BRIAN Lenihan must be rueing the day that he appointed Alan Dukes as chairman of Anglo Irish Bank.
At the time it seemed like another stroke. There was Alan, vice president of Fine Gael, being entrusted with the most delicate job in the banking sector. It was also one of the best-paid, at €250,000 per year.
No cronyism here. An old blueshirt had taken the banker's shilling from a soldier of destiny. Poor Alan already receives a ministerial pension of €100,000 a year, so is limited to a mere €150,000 from Anglo.
For a few months, Alan was every Fianna Fail TD's favourite banker. He towed the Government line. He supported Nama. Diehard blueshirts in Leinster House suddenly gritted their teeth at the mention of their former leader's name. Alan was persona non grata in Fine Gael circles.
I have had my differences with Dukes -- but, to his credit, he is a contrary creature. Last week he demonstrated how perverse he is when he kicked his Fianna Fail patron in the solar plexus.
Dukes suddenly charged into alien territory. Instead of restricting his comments on the banking sector to his own problem child -- Anglo -- he decided to deliver a broadside on the future of all the other Irish banks. A peculiar diversion.
His speech was dynamite. The banks (excluding Anglo) would need another €15bn to survive. A monumental sum in terms of the entire tax take.
Lenihan was reported to be far from pleased. Indeed he surfaced on Ivan Yates' Breakfast Show to rubbish his protege's thesis. But Dukes had done the damage. The Government message that the recapitalisation programme was now completed had been blown out of the water by one of Lenihan's pet bankers.
It will probably not have escaped Alan's notice that Lenihan will be out of office in three weeks' time, replaced by his old blueshirt colleagues. Yet that does not mean that his forecast was wrong.
Indeed, the pertinent question is "Where has Alan been for the last two years?" Well, belatedly, he has begun to see the light.
Alan is signalling default, but -- like the entire establishment -- he will not yet mention the 'D word'.
Nor will Brian. Nor will Michael Noonan, nor the Labour Party, nor the Greens.
No one wants to be dubbed the Default Party; but the penny has dropped. We are deep in default terrain.
Despite the election, the all- party conspiracy to avoid the D word is intact. Politicians' denial of its inevitability remains. Yet Ireland is going to default sooner rather than later.
Politicians will shortly be forced to admit that we cannot repay the loans at all.
Fianna Fail is in denial. Fine Gael and Labour duck default by speaking glibly of "renegotiation". They muddy the waters by pleading that we cannot repay the loans at the current interest rate, implying that they will secure a great victory when it is cut.
If Alan is right (and I suspect that he is underestimating the need for further capital), then where will Fine Gael and Labour find the €15bn?
From the taxpayer?
Or will they be forced to borrow it? No bank on God's earth will touch Ireland.
So there is only one source of funds. We will have to relive the nightmare scenario. Here comes the second bailout.
The logical conclusion of Alan's prognosis is the dark shadow of Olli Rehn and Ajai Chopra returning to haunt Ireland in the coming months as we plead for a further €15bn.
The terms for a second diktat would be off the wall. We are already incapable of repaying the earlier loans. Further repayments would finally kill off growth.
The sort of bull the Opposition are spouting about "restructuring" or "sharing the pain" is an anaesthetic for the electorate without mentioning the dreaded reality.
Our European and IMF masters are playing ball with Fine Gael and Labour by agreeing that some of the terms could be changed. The IMF understands the needs of political grandstanding during elections. More importantly, look at the small print. Renegotiation is fine, but IMF spokesmen insist that there will be no changes in the "core conditions". Which means Labour and Fine Gael can simply tinker around the edges.
The two Opposition parties are giving the impression that they are going to salvage something more important, that, somehow, they are on the road to debt forgiveness without default!
If Dukes is right, we are heading for two further crises. Small businesses could be the next casualty, followed by house mortgages.
Both sectors are in a state of devastation. Recapitalising the banks has so far given no relief to small businesses, the backbone of the Irish economy. Nor has it eased the pain of those with mortgage arrears.
Dukes' missile was an exocet in the middle of the election. We are approaching a banking moment of truth just as the political battle climaxes. The result is an outburst of political high wire acts.
On Wednesday, Lenihan's decision to postpone the payment of €10bn into the banks and to leave such an unpopular item to his successors is part of the posturing. It cornered the Opposition into agreeing to implement the Fianna Fail programme. His excuse -- that his action was taken in the interests of democracy -- is infantile.
So all eyes are now set on the summit meeting on March 24 when a 'European-wide' solution for the banking crisis may be sought. At that meeting, Michael Noonan will probably be Ireland's new man from Merrion Street. He will be accompanied by the same mandarins who guided poor Lenihan (and Ireland) into the first heap of manure.
The mandarins will be warning Noonan against any rash action, advising deference to the European powers and the European Central Bank.
Noonan is certain to swallow the mandarins' medicine. Just as Lenihan did. European lenders will give him a few token concessions to bring home. Later in the spring, he will appear at a news conference, waving a piece of paper, claiming concessions from Rehn and Chopra.
The same team who cravenly capitulated in the initial negotiations will be batting for Ireland at the crucial meeting on March 24. This time, Michael will be sitting in the chair.
Wait and see, he will be captured by the mandarins. Just as poor Lenihan was.
On Thursday, the outgoing Minister for Finance let the cat out of the bag when speaking to Yates. He admitted that no less a person than himself had "advocated" not paying the bondholders at the first negotiations. Default by any other name.
The response was humiliating. The ECB had set its face against it. They would not "countenance it". And that was that. We surrendered before the first shot was fired.
A case of the mandarins of the ECB, the apparatchiks in the Department of Finance, the politicians of Europe and Ireland ganging up to save the banks.
Have all our political parties forgotten that they need to save the people from the bankers? Not the bankers from the people.