Wednesday 20 September 2017

Frank Barry: Politicisation of public service may have been our undoing

'DEFERENCE and diffidence'. That was the description of the Central Bank's attitude in the lead-up to the current crisis.

As the Honohan report (by the now Central Bank Governor Patrick Honohan) put it in 2010, rocking the boat and swimming against the tide of public opinion would have required a particularly strong sense of the independent role of a central bank in being prepared to 'spoil the party' and withstand possible strong adverse public reaction.

There could hardly be a more dramatic contrast to the actions of the first Governor of the Central Bank, Joseph Brennan, in the early 1950s. Rather than agree to moderate his blistering criticism of government economic policy, he instead chose to resign.

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