But the ex-PD leader, who lost his seat in 2007, said he did not foresee the looming economic crash when he was running the country.
The former attorney general, who was one of the chief government players during the boom, said all the political parties in the country hold collective responsibility for the current financial hardship.
“I fantasise on occasions that I woke up one day in 2006 and said ‘this must stop. We are all going over the cliff.’ But it just didn’t happen. There is no point in conning myself that I in some way saw what was going to happen. I didn’t.
“We allowed the Central Bank to go to sleep on the job. We should never have had the property bubble in retrospect.”
But he believes all the political parties should take the blame for the country’s descent into recession.
“I lost my seat in 2007 and that was an election in which Fine Gale and Labour lost as well. They were very lucky they lost that election but they were outbidding the PDs on tax and spending policies at the time.
“All I’ll say is collectively the Irish political system made a big haims of the economy at that time. When I, for instance, said something about reforming stamp duty I was accused of being a party pooper but look at all the people who possibly didn’t enter into transactions a result of that hesitation about stamp duty who would have been now in negative equity up to their ears.
“People talked about a soft landing. Even now to this day does anyone know what that phrase actually meant?”
He also said the recent budget is necessary to pay for the mistakes of the past.
“I think a few things are coming home to roost now. It’s a hard budget. A lot of people are getting frightened now. I think this is the price of undoing the damage that was done before.”
The former tánaiste also poured cold water on speculation that he would run for office again but he said he would like to help to put young people back in the Dáil in a new centre right party.