Lenihan, Brian (1959–2011), politician, was born on 21 May 1959 in Athlone, Co. Westmeath, eldest of five sons and one daughter of Brian Lenihan (qv), Fianna Fáil politician, and his wife Ann (née Devine). His grandfather Patrick James Lenihan (qv) was also a Fianna Fáil TD (1965–70); his aunt Mary O'Rourke was TD for Longford–Westmeath (1982–1992, 2007–11) and for Westmeath (1992–2002), and a cabinet minister (1987–92, 1997–2002), and his brother Conor was TD for Dublin South-West (1997–2011) and a junior minister.
Educated in Athlone at Fair Green infant school (1963–6) and the Marist national school, Brian was regarded from an early age as the brightest in his generation of the family. After the family moved to Dublin in 1971, he attended Belvedere College, where he was school captain in his final year, and TCD (1977–81), where he won a foundation scholarship in 1979 and graduated with a BA in legal science (first class). He was active in college societies, particularly the historical (debating) society, in which he was a censor and then treasurer. Fluent in French and competent in several other languages, he was an enthusiast for the Irish language. His Jesuit education gave him a sense of being part of an European catholic educational tradition, and he was always a believer, though with a certain amount of heterodoxy.
Lenihan won a scholarship to Cambridge, where he studied at Sidney Sussex College (1981–82) and graduated LLM (first class). After studies at the King's Inns, Dublin, he was called to the bar (1984) and became a part-time lecturer in law at TCD. Developing a successful practice, he became a senior counsel in 1997, but gave up the law as his political career developed. In 1997 he married Patricia Ryan, who later became a circuit court judge; they had one son and one daughter. In 2019 Patricia was appointed president of the circuit court.
Early political career Active in politics from the age of 15, Lenihan worked in his father's successive election campaigns in Dublin West and in his unsuccessful 1990 presidential campaign. In the by-election of 2 April 1996 caused by his father's death, he was elected TD for Dublin West. He made it a condition of his candidacy that Fianna Fáil should oppose the opening of a casino in the Phoenix Park, which faced strong local opposition in Lenihan's Castleknock support base. Although the Fianna Fáil leader, Bertie Ahern, was favourable to the casino development, the party gave way to Lenihan, believing that without him the party could not hold the seat. This led to Ahern's developing an antipathy towards Lenihan, which retarded his subsequent political career.
There was a widespread expectation after the victory of the Fianna Fáil–Progressive Democrat electoral alliance in 1997 that Lenihan would receive governmental office; instead, he was nominated to chair the all-party oireachtas committee on the constitution, where he addressed a variety of matters, notably abortion. During the 1997 presidential election, he was election agent for the successful candidate, Mary McAleese. After the 2002 general election, he was appointed minister of state for children, attached simultaneously to the departments of Health, Education, and Justice; in 2005 this position was upgraded, allowing him to attend cabinet meetings, though not as a full minister. He undertook a variety of initiatives to give children a stronger voice in public life and improve childcare, overseeing a national play strategy to build new playgrounds, dealing with the fall-out from clerical abuse scandals, and carrying out much of the groundwork for a constitutional amendment to guarantee children's rights (eventually enacted in 2012).
Justice and Finance, 2007–08 After the 2007 general election, he played an active role in forming a new coalition government, comprising Fianna Fáil, the Green Party and the remnants of the Progressive Democrats, and involving a support pact with several independents. (Throughout the life of the government, Lenihan took a significant role in liaising with the Greens.) On 14 June 2007 he was appointed minister for justice, equality and law reform, and promptly set about planning a programme of legal reform, including changes to immigration law and proposals to provide civil partnerships for same-sex couples; he also paid careful attention to police and judicial appointments. Lenihan later stated that Justice was his preferred portfolio and he would have liked to retain it.
On the election of Brian Cowen as taoiseach in succession to Ahern (7 May 2008), Lenihan was appointed minister for finance. Cowen regarded him as his ablest minister and believed he was best equipped to cope with the deteriorating financial situation. Lenihan's lack of economic credentials (though he had lectured in banking law) was subsequently criticised, but this has often been the case with finance ministers, and civil servants praised his ability to absorb, analyse and synthesise data. Privately, he had been critical of Ahern's 'buying' the 2007 election with loose budgetary policy, and rapidly realised that falling tax revenues caused by the global economic downturn meant that the government faced a serious budget deficit. On 8 July 2008 he introduced an emergency mini-budget, with €440 million in immediate cuts (rising to €1 billion within a year). These cuts were partly notional, however, and many cabinet ministers believed the economy would have a 'soft landing' and resisted Lenihan's view that making cuts as early as possible would lead to a speedy recovery.
