Chapter 7  image


“Now remember boys, if a government is formed, I won’t take any office, and I certainly won’t be Attorney General”.1

JOHN A. COSTELLO, 13 February 1948

“… a fear amounting almost to terror that I would be a flop as Taoiseach …”2

JOHN A. COSTELLO, 29 February 1948

On 15 February 1948, as on practically every Sunday morning for 40 years, Jack Costello played golf at Portmarnock. With him were the other members of his regular four-ball—his former school friend Dick Browne, then chairman of the ESB; Dick Rice, Chairman of the Revenue Commissioners; and Dublin City Sheriff Seamus O’Connor. He played well, as he told his son Declan, getting “a beautiful drive and a glorious second at the first hole, landing on the green and nearly getting a three”.3

Portmarnock was then, as now, a golf links “with a national and international reputation”,4 and Costello was captain of the club, a position he regarded as a great honour.5 But if more attention than normal was paid to the quality of his game—which was even noted in the Irish Times6—it wasn’t because of his position in the club. It was because this regular round of golf was played in far from ordinary circumstances. For John A. Costello was wrestling with the biggest decision of his political career: whether to accept the entirely unanticipated and unwanted chance of becoming Taoiseach of Ireland’s first coalition government.

Although he banned discussion of the subject as they played, it must have been on all their minds. Seamus O’Connor had already given his view—when they called to collect him, “he came out towards the car doubled up in two laughing at my predicament … and explaining, when I told him that I hadn’t yet accepted, that I had no choice”. After their round, his other companions agreed. Costello was surprised to get this advice from Browne in particular, “as I fully expected that with his non-political and very hard-headed outlook he would advise me against it”.7

But there was one more advisor he wished to consult before making his decision, his old university friend and rival Arthur Cox. At a quarter to five, he arrived in Cox’s office along with Rice and Browne, and they discussed the matter again. Cox observed that by entering politics, Costello had been “playing with fire”, and he had to expect to be burned at some stage. Having accepted what taking the job would mean to Costello, and praising his work as a senior counsel, Cox “finally produced the argument which finished the matter as far as I was concerned. He said that if I refused the nomination and the thing did not come off as a result of my refusal I would regret it for the rest of my life. That convinced me as I felt that I could not refuse.”8

The die was cast for Costello, though he spent the next three days hoping that something would happen to derail his election. While his agreement was crucial to the proposed coalition government, others had done the groundwork to make it possible. That groundwork really began with the increased co-operation on the Opposition benches noted in the previous chapter. This included transfer patterns in the 1945 presidential and 1947 by-elections, and a greater confluence of views in the Dáil, as the Fianna Fáil government became increasingly unpopular.

The wind of change was blowing too in the newly renamed constituency of Dublin South-East, where for the first time Jack Costello topped the poll, taking almost 29 per cent of the vote, while MacEntee was just under the quota with slightly less than 25 per cent. MacEntee would not regain his position at the top of the poll until 1961. The second Fianna Fáil TD, Bernard Butler, had moved to Dublin South-West, and the party lost its second seat in South-East to a new candidate, Dr Noël Browne of Clann na Poblachta, who won just under 17 per cent of the votes. None of the other candidates broke the 10 per cent mark.

The size of the Dáil had been increased as part of MacEntee’s attempt to secure Fianna Fáil’s position, from 138 to 147, the maximum allowed by the Constitution. Despite this increase, Fianna Fáil dropped one seat to 68; Fine Gael gained one seat to 31 (although, as this was a larger Dáil, the party’s percentage of seats actually fell), while its vote dipped below 20 per cent for the only time, to 19.8 per cent; Labour gained six seats to 14, while their separated brethren in National Labour gained one to five; on its first outing, Clann na Poblachta took 10 seats (a bitter disappointment to MacBride, who had expected to win many more); Clann na Talmhan lost four seats, returning with a total of seven; and there were 13 Independents.

The final result of the election was delayed due to the death of Fine Gael candidate Eamonn Coogan in Carlow-Kilkenny. The vote in that constituency having been deferred for one week, leading figures in all the parties descended to canvass. Prominent among them was Seán MacEoin, whose presidential campaign in 1945 had demonstrated that a Fine Gael candidate could attract support from Opposition voters. In Carlow-Kilkenny he met leading figures from the other parties, including Jim Larkin of Labour and James Pattison of National Labour, and concluded that an inter-party government could be formed, that the onus was on Fine Gael and its leader to make the first move, but that Mulcahy would not be acceptable as Taoiseach to Labour or Clann na Poblachta because of his Civil War record (although MacEoin, strongly in favour of Mulcahy’s leadership himself, formed the impression that the other parties would relent if no acceptable alternative was obtainable).

MacEoin reported his findings to Mulcahy the day after the vote in Carlow-Kilkenny, and found that his leader was already thinking along similar lines. However, Mulcahy pointed out that National Labour held the balance of power, and that the party’s National Executive was strongly inclined to support Fianna Fáil. MacEoin agreed to meet them behind the scenes to see what could be done.9 Meanwhile, Mulcahy consulted Fine Gael colleague Dan Morrissey, a former Labour TD, about his options. Morrissey said that even if a coalition could be formed it would probably only last six months, “but that I had to do it”. On 11 February he wrote to the other party leaders, inviting them to a meeting in Leinster House (Mulcahy evidently wasn’t superstitious—he set the meeting for Friday the thirteenth). All except National Labour attended.10

But while National Labour was publicly remaining aloof, MacEoin had travelled to Cork to meet local TD James Hickey. The National Labour man agreed that a coalition should be formed, subject to the proviso that Paddy McGilligan would be Minister for Finance. A number of other TDS—Spring, O’Leary and Everett—were also contacted and gave their approval. They naturally didn’t want their position made public in advance of their official meeting on the day before the Dáil assembled. However, MacEoin later recalled, they gave him an assurance that “if their confidence was maintained they would support the formation of a new Government”.11 Clearly, this was less than cast-iron—but it gave Mulcahy reasonable grounds for believing that an alternative government could be formed, if agreement could be reached on a Taoiseach.

At the meeting of the other four parties on 13 February, there was broad agreement on the desirability of forming an alternative government, and on the allocation of portfolios among the parties. But Mulcahy later recalled that Labour leader Bill Norton told him that his party would not agree to “serve in a government under the leadership of one who had been the leader of another party. My reply … was that … while the Fine Gael party might feel that I should be the leader of the Government … I would not stand between them and the setting up of such a government.”12 This has sometimes been interpreted as an attempt by Norton to ease Sean MacBride’s path into government; in fact, Labour were just as opposed to Mulcahy as Clann na Poblachta, and for the same reasons.

Crucially, at this point Norton suggested to Mulcahy that Costello should be brought to the next meeting the following night, “for the purpose of your advice and help. There was a general feeling that you should be so asked.”13 If not an explicit suggestion of Costello as a potential Taoiseach, the request certainly had that implication. Norton had known Costello for a long time, and had, as we have seen, negotiated with him a successful conclusion to the long-running dispute over the rights of transferred civil servants. Costello was also friendly with another leading Labour figure who would be a Minister, T.J. Murphy. He later recalled that they had frequent conversations in the Dáil. But he felt that the main factor making him acceptable to Labour was his father’s friendship with Big Jim Larkin from their joint service on the board of Grangegorman Hospital.14 Larkin’s son, also Jim, was overheard by Mulcahy at the time of the formation of the Second Inter-party Government saying to Costello, “Don’t you know that we would do anything for you?”15

Costello also knew Seán MacBride from the Law Library, later claiming to have invested considerable time in trying “to persuade him to bring his gunmen colleagues within the framework of the constitution and legality—into the Dáil”.16 The other salient point is that while Costello had been Attorney General, he only took up that post in 1926, and had played no part in the Civil War. As Liam Cosgrave put it, he “had not been so prominent in politics that he had incurred any enmity”.17

It was, then, only on the evening of Friday 13 February that Costello entered the picture. His first involvement in the discussions was to meet Patrick McGilligan along with Richard Mulcahy and the latter’s election agent, Paddy O’Reilly. O’Reilly took the view that they could persuade the other parties to accept Mulcahy as Taoiseach if they “stood firm”, but Costello disagreed.18 It seems Mulcahy was also realistic about the chances of getting support from the other parties—while some members of the front bench wanted to offer their potential partners a choice of Mulcahy or the return of de Valera, the General disagreed.19 For Mulcahy, with his memories of the Civil War split, the removal of de Valera took precedence over any ambitions of his own.

While Costello shared this analysis, he clearly had no inkling that he would be the alternative choice. As he walked down the steps of McGilligan’s house on the Friday night, he later recalled, he said, “Now remember boys, if a government is formed, I won’t take any office, and I certainly won’t be Attorney General.”20

Blissfully unaware of what was about to befall him, Costello did some legal work on Saturday morning, before playing four holes of golf at his local course, Milltown. He was anxious to break himself in after the election campaign before his regular game at Portmarnock the following day. But shortly after he arrived home, he had a caller, Senator James Douglas, an old friend who had some unsettling news for him.

Douglas reported that Seán MacBride had mentioned Costello as a possible Taoiseach, and wanted to see him. Costello was at first disposed to treat the idea lightly, dismissing it as absurd, but agreed to meet his fellow barrister. According to Costello’s letter to his son Declan in Switzerland, MacBride called at 3.30 on the Saturday afternoon. “We had a frank talk during which he told me that his people would accept me and would not accept any of the others whose names I suggested. I pressed Dan Morrissey very strongly but to no avail. He left shortly after five with my refusal but asking me to reconsider it.” It is curious that this encounter was not mentioned anywhere else by either of the two men. The only other source which mentions it (briefly) is Patrick Lynch’s “Pages from a Memoir”, which is based in part on the letter to Declan.21 Given that the letter was written within a fortnight of the events described, it seems highly unlikely to be incorrect. Perhaps with the passage of time, all concerned were anxious to downplay MacBride’s role in putting the Government together.

However, Costello was not MacBride’s first choice as a Fine Gael alternative to Mulcahy. According to his own account, the Clann leader suggested Sir John Esmonde, who he described as “then one of the leaders of Fine Gael”.22 MacBride appears to have been the only person who considered the Wexford baronet a leading figure in the party—his name was immediately ruled out by the Fine Gael negotiators, who, according to MacBride’s memoirs, then suggested Costello’s name. The Clann leader readily agreed, as he “had great respect for him; he was businesslike and capable. He had not really been much involved in bitter civil war politics.”23

Curiously, MacBride continued to hold Esmonde in high regard, telling Costello’s secretary, Patrick Lynch, over dinner in October 1949 that he was thinking of having Esmonde replace him as Minister for External Affairs, so that he could take up a new Department of National Development. The conversation was reported to Costello, who evidently didn’t take it too seriously.24

In any event, on the evening of Saturday 14 February Costello went to meet his Fine Gael colleagues in Mulcahy’s house, Lissenfield, in Rathmines. He came under “intense pressure, having been at the outset informed that I was the only one to whom Labour and Clann na Poblachta would agree”. Among those at the meeting were Mulcahy, Morrissey, McGilligan, O’Higgins and MacEoin, all about to become ministers, Liam Cosgrave, Gerard Sweetman and Liam Burke, the General Secretary of Fine Gael. Burke provided the only light relief for Costello, as he “emotionally likened the situation to the unanimous election of a Pope”! The putative pontiff did his best to claim his “complete unfitness for the job”, but was overruled by his colleagues.25

MacEoin later recalled that persuading Costello to accept the responsibility presented “the greatest difficulty … He resisted for a long time and he said amongst other things that his practice at the Bar was of a high order and that his emoluments and briefs brought him in a high salary, that he had responsibilities to himself, his wife and family and that it was unreasonable to ask him to accept the great responsibilities at a much lower salary. This was waved aside by his colleagues who felt that he must make the sacrifice for the sake of the country.” His plea for more time to consider his position was rejected, as “it was felt that if he got time he might refuse so he was pressed to give provisional assent”.26

Costello finally found himself with little option but to agree—he was particularly moved by the appeal from Dr Tom O’Higgins, who had lost his father and brother to Republican violence. As he wrote to Declan, “I had to realise what a tremendous tribute it was to me and how my friends and colleagues looked to me to complete for them what they had all worked so hard and sacrificed so much to bring about.” Having given his provisional agreement, he went home to Herbert Park to break the news to his family. Bizarrely, he told his wife, Ida, that his new job would be less stressful than his existing career as a barrister. “I said that it would mean less night work and worry.”

