President blames regulators, State and lawyers for crisis
Published 11/09/2010 | 05:00
PRESIDENT Mary McAleese has launched an unprecedented attack on lawyers, economists and regulators for their role in the financial crisis.
And she made it clear that she feels the light-touch regulation espoused by the Government is to blame for the economic collapse that has resulted in 450,000 people on the live register and tens of thousands in mortgage arrears.
Her comments are all the more hard hitting because it is highly unusual for a president to pass such concise and critical judgment on a major political issue while in office.
Mrs McAleese said lawyers should stop making contracts "deliberately" complicated in an attempt to avoid scrutiny, that so-called experts had to be trained to "think ethically" and regulators had to develop the skills needed to oversee financial markets.
Speaking yesterday on the penultimate day of a five-day state visit to the Russian Federation, Mrs McAleese said there was a need to train people to consider the long-term implications of their actions and not just the short-term financial gains they could make.
Her comments came after she told the New York Stock Exchange last May that Irish people were "mad as hell" and "hurt and angry" that the country found itself in economic turmoil created by "once-trusted individuals and institutions".
And yesterday, she laid the blame for that hurt firmly at the feet of the Government and the regulators.
"It was long argued that heavy, strong-handed regulation was not the most conducive environment for business, yet as we now know to our great cost, that light regulation was a recipe for trouble," she told an audience at the St Petersburg State University of Economics and Finance.
"If in the future, if we are to avoid the extremes of economic boom and bust scenarios, we need not only smart and rigorous regulatory systems that allow commerce to flourish, where the regulator has all the powers and competences, but we need professionals who are hard-wired to behave ethically, to think ethically, to act ethically, to respect the requirement of compliance, to understand and see themselves as operating in the broad public interest.
"We need to have people trained to consider the longitudinal consequences of their decisions and not just the short-term gains they might make."
The President also criticised the legal profession, saying that children should be taught the law, including legal rights and responsibilities in schools, and that such information should not be kept like "vintage wine" for the consumption of the few.
Mrs McAleese is herself a lawyer by profession.
She said: "Legal academics and economists need to work together to better understand the technical complexities of international financial systems, to make their operations more transparent and open to interrogation by the average citizen and to render their sometimes impenetrable -- sometimes deliberately impenetrable -- transactions more amenable to effective regulation.
"I have long been of the view that the teaching of law and our legal rights and responsibilities as citizens should not be kept like some fine vintage wine for the consumption of college students of law but should begin in childhood in our schools and be available to all."
Mrs McAleese flies home today after leading a five-day state visit to the Russian Federation, where she met with some of the country's most powerful figures, including President Dimitry Medvedev; the governor of St Petersburg, Valentina Matvienko; and the head of the Russian Orthodox Church, Patriarch Kirill.
Yesterday, she was taken on a tour of the world-famous State Hermitage Museum, former home of the Russian emperors.
Last night, she attended a cultural reception hosted by the Irish ambassador to Russia, Philip McDonagh.