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Honohan appointment marks return of 'public intellectuals'

It's the most important job in Irish banking and arguably the most important job in the country right now. He will have to reform the banking system and save the National Asset Management Agency (NAMA) and perhaps the Government itself.

It's a big ask and in his hour of need Finance Minister Brian Lenihan has turned to one of nation's most distinguished scholars, Prof Patrick Honohan, appointing him governor of the Central Bank.

For once, this Government has reached far beyond the usual range of Fianna Fail loyalists and Finance Department civil servants to pick a man who probably knows more about Irish banking than any other living person.

In choosing Prof Honohan, Mr Lenihan is also selecting an academic with huge experience outside the groves of academia, following stints as adviser to Garret FitzGerald when he was Taoiseach, the Central Bank and the World Bank.

So does this appointment mean we are finally seeing the return of the intellectual to Irish public life?

Earlier this year, at the height of the banking crisis, Mr Lenihan did something similar when he looked past the usual list of suspects and appointed Alan Ahearne, another academic and former senior economist at the Federal Reserve Board in Washington DC, as one of his key advisers on the banks.

'Public intellectuals' began gaining real currency around 20 years ago, when writers and academics who had shown distinction in their own field, displayed the ability to communicate ideas and influence debate outside of it.

There's nothing new about such "brand-extension". In the humanities, public intellectuals have been in business since Plato and Aristotle, but we had to wait for television to bring them popular fame.

Many argue that the audience for intellectuals has shrunk because of television and even more because of the internet.

A culture used to the moronic contestants of reality TV and the instant information provided by Google has little appetite for the complex arguments and moral subtleties of the intellectual.

But Prof Honohan's appointment says as much about Mr Lenihan's thinking as it does about the state of the country's banking sector.

Such shifts in political appointments are rare these days. The financial crisis has left many politicians and civil servants immobilised by a mix of inertia and spinelessness. Obstacles and issues that are actually puny, to them look Himalayan.

It's heartening that the Finance Minister believes it's time to go beyond the usual gene pool when recruiting new talent. Crucially, he isn't afraid to appoint people who have been strong critics of the goings-on and the decisions taken at the Finance Department, something that both Prof Honohan and Mr Ahearne have done publicly in the past.

Much of the debate surrounding NAMA is noisy entertainment and uninformed opinion, but the emergence of some critical thinkers will allow proper discussion to take place.

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A lawyer himself, Mr Lenihan is trained to argue on first principles and haggle over words and will happily debate the country's financial issues, rather than surround himself with obsequious 'yes men'.

In the US and UK, something of a revolving door exists between business, academia and politics. Over half of America's senators practised law. Mr Obama's inner circle is sprinkled with classmates from Harvard Law: the dean of that school, Elena Kagan, is solicitor-general; Cass Sunstein, a professor there, is also in the administration.

The credit crunch has made financiers more prominent now: in Britain, a former boss of Standard Chartered bank is now minister of trade; a former adviser to investment bank UBS Warburg is competitiveness minister. In America, Hank Paulson, a former treasury secretary, and Jon Corzine, the governor of New Jersey, are both former chief executives of Goldman Sachs, a bank apparently blessed by Midas.

Of course, the task of any intellectual is to make ideas as interesting as possible; no mean feat when you're talking about NAMA, subordinate debt and derivatives. Both Alan Ahearne and Patrick Honohan, if they press on with real change, may turn this banking crisis around. It's about time we had a dose of uncompromising intellectual debate. Let it begin.


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