Honohan needs to find Anglo needle in his haystack
Almost 36 hours after his appearance before the Oireachtas Finance committee, the governor of the Central Bank has shifted his position by agreeing to provide the gardai with the bank's analysis of why it believes there is nothing in the infamous Anglo tapes to warrant any new prosecution.
Patrick Honohan has obviously been surprised at the level of disappointment that was felt by the general public at his admission to the committee that he had only listened to the portions of the tapes which were revealed by the Irish Independent and the 'Sunday Independent' more than three months ago.
Politicians and commentators were surprised, and in some cases shocked, by this revelation.
Obviously he is a busy man, but it is a surprise that neither he nor any member of his staff listened to the full set of recordings or obtained transcripts of these recordings.
Ultimately, Anglo Irish Bank brought the country to its knees.
It is believed that the tapes run to hundreds of hours and it would be an enormous task, but it is one that ordinary taxpayers expected the Central Bank to undertake as part of its investigation and analysis of what happened in the rogue bank.
Mr Honohan has done the State some service. That should be said at the outset. If he had been governor of the Central Bank/Regulator for the past decade, there's a very good chance the banking system wouldn't have ended up in quite the mess that it has.
And in his four years at the Central Bank, he has generally performed well in exceptionally difficult circumstances. There's no doubt that coming from an academic background – as opposed to the usual route to the job via the Department of Finance – Prof Honohan has brought fresh thinking and perspective to the role.
Even before he was appointed as governor, there was probably nobody in the country who understood the banking system better. It's a pity that nobody inside government thought of picking up the phone to ask him to come in and advise them.
By the time they did, the damage was done and since then Honohan's job has been the equivalent of glueing back together the hundreds of pieces of a shattered vase. It's a time-consuming, laborious process and inevitably mistakes will be made along the way.
That said, Wednesday was not a good day at the office for Honohan. It wasn't that he performed badly before the Oireachtas Finance Committee – he didn't.
His handling of the questions on mortgage arrears was assured and straight to the point. He even made a decent defence initially of the earlier controversial decision by the Central Bank not to refer the Anglo tapes to the gardai or the Director of Corporate Enforcement.
People were right to be outraged by their content as he himself was, but there was not enough evidence in them for a prosecution in court, he told the committee. The problem, though, came when he admitted not all of the tapes had been listened to.
It may be the equivalent of dealing with a needle in a haystack, as Honohan argued. Tough. People, who have ponied up €64bn for the banks have the right to expect no less from the authorities.
The failure to listen to all the tapes also points to a lack of political nous on the part of Honohan. That could be interpreted in two ways. On the plus side, there is an argument we've had too much politics in these positions in the past. That we need a Governor who is above politics, who dispassionately tells people that they need, instead of want, to hear. And that is certainly Honohan.
The counter-argument, however, is that ultimately the job is, or has to be, political. This raises the question as to whether somebody with an academic background and somewhat unemotional and scientific approach to problems is the man to 'take on' the banks and the ECB.
The question remains: would a more forceful, antagonistic and 'political' Governor, out to lay down a marker and make a name, achieve better results with the banks, particularly on mortgage arrears?
Given his performance to date, Honohan deserves the benefit of the doubt. And it would be unrealistic to expect him to change his style. His independence, intelligence and logic are to be valued. But it wouldn't hurt to balance it with a little political nous, starting with the Anglo tapes.
Shane Coleman is political editor of Newstalk 106-108