Don’t hold your breath for banking inquiry to uncover any shocking insight into crisis

Political World with Harry McGee – harrymcgee@gmail.com

Someone who is 28 now would have been twelve when the Moriarty and Mahon Tribunals of Inquiry began their work in 1997. And unless they were complete political junkies from the age of dot, they would have been unaware of the circumstances that gave rise to the inquiries, and would have had little interest in the proceedings through their teenage years.

By the time both Tribunals finally reported after many years, that person would have been past the mid-point of their twenties and reading (if they bothered) about events that were historical, that involved people who were prominent before they were born, some of whom were dead.

Tribunals by their very nature with their snail-like procedures (and frightful costs) make a mockery of the notion that they are inquiring into an urgent matter of public interest (which is what they are supposed to do).

This week, the Government gave the go-ahead for legislation that will allow a parliamentary inquiry into the banking crisis of 2008, the circumstances that led up to it, and the response of the authorities to the events that unfolded over the following two years.

All things being equal, and with a fair wind, the legislation may be enacted by the end of the year. The Oireachtas itself (through the Ceann Comhairle and the Committee on Procedure and Privileges) will have the power to set up the inquiry. But there are a lot of procedural hoops that will have to be overcome all of which will delay the start.

My guesstimate is that the earliest it can kick off with public hearings is late next year. And my tuppence worth is if it starts in late 2014, it’s going to have two major flaws – the first is that it has all taken too long and it will be falling into the same ‘historical’ trap as the tribunals; the second is that it will be so close to the next general election that the investigation will invariably become political.

So what are the hoops and possible delays? Well it’s taken an awful long time and that’s partly the Government’s fault and partly because of the botched referendum in October 2011, which was also the Government’s fault in a way.

Ireland was not the only country which witnessed spectacular collapses of banks and financial institutions.

We looked with envy at the US and at Britain where within months full-blown parliamentary inquiries had been held and the chief executives of failed banks were put through the ringer, particularly by the extraordinary scalpel-like Henry Waxman, who chaired the US Senate hearings into the collapse of Lehman Brothers and others.

Another example that was held up to show how shamateurish we were was the very quick prosecution and conviction of Bernie Madoff in New York.
But that’s not a direct comparison because Madoff was an out-and-out con artist who ran a Ponzi scheme which collapsed when his bank ran dry of gullible investors because of the financial collapse. It was a straightforward case.

Culpability, if there was any, in Irish banks was a horse of a different colour – much more complicated, much less apparent. The nearest comparitors were the heads of the collapsed banks in the US and in the UK. All were disgraced but how many were convicted? Zero, unless I’m mistaken.

Parliamentary inquiries haven’t been a reality in Ireland for almost two decades. They came to an unceremonious stop when the High Court ruled that a parliamentary inquiry into the shooting by Gardaí of John Carty in Longford had exceeded its powers.

Carty had mental problems and had holed himself in his family home with a shotgun. He was shot after emerging from the house with the shotgun in his hand and after being challenged by Gardaí.

For more, read this week’s Connacht Tribune.