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As Germany intensifies its crackdown on pro-Palestinian voices, we speak with Greek economist and politician Yanis Varoufakis, one of the planned speakers at a conference in Berlin last weekend that was forcibly shut down by police. The Palestine Congress was scheduled to be held for three days, but police stormed the venue as the first panelist spoke. Germany’s Interior Ministry had also banned some conference speakers from even entering the country, including Varoufakis, the Palestinian British surgeon Ghassan Abu-Sittah and the Palestinian researcher Salman Abu Sitta. “This is not about protecting Jewish lives and Jews from antisemitism. It’s all about protecting the right of Israel to commit any war crime of its choice,” says Varoufakis.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: As the official death toll in Gaza nears 34,000, we begin today’s show looking at Germany’s intensifying crackdown on pro-Palestinian voices. On Friday, police in Berlin shut down a three-day Palestinian conference just moments after it began. In addition, Germany’s Interior Ministry banned several speakers from even entering Germany or addressing the Palestine Congress conference remotely. The Palestinian researcher Salman Abu Sitta opened the conference, but his remarks over a live stream were cut short when Berlin police raided the conference site.

SALMAN ABU SITTA: We have never seen before these daily scenes, one massacre after another, homes demolished over the heads of the occupants, bodies pulled from under the rubble, surviving child with all his family killed. We have never seen before people deliberately denied food and water, children starved to death and killed when rushing to get food. We have never seen before all means of life systematically destroyed — hospitals, clinics, schools, universities, libraries, ancient monuments, mosques, churches, universities, cemeteries, bakeries, apartment build—

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Yanis Varoufakis: We Are Living in a Post-Capitalist, Techno-Feudalist Dystopia

March 5, 2022

YANIS VAROUFAKIS: WE ARE LIVING IN A POST-CAPITALIST, TECHNO-FEUDALIST DYSTOPIA

World-renowned Greek economist, author, and politician Yanis Varoufakis argues that global capitalism as we know it is dying—and something much worse is taking its place. Yanis Varoufakis speaks with This Is Revolution co-hosts Jason Myles and Pascal Robert

Yanis Varoufakis speaks with This Is Revolution co-hosts Jason Myles and Pascal Robert. Screenshot/TRNN

From the push to turn more of the workforce into precarious “gig workers” to the ways profit-seeking digital platforms condition how we act and think while extracting free data from us, we can see and feel everyday the creeping evidence that we are living in a new reality. As world-renowned Greek economist, author, and politician Yanis Varoufakis argues, “This is how capitalism ends: not with a revolutionary bang, but with an evolutionary whimper. Just as it displaced feudalism gradually, surreptitiously, until one day the bulk of human relations were market-based and feudalism was swept away, so capitalism today is being toppled by a new economic mode: techno-feudalism.”

In their latest interview for TRNN, co-hosts of THIS IS REVOLUTION Jason Myles and Pascal Robert speak with Varoufakis about how this “techno-feudalist” system emerged, what sets it apart from the global capitalist system that preceded it, and what it will mean for humanity if we don’t stop it. Yanis Varoufakis formerly served as the finance minister of Greece and is currently the secretary general of MeRA25, a left-wing political party in Greece that he founded in 2018. He is a professor of economics at the University of Athens and the author of numerous books, including The Global Minotaur: America, Europe and the Future of the Global Economy and Another Now: Dispatches from an Alternative Present.

Pre-Production/Studio: Jason Myles
Post-Production: Cameron Granadino

TRANSCRIPT

…click on the above link to read the rest of the article…

The COVID Class War

July 1, 2020

varoufakis67_Sean GallupGetty Images_germanyprotesteurocrisis

The COVID Class War

The European Union’s proposed recovery fund to counter the pandemic’s economic fallout seems destined to leave the majority in every member state worse off. Finance will again be protected, if badly, while workers are left to foot the bill through new rounds of austerity.

ATHENS – The euro crisis that erupted a decade ago has long been portrayed as a clash between Europe’s frugal North and profligate South. In fact, at its heart was a fierce class war that left Europe, including its capitalists, much weakened relative to the United States and China. Worse still, the European Union’s response to the pandemic, including the EU recovery fund currently under deliberation, is bound to intensify this class war, and deal another blow to Europe’s socioeconomic model.

If we have learned anything in recent decades, it is the pointlessness of focusing on any country’s economy in isolation. Once upon a time, when money moved between countries mostly to finance trade, and most consumption spending benefited domestic producers, the strengths and weaknesses of a national economy could be separately assessed. Not anymore. Today, the weaknesses of, say, China and Germany are intertwined with those of countries like the US and Greece.

The unshackling of finance in the early 1980s, following the elimination of capital controls left over from the Bretton Woods system, enabled enormous trade imbalances to be funded by rivers of money created privately via financial engineering. As the US shifted from a trade surplus to a massive deficit, its hegemony grew. Its imports maintain global demand and are financed by the inflows of foreigners’ profits that pour into Wall Street.

This strange recycling process is managed by the world’s de facto central bank, the US Federal Reserve. And maintaining such an impressive creation – a permanently imbalanced global system – necessitates the constant intensification of class war in deficit and surplus countries alike.

…click on the above link to read the rest of the article…

Liberal Totalitarianism

May 8, 2018

Two young girls seen taking selfies during the feminist demonstration

Liberal Totalitarianism

It used to be an axiom of liberalism that freedom meant inalienable self-ownership. But liberal individualism seems to have been defeated by a totalitarianism that grew out of its own success at legitimizing the encroachment of branding and commodification into our personal space.

