Monday 18 February 2019

Mac the Knife shows us politics could do with a commitment to plain-speaking

Ray McSharry
Ray McSharry
Ray MacSharry

James Downey

Anyone who wants an insight into Ireland's economic woes need not plough through the hundreds of thousands of words written by academics on the subject.

He or can she can find the essence in the few pages of Ray MacSharry's chapter in the recently-published book 'Brian Lenihan: In Calm and Crisis'.

My younger readers may ask, Ray MacWho? For many years, MacSharry has been little in the public eye. His time in politics was short, and ended decades ago.

But he made an enormous impact as finance minister between 1987 and 1988, and his work then is still relevant.

The previous Garrett FitzGerald Fine Gael/Labour coalition failed to get the budget deficit under control. When Charlie Haughey returned as Taoiseach, he needed to bring in stern measures to remedy the national finances.

But he had no liking for tax increases or public spending cuts. He wanted popularity. He wanted to win elections. MacSharry proved himself tough enough - and clever enough - to defy his boss and do the right things.

In the following months, he calmly but briskly raised taxes and cut spending, to the extent that he became known as 'Mac the Knife'. It worked so well that some give him the credit for the birth of the Celtic Tiger. That may be an exaggeration, but the boom could certainly not have happened without him.

Another Fianna Fail finance minister, Charlie McCreevy, had his own philosophy. He said that when he had money, he spent it and when he didn't have it, he didn't. He held office in good times. He had plenty of money. He spent it.

MacSharry, in retirement, tackled him. He tells us now that McCreevy posed this question: "I have €2bn of a surplus. Do you think I should leave it there?" MacSharry replied simply: "Yes, I do." McCreevy, he writes, laughed.

This is one of several intriguing examples of MacSharry's continuing interest in public affairs and especially in control of spending. Brian Lenihan knew all about law and governance, but little or nothing about finance and economics.

Besides, he was too optimistic. It was he who said, early in his tenure as finance minister, that "we have turned the corner".

We had come nowhere near reaching the corner. Earlier still, however, he had grown disillusioned with the Department of Finance and the Central Bank.

We have long known that he turned up late one night, chewing garlic, on the doorstep of David McWilliams. We did not know, until now, that he had a longer conversation with MacSharry, when the two of them repaired to a hotel in Enfield Co Meath and spent "several hours" discussing the economy. It is easy to guess what advice and encouragement he got from 'Mac the Knife'. What he needed most of all was not economic knowledge, but courage and fortitude.

And Mr Lenihan, like his adviser, had these qualities in abundance. He demonstrated them amply in what was left of his all-too-brief life.

One of the most striking things about the Mr MacSharry's essay is the power of the writing. He makes his points firmly and briefly, without boastfulness or exaggeration.

He gives us revelations in a handful of lines, leaving his readers to ponder the implications for themselves.

He tells us that he once chided Bertie Ahern for his reluctance to promote Mr Lenihan, manifestly the most brilliant man in the Fianna Fail party. Not many would tell a Taoiseach that to his face.

We could do with a lot more of this plain speaking in Irish politics. We could do, as well, with a lot more in the way of unpopular measures when they become necessary.

And this reflection prompts a look at our present rulers. For most of its first three years in office the Fine Gael-Labour coalition did pretty well. Then came all that fumbling, all those scandals, all the silly own goals.

Worse, however, has been the recent excessive focus on the next General Election, which has led to a Budget composed of measures which range from the praiseworthy to the petty to the contradictory. Some began to be revised almost as soon as Michael Noonan and Brendan Howlin had delivered their Budget speeches.

People wanted, and needed, a little relief. But we should worry about those happy growth forecasts, stretching too many years into the future. The era of the economic shock has not ended.

Mr MacSharry has made a contribution which we should take to heart. He says that in 2008 we saved the currency when we saved the banks, but we have had little reward. Instead, Europe has treated us badly. He says this with his customary brevity and in his customary no-nonsense style. We should take it as an antidote to wild optimism - or even the saner kind of optimism.

Irish Independent

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