Monday 20 November 2017

You were warned, but took no heed

John FitzGerald admitted his errors at the Banking Inquiry. However, the ESRI ignored some warnings of economic doom

ADMIRABLE HUMILITY: John FitzGerald said the ESRI failed ‘to see the economic collapse’. Photo: Brian Lawless/PA
ADMIRABLE HUMILITY: John FitzGerald said the ESRI failed ‘to see the economic collapse’. Photo: Brian Lawless/PA
Donal Lynch

Donal Lynch

Nobody expected ESRI economist John FitzGerald to be a soothsayer and nobody likes someone who says: "I told you so", especially to a man who has the admirable humility to admit his mistakes.

But it can't be denied that in 2008 while the body for which he worked, the Economic and Social Research Institute, was "failing to foresee the economic collapse" and "making the call that Ireland would probably escape it", as FitzGerald put it last week, there was a chorus of Cassandras in the national press sounding a warning that things were a lot grimmer than the picture being painted by officialdom.

The Sunday Independent, sometimes portrayed as a cheerleader of the boom, practically howled from its pages about the coming storm. In late January of 2008, Political Editor Daniel McConnell wrote a report with the headline "Just Who Is In Charge As Our Economy Collapses?" He graphically described the situation Ireland was facing: "Stock Market meltdown, soaring oil prices, collapsed housing market, job losses on the rise, a pensions wipe-out, credit squeeze and total government inaction: No, not a nightmare, just the Irish economy which is in deep, deep trouble." Presaging the chain of events that would soon engulf the country he also wrote: "Banks are finding it much tougher to raise cash and are beginning to turn the screw on the big developers".

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