Then yet another meeting later that evening in the Mansion House. All the parties to be involved in the Inter-party Government were represented, except National Labour. James Dillon was there too, as the representative of a group of six Independents who had agreed to support the government (the others were Alfie Byrne and his son Alfred Byrne junior, Patrick Cogan, Charles Fagan and Oliver J. Flanagan). Costello was faced with his future Cabinet, chosen without reference to him. He again tried to argue his unsuitability for the job, as well as his financial worries. But his potential coalition partners dismissed his concerns. “William Norton said that they were wasting their time unless I agreed as his group would have nobody but me. Seán MacBride said the same …” He asked to be given until Monday to think about it—they gave him until eight o’clock the following day, Sunday. “They then proceeded with the discussions of plans based on the assumption of my acceptance. They allotted ministers and settled procedures. I intervened from time to time as if I were forming the cabinet always with guarded references—‘If I do accept’. It was close on midnight when I got home and I didn’t sleep much that night.”

What were the concerns playing on Costello’s mind that night, and the next day as he played golf and consulted Cox and the others? One aspect was financial—he was making a very good living at the Bar, and he still had a family to support. Only Grace had left the family home at this stage, Declan was receiving presumably expensive treatment in Switzerland, and Wilfrid’s care would have to be paid for indefinitely. He also had a fairly elaborate domestic staff, with a cook, two maids and a gardener.27 Critics have pointed to his evident reluctance to make financial sacrifices—Eithne MacDermott, for instance, referring to the “whinging note” he adopted on this issue.28

But while money was certainly an issue, it seems to have been more of an excuse than a deciding factor. As he wrote to his son some days later, “I think I can honestly say that it was not the financial loss or even the parting from my life’s work as an advocate … that made me fight so hard against acceptance but a fear amounting almost to terror that I would be a flop as Taoiseach and bring discredit on the new administration if it was formed. I felt that such a new departure would be looked upon with distrust and be subjected to severe criticism. If I proved unfit it would be disastrous for them all.”

After receiving Cox’s unwelcome advice, he finally told Mulcahy on Sunday evening that he would accept, and went to another meeting in the Mansion House with his future Cabinet. “The meeting was quite informal—sitting around the fire as I refused to take the chair or have any formality.” Of course, while the alternative government now had a Taoiseach, it did not yet have a majority, and Costello spent the next three days hoping that something would prevent it getting one.

There had been little difficulty in reaching agreement on policy. Seán MacBride laid down three conditions for the Clann’s participation—the planting of a minimum of 25,000 acres of trees a year; the provision of money from the Hospitals Trust to build hospitals and sanatoria; and improvements in old-age pensions and health benefits. He later claimed there were “visible signs of relief” around the table when he didn’t insist on constitutional change, such as the repeal of the External Relations Act. “I did mention in private conversation with them afterwards that I would naturally be very glad to see the External Relations Act repealed, but I realised that I hadn’t got a mandate for that … All the other things I had asked for were things that they had campaigned for as well, and therefore it was reasonable to ask for them …”29

The parties agreed a 10-point programme of policy points on which they agreed: increased agricultural and industrial production; a housing drive; a reduction in the cost of living; taxation of “unreasonable” profits; a comprehensive social security plan; the removal of the Supplementary Budget taxes on tobacco, beer and cinema tickets; facilities for TB patients; the establishment of a Council of Education; a National Drainage Plan; and modifications to the means test for old age, widows’ and blind pensions.30

Costello, meanwhile, “immersed” himself in his legal work, including “a difficult licensing case which in fact proved to be my last” in the Circuit Court on the Monday. But that evening, as he drove through the gates of Leinster House, he received “the shock of my life” when Michael Donnellan of Clann na Talmhan stopped his car. “He nearly pulled the arm off me and addressed me as ‘our Taoiseach’ telling me that he knew for certain that the five National Labour were voting for us.” (If MacEoin’s account of his previous negotiations with National Labour is accurate, it seems strange that he didn’t prepare Costello for this shock.)

His colleagues having confirmed the news, he met the five National Labour TDS, led by Jim Everett. “I spoke plainly. I told them I didn’t want the post and that if there was agreement it had to be absolute agreement, no formulas designed to cover but not get rid of difficulties.” The only concrete point raised by National Labour concerned the right of representation at the International Labour Organisation in Geneva, from which the Irish Transport & General Workers’ Union had been excluded. Costello said he couldn’t make any promises, except that if a government was formed, he “would see that their party got a square deal”.31 Such was Costello’s reputation that this was enough for Everett and his colleagues, who resisted heavy pressure from their party executive to support Fianna Fáil and announced they would back a change of government.

Bonfire celebrations greeted him in Donnybrook that night—the following afternoon he received “a tremendous ovation” from the first meeting of the new Fine Gael parliamentary party. Characteristically, he pointed to Mulcahy and said, “There is the man you should be applauding, not me.” He had to address his constituency supporters again that night, who he said were as enthusiastic as he was depressed. Fianna Fáil too were depressed—they had fully expected National Labour to vote for de Valera, as the party’s executive had instructed. Seán Lemass recalled that “up to the night before the Dáil met we did not realise there was going to be a majority against us. Even then, we did not believe it was going to last very long because it was such a makeshift sort of government.”32

On Wednesday morning, after Mass in the Pro-Cathedral to mark the new Dáil term, Costello had his “first experience of the battery of cameras which pursued me for days after. I went down to court after Mass still trying to convince myself that something would happen to prevent the inevitable.” After lunch in the Stephen’s Green Club with Ida, Grace and Alexis, he went down to Leinster House with his son-in-law. With a change of government on the cards after 16 years, there was intense public interest. “The Chamber itself was packed to capacity and a big crowd filled Kildare Street some hours before the Dáil sat.”33

The incoming Taoiseach, meanwhile, “was feeling like nothing on earth. I had the feeling that the whole thing was a fantasy.” He was nominated by Mulcahy, who praised him “for the character and ability that has pointed him out so clearly to a number of groups in the House and in the country as the man to hold together and to bind that spirit and to lead it to achievement”—a handsome tribute given that Mulcahy had been passed over by those same groups. He added that Costello “by making sacrifices of various kinds … is stepping in to encourage men of various parties to sit down together and face whatever difficulty arises, politically, socially or economically in Ireland these days”. His nomination was seconded by Norton, who said Labour was willing to give inter-party government a trial, and “to give to our people something of the fullness and sweetness of life which inter-party government has given democratic people in other countries with which this country is comparable”.

MacBride accepted that his party had not received a mandate to repeal the External Relations Act “and such other measures as are inconsistent with our status as an independent republic. These, therefore, have to remain in abeyance for the time being.” He added that Costello was “a man of honour, of integrity and of ability, well fitted to fill the high position for which he has been proposed”. Dillon said Costello was “a decent man and he comes of decent people”. He added that he was “more optimistic” than MacBride about achieving his objectives—on the basis that Ireland would soon be called upon to “take her place with those nations who seek to defend the liberty of the world from the greatest threat that has ever challenged it … In accepting that invitation, we may see a sovereign, independent and United Ireland delivered from the nauseating frauds of a dictionary republic sooner than we anticipate.”34

De Valera was defeated by 75 votes to 70, and then Costello’s nomination was approved by 75 to 68. Two independents who supported de Valera—Thomas Burke, the Clare bone-setter, and Ben Maguire of Sligo-Leitrim—did not vote against Costello. He was supported by five parties (Fine Gael, Labour, Clann na Poblachta, Clann na Talmhan and National Labour), as well as eight Independents—the six put together by Dillon as well as Patrick O’Reilly and William Sheldon. When the result was announced, Oliver J. Flanagan called out, “Thanks be to God that I have lived to see this day,” and was rebuked by the Ceann Comhairle. Costello confided to his son that this annoyed him, as he was about to speak and he felt the Ceann Comhairle was motivated by his dislike of Flanagan. The new Taoiseach’s acceptance speech was made off the cuff—he admitted that he “couldn’t bring myself to think of it” beforehand, another indication of his deep reluctance to accept the inevitable.35

For once, he was brief. He expressed his appreciation of the honour that had been conferred on him, but pointed out that the position “was not sought by me nor wished for by me in any way”, and that he had not been part of any political manoeuvre. “I will have to shoulder serious responsibilities for which I am in no way fitted. At the same time I am quite confident, from my contacts and knowledge of the men who are joining in this Government, that everybody will work for one purpose and one purpose alone, namely, the good of all sections of the people.” He also urged the “men of patriotism, honesty and courage” on the opposite benches to offer the new Government help and support.36

Two new members of the Dáil—Noël Browne and Tom O’Higgins junior—later wrote separately of the simplicity of the change of power. After the vote, the Dáil was adjourned to allow the new Taoiseach go to Áras an Uachtaráin to accept his seal of office from the President. The Ceann Comhairle announced that when they returned, Fianna Fáil and Opposition TDS would swap sides in the Chamber. “Thus was marked in the Dáil the fact that all the powers of government had passed from one side of the House to the other.”37

Immediately after the vote, Costello was met at the exit from the Dáil Chamber by Maurice Moynihan, Secretary to the Government, and J.J. McElligott, Secretary of the Department of Finance, who knew him.38 The two officials accompanied Costello, “feeling very forlorn”, to the Taoiseach’s room at the back of the chamber, where he met de Valera. They had “a few frosty words” before the outgoing Taoiseach left. Costello told Declan that McElligott “was delighted at the change though officially he was correct. He gave me in a few minutes a lurid picture of what was facing me and I then proceeded to go out to the car for the journey to the Park.”39 He was accompanied in the car by Moynihan, by Alexis FitzGerald, and by Captain Mick Byrne, a prominent constituency worker who later became his aide-de-camp.40

Then it was back to Leinster House for the debate on the nomination of the members of the new Government. Costello, of course, had had little or nothing to do with their selection, or the distribution of portfolios. The team was generally well regarded—theUSMinister, for instance, suggested that the Cabinet was “an impressive group—more able, I should say, than its predecessor”. However, he added that it was “chosen from six [sic] political parties whose ideas and policies are contradictory”.41

