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OpEdNews Op Eds    H3'ed 3/23/15

As goes Greece, so goes the world

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New Greek Finance Minister Yaniks Varoufakis continues his People-centered and unconventional approach to politics. One sign of this is his still semi-regular blog postings, including this latest one: Of Greeks and Germans: Re-imagining our shared future. Unfortunately, the title gives the problem away - only one side imagines a shared future, or shared anything. The other side, which is really the Germans funneled through the Troika (the ECB, EC, and IMF) imagines a very different thing. Before I get to that, it's worth seeing some of Varoufakis' latest posting:

When, in early 2010, the Greek state lost its capacity to service its debts to French, German and Greek banks, I campaigned against the Greek government's quest for an enormous new loan from Europe's taxpayers. Why?

I opposed the 2010 and 2012 'bailout' loans from German and other European taxpayers because:

  • the new loans represented not a bailout for Greece but a cynical transfer of losses from the books of the private banks to the weak shoulders of the weakest of Greek citizens. (How many of Europe's taxpayers, who footed these loans, know that more than 90% of the 240 billion borrowed by Greece went to financial institutions, not to the Greek state or its citizens?)
  • it was obvious that, at a time Greece could not repay its existing loans, the austerity conditions for giving Greece the new loans would crush Greek nominal incomes, making our debt even less sustainable
  • the 'bailout' burden would, sooner or later, weigh down German and other European taxpayers once the weaker Greeks buckled under their mountainous debts (as moneyed Greeks had already shifted their deposits to Frankfurt, London etc.)
  • misleading peoples and Parliaments by presenting a bank bailout as an act of 'solidarity to Greece' would turn Germans against Greeks, Greeks against Germans and, eventually, Europe against itself.

In 2010 Greece owed not one euro to German taxpayers. We had no right to borrow from them, or from other European taxpayers, while our public debt was unsustainable. Period!

Varoufakis goes on to describe how Greece went ahead with this disastrous bailout of the banks anyway (he didn't become Finance Minister until late 2014). Just as he predicted, this put Greece even more in the hole...

...soon after [2] with the largest taxpayer-backed loan in economic history given to the Greek state on austerity conditions that have caused Greeks to lose a quarter of their income, making it impossible to repay private and public debts, and causing a hideous humanitarian crisis.

Unfortunately, rather than realizing who he and Greece were up against, Varoufakis ends on this rather idealistic and frankly, weak, plea:

That was then, in 2010. What should we do now, in 2015, that Greece remains in crisis and our people, the Greeks and the Germans, have, regrettably but also predictably, descended into a mutual 'blame game'?

First, we should work towards ending the toxic 'blame game' and the moralising finger-pointing which benefit only the enemies of Europe.

Secondly, we need to focus on our joint interest: On how to grow and to reform Greece rapidly, so that the Greek state can best repay debts it should never have taken on while looking after its citizens as a modern European state ought to do.

In practical terms, the 20th February Eurogroup agreement offers an excellent opportunity to move forward. Let us implement it immediately, as our leaders have urged in yesterday's informal Brussels meeting.

Looking ahead, and beyond current tensions, our joint task is to re-design Europe so that Germans and Greeks, along with all Europeans, can re-imagine our monetary union as a realm of shared prosperity.

Here is my reply to his blog post, and sent separately to him in an email request for comment. I'll post an update here should he respond on the record.

At the end of 2013, I and the president of the Henry George School in NYC co-interviewed Yanis Varoufakis.
I wrote an article which included the hour-long interview, which included, among other things, a proposal (mine) for Greece to issue a secondary domestic series of Sovereign Money, in addition to the too-few Euros allowed by the ECB, as Yanis writes about so well in the current article.
Herein is a small part of that article, as well as links to the original on Global Economic Intersection and (where I am a Managing Editor). It was also recently posted the Henry George School website in preparation for a webinar I will be co-hosting with the president March 31 on Varoufakis' views of Thomas Piketty, which will probably address that in the context of the current Greece crisis as well:
"What are the alternatives?

A possibility came out when I co-interviewed Varoufakis, along with New York Henry George School President Andrew Mazzone, in the fall of 2013. During that interview, I was able to ask him specifically about the monopoly on money creation, something Henry George was against as well. Here is the link to that, as well as to his nuanced response, after agreeing with me.

Would an approach that includes direct issuance of money (drachmas) by Greece in place or in addition to, Euros, better serve Greece and the EU at this precarious tipping point? I hope the world will find out. It will have to be soon if it is to be at all. The alternatives are default, a write-down, or dropping out of the EU, which Syriza and Varoufakis have rejected so far."

Read the rest here:
and here:

Yanis is a very busy man, and there are political considerations to his answering-by-blog, but I hope we can hear his current views on an alternative supplemental Greek currency now that the troika (ECB, IMF, and EC (and Germany should also be included as an equally important player, IMO)) has refused any reasonable accommodation. It's clear they not only don't care if Greece fails, but look forward to dividing the collateral spoils and turning Greece into a vassal serf failed State under a neo-feudal system which will than serve as the model for future failed States in Europe and beyond. The supranational banking system has no country, knows no loyalty, and is beholden to no national legal system. What Yanis (we are on a first name basis) doesn't understand, despite his obvious brilliance as an economist, is that the banks and their .1% elite owners are at war with the 99.9% and even with the system of Nation States since the Westphal agreement. The New World Order (NWO) wants no "partners" and takes no "prisoners" except in the sense of permanent indentured servitude. If little Greece cannot stand up to them now, then Cyprus (which already received a crippling body blow in the form of a bank bail-in that confiscated billions from ordinary depositors to bail out the foreign creditors), Spain, Italy, Portugal will be next, followed by other countries and regions that seem strong now, or even credit-positive, but which in reality are teetering on other peoples' debts. When the banks in those countries fail, there will already be bailout mechanisms practiced on lesser countries that will be trotted out as "the model" for which to save "society" but which really brings in permanent serfdom for virtually the entire world.

One new alternative that has come up since I first wrote my article is the new China-led Asian Infrastructure Investment Bank (AIIB). Already, the oppressed and often bullied third world, Asian block, and even America's staunchest allies in the EU - England, Germany, Italy and France - are rushing to join the 30-member, and counting, founding membership of this bank before the doors close March 31. Greece should do the same immediately. This would strengthen their bargaining position with the troika as well. Then, they should dust off their drachma printing presses, which haven't been used since 2002, and figure out a mechanism to replace the currency deflated by the draconian policies of the troika.

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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a former blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:

Scott is a former and current President of Common Ground-NY (, a Geoist/Georgist activist group. He has written dozens of (more...)

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