Joe Higgins (Dublin West, Socialist Party) | Oireachtas source

Professor Black, in his testimony here, evidenced the policy of the United States in the 1990s when the Administration, he says, pushed quite extensive liberalisation in the financial area. However, Dr. Donovan, on page 2 of his opening statement, said:

As an overall comment, I think it is widely accepted that the IMF's surveillance process failed in Ireland.  Although, as discussed below, some vulnerabilities were noted, the assessments by the IMF staff gave no inkling that a major disaster could be in the making. Adjectives such as "exceptional", "remarkable", " highly impressive" were used throughout the first seven years of the decade to describe Ireland's overall economic performance.

On page 5, he asked, "Why did the IMF team get things so badly wrong?" and suggested a few explanations. On page 6, he said:

These were serious shortcomings, to which can be added the general approach at the time that favoured so-called principles-based, what is sometimes called light touch, financial regulation. The IMF, being a creature of its member countries, was undoubtedly heavily influenced by this prevailing philosophy.

Could it be that the explanation for the failure of the IMF to identify what was going on in Ireland, in reality, and the use of the adjectives "exceptional", "remarkable" and "highly impressive" were used during the bubble because the financial deregulation, privatisation and free reign given to major financial institutions in Ireland in fact made the country the star pupil of the IMF policy and the policies of the dominant countries within the IMF?