It was a week when top European Union officials lined up to suggest that yes: maybe we did get a few things wrong.
First, we had European Central Bank boss Mario Draghi observing that the EU’s leaders made a royal cock-up in its management of the crisis.
Then, on Friday, Europe’s top bureaucrat, Catherine Day, had a few frank admissions of her own to make while on a visit to her native capital city.
Mr Draghi’s comments will not have pleased German Chancellor Angela Merkel and her departed comrade-in-arms ex-French president Nicholas Sarkozy.
In a magisterial put down also aimed at his ECB predecessor, Jean Claude Trichet, the bank boss acknowledged that in mid-2010, just as the US and other economies were embarking on slow recovery, the “trajectory of the euro area departed from the others.”
So how did this happen? “Policy choices, commendable in themselves, made under the pressure of events were sequences in the wrong order”. A Keystone Cops style cock-up, in other words.
Mr Draghi pointed, in particular, to promises by Sarkozy and Merkel to burn bondholders in future. This helped trigger the Irish bailout.
As the ECB president observed, the euro zone should have followed the Americans in putting in place effective back stops ahead of major bank stress tests. It failed to do so.
Draghi traces Europe’s slow recovery from the edge of disaster to the summer of 2012 “when crisis management shifted towards execution of a consistent recovery strategy”.
This was when “Super Mario” made his famous promise to “do what it takes” to save the euro.
Europe’s top banker acknowledges that much remains to be done. Indeed, many in the markets believe that the crisis is merely in remission and could break out at any time.
Draghi acknowledges that availability of credit, for example, remains a huge issue, given the need to shrink the size of European banking loan books.
The bond market is taking up the slack in the case of large corporates, but SMEs are losing access to finance. Bond investors are reluctant to invest in such companies. A key task will be to engineer the development of capital markets suited to the needs of SMEs, key sources of growth and jobs.
Speaking high up in the Aviva Stadium while the Leinster team trained on the pitch beneath, Ms Day was in reflective mood.
The director general of the European Commission acknowledged the crisis showed there has not been enough policy coordination between member states together with a “lack of political will to confront the realities of interdependence.”
While insisting that there was a “serious underestimation of the political will to keep the euro together“, she accepted that “we must never again sleepwalk into the situation we found ourselves in”.
The penny appears to have finally dropped in parts of the Brussels and Frankfurt establishment that the old style insouciant approach to Europe’s citizenry simply will no longer wash. Yet some old attitudes persist among diehard supporters of the European ideal.
On Wednesday, European Minister Paschal Donoghue, spoke at a gathering to commemorate Michael Sweetman, a leading political thinker and organiser of the 1972 referendum campaign in favour of Irish entry to then Common Market. It was put to the minister by a questioner that Ireland had “missed a trick” in failing to invite Commission president Barroso to celebrate Ireland’s exit from the EU/IMF bailout.
Mr Barroso and his entourage are still miffed, apparently.
Mr Donohue pointed out the Irish peoples’ standard of living has taken a heavy hit. It was not the right occasion for a grand end-of-bailout celebration party.
In this regard, it was interesting to hear John McCarthy, chief economist at the Department of Finance, discuss the “serious design flaws” at the heart of European Monetary Union and the need to retrofit appropriate governance tools.
However, EU officials are still loath to come clean on this aspect of the crisis and to acknowledge the real elephant in the room, the asset price bubble across much of the EU which was tolerated by the European Central Bank while being fostered by many national governments.
The architects of the euro are reluctant to own up to design and implementation failures because of a continuing reluctance in key member states to accept that Ireland, in particular, deserves a reasonable level of backdated financial support given the huge burden forced on the taxpayer.
Catherine Day talked about all the steps being taken to ensure that national budgets are drawn up with EU-wide co-ordination in mind.
There is this notion that once out of the bailout, with one bound, our hero, Ireland, is free. Sadly, listening to Ms Day, you realise that this is nonsense. We will be under the cosh for a long time to come.
Until three-quarters of our outstanding debt is paid off, we will be subject to six-monthly supervision.
The Government will still be expected to extract another €2bn to €2.5bn come the next budget.
The hope is the bit of growth finally kicking in can mop up much of this pain.
Minister of State at the Department of Finance Brian Hayes was honest enough to admit, as far as many people are concerned, it is no bad thing that such disciplines will be in place. Better this, than the usual host of short-termist vote catching wheezes.
As he put it, “people like the surveillance of a fiscal council. We need contrary views. As a Government and as public administrators, we have not been good at taking criticism.”
To put it mildly, one might add.
Still the plain-speaking Hayes could be a loss if he is elected to the European Parliament. Some of his ministerial colleagues remain rather fond of the vote-catchy promise.
Catherine Day insists that the focus in Brussels is switching away from emphasis on the quantity of public spending and towards the quality of that spend.
Certainly, if Brussels can offer real expertise when it comes to devising programmes, this will be no bad thing — but the centralised bureaucracy also needs to step back and allow local firms and communities freedom from expensive over-regulation. It is a delicate balancing act, made more urgent by increased evidence of grassroots voter disillusion with the whole euro project.
It seems we are entering a period of close coordination in banking and finance, and taxation. This will be no bad thing as long as projects such as the IFSC are not slowly strangled in the process. But Mr Donoghue predicts that, at the same time, more powers, in other areas, will be handed back from Brussels, under pressure from citizens tired, one suspects, of being dictated to.
Catherine Day acknowledges that much greater coordination will be required in the energy sphere as Europe sets out to reduce its reliance on Russia. She also accepted that eurozone countries in surplus need to do more to create the sort of domestic demand that can lift growth right across the eurozone.
Referring specifically to Germany, she said the point should be made that big annual (export) surpluses “are not necessarily a blessing”.
And she added that, “while we are not saying that Germany be less competitive, we say that you might need to open up more your services sector.”
Events both in Ukraine and much closer to home are, it seems, forcing Europe’s leaders to engage more with their critics and move away from either finger-pointing or patronising shoulder-patting.
As Ms Day puts it: “We have to invest more in anticipating what the challenges will be. In Europe, we have tended to be hidebound and slow moving, even if we get there in the end.”