Monday 22 January 2018

Cowen's perception of events might not tally when history is written

Mr Cowen's legacy will be decided by others and not by his perception of events
Mr Cowen's legacy will be decided by others and not by his perception of events
Ailish O'Hora

Ailish O'Hora

We saw another side to Brian Cowen at the Banking Inquiry yesterday - actually more than one, in fact.

He was doing his impression of the three monkeys, you see.

Essentially it was a case of see no economic meltdown, hear nothing about the banking collapse - despite a round of golf at Druid's Glen with the Anglo boys in 2008 - and say nothing about all the bad things that were happening in the run-up to the crisis. It beggars belief that Mr Cowen could still think there was no link between the banking crisis and the economic one when he met Anglo executives, including former chairman Sean FitzPatrick and ex-director Fintan Drury, for a round of golf at Druid's Glen in July 2008.

But that is what he told the Banking Inquiry yesterday, despite also confirming that his earliest memory of a guarantee being seriously considered was "April or May".

That begs another question: If that were the case, then why was the banking crisis not the key issue at the Druid's Glen meeting?

Instead, Mr Cowen was at pains to point out that they did not discuss the banking sector - just the economic problems of the day.

It was if he believed the two could not be inextricably linked.

Strange really - given the property boom, which had already turned sour, and the international crisis.

Mr Cowen's perception that we were somehow "bounced" into the bailout was also concerning.

In his opening statement he highlighted that in April 2010 it was clear that Greece would no longer be able to retain the confidence of market lenders.

But at home, our economy had also reached crisis point.

In September, the government said it was withdrawing from the markets as a tactical move since we were fully funded until mid-2011, he added.

However, the reality of the matter is that that there was little tactical about it and we had already been priced of the bond markets at that stage with the yield on 10-year bonds at over 6pc.

That figure had jumped to over 9pc by the time the bailout was introduced in November 2010 - not to mention our structural deficit.

We were also over-spending by €12.5bn per annum in 2010, the year the €67.5bn EU/ECB/IMF bailout was confirmed, not to mention the money that came out of the National Pension Reserve Fund.

While there is an argument that we could have negotiated a slightly better deal, there was no real alternative.

When history is written, this period will never go down as a highlight in the lifetime of the State.

And Mr Cowen's legacy will be decided by others and not by his perception of events.

Irish Independent

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