While Lenihan read his way into his brief, the Irish banking system faced a growing crisis, aggravated by the bankruptcy of the American investment bank Lehman Brothers on 15 September 2008. Irish banks had lent recklessly, often on highly speculative construction projects, and had taken advantage of European monetary union to finance their activities with short-term loans. In the deepening financial crisis they found it impossible to roll over their debts, while depositors withdrew cash. Attempting to stem withdrawals, the government guaranteed private deposits up to €100,000 on 21 September, thereby acquiring an enormous contingent liability.
The bank guarantee On the night of 29 September 2008, after a meeting of senior officials with Cowen and Lenihan, the government decided to guarantee the liabilities of the six domestic Irish banks over the next two years. Lenihan suggested that the two most precarious institutions, Anglo Irish Bank and Irish Nationwide Building Society, should be nationalised, but was overruled by Cowen, who believed such a step would have no greater effect than would a guarantee, and would create expectations of further nationalisations. Some officials present later claimed that Lenihan was indecisive during the meeting, discussing various options without endorsing a clear course of action. The guarantee was initially supported by Fine Gael and Sinn Féin (with only Labour voting against it in the oireachtas) and led to an inflow of funds. In October 2008 Lenihan declared that Ireland had experienced 'the world's cheapest bailout' (Gallagher and Marsh, 175). However, the guarantee was later criticised as a disaster after the banks proved not merely illiquid but massively insolvent, and there was much unproven speculation about politicians' alleged ulterior motives. Lenihan's defenders argue that the guarantee was the least worst option at the time, and that refusing to support the banks would have risked the same sort of crisis across Europe that had followed the bankruptcy of Lehmans in America. It is suggested, however, that too little thought was given to excluding some forms of subordinate debt from the guarantee, and that the government should have tried to extract support from the European institutions for their role in shoring up the euro. Introducing the guarantee without consulting other EU governments aroused significant hostility from some other countries (notably the UK), who feared it might endanger their own financial institutions by encouraging depositors to transfer to Irish banks; this limited Ireland's subsequent ability to appeal for sympathy.
Austerity budgets, 2008–09 The public mood rapidly soured when in a stringent budget in October 2008 Lenihan withdrew the automatic provision of medical cards to those over 70 (reversed after widespread protests by the elderly). Anger intensified as it became evident that the banks – particularly Anglo Irish – had engaged in extensive reckless lending. Much of the existing bank management was cleared out and Anglo Irish was nationalised (15 January 2009), followed by Irish Nationwide (August 2010). Lenihan also made a series of appointments to key financial posts, often bringing in outsiders uninvolved in the light-touch regulation that had led to the debacle. These appointments included Matthew Elderfield as financial regulator, Patrick Honohan as governor of the Central Bank, and Kevin Cardiff as secretary general of the Department of Finance.
In April 2009 Lenihan delivered another emergency budget, and announced the creation of the National Asset Management Agency (NAMA). This was a holding company that would set a floor under the banks' liabilities by acquiring their most problematic loans at a set price and disposing of assets acquired at the best prices obtainable. Details of the scheme were announced in July 2009 and the relevant legislation enacted in October. Lenihan introduced other significant financial legislation during 2009 (in all, as minister for finance he oversaw some twenty significant enactments), helping in the drafting and taking a leading role in debate as it passed through the oireachtas.
He attached great importance to communicating with the public, and his distance from the decision-making centre of the Ahern government whose mistakes had brought about the crash now worked to his advantage; there was a general perception that he was doing his best to serve the national interest. Although the scale of the crisis had now sunk into the public mind, Lenihan still faced some internal opposition from government members, particularly over the issue of renewed social partnership arrangements with public service unions. (He was eventually overruled on this point by Cowen, who wished to preserve some of Fianna Fáil's labourist credentials and avoid industrial unrest, which might exacerbate the crisis.) Although Lenihan did his best to extend the progressivity of the tax system and to protect sectors such as agriculture and retail which he saw as engines for a future recovery, he believed that there was simply no alternative and that front-loading spending cuts and tax rises would make it impossible for a successor to reverse course.
On 9 December 2009 Lenihan produced his third austerity budget. A week later, it was discovered that he was suffering from pancreatic cancer in a virtually inoperable form, and that he might only live for a few more years. The diagnosis was made public on 26 December by the television channel TV3; its decision to reveal his condition without permission at a time when the Lenihans were celebrating Christmas was widely criticised. He chose to remain in office, and while he was physically weakened by chemotherapy and radiotherapy, friends believed that his plight actually increased his powers of concentration.
While Lenihan largely maintained his popularity, Cowen was seen as out of his depth. As Lenihan grew increasingly distant from Cowen, he gave encouragement to some backbench TDs who saw him as an alternative party leader possessing more credibility than Cowen and thereby able to limit the forthcoming electoral debacle. In private, Lenihan wryly suggested his role as interim leader might be that of El Cid in the eponymous 1961 film (who turns down a potentially lifesaving operation to continue leading his troops in battle; after his death, his corpse, strapped to the saddle, leads them to victory). However, the idea of Lenihan as party leader suffered from serious flaws: to become taoiseach, he would have had to disclose the full extent of his illness; a replacement finance minister would have been required, but all the likely candidates were more deeply implicated than Lenihan in the decisions leading to the financial crisis. Cowen also retained considerable support among Fianna Fáil TDs; he might have won a leadership challenge, and Lenihan then would have had to resign. Lenihan also felt some degree of loyalty to Cowen, and appears to have decided that he would only act if Cowen stepped down; but this was not the impression he gave to some of his backbench contacts, and they later complained that on more than one occasion they gave him opportunities to strike which he passed up.