The Tánaiste and Minister for Social Welfare was Labour leader Bill Norton, on whom Costello was to rely greatly, recalling often in later years how his advice had been sought whenever a difficulty arose.42 Patrick Lynch noted the two men’s mutual sympathy and understanding, describing the Labour leader as “very able, very practical, very hard-headed”. He was also “utterly devoid of sympathy” for Noël Browne and for progressive politics in general. Lynch believed Norton was “essentially a conservative”43—an assessment with which Browne would have entirely agreed. The Tánaiste played a key role in keeping the coalition together, thanks to his experience as a negotiator and feel for issues likely to cause the Government trouble—he “exhibited a high degree of the skill that consists in making the rough ways of government smooth”. While he had no sympathy with the old guard in Fine Gael, “he was shrewd enough to see that his mistrust was shared by that party’s newer elements”.44

Fine Gael leader Dick Mulcahy had initially been pencilled in for Finance and then External Affairs,45 but ended up in Education—a “backroom” role in which he was happier than he would have been in a more prominent Department, or as Taoiseach.46Although MacEoin claimed National Labour had insisted on Patrick McGilligan in Finance, Patrick Lynch believed it was MacBride who demanded he got this key role—a decision that disappointed McGilligan, who wanted to be Attorney General as there was too much work involved in Finance.47 Labour too were keen on McGilligan, having “half an idea that he was nearer to them than to his own party”.48 In any event, McGilligan was a key figure in Cabinet, both because of his portfolio and because of his character—which even Noël Browne was prepared to compliment, calling him “easily the brightest intellectual in the coalition Cabinet”.49

MacBride took External Affairs, and began his Cabinet career in a highly influential position. He had, after all, played a key role in the formation of the Government and in the choice of its Taoiseach. He contributed on a wide range of issues, most of them outside his own departmental brief, and was taken seriously by his colleagues—initially, at any rate. Mulcahy later recalled how he and Dr Tom O’Higgins reacted to MacBride after the first Cabinet meeting—“Another de Valera”.50 Coming from these two, this was not in any sense a compliment. But it did indicate a certain stature, a stature that MacBride was to lose over the lifetime of the Government.

MacBride nominated his inexperienced party colleague Noël Browne to the Department of Health (of course, any Clann nominee would have lacked experience of parliamentary politics, as did MacBride himself). As well as believing that a doctor would be best placed to take on the “job of work” in Health (particularly, although MacBride didn’t mention it, one so prominently associated with the fight against TB), he also thought the appointment of a young man not associated with the Republican movement would widen the Clann’s appeal and remove the criticism that it was “only a group of old IRA men, parading under a new façade”. MacBride later claimed that he faced a lot of criticism on the party executive over this decision. “I had to throw my weight heavily onto the scales to get them to agree. It was a reluctant agreement on the part of the majority of the Standing Committee …”51

While MacBride suggested it was the nomination of Browne that caused the opposition, it seems more likely to have been prompted by distaste at the idea of entering government at all, a move which was only narrowly adopted after a marathon meeting of the National Executive, by 18 votes to 16.52 Concerns about Browne were also raised by Fine Gael’s Seán MacEoin, who asked MacBride if he was wise taking on the “young fellow” Browne. “You don’t know very much about him. You’d be much better off with somebody like Con Lehane, an experienced republican and politician.”53 MacBride would have cause to regret his decision, as would the Clann and the Government.

Clann na Talmhan leader Joe Blowick became Minister for Lands, a position in which he did little damage and little else. National Labour’s Jim Everett took Posts and Telegraphs, while T.J. Murphy of Labour was in Local Government (after his death in April 1949, he was succeeded by Michael Keyes). The other Fine Gael ministers were MacEoin in Justice, O’Higgins in Defence, and Morrissey in Industry and Commerce. James Dillon became the first Independent to be appointed to an Irish Cabinet, achieving his long-time ambition of becoming Minister for Agriculture.

Liam Cosgrave had a key role as Government Chief Whip—speaking of the difficulties of that job, he quoted Wellington’s reported remark about his own troops: “I don’t know about the enemy, but they certainly frighten me.”54 At Costello’s retirement dinner, he spoke of the contradictory aims of some of the Government’s supporters—one believed the Taoiseach was a Republican, others that he would preserve the “tenuous link with the Crown”; one wanted an increase in the price of milk, another would withdraw his support if the cost of butter went up; and yet another would bring down the Government unless a ban on taking sand from the foreshore in his constituency was lifted. As Cosgrave wryly commented, “For all I know they’re still drawing sand from the foreshore!” Much as they differed, though, all were “united in their dedication to John Costello as a man of the very highest integrity”.55

This dedication to the Taoiseach was particularly evident among members of the Cabinet. Everett told his Departmental Secretary “more than once, with obvious approval, that the Taoiseach was a saint”.56 Cosgrave recalled Costello in Cabinet as being patient, adding that he was “highly respected by Labour and Blowick and of course Fine Gael members”.57 Even Noël Browne said Costello “was a most fair-minded chairman of the Cabinet, most honourable in every way, he gave us plenty of time to debate everything, and gave everybody the same opportunity to discuss”. Browne characteristically qualified this praise by adding, “but that is not important”. He believed that “on basic fundamentals and important social and economic and financial issues the dominant policies that come out of a multi-party situation are those of the biggest party in that … government”.58

As the Irish Press sourly noted, there were 13 in the Cabinet, compared to 11 in the outgoing government. “In a team of 11, sufficient places could not have been found to reward all those who had a claim to office as a result of their contribution towards coalition making.” The paper also noted that all the key posts had gone to Fine Gael, which wasn’t strictly accurate but was close enough to the truth.59

The change in status for the Costello family was immediately evident, as an unarmed Garda patrol was placed on 20 Herbert Park.60 Costello’s absence from a meeting of the Irish Council of the Society of St Vincent de Paul was noted by the Chairman, Brother E.J. Duffy. Another attendee later told Costello, “Your deputy explained your absence was due to the fact that you were busy forming a new Government for the country … Even with the rank of Taoiseach you were just a member to Ned and no matter what pleas your deputy put up he was shot down and eventually told ‘it was no excuse’.”61 As for the new Taoiseach, once the initial shock wore off he took to his new duties with the same determination and focus he had shown for the law. He assured Declan in Switzerland that he was “perfectly and supremely happy and contented, and face the future and what it holds with resignation, and with confidence and hope”.62

On the Tuesday after his election, Costello broadcast to the nation, claiming that in the formation of the Inter-party Government “the Irish genius for democracy has asserted and proved itself”. He said the participating groups would maintain their separate policies and individuality, but that agreement had been reached “over a wide field of action”. If the new Government was a novelty, he said, it was “a refreshing and timely” one, which brought together “men of different groups who have been colleagues and friends for many years and who have learned to know and respect one another without necessarily seeing eye to eye on every detail of every subject”. Warning against frequent elections as neither desirable nor necessary, he said the Dáil would become “a deliberative assembly rather than a machine for registering the will of a majority party”.63

He cited national freedom and unity as “chief of these fundamental objectives upon which there is complete agreement”—but then went on to say that “economic considerations must take priority over all political and constitutional matters”. The Government’s aims were to increase national income to pay for adequate health and social services, reduce the cost of living, increase exports, establish a Council of Education to remove educational matters (including the revival of Irish) from party politics, and action against the “twin evils” of TB and emigration. He recognised the right to a fair return for those who put capital into Irish industry, saying that “no decent Irish industrialist has anything to fear from this Government. Obviously, however, unreasonable profits acquired at the expense of the consumer will be scooped for the common good.”

Costello also outlined a lofty ambition for Ireland to act “as the interpreter of Europe to the New World and as the interpreter of the New World to Europe, intending thereby to further peace among men, to strengthen that culture of which we all are a part and to extend the dominion of the Christian religion”. In his peroration, the new Taoiseach recognised that difficulties lay ahead. “The members of the Government, for whom I speak tonight, are more than willing to do their share. With the willing help of our people and under the providence of God we have no doubt that we will fully succeed.”64 According to the Irish Independent, he was applauded by a crowd in Henry Street as he left the radio studio after eleven o’clock that evening.65

Press reaction to Costello’s election was predictably mixed. In an editorial, the Irish Independent said the majority of citizens would welcome the formation of the government, noting that it was led by a Taoiseach “who not only stands in the highest rank in his own profession, but whose profound knowledge and experience of public affairs admirably fit him for his office”.66 The Independent’s headline was “Mr Costello is Taoiseach”. Clearly, this would not do for the Irish Press, which hilariously opted instead for “Mr de Valera is no longer Taoiseach”. In an editorial, the Press thundered that the new ministers had been chosen not for their ability, “but simply and solely because their party had to get its reward in representation for its help in making the Coalition Government possible. The fantastic nature of some of the appointments indicates how fierce the bargaining must have been and how desperate must have been the efforts to reach an agreement.” The paper’s political correspondent sniffed that the atmosphere was that of a “commercial deal”.67 This dismissive attitude on the part of Fianna Fáil extended to the new Taoiseach. Years later, Todd Andrews described Costello as “a lawyer of no political distinction … a survivor from the Irish Parliamentary Party. He was regarded by Clann na Poblachta as innocuous and malleable. In fact, in government he did not know whether he was coming or going.”68

Others were naturally more enthusiastic, and the new Taoiseach received a huge number of congratulatory letters and telegrams. Former Finance Minister Ernest Blythe sympathised that he had been “elevated to something more like a bed of thorns than a bed of roses”, but said that didn’t take away from the honour.69 Fellow barrister Kevin Liston congratulated him on his own appointment, and on that of Cecil Lavery as Attorney General. “You will both be sadly missed from the library—but I need scarcely add that the lowering of the standard will make it a bit easier for the rest of us who are lower down in the class!”70 But perhaps the most welcome letter for Costello personally came from a medical consultant, who advised him to look after his health—“more than ever, I think your relaxation at golf will be helpful”.71

For many supporters of the Opposition parties, news of Costello’s election seemed almost miraculous after 16 years of de Valera. In his memoirs, barrister and future minister Patrick Lindsay described his desperate hunt for news while out of touch on circuit on the day the Dáil met. He finally found a guard in Tuam who informed him with evident emotion of Costello’s election. The two agreed on a celebratory drink, but when Lindsay suggested he should park his car properly the garda responded, “Leave it where it is. We have freedom for the first time in sixteen years.”72

The new Taoiseach, responding to a letter of congratulations from diplomat Michael MacWhite, wrote on 10 March that “the honour was thrust upon my unwilling self but now that I have accustomed myself to the radical change … I am extremely happy. I believe we are going to do a great deal of good. The volume of support is increasing daily and I hear from all parts of the country of a widespread feeling of relief brought about by the change.”73

It would be imagined that the British would have been happy to see the back of de Valera. But in fact the British representative in Dublin, Lord Rugby (formerly Sir John Maffey), wrote what appears to have been a sincere note of commiseration to the outgoing Taoiseach. He told de Valera “how deeply I felt today’s swift closing of the chapter”. Rugby thanked him for his accessibility, patience and frankness over the previous eight years, and wrote of his “deep and warm … regard … for you as a man and a fellow-traveller through anxious times”. The new leader of the Opposition responded philosophically that he naturally regretted “being no longer able to do things or to get things done” but that “not having the power I have not the responsibility”.74

