Saturday, January 23, 2010

Prime Time on Banking Inquiry

I participated in a discussion on Prime Time on RTE on Jan. 19th with Willie O'Dea TD, Minister for Defence, and George Lee, Fine Gael. It was my first time on live TV so it was a learning experience. You can watch the clip here.
Here are some thoughts:

The Minister had the unenviable task of sticking up for the much maligned hybrid inquiry structure proposed by the government. He stuck to his task, frequently falling back on the strategy of occupying time by stonewalling on the tough questions. His main claim was that the first stage of the inquiry - the reports by Prof. Honohan and a "wise man" - would be a scoping exercise. This is strange because there isn't much need for scoping here. Unlike the US and UK crises, the Irish situation is not because of exotic derivatives or loose monetary policies, but because of poor governance and regulation. Asking for a report by Prof. Honohan, who despite his impeccable credentials and reputation, has potential conflicts of interest by virtue of his office, is suboptimal. An outsider would have been preferable.
Next, the wise man. The Minister indicated that this would be a judge. Is it an accident that the US and UK have steered clear of judges? Is there a shortage of well-credentialed and honest judges there? No. Judges have different skill sets and don't fit the job description. Judicial inquiries have a history of delays and failures, and one can only hope that we get lucky here.

The Minister did make two solid points: the inquiry committee could hold public hearings, and that its conclusions must not be prejudged. In re the first, why rely on it to hold public hearings of its own accord? Why not mandate public hearings? On the second point, the government is viewed with suspicion because it did not have to create this unnecessarily complicated mechanism if it truly cared about transparency and accountability.

George Lee was very polished and sophisticated and made a number of good points. I largely agree with him except on the format of an inquiry. He seems to prefer an Oireachtas inquiry whereas I endorse a public independent commission.

Miriam O'Callaghan anchored impressively; my fav. anchors - Tom Brokaw, Keith Olberman and Chris Matthews would have been proud.

In conclusion, the government missed an opportunity to derive credit for showing some leadership. If it is paying for PR, it should demand some money back. Virtually every politician in the US and UK has managed to take advantage of the public anger against bankers, even at the risk of being accused of gross hypocrisy. Gordon Brown is a good example. Here the government and its supporters remain firmly anchored to Public Enemy No.1.