Former Finance Minister Varoufakis Surprised Greece Voted ‘No’ on Austerity

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In a very long piece on former Greek finance minister Yanis Varoufakis in the New Yorker, the former head of the nation’s economy admits to being surprised both by the Greek people’s rejection of an austerity deal and the Prime Minister’s acceptance of one.

Much of the post is dedicated to admiring Varoufakis’ unquestionable sense of style and luxurious life, though it later discusses the academic’s conviction that debt brinkmanship and threats of default were the key to shaking European chumps out of more cash to finance Greece’s adventure in dead-end left-wingery. He is not happy that Prime Minister Alexis Tsipras accepted an “austerity” package tougher than the one Greek voters previously rejected.

He says he did not see that coming – Varoufakis expected the voters to say “yes” in their referendum, at which point he could walk away from a Finance Minister job he found exhausting and frustrating. The voters said “no,” but he ended up walking anyway, perhaps disappointed that he could not frame it as a more dramatic stand on principle.

That sense of winging it, guessing wrong, focusing on the short term, and winning political victories over hard, cold reality pervades the piece, which takes time to mention that some of those political battles against reality involved physical violence and body counts.

An anecdote from the recent past neatly summarizes the Left’s view that their irresponsible debt can be weaponized against those foolish enough to loan them money:

A few years ago, Varoufakis told Yorgos Avgeropoulos, a documentary filmmaker, that the difference between a debt of ten thousand euros and one of three hundred billion euros is that only the latter gives you negotiating power. And it does so only under one condition: “You must be prepared to say no.” Upon his election, Varoufakis used the less than ideal influence available to a rock climber who, roped to his companions, announces a willingness to let go. On behalf of Tsipras’s government, Varoufakis told Greece’s creditors, and the world’s media, that his country objected to the terms of its agreements. This position encouraged widespread commentary about Greece following a heedless path from “no” to default, and from default to a “Grexit” from the euro currency, which might lead to economic catastrophe in Europe and the world.

Varoufakis celebrated his election as Finance Minister with a paraphrase of Dylan Thomas: “Greek democracy today chose to stop going gently into the night. Greek democracy resolved to rage against the dying of the light.”

Varoufakis also seems convinced that the Germans could wave Greece’s problems away if they wanted to. This ignores the political reality in Germany, where the working man grows understandably weary of subsidizing every basket-case economy in the Eurozone. Why should Germans pay through the nose to prop up the Greek entitlement state?

The New Yorker article dispenses a bit of blame for the current crisis on both Greek leftists of the past, and the greedy bankers who let them rack up all that debt: “For years, the state had borrowed recklessly from reckless banks in Greece, Germany, and France… Greece was already known to have severe, long-standing economic weaknesses: tax evasion, corruption, oligarchic habits, a failure to make products that other countries desired.”

The lesson of Greece, to be learned by voters in America and all around the world, is that these smooth-talking, poetry-spouting, high-living academics have no idea what they are doing to the future. Instead of soberly assessing the true cost of a minimal government, and the true ability of a complex economy to shoulder that burden, they steamroll all opposition to their lofty ambitions as “greed,” without a care for what kind of mess they’re leaving for their successors to clean up.  If we don’t stop today’s liberals in America, we will be tomorrow’s Greeks, except it will be ten thousand times worse, because the entire world couldn’t shoulder our debts, even if it wanted to.

Enjoy this account of Varoufakis’ meeting with the man who has worked so hard to put America on that road to ruin.  Of course they got along famously:

At the White House, Varoufakis repeated a line that he had used at Brookings: “Mr. President, my government is planning, and I am planning, to compromise, compromise, and compromise, but we’re not going to be compromised.” (“He liked that,” Varoufakis recalled.) Varoufakis told him, “Mr. President, of course one has to suffer costs in order to get the benefits, but the question is the balance. There has to be a positive balance.” He went on, “We are being asphyxiated for trying to simulate what you did, right?”

Obama showed more solidarity than Varoufakis was expecting. “I know—austerity sucks,” Obama said. (“He used those words. Very un-Presidential.”) According to Varoufakis, the President was referring less to austerity’s unpleasantness than to its ineffectiveness. Obama meant that austerity “doesn’t work—it creates misery, and it’s self-perpetuating, and it’s self-defeating.”

Varoufakis told Obama that he hadn’t felt quite the same comradeship when speaking with the U.S. Treasury Secretary. “Jack Lew is not toeing the Obama line,” he said.

“You know how finance ministers are,” Obama replied. “They’re more conservative.”


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