American diplomats were somewhat more enthusiastic about the change. Vinton Chapin, in charge of the legation during the absence of US Minister George Garrett, informed Washington before Costello’s election that he was a prominent member of the Irish Bar who was a “strong supporter British Commonwealth. He is friendly disposed to the U.S. and … little change international policy expected.” A month later, Garrett himself described Costello as “Dublin’s outstanding lawyer”, adding that he was “generally considered the best selection that could have been made”. And in July, the Legation’s Second Secretary said Costello’s emergence as a national figure had given Fine Gael “a tremendous shot in the arm … He is a marvellous individual personality and enjoys the respect of everyone. It is significant too, I think, that he does not have any great record, particularly during the Civil War. Thus, the Fianna Fáil Opposition finds it difficult to work up popular feeling against him.”75

James Dillon had a high regard for Costello. But, alone among ministers, he was critical of the Taoiseach’s chairing of Cabinet. Costello’s lengthy anecdotes held things up, “to the extent that one would sometimes despair of doing any business. But he was so good a man, and everyone was so personally devoted to him, that when the chips were down no one would bring him to order.” As Dillon’s biographer, Maurice Manning, noted, this may have missed the point—Costello was quite capable of using delay as a way of avoiding contention at Cabinet.76

Patrick Lynch described the lengthy and indecisive Cabinet meetings as “one of the weaknesses” of the Inter-party Government. Many meetings ended without any decisions being taken—but he blamed this on McGilligan rather than Costello, believing that the Minister for Finance deliberately missed meetings where MacBride wanted to criticise his Department. This led to issues (like preparations for devaluation, for instance) staying on the Cabinet agenda for months with no decision taken.77 This view was supported by Dr T.K. Whitaker, then a senior official in Finance, who recalled that his minister was something of a “Scarlet Pimpernel”, seldom seen in the Department, as he didn’t want to get embroiled in unseemly day-to-day rows, particularly with MacBride.78 In October 1949, MacBride complained to Lynch that McGilligan had been “too ill” to attend a Government meeting, but two days later was able to go to Longchamps, outside Paris, for the Arc de Triomphe race.79

McGilligan, while undoubtedly brilliant, was something of a hypochondriac. Both he and his wife were constantly convinced that he was in danger of serious illness, which no doubt explains how he lived to the age of 90. In March 1949, Costello wrote to his friend Tom Bodkin that McGilligan had been ill since Christmas, “and finally went into a nursing home whence he emerged with the ‘depressing’ news that there was nothing wrong with him”. Bodkin replied that McGilligan “must be a very tough man for, in the fifty years or so that I have known him, he has always looked delicate and worked furiously”.80 In mid-1950, the British Ambassador was told McGilligan had considered resignation because of ill-health, but had been prevailed upon by Costello to change his mind because MacBride had “put in a claim to the succession”.81 The source of this story was the banker Lord Glenavy—the suggestion of MacBride moving to Merrion Street would have been enough to frighten the financial establishment, and may have been made for precisely this reason, as it is not mentioned anywhere else.

MacBride felt that the people who mattered most in Cabinet were Costello, Dillon, McGilligan, O’Higgins and Norton. He and Dillon had been in school together in Mount Saint Benedict; the Clann leader regarded Dillon as “active and efficient”, with views that “were always amusing and interesting and reasonably sound”.82 By contrast, the Agriculture Minister was not impressed by MacBride’s contributions in Cabinet, describing him as having “the judgement of a hen”.83

Dillon was a colourful and controversial figure. The US Legation noted in December 1948 that Fianna Fáil was expected to continue attacking the Minister for Agriculture, and that his “tendency toward overstatement may damage coalition”.84 These views, curiously, were echoed the following month at a meeting of the Fine Gael parliamentary party. Costello said Fianna Fáil was making Dillon “the object of attack with a view to discrediting him and thereby bringing down the Government and forcing a General Election”. He urged TDS and senators to go on the offensive, speaking to meetings at least every second weekend to get the Government’s message across. Other speakers, while they paid tribute to Dillon’s good work, “felt that he was talking too much and in somewhat exaggerated terms at times”.85

The Minister for Agriculture caused tensions with some of the Independents supporting the Government too. William Sheldon, the Donegal Independent, wrote to Costello the day before his election as Taoiseach to make it clear that while he would be voting for him, he could not “accept the position of having anyone ‘lead’ or speak for me and therefore cannot consider myself represented in any way by Deputy Dillon”.86 Both Sheldon and Wicklow Independent Patrick Cogan later wrote to Costello complaining about Dillon’s attitude towards farmers, particularly regarding the provision of credit facilities and the de-rating of agricultural land. Sheldon told Costello that he was “still prepared to give my support to your government generally, but I should be disingenuous if I were to disguise that I am disturbed by some tendencies in agricultural matters”.87 Costello’s replies were polite, but supportive of his minister. Cogan secured the Taoiseach’s full attention with a letter in May 1950 seeking a discussion on credit for farmers, “as I feel that I cannot support the Government on any issue while they take up such an unreasonable attitude on this question”.88 Costello replied immediately, agreeing to a meeting. Keeping the Independents sweet was a time-consuming process for the Taoiseach, but one he couldn’t afford to ignore.

Both Costello and Browne later recalled differences of opinion at the Cabinet table between members of Fine Gael. Browne said the hostility between individual Fine Gael ministers “dissolved when faced with outside opposition in the Cabinet”,89 although he didn’t specify what led to this hostility. Costello said there was no disagreement between Fine Gael and Labour, and that any trouble “would be more between Fine Gael members, or between the Department of Industry and Commerce who wanted to put tariffs on for the benefit of Irish industry, and James Dillon who wanted to keep them off for the benefit of agriculture”.90

But while there may not have been disagreements between Fine Gael and Labour Ministers, the wider parties were another matter. In May 1948, after three months in Government, the Fine Gael parliamentary party was congratulating itself on “the rising tide of enthusiasm and willing support which is everywhere in evidence”, and planning more party meetings around the country to take advantage. But these were to be resolutely Fine Gael occasions—the minutes of the meeting, chaired by Mulcahy, note that “the organisation of Inter-Party meetings are often a snare and must be treated cautiously”.91 Two months later, however, a change of emphasis was apparent, with Gerard Sweetman and Michael O’Higgins reporting on exploratory talks with the party’s coalition partners. These talks had suggested a series of inter-party meetings, designed “to review, explain and support Government policy and to solidify inter-party strength”. The parliamentary party supported the creation of a permanent Inter-party Committee to oversee such events.92

The following year Sweetman, the party’s Honorary Secretary, reported the Taoiseach’s request that every deputy and senator should submit a monthly report “stating what Meetings they had addressed either on behalf of the Party or of an Inter-party nature so that he, the Taoiseach, could get a picture of the manner in which propaganda was moving throughout the country”.93 He also urged branches of the party to counter “mendacious propaganda” being spread about the Government and to ensure that people were properly informed about what the Government and party were doing.94 An interesting insight into the real views of people in the party is given in the minutes of the Fine Gael Advisory Committee, a body containing a number of senators and other influential figures. In January 1949, it complained that “Labour doctrine and false philosophy, social and economic, is being imposed on the Government. Fine Gael is strongest party and should not be afraid to make its weight felt … Supporters shocked to find Fine Gael so out of touch with economic realities and industrial relations and highly impregnated with Socialism.”95

This view would have come as something of a surprise to left-wing members of Labour and Clann na Poblachta (including Noël Browne) who regarded the Government as being dominated by Fine Gael, and in particular by the more reactionary elements within that party. Costello was called upon once or twice a year by delegations of Labour deputies anxious about particular matters—the cost of living, unemployment, housing, worker representation on State and semi-State boards, and so on.96 Again, smoothing ruffled feathers was time-consuming, but necessary, and the Taoiseach was generally regarded as being good at it.

A more crucial issue for Labour in government was Norton’s proposed social security scheme. Costello knew how important making progress was for Labour—but he had doubts about the scheme. His own copy of the Social Security White Paper was clearly well read, with copious marginal notes and underlining. He also highlighted a sentence in a memorandum by McElligott, presumably because he agreed with it: “While some reform of existing insurance schemes may be necessary, the improvements proposed go much too far.”97

His economic adviser, Patrick Lynch, was extremely critical of Norton’s plans: “In its present form the draft White Paper contains disincentives both for work and saving; in short, it tends to undermine the Government’s policy of securing more productivity … and more investment … Redistribution of a low national income as proposed in the White Paper would impose a flat direct tax indiscriminately on rich, not so rich and poor alike. It would have the effect of dampening the spirit of enterprise and discouraging saving …”98 McGilligan was even more critical, describing it as “a centralised bureaucratic type of scheme following the well known lines of doctrinaire socialistic teaching … I think the community will have to be very careful of not being fooled by words as they certainly are being fooled in England …”99

However, whatever his private thoughts, Costello was head of an inter-party government, and he defended his government’s agreed policies in public. At the February 1950 Fine Gael Ard Fheis he stoutly supported Social Security, claiming “it is nonsense to suggest, as a few people have suggested, that the White Paper proposals represent the first step on the road to totalitarian socialism. This attitude represents a confusion of thought that refuses to distinguish between genuine social security and the totalitarian Welfare State.”100 Given McGilligan’s views quoted above, it would be interesting to know what he thought of this statement.

“Jobbery”, or the filling of jobs in the gift of the Government on the basis of political bias, had been one of the sins of Fianna Fáil in the eyes of the Opposition. Once they were in power themselves, of course, their perspective changed. Noël Browne claimed to be shocked by an example of “Fine Gael jobbery” early in the lifetime of the Government, when Seán MacEoin proposed to appoint someone who had left school at 12 or 13, despite there being a number of better qualified candidates. Browne suggested that he was only being appointed because he knew MacEoin or was a Fine Gael member. “Unperturbed, MacEoin smilingly replied, ‘That’s not a bad way to make an appointment, Noël!’”101 This may or may not have been an accurate report of MacEoin’s behaviour, but the Minister for Justice did write to Costello in November 1949 strongly urging the appointment of a non-civil servant (by inference a party supporter) to the post of Controller of Government Publications.102

After 16 years in opposition, it was only natural to give what patronage was available to party supporters. For instance, in March 1949, the Fine Gael Advisory Committee agreed to draw the attention of Costello and McGilligan to vacancies on the Boards of State companies “with a view to making Fine Gael appointments to replace those directors who retire annually”.103 Costello and his colleagues were no worse than Fianna Fáil, or indeed their coalition partners, in this regard. But, as Patrick Lynch pointed out, while Costello “was personally the epitome of integrity”, he was willing to change policy where necessary for short-term political advantage. “In the longer-run the totality of these apparently trivial day-to-day expedients may compromise the possibility of adhering to principles earlier formulated.”104

The result was the most notorious example of jobbery from the period, the Battle of Baltinglass in 1950. This involved the transfer of Baltinglass Post Office in County Wicklow from Helen Cooke, whose family had run it since 1880, to Michael Farrell, a supporter of Jim Everett, the local TD and Minister for Posts and Telegraphs. Local protests generated huge media interest at home and abroad, and led to the Independent TD Patrick Cogan withdrawing his support for the Government, and the resignation of Noel Hartnett from Clann na Poblachta. Costello backed his minister, although Everett eventually had to back down in the face of public outrage. The Battle of Baltinglass was to prove a potent weapon for Fianna Fáil in the 1951 general election.