Deepening crisis, 2010–11 By early 2010 the economic situation was becoming even worse. The disclosure that Greece had entered the euro on the basis of falsified economic figures, and its resort to a bailout (the first of several), led to steady increases in the borrowing rates for peripheral countries such as Ireland. This was intensified when the banks' liabilities proved much greater than anticipated. With the prices paid by NAMA for acquired assets significantly lower than projected, the banks' increased need for capital led to the government securing majority stakes in all except Bank of Ireland (where it held a minority stake), resulting in a €64 billion investment with dubious prospects, and to growing international doubts over Ireland's financial position. Lenihan tried to stave off pressure from the EU and International Monetary Fund (IMF) to accept a bailout by preparing a four-year plan for the public finances, which he hoped would provide a basis for more European support. Meanwhile, the government's dáil majority was whittled away by defections and by-election losses.
In August 2010 Lenihan was invited to address the annual commemoration of Michael Collins (qv) in west Cork, traditionally a Fine Gael event. While speaking of reconciliation, he emphasised Collins's achievements as a finance minister and warned that further sacrifices might be necessary to stabilise national finances.
With EU peripheral states in increasing difficulty, in November 2010 Ireland entered bailout negotiations. Since Lenihan hoped to get better terms by holding out (he successfully resisted pressures to raise Ireland's low corporation tax rate, which might have deterred foreign investment), not all ministers were informed of the true situation, and some embarrassingly denied that a bailout was imminent. This was soon disproved by the arrival in Dublin of representatives of the EU, IMF and European Central Bank (the so-called 'troika'), and by a public statement by Honohan, the governor of Ireland's Central Bank. On 21 November terms were finally agreed, with Ireland borrowing at punitive rates of interest; Lenihan, who had to fly from Baldonnel aerodrome to Brussels, later recalled his gloom at the thought that the disaster he sought to avert had happened, and 'hell was at the gates'.
The Green Party subsequently announced that, once Lenihan's December budget and associated legislation had been passed, they would withdraw from government, leading to an election in the new year. This precipitated a leadership challenge by Minister for Health Micheál Martin, who became the focus for internal Fianna Fáil discontent. Lenihan not only supported Cowen, but denied on air that he had plotted against him, leading to public disclosure of his backbench intrigues by the Kilkenny TD John McGuinness. Cowen defeated Martin, but then self-destructed through a ham-fisted attempt at a cabinet reshuffle (after several ministers resigned, the Greens refused to support their replacements). He then resigned as Fianna Fáil leader while remaining taoiseach until the election. Lenihan stood for the party leadership, but on 26 January 2011 Micheál Martin was elected leader with Lenihan coming a poor third of four candidates. At the February 2011 general election, he was the only Fianna Fáil candidate returned for a Dublin constituency (and one of only twenty nationally).
In March 2011 Lenihan was appointed Fianna Fáil deputy leader and opposition spokesman on finance. He participated in dáil debates and spoke to journalists about putting his account of his ministerial career on record, but his health deteriorated rapidly, and he died, aged 52, on 10 June 2011 at his home in Castleknock, Dublin. He had already made his funeral arrangements, and was buried in the graveyard of St David's church, Kilsallaghan, Co. Dublin, a quiet, semi-rural corner of his constituency he had discovered while canvassing and chosen as his final resting place.
Posthumous Reputation Almost immediately on his death, Lenihan became the focus of a legend as the lost leader, the golden boy, a Collins-like figure who had to bear the consequences of others' mistakes and make hard decisions to secure the best deal for his country under impossible circumstances. It is certainly the case that he laid the framework for Ireland's exit from the bailout in December 2013, with the succeeding Fine Gael–Labour government largely following his four-year plan; that he bears little of the blame for the blunders of Ahern and his finance ministers; and that the damage had been done before he took office. His room for manoeuvre was severely restricted and, though some of his detailed decisions can be faulted, the view that default on the Icelandic or Argentine model might have been preferable is confined to a minority of commentators. Debate continues about how far austerity measures contributed to the subsequent economic recovery and how far that recovery was owing to wider developments. The handling of NAMA also remains a matter for debate (though it should be noted that significant decisions in this respect were taken by subsequent governments, and that Spain and Slovenia adopted it as a model for handling their banking crises). Even in 2017, it is still too early to assess the full significance of Lenihan's measures, but his commitment to the national interest as he saw it commands respect.