The Taoiseach, Mr Ahern, told Dublin Circuit Civil Court that at no stage in his 24-year career as a politician had he been offered an inducement or bribe.
He told Judge John O'Hagan he could think of nothing worse than a politician being branded as corrupt, as taking bribes or back-handers, or using their position to thwart the law or rules, procedures and regulations.
"You have to stand in front of the electorate regularly and you are judged by your policies and your performance for the people. If you are corrupt they will give you short shrift," he said.
Giving evidence in his defamation claim against a Cork businessman, Mr Denis O'Brien, Mr Ahern said there was no profession subject to such public and media scrutiny as his own.
He told his counsel, Mr Rory Brady SC, he had never heard of Mr O'Brien before an article in the Sunday Business Post on April 23rd last year saying that a new Fianna Fail bribes inquiry could lead to an election and clearly identifying him as the senior politician who in 1989 had accepted a £50,000 bribe.
"I didn't know where he was coming from. I couldn't believe it. I did not understand why he would do something I knew was entirely untrue. I knew I was in major difficulty," the Taoiseach said. "Unfortunately in politics, if somebody says something, gossip goes around. You are painted into a corner, unable to defend yourself.
"The allegation was in major headlines and was on the morning national news. It continued throughout that day, which was Easter Sunday, and during Easter Monday."
When he addressed the 1916 Commemoration in Arbour Hill, there were so many journalists they had to be corralled behind crash barriers. Normally there would be only five or six present.
Mr Ahern said people immediately believed there was something in the allegations, and it damaged him in a major way. There was a lot of detail in the article referring to banks and building societies. Other newspapers had carried the story.
Journalists "with fairly creditable names" had followed up the story. People would have believed they had researched and checked the story, and readers would have tended to believe it.
It had been in the news through the following week, and the Sunday Independent had carried an opinion poll in which 56 per cent of the people polled said they did not believe his denial. Everybody he met on that Easter Sunday had asked him about the story. They told him they felt he was in trouble.
He the politician was somebody else. The only senior politician around from 1989 who could bring down the Government was himself.
"Every allegation made by Denis O'Brien is totally untrue, totally fabricated," Mr Ahern said. In the 24 years he had been an elected public servant he had tried to give public service as honestly as he could and, although he had been paid for it, he felt he might have done better in his previous profession.
Mr Ahern said he had never been wealthy and would take issue with anyone calling him corrupt or accusing him of accepting a bribe. He told Mr Brady that shortly after publication of the Sunday Independent opinion poll, he attended the FAI Cup Final and had taken more "stick" from the public that day than he had in all of his previous years as a politician.
He said he had not met Mr O'Brien in the underground car-park at the Burlington Hotel on the night he claimed or any other night, nor had he ever been in a car with Mr O'Brien at any location.
"I have never received any cheque for £50,000, cash or money order or any other money from O'Brien, nor have I been paid that sum by a Mr O'Callaghan or any of his representatives," he said. He never assisted Mr O'Callaghan on the Liffey Valley project over planning permission or anything else. He was the victim of false and malicious statements accusing him of taking a bribe.
On June 29th he had heard for the first time that Mr O'Brien was not proceeding with his defence to the court proceedings.
Mr Ahern said he had co-operated fully with the Flood tribunal by giving it all his records on all the issues required including his personal financial affairs. He had only instructed his lawyers to initiate court proceedings after a number of failed attempts to allow Mr O'Brien to withdraw his allegations and apologise.
Mr O'Brien had neither withdrawn his allegations nor apologised. If he had apologised that would have been that. He had seen newspaper reports in which Mr O'Brien had claimed he was sucked into a scheme, but he said the timing of the withdrawal of his defence coincided with an affidavit by Mr Michael Fingleton, managing director of the Irish Nationwide Building Society, which had shown INBS documents produced by Mr O'Brien to have been forgeries.
Rejecting an allegation that he had accepted the money from Mr O'Brien in a State car, Mr Ahern said he had never held the keys of a State car since first being driven as a public servant by members of the Garda.