One Fine Gael member for whom a job was found under the new government was Costello’s leading constituency activist, Mick Byrne, who was given a temporary commission as a commandant and appointed his aide-decamp.105 Then aged 56, he had been a member of the Volunteers, a collector for the Irish Republican Prisoners’ Dependents, and a captain in the National Army up to 1924.106 Later he worked for the gas company. Following an accident there he had an artificial steel hand shaped like a hook, and was known as “Steeler” Byrne. The hook was reputed to be very useful during attempts to disrupt election meetings.107 Noël Browne was in awe of his brilliance as a tallyman (he was able to predict Browne’s election early on the day of the 1948 general election count).108

While formally serving as ADC, Byrne’s role was more that of a personal assistant to the Taoiseach. It was a job which evidently only he could fill, for when Costello returned to office in 1954 he was decidedly lukewarm about having an ADC at all.109 This reluctance was castigated by his son-in-law, Alexis FitzGerald, who said he should always be accompanied by an ADC. “I don’t mind you writing yourself down. You shouldn’t write your office down. Every time you go out at the moment you do. It should stop. Of this, I am convinced.”110 There were no such problems during Costello’s first term as Taoiseach, as Byrne filled his ceremonial role enthusiastically, being described by a British journalist as “the smartest man in the Irish Army—beautifully polished tan boots, buff breeches, olive-green tunic and Sam Browne”.111 On the day before the first Inter-party Government left office, Byrne was appointed Inspector of Supplies in the Office of Public Works.112 Costello remained very close to him—the Mass card from his funeral was one of a number kept in the former Taoiseach’s bedroom in later life.113

Two days after the formation of the Government, the British newspaper the News Chronicle confidently predicted that MacEoin’s appointment as Minister for Justice “has dashed the hopes of unrepentant followers of the new IRA. He has a fine battle record in the revolution, a shrewd outlook, and is not likely to grant any amnesty to IRA firebrands now in gaol.”114 At about the time this was being written, MacEoin was informing Seán MacBride that the prisoners would in fact be released. According to MacBride’s own account, the Minister for Justice told him he appreciated the fact that the Clann leader hadn’t raised the issue, but had decided to take immediate action. “This is exactly what I was hoping would happen … If they were really genuine about cooperation they would do this without my having to say it. And it worked …”115 Given MacBride’s difficulty in persuading the Clann to enter government such concessions were important—already in March the US Minister in Dublin was advising Washington that while MacBride “is a charming individual and will probably prove to be a good Minister … his party Clann na Poblachta is a dead duck …”116

There was naturally a suspicion that the release of the prisoners was part of the Clann’s price for entering government. This was, equally naturally, vehemently denied by ministers. The archival evidence is not conclusive. The first written reference is a letter from Stephen Roche, Secretary of the Department of Justice, to Maurice Moynihan, Secretary to the Government, seeking formal confirmation of a decision to release Liam Rice and Eamon Smullen from Portlaoise Prison. MacEoin had told Roche that the Government had decided on 24 February that the two men should be released, and they were duly set free.117 The fact that Justice had to seek formal confirmation of this decision from the Department of the Taoiseach is an indication of the somewhat chaotic arrangements surrounding Government meetings at the time, but doesn’t shed any light on the question of who originally suggested the releases. Although the initiative was clearly political rather than departmental, that doesn’t rule out MacEoin as the originator. In any case, the release would have appealed to Costello, given his long-standing aversion to emergency powers.

The following month, the remaining three prisoners, Tomás MacCurtain, Henry White and James Smith, were also released (both MacCurtain and White had originally been sentenced to death for murdering gardaí, although White’s sentence had been reduced to manslaughter on appeal).118 In August, the Government agreed to the reburial of the remains of six IRA men who had been executed during the Second World War and whose bodies were buried on prison grounds.119 (While this was of course welcome to Clann na Poblachta, it is perhaps significant that it was Labour Deputies James Larkin and Roddy Connolly who lobbied MacEoin on this issue.)

In April 1948, Costello outlined in the Dáil his position on the inclusion of Republicans in government. He had been tackled by Fianna Fáil’s Gerry Boland over MacBride’s attendance at an Easter Rising commemoration at which volunteers had been sought for the IRA. With some passion, Costello said that his chief reason for becoming Taoiseach was his belief that bringing Clann na Poblachta into government would lead to “the end of the gun as an instrument for furthering political theories or wishes … we will see the end of the gun in politics in this country”.120

But the most important concession to Republicans was “a general easing of pressure on the republican movement”,121 and “the end to police harassment and intimidation”.122 In this more benign atmosphere, Republicans like the newly released MacCurtain began rebuilding the IRA.123 By the middle of 1950, this was being noted in Government circles. Maurice Moynihan was told by Daniel Costigan, an official in the Department of Justice (later appointed Garda Commissioner) that “the IRA are getting more active—drilling, instructing in explosives, but [he] thinks the police may be playing it down”.124

Coalition led to changes in the way government worked. One aspect was the increased use of Cabinet committees. These were not unknown in single-party governments, but were far more prevalent under Costello. A summary of the number of outstanding Cabinet committees shows there were eight in February 1938 and 10 in January 1940. But the First Inter-party Government established 57 of these committees, and the Second Inter-party Government 33. By contrast, in de Valera’s government of 1951–4 there were just 15. The most important of these committees in the First Inter-party Government was the Economic Committee, established on 27 February, made up of Costello, Norton, Mulcahy, MacBride, Dillon, McGilligan and Morrissey.125

There was change, too, in the approach to collective responsibility. A strict interpretation of collective responsibility and Cabinet confidentiality had been laid down even before the formal establishment of the Irish Free State. In August 1922, the Provisional Government decided “that all decisions of the Cabinet should be regarded as unanimous, and should be treated as strictly confidential”.126 There were a number of cases of ministerial dissent being recorded in the minutes of the Executive Council, all of them in 1923—Joe McGrath’s opposition to the appointment of the Commissioner of the Dublin Metropolitan Police; W.T. Cosgrave objecting to the deletion of a number of sections of the Civic Guard Bill; and Kevin O’Higgins’ attempt to have allegations against army officers in Kerry properly investigated.127 But in the main both Cumann na nGaedheal and Fianna Fáil stuck to a rigid interpretation of collective responsibility.

This interpretation was set out by W.T. Cosgrave when he refused to give the Army Inquiry Committee a copy of his Attorney General’s legal opinion. “… I must point out that the Executive Council acts collectively, and that its proceedings are necessarily of the most confidential description. When it arrives at a decision to do or abstain from doing any particular act, the decision is the decision of all its members. Previous divergence of views, individual opinions, arguments pro or con, all become merged in the decision which becomes, not the decision of a majority, but the decision of all binding every member of the Council equally whatever may have been his previous attitude …”128

As a former Attorney General, Costello was well aware of the established practice; but as head of a diverse coalition government, he had to recognise a changed reality. In November 1948, he answered questions about remarks made by Dillon and by MacBride, and whether they contravened Government policy. In both cases, he said the ministers were speaking in a “personal capacity”, and therefore the question of Government policy didn’t arise. Lemass derisively asked if the Taoiseach could “arrange to have some signal given, such as the flying of a flag over Government Buildings, whenever a Minister is speaking in a manner in which he is expected to be taken seriously”.129

McGilligan expressed the new approach in the Dáil in 1950, after a public divergence of view between himself and MacBride: “Have we got to the stage when men, just because they join the Government circle, must all … when they go out of the council chambers speak the same language?”130 The answer to that question, according to the theory of collective responsibility, was yes; but a more flexible approach was part of the price of coalition government. The British Ambassador noted in March 1950: “Cabinet responsibility is not marked. Members of the Government criticise in public the policy of their colleagues … ‘Free votes’ on contentious subjects have shown differences of approach between Ministers on which the Opposition has not been slow to seize. But the Government as a whole shows every sign of intending to remain in office for the balance of three years needed to complete its full term; the ranks are closed at once against any real threat to its stability.”131

There was change, too, in relations with the Civil Service. One of the first decisions of the new government was to exclude officials from cabinet meetings—a move described as a “disaster” by Patrick Lynch.132 MacBride objected to the presence of the Secretary to the Government, Maurice Moynihan, as a representative of “the establishment in excelsis”.133 More importantly, Moynihan had worked closely with de Valera for 11 years. The Government’s suspicion of him was not unprecedented—when Fianna Fáil entered government in 1932, the Secretary to the Executive Council, Diarmuid O’Hegarty, was removed. The difference, however, was that O’Hegarty, who was appointed a Commissioner of Public Works, was replaced by someone the new Government trusted.134Moynihan wasn’t, continuing as Secretary to the Department of the Taoiseach and carrying out his existing duties, with the exception of attending Cabinet meetings. The result was that Liam Cosgrave ended up taking minutes and deciding what should be recorded as decisions.135 If Cosgrave wasn’t there, Costello had to do the job himself.

But while Moynihan was excluded from the Council Chamber, he still fought a battle to ensure proper procedures were followed, and that ministers did not trespass beyond their departmental responsibilities. The main offender was MacBride, who frequently attempted to express his views on matters beyond External Affairs. Moynihan warned Costello that this “would open the way to the creation of chaos in the arrangements for the transaction of Government business”.136 Costello, however, was reluctant to confront MacBride on this issue just a year into the lifetime of the Government. On two occasions in January 1949 he told Moynihan that he agreed with the rule that memoranda should be submitted by the responsible minister, but that MacBride’s contributions should be circulated anyway, due to “unusual circumstances”.137 However, as time went on MacBride’s influence declined and order was restored to Government business.

One of the key battlegrounds in Cabinet was over economic policy. It was not clear at first how much change the Inter-party Government would introduce. The initial emphasis was on cutbacks rather than extra spending. Costello wrote to each minister in March that “the Government is definitely committed to economy and retrenchment in the public service” in order to pay for the lifting of extra taxes imposed by Fianna Fáil in the previous year’s supplementary budget. Savings were “essential … to check inflationary tendencies resulting from excessive State expenditure and to lessen the impact of taxation on the cost of living … It is not too much to say that the fate of our government depends on the success or failure of the economy drive by individual Ministers …”138 The following month, the new Taoiseach told the Federation of Irish Manufacturers that a change of government “hardly causes a momentary interruption in the economic life of the people”. However, he went on to suggest that it was impossible to have decent industries “if we bolster up inefficiency at the expense of the consumer”. In what was a clear criticism of tariffs, he called for an emphasis on positive encouragement of “Irish initiative, skill and craftsmanship rather than on negative steps to discourage fair and reasonable competition”.139

The issue of protection, and specifically the restrictions on foreign investment imposed by the Control of Manufactures Acts, became a major source of disagreement between External Affairs and Industry and Commerce. The disagreement was brought to a head during the negotiation of a Treaty of Friendship, Commerce and Navigation with the United States. MacBride was keen to reach agreement with the Americans, but the negotiations dragged on well into 1949 because Industry and Commerce opposed change. Costello revealed his views on the subject to Vinton Chapin of the American legation in October 1948, describing the Act as “outmoded and outdated and … as much humbug as the External Relations Act”. He added, from his experience at the Bar, that the restrictions were easily circumvented.140 Costello knew what he was talking about—one of the main architects of ways to get round the Acts was his old friend Arthur Cox, who “drove a coach and four through the legislation”.141

However, while Costello may have thought the Act “humbug”, he had to take political realities into account. The American Minister in Dublin, George Garrett, reported in December 1948 that the Government would be reluctant to repeal the Acts because of strident opposition from Lemass and from the Federation of Irish Manufacturers.142 In a speech in New York the following month, Dan Morrissey repeated the Industry and Commerce view—industrial policy was based on the maintenance of protective tariffs and retention of control by Irish nationals in new industrial undertakings.143

Garrett tackled both Costello and MacBride on these remarks, suggesting that they must be taken on their face value as an indication that the Government was not going to change the rules. However, “both Costello and MacBride were inclined to deprecate the importance of Morrissey’s statements, suggesting that they had largely been made for political effect”.144 Norton, meanwhile, delivered a speech suggesting the establishment of an Industrial Development Commission which would foster new industries and examine tariffs (an idea which bore fruit in the Industrial Development Authority). The Irish Times in an editorial suggested Norton had helped “to correct any misguided impression that might have been left by … Mr Morrissey … Mr Norton has introduced the necessary safeguards. The government … will not follow blindly the policy of its predecessor.”145 The Treaty was eventually finalised in 1950, giving the Americans some but far from all of what they had been seeking. It is an indication of the strength of protectionist feeling in Industry and Commerce that the Department was able to hold out against the Taoiseach and the Minister for External Affairs so successfully.

