Wednesday, January 12, 2011

The Taoiseach and the smartest guys in the room!

There is a notion abroad that it was very curious that An Taoiseach Brian Cowen didn't ask Seanie Fitzpatrick on the golf course in the summer of 2008 what the latest situation was with the financial problems of Anglo Irish Bank. But this columnist doesn't feel the Taoiseach's lack of interest was that surprising: Let me explain.

A normal lowly Fianna Fail politician has two ambitions: To get elected to the Dail, and then to get re-elected. A select group have more grand ambitions: To become Taoiseach and to remain in that office. So it is naive to believe that Fianna Fail leaders would be that concerned with esoteric matters that would be outside their purview, like the state of health of one of the country's financial institutions. About five years ago the Fianna Fail top brass would doubtless have been proud of their role in the economic prosperity that they presided over. But around that time they had effectively ceded their role in governing the economy to those who were the 'smartest guys in the room'. ( as the boyo's in Enron were called ) If the Financial Regulator and the Governor of the Central Bank were lax in their roles policing big business, it was because they got their lead from the cabinet. Ministers had become so in thrall to the Seanie Fitzpatricks of this world, partly because a group consisting of teachers and solicitors naturally didn't feel they were in a position to rein in bankers about banking.

Apparently when meeting members of the public during his tenure, one of Bertie Ahern's stock phrases was to proclaim; 'how's the hard working man'. For the former Taoiseach it wasn't necessarily important what one was hard working at. Indeed those egghead types who would have been into long-term planning likely wouldn't have been Bertie's cup of tea: As opposed to those who were keeping the show on the road by building houses with borrowed money that in actuality didn't exist. His successor Brian Cowen is not an identikit politician. He didn't share Bertie's ravenous desire to be Taoiseach for instance. But he found himself in the top job because he was popular in the Dail Bar and had never offended any of his superiors. It also seemingly never perturbed him that he mightn't be qualified for the job. As a stalwart member of the party, steeped in it since a child, he would have been honoured to keep the hamster wheel rolling. Although it may seem bizarre, one gets the impression that he wanted as easy a life as possible. Certainly the Government has seemed behind the eight ball throughout the crisis, as if they couldn't believe their bad luck and just hoped the misery could be wished away. In this context it wouldn't be strange that Brian Cowen wouldn't have quizzed the head of Anglo-Irish Bank in 2008. He simply didn't want to know if there was bad news, just as a student who has done a poor exam mightn't be in a rush to get the result.

Our economic calamity has occurred because our leaders had no interest in long term planning. They were willing to sub-contract their responsibility to civil servants who kept their heads down and to bankers and developers. The ironic thing about the Fianna Fail led governments in the last 13 years was that they only took the long view in regard to events outside the jurisdiction, i.e the northern peace process. Bertie Ahern withstood insult both from the media and Unionist politicians, as well as sidelining moderate parties, in order to effect a settlement that could stand long term. But in the south everything was done on the hoof and all parties were placated in the short term. The bubble allowed new elites to emerge, and Brian Cowen wasn't going to discommode them on the golf course in July 2008.