You have to love Americans and the way they just come right out and tell it like it is. In recent weeks we have listened to a lot of tortuous waffle from Irish and European experts appearing at the banking inquiry being conducted by a committee of the Dail (Irish parliament).

But last week a genuine expert from the U.S. cut though the finance jargon and told the committee exactly what he thought about the causes of the economic meltdown in Ireland in plain language that everyone could understand.

When Bill Black, professor of law and economics at the University of Missouri and an expert on white collar crime and public finance, addressed the committee last week he did not waffle and he did not pull his punches. The Irish bank guarantee was the “most destructive own goal in history,” he said, using soccer parlance.

When the Irish government gave the unlimited guarantee with no real understanding of the extent of the debt problem in the banks they were guilty of "turning a banking crisis into a fiscal crisis," he said. The government turned a problem for the banks into a crisis for the national economy. They effectively bankrupted the country.

Black considered the guarantee to be the “most destructive own goal in history” because no other country had ever done anything as bad in terms of economic decisions.

Black said that in his experience in the kind of situation that Ireland faced you would “never, ever, ever bailout subordinated debt holders." Yet that is what the last Irish government did and the policy has been continued by the present government which has stuck to the mantra that Ireland does not default on any of its debts. Ever.

The blanket guarantee given by the Irish government at the end of 2008 covered all the debts of the banks, including almost all the subordinated (or less secured) debt. This meant that the foreign banks and investors who had loaned billions to the Irish banks and got a higher interest rate because of the higher risk involved with subordinated debt won on the double.

They won twice, Black said, because they got the higher interest and then when everything went belly up they got all their money back. He shook his head at the stupidity and incompetence of it all.

The amount of debt guaranteed, some €440 billion, was so great that it was more than the Irish state could underwrite. As the property crash deepened and money markets stopped lending to Irish banks and eventually to the Irish state we hit the financial wall and two years later we had to be rescued by a bailout from the IMF and Europe.

It was put to Black that he was being too critical of the last government because on the night the guarantee was given at the end of 2008 it believed that the problem in the Irish banks was a temporary liquidity one rather than a fundamental solvency one. It had been assured of that by the Irish banks on the night of the guarantee. They said that they needed support to get through the liquidity problem but that basically they were solvent and would be OK in the longer term.

This is a line we frequently hear. It suggests that the senior management of the Irish banks genuinely believed that they were facing a temporary liquidity problem and that their banks were solvent. And at the critical all night meeting they convinced then Taoiseach (Prime Minister) Brian Cowen and then Minister of Finance Brian Lenihan that this was the case.

So the decision by the government on that fateful night to give an unlimited guarantee on all the debts of the Irish banks was justifiable at the time, the argument goes.

But Black was having none of it. He pointed out that for more than a year before the guarantee foreign banks and investors -- run by the sharpest financial brains in the world, as he put it -- were pulling billions out of the Irish banks because they knew a crash was increasingly likely here. Surely that was a sign that something was radically wrong, Black said. If the smartest guys in international finance were yanking their money out of the Irish banks, surely that could not be ignored?

But ignored it was. The top brass in the Irish banks and the government of the day seemed to think that all these international financial players were wrong.

They buried their heads in the sand, crossed their fingers and hoped for the best. They convinced themselves that any fall in property values would be gradual and manageable.

But it was not gradual and manageable. The property market here fell off a cliff, losing more than half its value and leaving the banks with huge losses and the state with a catastrophic fall in tax revenues.

The consequences, as we know now, were a disaster for the Irish people. The blanket guarantee by the state had "socialized" the enormous debts, transferring them on to the backs of ordinary taxpayers here.

And we've been paying for that ever since and will go on doing so for decades. Despite the very slight reduction in the last budget, most taxpayers here this year will be paying 60 to 70 percent more in tax and charges than they were at the start of the recession eight years ago.

Around three quarters of ALL income tax collected here this year will go to making our interest payments on the bailout money. That's why people here are so angry.

They know that a big chunk of the bailout money was used to repay the foreign banks and investors which loaned money to the Irish banks. They know that even the unguaranteed loans were repaid, as Black said.

It was refreshing to hear the disaster put in such direct language, and Black deserves our gratitude for doing so. His testimony to the committee last week was a remarkable contrast to the qualified, cautious and sometimes contradictory evidence given by other speakers to the committee in recent weeks.

One would like to hope that Black's blunt summation of what went wrong would prompt a major change in official attitudes to the crash. His biography shows that he has worked on anti-corruption initiatives for the World Bank and also was an advisor on the enforcement action against senior management at Fannie Mae in the U.S., so his expertise and experience in financial matters is beyond question.

He was absolutely scathing about the inaction of financial regulators here and about the incompetence at senior level in the Irish banks. He made it clear that he thought that some of this amounted to criminal behavior, and that there should have been consequences for those involved.

As we all know, the only consequences for almost all of those involved at the top level was that they were allowed to "retire" with large pay-offs and huge pensions.

When he was asked if the way we run our banks had improved, he cited this lack of consequences, including any jail time such as was imposed in the U.S., as a clear illustration that nothing much had changed here. He said the best approach had to affect “the senior individuals who make the decisions” and that “the only potential effective deterrent has to involve jail sentences for criminality.”

He agreed that there had been some minor improvement in regulation, but it was far too little to protect us from another crash in the future.

The sad fact is that, despite the headlines made by Black here last week, his forthright observations are not going to make much difference. Part of the reason for that, as he pointed out himself, is that the committee he was giving evidence to has such little power.

The Committee of Inquiry into the Banking Crisis, usually called the banking inquiry, is a committee of the Dail which was established in November and has been sitting for just a few weeks. It is hoping to produce a report by the end of this year. Its members are ordinary politicians from the Dail and the Senate, few of whom have any competence in financial matters.

According to its own terms of reference, its purpose is to inquire into "the reasons Ireland experienced a systemic banking crisis, including the political, economic, social, cultural, financial and behavioral factors and policies which impacted on or contributed to the crisis and the preventative reforms implemented in the wake of the crisis."

If you think that sounds like a lot of waffle, you would be right. The fact is that the committee does not have the power to force people to appear before it and, for constitutional reasons, it will not be able to find fault with any individuals, including the individuals who played key roles in the financial crisis.

Its report will be limited and general, rather than specific and hard-hitting. No one here is expecting much from it.

All of which makes the current fight by the new government in Greece for a debt reduction of particular interest to Irish people. It's a subject we will be coming back to here in the coming weeks as the Greek drama unfolds.

Professor William Black, from the University of Missouri-Kansas City.Photocall Ireland