Disagreements over free trade were also reflected in the Irish delegation to the Anglo-Irish trade talks in London in June 1948. As head of the delegation, Costello had to conciliate a range of departmental interests. Industry and Commerce wanted the power to protect more industries; Agriculture wanted to secure better prices for farmers’ products on the British market; Finance wanted to ensure Ireland could still draw dollars from the sterling area pool. This last point was complicated by the forthcoming Marshall Aid allocations. MacBride and External Affairs were determined to refuse any offer of a loan, on the basis that Ireland should hold out for an outright grant. But Finance felt dollars should be accepted, even if they had to be repaid, to help ease the pressure on sterling.

Costello initially backed MacBride, telling the Dublin Chamber of Commerce in May that “we are not prepared to take American aid at any cost. We are as proud of our economic independence as we are of our political independence and we are determined that we will not incur foreign liabilities and commitments which are not within our power to meet …”146 But the matter was made much more urgent at the talks on 18 June, when the British Chancellor, Sir Stafford Cripps, announced that Ireland would no longer be able to draw dollars from the sterling area pool from the end of the month. Costello accurately described this announcement as “a bombshell”—it would severely restrict Ireland’s ability to import vital goods. A late-night negotiating session with Cripps two days later in Costello’s suite in the Piccadilly Hotel finally reached a compromise—Ireland could continue to draw down dollars pending the receipt of Marshall Aid, on the understanding that she would do her best to get the maximum aid. It was a “vindication of Finance’s belief in the pre-eminence of the sterling crisis in Anglo-Irish economic relations”.147

The Anglo-Irish talks were also the scene for one of James Dillon’s more colourful phrases, his promise to drown the English with eggs. In a memoir quoted by his biographer, Maurice Manning, Dillon revealed that he had come up with this phrase at a press conference after the “hot-tempered” Costello “found some question which was addressed to him peculiarly provocative and proceeded to reply to the Press man with considerable emphasis. I thought that was an excellent moment to relieve the situation …”148His comments grabbed the headlines and diverted attention from Costello’s belligerence.

But if the Taoiseach was rescued by his Minister for Agriculture on this occasion, it was more often the other way round. After his retirement from politics, Costello recounted an incident from the early days of the Government, when Dillon sought, and received, his agreement to a scheme of land reclamation. He took the Taoiseach’s approval as sufficient sanction (or pretended he did), and announced the scheme in a speech in Mullingar. James McElligott, Secretary of the Department of Finance, first read of the plan in his newspapers, when he was heard to say (according to Costello), “It can’t be true! It can’t be true!”149 While somewhat embellished for an after-dinner audience, the anecdote was essentially accurate; Dillon had gone on a solo-run which caused “a state of upheaval” in Finance. The incident “showed that his observance of cabinet procedure could be cavalier, if not completely out of order”.150 It also rather neatly illustrates the problems Finance faced with this new government.

Part of McElligott’s problem was his own minister. McGilligan had started out in the approved manner, severely pruning the estimates left behind by Fianna Fáil (the most spectacular victim of this pruning was the proposed transatlantic air service, cancelled just a month before it was due to start). And he frequently sent memoranda to colleagues appealing for reductions in spending, arguing in December 1948, for instance, that unless spending was cut, there would have to be “crippling increases in taxation”, adding that while “some redistribution of incomes is necessary in the interests of social justice … the redistribution of incomes has already proceeded so far that Ireland is probably one of the most egalitarian countries in the world”.151

But McGilligan, and Costello, were reluctant to impose the sort of Cabinet discipline found in single-party governments. In February 1949, McElligott complained about public announcements by ministers of expensive schemes “without any prior consultation with the Department or, as far as we know, with the Minister for Finance”.152 The implication of the phrase “as far as we know” was extraordinary—McElligott was suggesting that his political superior might be keeping things from him. Later in the same year, he warned that Finance “has lost its power to control the situation … the Minister for Agriculture … cherishes ambitious schemes … the Minister for Health is equally ambitious … We have also confronting us the issue of a White Paper on Social Security, the cost of which, if implemented, would run into staggering figures …”153

As well as extravagance in the spending departments, he also had to contend with McGilligan’s equally strong desire to cut taxes. In the run-up to the Budget of 1949, the Secretary advanced an ingenious argument against a 6d in the pound tax cut, which would cost £1 million to implement. He said it “will not please Labour. There is nothing, it will be said, in the Budget for the working man—nothing off beer and ’baccy …”154 Given that McElligott’s concern for the working man had not been particularly evident before, his argument was presumably a sign of desperation in his dealings with his minister.

If Finance resented the other departments, that resentment was more than returned. Dillon complained to Costello that Finance had become an “intolerable octopus”, observing that officials in other departments spent their time “carefully composing lies for submission to the Department of Finance on the principle that if you want X the only hope of getting it is to ask for 10X + 3Y …”155 Costello, displaying his customary sympathy for a colleague, described McGilligan in March 1949 as “immersed in the preparation of the Estimates and … vigorously pushing aside the gloom of his officials”.156 McGilligan’s efforts in that regard had evidently failed by the end of the year, when Costello complained that a memorandum he had submitted to Government “creates an unnecessary atmosphere of gloom, which is scarcely justified by the facts stated … we are both very acutely aware of the far-reaching decisions which must soon be taken by the Government on matters of public finance and budgetary policy … A negative or unduly pessimistic presentation of the facts will not provide the kind of atmosphere in which I propose to have these Cabinet discussions take place.”157

Finance also found itself under siege over the devaluation of sterling (or “the sterling” as MacBride always referred to it) in September 1949. As early as June of that year, having been tipped off by the French Foreign and Finance Ministers,158 MacBride submitted a memorandum to Government on the possibility of devaluation, arguing that it was “essential to consider the steps which can be taken at this stage to minimise the disastrous consequences” devaluation would have for the Irish economy. Specifically, he wanted Government action to repatriate assets invested in Britain and their use for “national development projects” in Ireland.159 The Department of the Taoiseach noted that this memorandum appeared to be out of order, as it should have been submitted by Finance rather than External Affairs, but that Finance was not objecting to its circulation.160 But while the memorandum was circulated, it wasn’t actually discussed—the subject was postponed at no fewer than 14 Cabinet meetings, until MacBride’s prescient warning was overtaken by events.161

On Saturday 17 September, Costello received a message from Attlee confirming the British were about to devalue. In his memoirs, MacBride recalled that the resulting Cabinet meeting was held in Iveagh House, headquarters of the Department of External Affairs. This was the only time the Government met there, and MacBride implied that the meeting was held on his turf in recognition of his interest in the issue.162 In fact ministers met for two hours in Government Buildings before resuming in Iveagh House from 11 p.m. to 4.45 a.m.163 Iveagh House was chosen because most ministers were due there anyway for an official reception in honour of Archbishop Cushing of Boston. MacBride, supported by Browne, argued against devaluation; McGilligan and Dillon opposed them. Finance official T.K. Whitaker later described “MacBride sitting astraddle on a chair in the middle of the room (with other members of the Government sitting around the sides) and relentlessly cross-examining his senior Finance colleagues”.164

Not for the last time, Norton’s attitude proved crucial; once he sided with Finance the decision was made.165 The Government agreed to follow the British example, with a statement declaring that devaluation was “the course of least disadvantage”. However, MacBride refused to let the issue go, insisting on further discussion of the implications of devaluation and recommending a drive to increase dollar earnings, particularly through encouraging tourism and moving away from reliance on the British market. “The Minister for External Affairs strongly urges that in this situation the trade policy of the government should be to purchase our imports in the cheapest markets and to sell our exports where we will get the best prices possible.”166

The Government agreed to set up a special committee including outside experts to consider the various points raised by MacBride. It was to meet when memoranda had been received from various interested Departments. However, in February 1950, Moynihan noted that Finance and Agriculture had still not submitted their observations. After discussing this with Costello, he noted “there is no need to remind the Ministers for Finance and Agriculture further in this matter”.167 This strongly suggests that while Costello was prepared to humour MacBride, he was happy to let the matter drop as soon as he decently could—an interesting insight into his management style. MacBride—correctly—dismissed the committee as “a mere sop” in a conversation with Costello’s assistant, Patrick Lynch. In the same conversation, on 8 October 1949, MacBride complained that only Browne, Dillon and himself were getting results, and that he would have to leave Government within two months “unless there was a material improvement and the atmosphere ceased to be clouded by what he called Fine Gael conservatism”.168

The fall-out from devaluation included an attempt by MacBride to block the reappointment of Joseph Brennan as Governor of the Central Bank in 1950. Brennan had already clashed with the Government over his report for 1949. Summoned to a meeting with Costello, McGilligan, Mulcahy and McElligott on 18 November, he was told by the Taoiseach that “he considered its general tone and tendency contrary to Government policy”. Costello was careful, however, to stress that it was up to Brennan to decide how he should frame his report. The Governor put up a spirited defence, arguing that the Central Bank was “anxious to understand what the monetary policy of the Government was … they were bewildered by reading the various speeches of Ministers”. In reply, Costello “stated that the Monetary Policy comes from the Taoiseach and the Minister for Finance” (in other words, not from MacBride). At one point, he accused the Central Bank of wanting to interfere with Government policy. He also argued that the need for housing outweighed the threat of inflation—“inflation has to be chanced as against social betterment”.169 Brennan later said that he “merely abbreviated a passage to which the Taoiseach had taken particular exception (on the ground that it was not in accord with Government policy) while leaving the substance unchanged”. The “banshee of Foster Place”, as the bank was known in political circles, was left to wail on.170

MacBride, who significantly was not at the meeting, had meanwhile criticised the Central Bank, and the commercial banks, in a widely reported speech to the Catholic Commercial Club: “The time has come when our banking system and our financial authorities should cease to look upon themselves as mere money lenders who treat money and credit as a commodity to be exploited, irrespective of the needs of the community as a whole.”171 This speech led to complaints from Brennan, from the Government stockbroker, and the Governor of the Bank of Ireland. Brennan sought a statement from McGilligan that MacBride had not been speaking on behalf of the Government.172 No such statement was made, although Costello did give Brennan to understand that in an inter-party government “it was considered permissible for a Minister in an individual or party capacity to give public expression to views which might not necessarily be those of the government as such”.173

MacBride and Brennan did agree on one thing, though—neither wanted the Governor reappointed. The Clann leader argued that Brennan’s “views, policy and acts … are in direct conflict with the policy of the Government”, and that in an inter-party government the position should be filled by an agreed nominee.174 Brennan meanwhile told McGilligan he did not want to be considered for reappointment, only to be summoned by Costello to be told he already had been. The Taoiseach spoke about co-operation between the Bank and the Government. “I told him that cooperation had to be two-sided, and the Minister for Finance was not doing his part.”175

Brennan’s reappointment was a clear victory for financial orthodoxy over MacBride. The Clann’s standing committee issued a statement deploring the reappointment “as being indicative of a decision to continue the disastrous policy of the export to Britain of our men and money”.176 Costello’s decision was presumably taken in the interests of maintaining the confidence of financial circles in his government. Allowing the Governor to resign would have led to an even bigger row over its investment strategy. However, Costello had already demonstrated that he was open to new economic thinking—but on his own terms, not MacBride’s.

