Tuesday 24 October 2017

Banking inquiry: Cowen apologies for state of economy but blames everyone else

Taoiseach Bertie Ahern, Foreign Minister Brian Cowen, and Finance Minister Charlie McCreevy share a joke before a Cabinet meeting at Emo Court in Co Laois in 2003.
Photo: Frank McGrath
Taoiseach Bertie Ahern, Foreign Minister Brian Cowen, and Finance Minister Charlie McCreevy share a joke before a Cabinet meeting at Emo Court in Co Laois in 2003. Photo: Frank McGrath
Ailish O'Hora

Ailish O'Hora

A deeply contrite and apologetic former finance minister and Taoiseach Brian Cowen showed up at the Banking Inquiry yesterday.

It's hard not to compare his demeanour and contribution to that of Charlie McCreevy given the closeness of their evidence - he had brought a new level of hubris to the proceedings on Wednesday.

Unlike Mr McCreevy's more L'Oreal approach, Mr Cowen, who was the Fianna Fáil Minister for Finance from 2004 to 2008 and later Taoiseach, accepted and apologised for his role in the crisis up front.

Not only that, he accepted that a deference to the banks was shown by regulators, there was little forensic investigation into the banks and their dependence on the property sector, as well as their subsequent reliance on wholesale funding, compared with other markets.

Advice and warnings on an overheating economy and a property bubble went unheeded too, he conceded.

So far, so refreshing. But this wasn't to last and the mask soon slipped.

Once the line of questioning became more intense, turning to his own performance in the run-up to the crisis as finance minister from 2004 to 2008, the atmosphere changed and his approach became more defensive and prickly.

"It's become very McCarthyite round here," he quipped and his discomfort at being asked direct questions about his tenure was palpable.

Cranky Cowen had reappeared, the one we had gotten used to seeing towards the end of his tenure as Taoiseach when the ship had well and truly hit the rocks, so to speak.

Then the McCreevyisms kicked in.

It was as if Mr Cowen had managed to disconnect the pro-cyclical and pro-property policies that he oversaw with their impact on the economy.

Take, for example, the property reliefs that he inherited from Mr McCreevy's time as finance minister.

Mr Cowen was quick to highlight that he began to phase them out in the 2006/2007 Finance Bill/Budget, yet without any real acceptance that at that stage it was too little too late and the property bubble was in full bloom.

He said, for example, that one of his political philosophies was budgetary prudence.

Yet he seemed to find it difficult to accept that giveaway budgets contributed so much to our economic bust.

Construction became a big part of the economy, he admitted, but he seemed to find it difficult to reconcile that with the fact that we had became economically dependent on the sector and that it was a key driver of the "full employment" of the mid-2000s he also spoke of.

Thankfully he stopped just short of saying there was no such thing as the 'Galway tent.'

He was deeply proud of social partnership, he added, but there was no mention of the hangover that still lives to this day from that policy.

Mr Cowen used the word 'hindsight' many times during the day - I stopped counting after the eighth mention.

Clichéd as it is, Mr Cowen was right in that you don't have the benefit of it in the thick of a crisis.

But that's not good enough.

No individual is responsible for the crisis and we all played a role, given our addiction to property ownership, and there were external influences.

But political leadership is not just about getting re-elected, is it? It's about being able to realise there's a problem and having the courage to face up to it.

Is that not why they get paid so handsomely when they are in office? Not to mention when they retire.

Irish Independent

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