“We made policy decisions with our eyes wide open”
Former Taoiseach Brian Cowan

The establishment of inquiries and tribunals in response to the scandals and abuses that erupt regularly in public life in Ireland has a very long tradition.   They usually take the format of long drawn out proceedings followed by the publication of a report.  Though such inquires have covered a range of issues - from clerical sexual abuse to political corruption – they all end the same way.  The fundamental issues are never addressed and no institution or individual is held to account.  Such a consistent outcome demonstrates that inquires of this sort are no more than a mechanism to placate pubic concerns without having to change anything within the state and society.    The Oireachtas inquiry into the banking crisis (whose final report was published earlier this year) falls firmly into this tradition.      

That the report on the most severe economic crisis to hit the Irish state – the total cost of which is estimated to around €100bn – should come so long after the critical events of the crisis is a clear indicator of the lack of urgency in addressing the issue.   Almost eight years have passed since the bank guarantee, and almost six since the bailout by the Troika.   The parliamentary inquiry itself was only established in late 2014.  

Yet, is not just the passage of time that diminishes the impact of the inquiry.  The terms under which it operated were also very restrictive.  The inquiry was not allowed to make any adverse findings against any individual or institution.  It was also prevented from examining any material relating Anglo or Irish Nationwide - the very institutions that were at the heart of the crisis!  This lead to one witness to the inquiry, US regulator Bill Black, decrying it as “fundamentally flawed”.  

“A right to reputation”

Another restriction on the inquiry were the legal threats arising out of the perverse notion of “a right to reputation” that exists within Irish law.  Censorship was at work prior to the publication of the inquiry report with a number of parties demanding changes to the initial draft.   The property developers Johnny Ronan and Michael O’Flynn threatened legal action if changes were not made.  This is the same Johnny Ronan who in his evidence to the inquiry made a reference to concentration camps that appeared to imply that the treatment of property developers in Ireland was comparable to that of Jews in Nazi Germany!  There was also political manoeuvring by members of the inquiry itself that saw the removal of references to Fianna Fail’s infamous tent at the Galway Races and the links between senior members of the party and executives at Anglo. Trade Union leader David Begg, at the centre of the scandal, was able to wander into the enquiry and wander out again with an informal chat that did not require any kind of explanation of his role.

Given all this it was hardly surprising that the final report of the inquiry – costing €6.5m and running to 600-plus pages - turned out to be a damp squib.   Adopting a passive non-specific tone it essentially put the financial crisis down to a series of systemic mistakes and misjudgements by politicians, regulators and bank officials.  By spreading responsibility as widely as possible it effectively exonerated everyone involved.   As part of this the report sought to dismiss the significance attached to the flurry of activity on the 'night of the guarantee' – 29 September 2008.    It described as “a myth” the idea that the bank guarantee was cooked up in one night and highlighted documents that suggested that idea of guaranteeing the banks was "in reality" considered as part of a range of options as early as January that year.  However, what they don’t explain is how the limited guarantee outlined in those documents was transformed into the blanket guarantee that brought tens of billions of euros of liabilities unto the Irish state.   

Another element of this process of exoneration was an attempt to shift responsibility in relation to the severe conditions of the bailout onto the Troika.   So the report chronicles conversations between Michael Noonan and Jean-Claude Trichet, including one where the "irate" ECB chief is reputed to have warned that if bondholders were burnt "a bomb will go off and it won't be here, it'll be in Dublin".  The ruthlessness of the Trioka should not be underestimated but it also must be understood out that successive Irish governments, throughout the period of the banking crisis and the bailout, have been willing partners rather than reluctant victims. 

The weakness of the report is revealed most clearly in its recommendations on how a future banking crisis can be avoided.   Most of these are a repackaging of regulations and practices that are already in place.  Moreover, they were already in place in the period leading up to the crash.   The problem was not a lack of regulation but regulations and controls being completely ignored.   More regulations won’t change that. 

Corruption

At the most base level the banking crisis highlights the corrupt nature of capitalist rule in Ireland.  For while the Irish state may be liberal democratic in form with a constitution, parliamentary structures, courts and so forth it is actually run by a close knit cabal of politicians, state officials and businesspeople (with the trade union leadership as a junior partner) who are not bound by any law or regulations.   In this type of political culture the informal arrangements (as represented by gatherings in golf clubs and race courses or off the record meetings at the Central Bank) that were part and parcel of the financial crash, and what has followed, take on greater significance. A recent example was the disclosure that the chair of a Dail committee looking at Garda corruption met the former Garda commissioner in a car park. These car park meetings, and admissions that minutes of meetings were not kept, feature in all these enquiries and there is no admission that by their very nature they are corrupt attempts to avoid scrutiny.

The outcome of the banking inquiry shows that the Irish ruling class want to move on from the banking crisis.  What was notable over the inquiry was the understanding reached between Fine Gael and Fianna Fail not to use it as a means to damage one another.  In many ways the banking inquiry foreshadowed the post-general election arrangement between the two parties.

While the financial crash and the bailout may be old news for the political class for Irish workers their consequences continue.   The banking inquiry is finished, the general election is over but the programme of Troika rolls on.   In order to counter this effectively Irish workers need to create a movement that will break the trade union movement from the ruling cabal and fight not only against austerity but for a real democracy.