There were many disadvantages in becoming Taoiseach without having been party leader; but there were advantages too. One of these, as Ronan Fanning has pointed out, was that Costello “was unencumbered by the baggage of advisers and henchmen who ordinarily surround a party leader in opposition”.177 He was free to choose his own advisors, and turned first to his son-in-law, Alexis FitzGerald, who in turn recommended an economist in the Department of Finance, Patrick Lynch. Lynch was transferred to the Department of the Taoiseach three days after the formation of the Government “for the purpose of preparing economic data” for Costello. In July 1950 he was promoted to be Assistant Secretary to the Government and of the Department of the Taoiseach178—a very rapid rise which showed his value to the Taoiseach.

Independent economic advice had been offered before—notably by Professor Timothy Smiddy to de Valera—but the formal appointment of Lynch was unprecedented. The historian of the Department of Finance has suggested that it was a recognition both of the increasing importance of the economy in political debate in the postwar years, and of Costello’s view of his role as Taoiseach, as “the mouthpiece of the Inter-party Government on major issues which might split the coalition—a role he also assumed, for example, in the direction of the government’s foreign policy. In short, the capital budget was too important a decision to be entrusted to the Department of Finance alone.”179

Lynch found Costello “very quick on the up-take” when it came to economics. His knowledge of the area was minimal when he became Taoiseach, but with Lynch and FitzGerald he would insist on a detailed discussion of economic issues. “He never made a speech about any aspect of economic policy without understanding the implications of what he was talking about. It is possible to convert Keynesianism … into fairly easily defined issues concerning investment and so on, and this he understood and could defend in Cabinet.”180

Costello’s new interest in economics was noted by Lemass, who in July 1949 suggested his “knowledge of the elementary principles of national economic policy was acquired within the past year or year and a half. If, however, we have, in courtesy, to assume that it is of longer standing that that, I can only say that we would never have suspected it.”181 Costello replied by recalling the words of his UCD French professor at his last lecture. “He told us that we then knew enough French to learn French. I have never forgotten that … The longer I have lived and the more experience I have gained in law, politics or economics, the more I realise how little I know and how much there is still to be learned … I do not suffer the illusion that I know everything. When I was charged with the responsibility of my present post last year I took the precaution of gathering around me the best men and the best advice available here on Irish economic affairs so that I might be the better able to discharge the task this House placed upon me.”182

The influence of these “best men”, Lynch and FitzGerald, was not necessarily welcomed by his political colleagues. In later years, Mulcahy described them as being “a hard crust of intellectualism around him”, believing that by relying on their advice, Costello’s contact with his Cabinet colleagues was weakened.183 (Criticism of intellectualism may be more of a comment on Mulcahy than on Costello.) McElligott was unhappy too—meeting Lynch on the steps of Government Buildings on the day after Costello’s speech on the Capital Budget, he said, “You are a very young man, I want to give you one piece of advice. The more politicians know, the more dangerous they are!”184

It was Lynch who suggested at the start of 1949 that “a clear distinction should be made between the capital and current budgets, thus making Keynesian policies explicit”. If capital investment was separated from other spending, the need to balance the budget would not be a constraint on borrowing for capital purposes. Like MacBride, Lynch believed that part of the Irish economic problem was chronic underinvestment while sterling assets accumulated in Britain, all the while declining in value. A balance of payments deficit would in effect repatriate these sterling assets—although he stressed that “Keynes rejected inflation as much as he abominated continued deflation”. Along with FitzGerald, he drafted a speech for Costello to deliver to the Institute of Bankers in November 1949, making sure to clear it with McGilligan in advance. The Minister “made no changes of substance” to the draft.185

In his speech, Costello said the Government accepted its responsibility to reduce poverty and unemployment, and “to create economic conditions within which it will be possible to provide a high level of employment and … arrange our economic affairs [so] that no resources of land or labour which can be usefully employed should be allowed avoidably to remain idle …” He blamed Ireland’s poor economic performance on a lack of capital investment, particularly in agriculture, and said it was “the complete acceptance of this view by all the groups represented in the present Government” that made possible its formation. While some investments would earn revenue, others, such as housing, would “bring social and economic benefits … just as indispensable to the national well-being”.

Costello said the need for investment was so great that past national savings would have to be drawn upon to pay for it. This would be done by repatriating some of the money invested in sterling assets—although it must be made “as sound and secure as anything which can be obtained … abroad”. He said the Government was determined to extirpate evils such as infertile land, lack of housing and shortage of hospital accommodation, and that this would “even justify short-term economic loss for the sake of social and long-term economic gain … There are greater evils … than a temporary deficit in the Balance of Payments.” Care would have to be taken to use the money for investment rather than consumption, to balance the projects properly between sectors, and to increase savings to pay for investment. The new strategy would be signalled by a division of the Budget into current and capital sides. “Our aim is to enrich the country by augmenting the national capital and increasing productivity, by means of a comprehensive long-term programme …”186

How significant was the introduction of the Capital Budget? Brian Girvin has pointed out that if the Capital Budget heralded the arrival of Keynesian economics, “it was remarkably short lived. Subsequent budgets were deflationary, emphasising a continuing commitment to the balanced budget and a fear of balance of payments crisis.” He also observed that the Capital Budget was important, “but only if part of an overall process to facilitate growth in the economy”.187 And the increase in capital investment was only possible because of Marshall Aid—once it ran out (and until Ireland joined the World Bank and the International Monetary Fund in 1957), government simply didn’t have the access to outside capital that would allow for significant State investment.188

Even its architect, Patrick Lynch, admitted that there was “an element of charlatanism in this initiative”, since Finance already made a reduction from the current budget in respect of capital items which were deemed “proper to meet from borrowing”. But while the concept was there before Costello’s speech, afterwards “the scale increased very greatly”.189 As Ronan Fanning has pointed out, Costello had in effect taken “personal charge of the direction of budgetary policy in a manner never before attempted by a head of government since independence”.190

While Costello was telling bankers publicly of the virtues of investing capital at home, he was also putting pressure on them in private. On the day before his speech to the Institute of Bankers, he chaired a meeting with representatives of the banks in an effort to secure funding for public housing in Dublin. The Government wanted the banks to take up a £5 million bond issue from Dublin Corporation. Costello began by appealing to the better nature of the financiers, relating his experiences of “the terrible housing conditions in which many people lived”, and pointing out that the best the Corporation could do for that year was to provide a new house for families of seven living in a single room. “The Government were determined that all possible steps would be taken to improve those horrible conditions.”

This appeal was by way of preamble; Costello quickly moved on to threats. He pointed out that British banks were required to put 40 per cent of their resources at the disposal of the Treasury through Bills and Treasury Deposit Receipts, and suggested that “if the Irish banks were un-cooperative on this question of investment some Irish Government would be compelled by pressure of public opinion to adopt measures … to ensure that the Banks worked in the national interest”. For the bankers, Lord Glenavy asked “whether the present transaction would be an isolated one or whether … further demands would be made on the banks”. Costello said it would not be an isolated incident, and the bankers went off to consider their options.191 Ten days later they returned for another meeting, and haggled over the interest rate to be paid—Costello warned them, “The Government had public duties and responsibilities to the community and they were determined to discharge them …”192 The Taoiseach’s threats worked—the banks agreed to take up the Corporation loan.

But the main source of new capital investment was Marshall Aid, which financed nearly half of all state investment from 1949 to 1952.193 The impact of the aid on the Irish economy was questionable—for instance, almost one quarter of all ERP funds were used to purchase tobacco194 and the projects were of long-term rather than immediate economic benefit. Local authority house-building increased dramatically—from 744 house completions in 1947 to over 8,000 by 1950; there was also the massive investment in hospital-building under Noël Browne; and of course there was James Dillon’s Land Project, which aimed to reclaim four million acres through increased fertilization and better drainage.195 This investment, as Finance pointed out repeatedly at the time, would not show a return for many years, if at all. On the other hand, the imports and dollars involved allowed a higher standard of living than would otherwise have been the case.196 This had important political consequences—for it allowed Costello and McGilligan to satisfy the competing demands of the constituent parts of the coalition.

There were three by-elections during the life of the government. The first two saw Fianna Fáil and Labour holding their seats in Donegal East and Cork West respectively. But in November 1949, Fine Gael won a seat from Fianna Fáil in Donegal West. The contest became known as the “Platypus” election, because during it de Valera said that every time he looked at the Government in the Dáil he was reminded of an animal he had seen in Canada with “web feet, powerful claws, the bill of a duck and the tail of a lizard”.197 The by-election victory was a personal triumph for Costello, who received a “prolonged round of applause” from the Government benches in the Dáil in recognition of his achievement.198 However, the gain of a seat in Donegal was offset for Fine Gael by the resignation of Sir John Esmonde from the party in September 1950, and from the Dáil the following May, and by the death of Galway West’s Josie Mongan in March 1951.199

Just over a year into his first term as Taoiseach, the British magazine News Review described Costello’s typical day. He frequently went to early morning Mass in Donnybrook, and walked the family dachshund, Slem, in the nearby park. The Taoiseach generally spent two hours after breakfast dictating correspondence in his upstairs study, “lined ceiling to floor with books—most of them on law. Working to a background of radio music (he listens a great deal), and using a Dictaphone, he … will reel off with lucidity and speed three to six cylinders …” At 11, his car would arrive with whichever of his two drivers was on duty, along with Mick Byrne, his ADC.

In Government Buildings, his first-floor office “is the same as it was in Dev’s time. The sage green Dun Emer carpet with mauve and gold border has been down nearly 25 years … There is a map of Ireland in a vivid blue sea, a safe, indifferently open, a cupboard of rolled maps and plans, a globe, a small radio. There are two ordinary black phones on the brown desk: an internal Dictagraph, and a private switchboard on which he can call any Minister, any time.” The Cabinet met on Tuesdays and Fridays in the ground floor Council Chamber in Government Buildings, “round an oval polished mahogany table with six great brass ash trays running like a centre-piece down the middle”.

Lunch was sometimes taken with MacBride in Iveagh House, but more usually the Taoiseach went home to Herbert Park. Official entertaining at lunchtime would be in a private room in the Gresham or Russell Hotels, or for more formal occasions at Iveagh House. After lunch, Costello would return to Government Buildings until seven or eight in the evening (three o’clock on a Saturday). Speeches were drafted at night, at home in his study.

