Brian Cowen blames his past mistakes on bad advice from the same sources he now uses to defend his policies
WHEN A Taoiseach gives a 7,000-word speech with the arresting title of The Irish Banking Crisis: The Mistakes, the Responses and the Lessons, the usual routine for a column like this is to analyse the merits and shortcomings of such a verbose contribution. But I kind of feel sorry for Brian Cowen. And I feel guilty about that. It is not in this column’s natural disposition to express sympathy for politicians.
Yes of course it is easy to pick through some of Cowen’s previous pronouncements as minister for finance.
Take his 2006 speech to the Dublin Chamber of Commerce for example. “Let’s get a few things straight,” he said. “Responsible leadership does not involve temporarily forgetting the lessons of good economics when it might be convenient politically to do so.”
The public liked that about the old Cowen, the straight-talking bit.
Securing Prosperity: The Next Steps Forward was Fianna Fáil’s pre-election economic document. At the launch in April 2007, Cowen promised that “the next generation . . . will be all the better as a direct result of our prudence, responsibility and long-term approach.”
Life was good before the 2007 election. Prudent long-term commitments were defined as lowering taxes and increasing public spending.
But just two weeks before Fianna Fáil introduced its pre-election manifesto, the ESRI published its Spring Quarterly Economic Commentary. It “raised concerns about the increasing deficit”, warned about deteriorating competitiveness and suggested exchequer returns might start to come in below target after the election. The ESRI also provided extensive data that backed up its findings that “house prices appear to remain overvalued”.
When Gay Mitchell and Pat Rabbitte raised these concerns by the ESRI in the Dáil a few days later in early April 2007, Noel Ahern, in that wonderfully reassuring Fianna Fáil manner, dismissed any attempt by those to reassert economic realism. The demand for housing was full steam ahead according to forecasts. “My department [local government] suggests that the population could increase by one million over the next 15 years.”
One million! The economic fundamentals of this country were based on the assumption that the population was going to increase by a quarter.
And that’s why I feel sorry for Brian Cowen. People stopped listening a long time ago. It’s too late. He has become the fall guy and that is not a fair reflection of all the causes of the economic collapse.
His failure to deliver timely state-of-the-nation speeches to a public hungry to believe in leadership has been compounded by the perception that such reassurance will only be delivered to members of the business community who happen to attend chambers of commerce meetings.
His speech to the North Dublin Chamber of Commerce last week marked a notable and welcome shift in his previous philosophy about the causes of the economic crash. “It would be wrong for us not to accept that the crisis was made worse for Ireland because of internal factors,” he acknowledged. “The reality is that there were domestic vulnerabilities when Ireland was confronted with the global crisis and these led to the near collapse of the banking system.”
The ESRI also liked to use that word, vulnerabilities, in its reports. Especially from 2006.
The belated acceptance will, regrettably for the Taoiseach, be interpreted as an attempt to pre-empt the findings of the banking inquiry. He should have made that speech two years ago. Instead, now it is perceived as a means of consolidating and entrenching the wounded authority of the same political masters who presided over the economic disaster in the first place,
But the most disconcerting part of his speech was the Orwellian doublethink, this simultaneous belief in two contradictory ideas.
On one hand, the Taoiseach admits that “with hindsight” the advice at the time “proved to be fundamentally wrong; however, those were the views expressed at the time”.
He then details the advice of the IMF in its assessment of the banking sector in Ireland in September 2007 and the financial stability report for 2007 produced by the Central Bank and Financial Services Authority of Ireland.
But on the other hand, a few paragraphs later, he justifies the Government’s policies on Nama by citing the same sources of advice!
He quotes the IMF’s June 2009 assessment of the Government, which had, the IMF concluded, “responded in the right manner”.
When the Taoiseach asks us to believe the IMF, why should we do so now when he admitted that they were wrong in the past?
Perhaps the founding principle of the Garda was rehearsed when the Taoiseach opened the memorial garden in Dublin Castle at the weekend for the 83 members of the force killed in the service of the State.
The last instructions by the first Garda Commissioner, Michael Staines, to new Garda recruits are inscribed on a wall in Templemore: “The Garda Síochána will succeed not by force of arms or numbers, but on their moral authority as servants of the people.”
Brian Cowen no longer has the moral authority to be a servant of the Irish people.