July 28, 2016

"Dignity ... is the last resort of a battered people, the last asset that one will die in order to preserve."

Yanis Varoufakis’s Greek Tragedy

Before Brexit, of course, there was Grexit: the possibility, one year ago, that Greeks defying the will of E.U. bureaucrats bankers would fall right out of Europe.

Yanis Varoufakis was the finance minister of Greece’s radical left government during that heady summer of 2015. He got famous first for his flair: open shirt, shaved head, and motorcycle jacket — but then really famous for playing chicken with his nations’ creditors in Brussels and Berlin.

His line was that Greece could not and should not be forced to take on huge new loans to pay off bad old ones as a price of staying in the European Union. “Fiscal waterboarding” he called it: periods of intense austerity that crippled the Greek economy in exchange for bailout money that went to big banks.

See Varoufakis and Tsipras in Paul Mason‘s film about the Greek crisis:

Greek voters loved him, but his prime minister, Alexis Tsipras, rolled over in the crunch. Varoufakis lost his battle and gave up his ministry, but the third phase of his fame had just begun — as the exceptional political figure who could articulate in principled defeat the brutal logic of finance for finance’s sake. He is more visible than ever in politics this summer as the leading figure of the pan-European democracy movement known as “DiEM 25.”

He’s at it in the US in book form, his title drawn from the inhuman code of Athens’ ancient warfare with Sparta: “the strong do what they want,” meaning today the banks and the rich; “and the weak suffer what they must.” On the cover of his book, he adds a question mark. In the book, Varoufakis argues that the fight for the glorious European project — England’s Brexit vote against union is part of it, he says — between the spirit of democracy and the power of wealth.

Guest List
Yanis Varoufakis
former finance minister of Greece for the Syriza party, professor of economic theory at the University of Athens, blogger, and author of the new book, And The Weak Suffer What They Must? (Nation Books).

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  • Pat Crowley

    The scariest part of this, and there were many scary things, was the revelation that Yanis will likely face treason charges…for defending his country and his people against the banks.

    • Yeah, I wonder what his plan was – they were going to issue script to get by?
      wow

      • Alex

        The plan was quite ingenious and simple. It was basically a debt-trading system. You owe X money. And Y owes you money. Both X an Y owe money to the state, (i.e. taxes). The system works by shifting and reducing tax amounts between the participants. It works because everyone owes taxes of a sort of another to the state. The state would issue digital numbers representing your tax ‘credits’, basically issuing special credit cards. Everyone would use these. It’s like state issued and backed bitcoins if you will.
        He speaks about this system in one lecture or interview on YouTube, but i really can’t remember which.

        • Per interwebs:

          In 2014, Greece exported $33.2B and imported $60.8B, resulting in a negative trade balance of $27.6B.

          The top exports of Greece are Refined Petroleum ($10.5B), Packaged Medicaments ($1.24B), Aluminium Plating ($705M), Non-fillet Fresh Fish ($548M) and Other Processed Vegetables ($458M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Crude Petroleum ($13.3B), Refined Petroleum ($4.24B), Packaged Medicaments ($2.88B), Passenger and Cargo Ships ($2.53B) and Petroleum Gas ($1.19B).

          Can you see from those numbers why Tsipras threw Varoufakis under the bus?
          The economy is totally jacked up on imports.

      • Marco Saba

        The core problem is not issuing currency, but how it is accounted for in the banks accounting books and in the Treasury accounting books.. At first, money creation must appear as an inflow in the cash flow account of the issuing body – which is not the case today.

  • Terrific interview! Loved every minute of it, especially the part where he says that change can occur without breaking laws or creating new policies — just reworking of current institutional mandates. That’s very similar to my “civic fiduciary” idea, wherein the money power (literally billions and billions in the metro-Boston area alone) held by tax-exempt institutional investors can be leveraged to the public interest.

  • Carlos Rodrigo Zapata C.

    Oxi means NO in a few countries, MAYBE in a lot of them, but YES in Greece. Sorry, there was an abrupt awakening.

  • Marco Saba

    I want to suggest to review the accounting of money creation in the Greek Treasury books. Here an inspiring text: The Honest Government’s Guide to the Revenue from the Creation of Money http://leconomistamascherato.blogspot.it/2016/07/banknotes-and-currency-are-liability-of.html

  • SageThinker

    Time to wake up. Neoliberalism is the cancer upon the world. It’s the kernel of the capitalist operating system that enforces the ethic of greed above love. Clinton is the quintessential neoliberal candidate. Trump is the scarecrow. Bernie is not allowed to run because he opposes neoliberalism with integrity. It is time to rise up and jump the fences that lead us to our slaughter. Time to rise up.

  • Potter

    I really appreciated how Yanis speaks of political and social history, how he boils down to geography (climate included) being a major factor in “uneven” development. And then as things get rolling, what happens after. He says it’s not so much to be blamed on culture or history. I think I have that right. Frankly I was wondering why the Greeks have to build cars at all or to be judged by that standard. That said maybe they should (and do) export more than olives and feta cheese.,, and tourism. Clearly the Greeks and the Spaniards are not the Germans. Thank goodness.

    Dignity- of all the points on the show this word rings true. What with the Greek vote to reject bailout terms and the recent Brexit we are talking about the dignity of people who feel they have been left out economically and politically. If it makes more sense to all involved to unite and work it out some way, these uproars and moves have to be heard and understood to be a passage to that end whenever it may happen.

    Thank you. I am so tired of all the Trump stories plastered over the front pages of our news… scary as these times are for us.

    • Gawd how I love revisionist history tinged with socialist paranoia.

      Germany was already industrialized – it wasn’t like a group of people sat down and said Germany will make stuff and France will do the banking.
      That^ is the socialist paranoia talking.

      Germany had already received 1.7 B before they got the 1.4B from the Marshal plan.
      And get this: Germany didn’t know they weren’t going to pay it back so the money was lent out with interest – not given away within Germany. The fund continued and grew to enormous proportions – IIRC, to 23B$

      “The Marshall Plan … is not a philanthropic enterprise … It is based on our views of the requirements of American security … This is the only peaceful avenue now open to us which may answer the communist challenge to our way of life and our national security.”
      (Allen W. Dulles, The Marshall Plan)

      That is a huge distinction to overlook in Yanis’ revisionist socialist economic history.

      What surplus was he talking about such that we shipped product to Germany? Food aid?

  • Floyd C. Wilkes

    Thank you ROS! I lack the words to adequately express how much I enjoyed this extraordinary program. The supremely insightful, brilliantly articulate Yanis Varoufakis in dialogue with Christopher Lydon creates incomparably rewarding and delightfully enriching conversation. Kudos to the entire ROS team and community, you do Massachusetts proud on a global basis.

  • L’Obelisk Jewellers

    OXI means NOOOOOOOOOOOOOOOOOO!