According to the News Review, the Taoiseach regularly attended weekly recitals at the RDS. “He is also fond of dancing, likes the cinema and the theatre, but doesn’t go often now. ‘People make a fuss; you can’t slip in quietly’.” But most of his leisure time was spent at home, reading (he told the News Review he liked biography, economics and thrillers; in reality he mainly read the latter). The family also played bridge, although Costello admitted, “They’re all better than I am.”200 And of course, while he was Taoiseach, he was still the TD for Dublin South-East, and continued to deal with a wide range of constituency matters (some of them utterly trivial, such as a request from a hairdresser in Haddington Road to have him excused from jury service).201

One of the perks of the job appears to have been privileged access to new films—there are several references in his appointments diary to morning visits to the Film Censor’s Office, presumably for an advance viewing of the latest release.202 He also continued to pursue other cultural interests. He collected paintings by a number of Irish artists, presenting friends and relatives with wedding gifts of small works by Nathaniel Hone, Evie Hone, Grace Henry and William Leech. He was influenced in his collecting by his friend, John Burke the solicitor,203 who also encouraged him to collect furniture by the Dublin cabinet-maker Hicks. He had a good eye for silver, much of it bought at Weldon’s antique shop.204 He was also for many years a patron of Weir’s jewellers on Grafton Street, where he bought presents for his grandchildren. As one of them remembered, “he liked beautiful things”.205

Costello’s interest in the arts had practical implications for Government policy, as he drove developments in the area in both of his administrations. This can be seen in the attempt to secure the return of the Lane Pictures, and the establishment of the Arts Council. As Attorney General, he had been involved in the long-running dispute with Britain over the Lane Pictures. These 39 paintings—including works by Manet, Monet, Renoir and Degas—were originally left by Sir Hugh Lane to the National Gallery in London after controversy over his plans for a gallery in Dublin. Lane, a successful art dealer and nephew of Lady Gregory, had founded the Dublin Municipal Gallery of Modern Art in 1908, but had been severely disappointed by the Corporation’s opposition to his plan for a permanent home for the collection. £40,000 had been raised towards the cost of building a museum on a bridge across the Liffey, and Lane had promised that he would cover any extra cost—but the Corporation still opposed the plan “in very strong language”.206

His biographer considers that Lane’s “intractability appears to have been responsible for the failure of his art gallery plan in Dublin”. His refusal to compromise on the site and architect for the project led to the Corporation’s rejection.207 After this row, he made a will leaving his paintings to London, but the British failure to exhibit them greatly annoyed him, so he wrote a codicil leaving them to Dublin instead. After his death in 1915 on the Lusitania, the codicil was found. But crucially it had not been witnessed, and was therefore legally invalid. A battle began between Dublin and London—neither of which had shown much interest in the paintings while Lane was alive.208

Thomas Bodkin was a friend of Lane and, as we saw in Chapter 1, an acquaintance of Costello’s in UCD. He practised as a barrister as well as dealing in art, before becoming Secretary to the Commission on Charitable Bequests, and later Director of the National Gallery from 1927 to 1935. Even before taking up the latter post, he was widely regarded as an expert in art, and submitted a memorandum to the Provisional Government in January 1922 proposing that it should restore the recently abolished independent Ministry of Fine Arts.209 Bodkin was friendly with W.T. Cosgrave, writing speeches for him, as well as a comprehensive history of the controversy over the Lane Pictures.210

He was also Honorary Professor of Art at Trinity College, which led to “sustained attack” from “some of the less respectable Catholic journals”.211 An example comes from the Catholic Bulletin of February 1931, which criticised a speech made by Bodkin: “[T]hese Catholic Friends of Trinity College, entrenched within the Central Catholic Library Organisation, persist in purveying Papist ‘rats’ for that Protestant rat-pit.” Bodkin was sufficiently concerned at this attack to send a copy of what he had actually said to Cosgrave. His speech suggested that Catholics confronted with “heresy” had a twofold duty: “We have first to protect ourselves: but we are also bound to try to do something for the heretics”212—by which he meant, of course, Protestants. It is illuminating that these far from ecumenical sentiments could be attacked as too liberal—and an indication that the similar views about Protestants of his friend Jack Costello were closer to the mainstream than might be realised today.

Whatever about his religious views, Bodkin’s political opinions meant he was not consulted by de Valera about arts policy as he had been by Cosgrave, and in 1935 he moved to Birmingham to become the first Director of the Barber Institute of Fine Arts, which opened in 1939. When Costello became Taoiseach in 1948, he sought Bodkin out to help pursue two pet projects—the Lane Pictures, and “our old and forgotten scheme of art in Industry and the possibility of developing artistic schemes in country districts”.213

De Valera had displayed no great concern about the Lane pictures—when he mentioned it to Lord Rugby in February 1947, the British Representative said it was “the first time that Mr de Valera has brought up this ‘injustice to Ireland’ and I do not know why he is now moved to take an interest in it”.214 A month after Costello became Taoiseach, the British Cabinet was assured that the controversy was not likely to be revived by the Irish, and that no effort should be made to try to reach a settlement.215 Bodkin, however, had other ideas, writing to Costello in April that he had “a feeling in my bones that you are the man who will, at last, get these pictures back”.216

The Taoiseach had an opportunity to raise the matter directly with the British Prime Minister, Clement Attlee, during the Anglo-Irish Trade talks in London. He found Attlee “a difficult man to get to know. He was very reserved and laconic, but after ranging over many aspects of Irish problems we came to that of the Lane Pictures.” Costello suggested that Attlee should recognise Ireland’s “strong moral claim” and make a gesture on that basis.217 He wrote to Attlee the following month, suggesting that the British people should “give the pictures to the Irish nation as a free gift and invaluable token of goodwill … The Irish people would then formally undertake to make liberal loans of the Pictures to English Galleries and to the North of Ireland.”218 Rugby informed London that the renewed Irish effort was due to Bodkin, as members of the Government “take little or no genuine interest in the topic on cultural or artistic grounds. Politics provides the main factor in keeping the question alive with them.”219 Politics, specifically the furore over the declaration of a Republic, also prevented further progress. In November, Attlee decided it was not the time to pursue the matter “while other and wider issues are under consideration”.220

In January 1951, following the theft of the Stone of Scone from Westminster Abbey by Scottish nationalist students, Lord Rugby advised London that “special precautions” should be taken to protect the Lane Pictures.221 One of the paintings, Jour d’Eté by Berthe Morisot, was stolen in 1956 by two Irish students, but returned undamaged to the Irish Embassy two days later.222 One of the students was the son of Sarsfield Hogan of the Department of Finance, who wrote a note of apology to the Taoiseach for “a folly which has put trouble on you and the Government”.223

Costello continued to raise the Lane Pictures, both in government and opposition. In 1958, he strongly advised de Valera against accepting a suggestion from Professor Lionel Robbins, chairman of the board of the (British) National Gallery, of a loan of the pictures to Dublin, provided the Irish Government agreed “formally to abandon any claim to the legal ownership of the Lane pictures …”224 Costello advised de Valera that this condition was “so insulting as to be unacceptable”, although on the basis of previous experience with the British it might be regarded as an opening offer which would lead to discussions which could reach a reasonable settlement.225 He was right, and an agreement was eventually reached on a long-term loan of the pictures to Dublin.

However, Costello, like the good barrister he was, spotted a change in a revision of the draft agreement which would prejudice the underlying Irish claim. The original draft suggested that the agreement “would settle for a considerable period the question of the Lane Pictures”. The underlined words were left out of a later draft,226 but reinstated after Costello spotted their omission. By the time final agreement was reached a new Taoiseach—Seán Lemass—was in place; he wrote to Costello thanking him for his “unfailing co-operation” in the matter.227 These thanks were repeated in a Dáil statement by Lemass in November. In his own statement to the House, Costello singled out Bodkin for praise.228

The other issue on which Bodkin and Costello collaborated was the establishment of the Arts Council. Fianna Fáil Minister P.J. Little had proposed the establishment of a Cultural Institute or Council of National Culture in November 1945,229 but nothing was done about it. Costello, however, was personally interested in the arts, both for their own sake and for their applications to industry. The first step was to commission Bodkin to write a report on the arts. This was submitted to Government on 4 October 1949, and was scathing of existing cultural institutions, and of the neglect “amounting almost to contempt” for art in the education system. The report recommended the establishment of an Arts Council.230 There was no doubt about who Bodkin—and Costello—envisaged in charge of the new body. Bodkin told the Taoiseach that if he was offered the post of Chairman “I shall accept it promptly”. He was not going to come cheap, however, suggesting a salary of £3,000 per annum.231

A lengthy correspondence ensued between the two men, with Bodkin not unreasonably insisting on a firm offer before giving up his job in Birmingham.232 He became alarmed at reports that the new Council would include in its aims the fostering and development of the Irish language, as well as music, literature and drama. Bodkin confessed he didn’t speak Irish, and wasn’t an expert in the other subjects either. “The work which I want to address myself to, and which alone I consider myself quite competent to do, is that connected in some way, however slight, with the visual arts.”233 Costello reassured him that these aims had only been included “to forestall criticism if they had been omitted”.234 Having finally received a formal job offer in January 1951, Bodkin now baulked, claiming that the terms of the Arts Bill “[reflect], to my mind, the old bureaucratic spirit of the Department of Education that so effectively frustrated the work I might have done when I was Director of the National Gallery of Ireland”.235

With commendable patience, Costello claimed he “was not wholly disappointed” at Bodkin’s refusal. While his aim had been to secure Bodkin’s services, he felt he couldn’t press him unduly given the difficulties of the job he was asking him to do. He initially considered dropping the whole matter, but after “a breathing space” he decided to have the Bill redrafted. The Taoiseach confessed that he was at fault because “owing to pressure from the storms that were blowing on me in all directions I didn’t examine the Bill as closely as I should”. Among the storms he mentioned were “strikes—milk, bread, Railways, Banks—Estimates, Price Orders and a succession of … problems”. He also admitted that he had been “unduly influenced” by the advice of his Department’s Secretary and Assistant Secretary (Maurice Moynihan and Nicholas Nolan) that the Council should be under the remit of the Minister of Education rather than the Taoiseach.236

The redrafted Bill met with Bodkin’s approval, and he suggested that he might be allowed to withdraw his refusal to accept the Director’s post.237 But the delay cost him the job—by the time the Arts Council was up and running, Fianna Fáil were back in power. Costello made an effort on his friend’s behalf, advising the new Taoiseach that he had intended to appoint Bodkin, that the legislation had been redrafted to meet his wishes, and that he would still be prepared to act.238 These representations evidently cut no ice with the new government, which appointed Paddy Little to the post.

Bruce Arnold criticised the manner in which the Council was set up. “Without real power, direct ministerial responsibility, direct involvement within the civil service, a proper vote with political decisions about the spending of money, the Arts Council from its inception was set adrift on a course that left it to the mercies of its members and, more importantly, its director.” He argues that the establishment of the Council “was seen as a kind of absolution for the politicians”.239 This implies that once the Council was set up, politicians could ignore the arts. But, of course, they had been happily ignoring the arts for decades; at least now someone was obliged to pay some attention to the area.

The historian of the Council offers a more balanced assessment, suggesting that Costello’s government “had taken the soft option in establishing an Arts Council without attempting to place it within an overall defined arts policy. But it is also true that the measure was the most significant step since independence towards the development of an official arts policy.”240 At the launch of the Council in January 1952, de Valera generously pointed out that its establishment “was due to the initiative of Mr Costello when he was Taoiseach”. Costello stressed the economic benefits of the arts and of the application of art to industry, adding that “there could be no nationality without art”.241

Costello’s personal interest in the arts allowed him to use his position to secure real advances. His interventions in the field of foreign policy were to have more mixed results.

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