw a number of places advertising that they accepted Sterling… at a rate of 1:1 with the Euro. A mere 15% FX fee.

AlbertCory• 3 years ago

They had an informed view of whether the liquid resources of would-be payers were stout or ailing!

Some world-class puns there.

rsynnott8• 3 years ago

As an Irish person, I would not _particularly_ recommend Ireland in 1970 as a model to aspire to.

And even given that, the banks did not actually fail, they just weren’t operating, and the expectation was that they would start back up again at some point. When Ireland actually faced the banks failing, in 2008, we bailed them out and nationalised most of them, at a cost of almost 10,000 euro per capita.

fullspectrumdev6• 3 years ago

Arguably the only reason it worked out fine (for some value of fine) in the 1970’s was because everything being a shitshow was the generally accepted state of affairs, and for a lot of normal working people being paid cash was still normal.

_cs2017_• 3 years ago

Flagging this article for being too stupid to warrant reading. In 1970, nobody was afraid their savings disappeared; when a bank fails, people would lose their savings unless the government insures or rescues the bank.

Given the extremely low quality of this article, and given that the author is a finance editor rather than some freelance contributor to Business Insider, I very much hope that HN readers would stop upvoting submissions from Business Insider in the future.

Pubs replaced banks in Ireland for several months in 1970 (2016)

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