FORMER TAOISEACH Brian Cowen has said he takes responsibility for Ireland’s current situation “more than most”.
In his first public comments since leaving office, Mr Cowen admitted he has often asked himself what the government he led could have done differently when the economic crisis struck in 2008. “All in authority have to take their share of responsibility for our present dilemma, and I, taoiseach at the time and a former minister for finance, do so more than most,” Mr Cowen said.
The remarks were contained in a speech delivered at Georgetown University in Washington last Wednesday, but have only now come to public attention. “Governments make mistakes in good times and in bad times and I and others have apologised for those made by my government and for previous governments led by my party,” he said.
Mr Cowen said that, with the benefit of hindsight, budgetary policy in Ireland during the years preceding the crisis “should have leaned more heavily against the wind”.
However, in his 8,398-word lecture he said this would have meant higher income taxes, lower levels of employment and higher unemployment. Spending on education, healthcare, research and development, infrastructure and social welfare would also have been diminished, he added.
Mr Cowen said Ireland had not possessed a sizeable stock of accumulated savings to finance domestic investment, and so it had seemed “perfectly reasonable” to borrow from abroad for investment purposes.
He said a growing reliance on money from overseas to fund the banks rendered the Irish banking system vulnerable to changes in conditions internationally.
However, Mr Cowen said the “understandable need” to find somebody to blame often resulted in a simplification of the complexities involved. “Given what we now know, it is clear that serious mistakes were made in individual European countries, including Ireland.”
Mr Cowen defended the introduction of the controversial banking guarantee in 2008. “It subsequently transpired the banks were insolvent, but that was not known at the time.”
