Wednesday, January 28, 2015

New Greek finance minister Yanis Varoufakis is a new hope for Europe

Greece has a new government giving new hopes for Europe (what a nonsense to say that it is a threat to "Europe"). Greece also has a new finance minister, Yanis Varoufakis, who has refreshing views on Europe and the world economy. You can read his views in in a blog that he has kept for many years and intends to continue: "Yanis Varoufakis thoughts for the post-2008 world".

It is great to have in Europe a new, thoughtful minister of finance. I hope he will receive support from colleagues in other European countries and from within the European Commission and the European Central Bank. Economic dogmas should stop reigning, rational reasoning should become the norm again.

A few weeks ago Yanis Varoufakis explained on his blog why he had decided to accept the invitation of the now new prime minister of Greece, Alexis Tsipras, to be a candidate for Syriza in the elections.
This is what he said:

Why I am running for a parliamentary seat on SYRIZA’s ticket

CRC_3299Critical engagement is a form of praxis. But there comes a time when, to retain its relevance, critical thinking must transform itself into direct political action.
It was never my intention to enter the electoral game. Ever since the crisis began, I entertained hopes of maintaining an open dialogue with reasonable politicians from different political parties. Alas, the ‘bailouts’ made such an open dialogue impossible.
As the Eurozone’s inevitable crisis was addressed by a cynical transfer of banking losses onto the shoulders of the weakest taxpayers, politicians and commentators who tied their colours onto the so-called bailouts’ mast demonstrated precisely no interest in rational debate.
Instead of discussing, in the European Union’s fora, the nature of our systemic crisis, the powers-that-be were busy fiscally waterboarding proud nations, letting them take a few short breaths before submerging them again into the waters of illiquidity. Thus Europe began to lose its integrity and its soul, turning from a realm of shared prosperity to an iron cage, a debt prison, a form of Victorian workhouse.
At the economic front, this crisis-denial led to contagion in the sovereign bond markets, beginning with Greece where the combination of savage austerity and huge loans was tried and tested, before being exported to the rest of the Eurozone. Predictably (as this blog was illustrating day in day out) the contagion was only made worse, reaching Italy with extreme prejudice and forcing the ECB to step in in the summer of 2012 with Mr Draghi’s famous “whatever it takes” moment. Only the crisis never went away but, rather, it was transferred from the bond markets to the real economy, yielding vicious deflationary forces that have now rendered Spain, Italy and France fiscally unsustainable.
At the social front, crisis-denial and the logic of the bailouts gave rise to a humanitarian crisis that Europe should be deeply ashamed of. Again predictably, the result was the fanning of the flames of misanthropy, of racist nationalism, of all those sinister forces that are demolishing European democracy and replacing it with self-propagating authoritarianism. The results of the last European Parliament elections confirmed that sad truth but did nothing to sway the powers-that-be away from the policies of deconstruction that are behind the emergent bigotry.
Greece is where all this started. It must be where a reversal of Europe’s fragmentation begins too. Regular readers of this blog are familiar with my efforts to come up with a sensible, modest proposal for resolving the euro crisis. Such proposals have no chance, I have now understood, until and unless they are tabled at the Eurogroup, in Econfin at the EU summit.
This is the reason that when Alexis Tsipras honoured me with the offer to run for an Athens parliamentary seat, and with a view to play a role in Greece’s negotiation with Berlin, Frankfurt and Brussels, I could not but accept.
My greatest fear, now that I have tossed my hat in the ring, is that I may turn into a politician. As an antidote to that virus I intend to write my resignation letter and keep it in my inside pocket, ready to submit it the moment I sense signs of losing the commitment to speak truth to power.