Banking Inquiry – Are we really learning anything new?

The Banking Inquiry continues to trundle on and fill the column inches. Each witness that comes before the inquiry promises more detail, better insight and the hope that we are going to get something new. However, one has to question if we are really getting anywhere at all?

Of course there is a number of ways to look at these things. The inquiry was always going to be more therapeutic than anything else. In the US and other countries we saw bankers and politicians hauled in for public questioning and we said ‘Oh that would never happen here’. It does happen of course but there is then the feeling that it does no good. Proving a law has been broken and someone is to go to prison is a matter for other bodies. The inquiry is giving us more details but the overall picture is not changing. Do people really care? It is annoying to hear of people who ‘made mistakes’ getting big pensions while you keep their successors off your back as you try to pay you mortgage. Despite this annoyance though we do have to struggle on and most of us have little time to sit and listen to the hours of evidence from the inquiry. We don’t care very much if it’s not going to change anything.

In the media we love a good Inquiry. I won’t deny that. If we didn’t have it I would have to find something else to write about. Inquiries, tribunals, investigations and reports will always be worthy of some praise from us wordsmiths because they give us something to talk about. The banking inquiry was faced with two dangers from the outset. Nothing I have seen so far suggests it is going to avoid either of these. The first was that it was going to become just a political sideshow. Over the last number of years, whether we agree with them, like them or hate them, politicians have been the only ones facing the public. That of course is no more than should be expected. The truth is though that we have been over a lot of ground on who thought what at a political level already. We know who will accuse who of what. We know what the defence will be and we have all pretty much made up our minds on our position. Politicians may make big statements, cause rows, create controversy with what they say but will it really allow us learn anything? Will future governments benefit? Will the public get new material from them that will change opinion? Highly unlikely. If a politician had this then it would already be used in either attack or defence. All they will have is their opinion.

The Inquiry is now set up for a big showdown at a political level with Brian Cowen as the star. He will deny that he over ruled Brian Lenihan. He will probably make some big calls and tough statements but when all the hype dies down will it change anything? We might as well be historians piecing together shreds of evidence to complete a narrative because it interests us. The bankers, the advisors, the officials are coming and going but thus far we are not uncovering too much more. When I wrote ‘Dynasties’ in 2011 I had to cover a synopsis of the guarantee and the bailout in the chapter on Brian Lenihan. It is true to say I was only giving a helicopter view but nothing in the evidence so far would give me cause to revise anything I said in those paragraphs. The point being that a lot of what is said here is actually already known and all we are doing is copper fastening it with the odd note.

The second issue for the Inquiry was that it would be too focussed on the night of the guarantee. It is clear to any observer that this has already happened. That night is fascinating. It is the poster boy for dramatic political nights. It is natural to get sucked in to the story line. Nights like that are rare though. There is already a ton of evidence to say that by the time we got to that night we were already goosed. If we were to learn anything valuable from the banking inquiry then it was far more important to focus on how we got to that night. The years before were the crucial ones. Poor authority by politicians, too much trust, bad regulation, and bad banking practice all led to the situation. Future governments could learn from exactly how this developed, what were the traps, the groupthink and general advice that allowed the situation to grow?

Alas we are only skimming over all that stuff. Politically it’s not as easy score points on it. In terms of news it’s not as exciting as the bank guarantee night. Ian Guider of the Sunday Business Post pointed out that Kevin Cardiff started his evidence from September 2008 and gave little detail as to what happened before. Already the focus on Brian Cowen is what happened that night and if he over ruled Brian Lenihan.

It is good to have this Inquiry. It is helpful. It is not, however, anywhere near as helpful or good as many commentators and politicians think. As we struggle on to pay the bills and put food on the table we give it all only a passing nod. It is providing neither new grounds to rethink our overall positions or escapism from the drudgery that the events concerned inflicted on many of us. In a couple of years we may well remember more from ‘I’m a celebrity get me out of here’ than our current version of ‘I’m a banker, I really shouldn’t be here’

Johnny Fallon
Southern Editor