LISBON – It used to be an axiom of liberalism that freedom meant inalienable self-ownership. You were your own property. You could lease yourself to an employer for a limited period, and for a mutually agreed price, but your property rights over yourself could not be bought or sold. Over the past two centuries, this liberal individualist perspective legitimized capitalism as a “natural” system populated by free agents.

A capacity to fence off a part of one’s life, and to remain sovereign and self-driven within those boundaries, was paramount to the liberal conception of the free agent and his or her relationship with the public sphere. To exercise freedom, individuals needed a safe haven within which to develop as genuine persons before relating – and transacting – with others. Once constituted, our personhood was to be enhanced by commerce and industry – networks of collaboration across our personal havens, constructed and revised to satisfy our material and spiritual needs.

But the dividing line between personhood and the external world upon which liberal individualism based its concepts of autonomy, self-ownership, and, ultimately, freedom could not be maintained. The first breach appeared as industrial products became passé and were replaced by brands that captured the public’s attention, admiration, and desire. Before long, branding took a radical new turn, imparting “personality” to objects.

…click on the above link to read the rest of the article…

The High Cost of Denying Class War

December 9, 2017

Matt Cards/Getty Images

The High Cost of Denying Class War

The rise of populism on both sides of the Atlantic is being investigated psychoanalytically, culturally, anthropologically, aesthetically, and of course in terms of identity politics. The only angle left unexplored is the one that holds the key to understanding what is going on: the unceasing class war waged against the poor since the late 1970s.

ATHENS – The Anglosphere’s political atmosphere is thick with bourgeois outrage. In the United States, the so-called liberal establishment is convinced it was robbed by an insurgency of “deplorables” weaponized by Vladimir Putin’s hackers and Facebook’s sinister inner workings. In Britain, too, an incensed bourgeoisie are pinching themselves that support for leaving the European Union in favor of an inglorious isolation remains undented, despite a process that can only be described as a dog’s Brexit.

The range of analysis is staggering. The rise of militant parochialism on both sides of the Atlantic is being investigated from every angle imaginable: psychoanalytically, culturally, anthropologically, aesthetically, and of course in terms of identity politics. The only angle that is left largely unexplored is the one that holds the key to understanding what is going on: the unceasing class war unleashed upon the poor since the late 1970s.

In 2016, the year of both Brexit and Trump, two pieces of data, dutifully neglected by the shrewdest of establishment analysts, told the story. In the United States, more than half of American families did not qualify, according to Federal Reserve data, to take out a loan that would allow them to buy the cheapest car for sale (the Nissan Versa sedan, priced at $12,825). Meanwhile, in the United Kingdom, over 40% of families relied on either credit or food banks to feed themselves and cover basic needs.

…click on the above link to read the rest of the article…

The Promise of Fiscal Money

November 11, 2017

The Promise of Fiscal Money

One of the few remaining sacred cows of Western capitalism is the independence of central banks from elected governments. But in an age when fiscal policy has become an essential factor in determining the quantity of money lubricating the system, an independent monetary authority no longer makes sense.

ATHENS – Western capitalism has few sacred cows left. It is time to question one of them: the independence of central banks from elected governments.

Setting aside the political controversy, central bank independence is predicated on an economic axiom: that money and debt (or credit) are strictly separable. Debt – for example, a government or corporate bond that is bought and sold for a price that is a function of inflation and default risk – can be traded domestically. Money, on the other hand, cannot default and is a means, rather than an object, of exchange (the currency market notwithstanding).

But this axiom no longer holds. With the rise of financialization, commercial banks have become increasingly reliant on one another for short-term loans, mostly backed by government bonds, to finance their daily operations. This liquidity acquires familiar properties: used as a means of exchange and as a store of value, it becomes a form of money.

…click on the above link to read the rest of the article…

Spain’s Crisis is Europe’s Opportunity

October 7, 2017

A Spanish policeman tries to avoid clashes between people holding Spanish flags

Spain’s Crisis is Europe’s Opportunity

The Catalonia crisis is a strong hint from history that Europe needs to develop a new type of sovereignty, one that strengthens cities and regions, dissolves national particularism, and upholds democratic norms. Imagining a pan-European democracy is the prerequisite for imagining a Europe worth saving.

ATHENS – To revive the ailing European project, the ugly conflict between Catalonia’s regional government and the Spanish state may be just what the doctor ordered. A constitutional crisis in a major European Union member state creates a golden opportunity to reconfigure the democratic governance of regional, national, and European institutions, thereby delivering a defensible, and thus sustainable, EU.

The EU’s official reaction to the police violence witnessed during Catalonia’s independence referendum amounts to dereliction of duty. To declare, as the President of the European Commission did, that this is an internal Spanish problem in which the EU has no say is hypocrisy on stilts.

Of course, hypocrisy has long been at the center of the EU’s behavior. Its officials had no compunction about meddling in a member state’s internal affairs – say, to demand the removal of elected politicians for refusing to implement cuts in the pensions of their poorest citizens or to sell off public assets at ridiculous prices (something I have personally experienced). But when the Hungarian and Polish governments explicitly renounce fundamental EU principles, non-interference suddenly became sacrosanct.

The Catalan question has deep historical roots, as does nationalism more broadly. But would it have erupted the way it recently did had Europe not mishandled the eurozone crisis since 2010, imposing quasi-permanent stagnation on Spain and the rest of the European periphery while setting the stage for xenophobia and moral panic when refugees began crossing Europe’s external borders? An example illustrates the connection.

…click on the above link to read the rest of the article…

The ECB’s Illusory Independence

June 4, 2016

The ECB’s Illusory Independence

ATHENS – A commitment to the independence of central banks is a vital part of the creed that “serious” policymakers are expected to uphold (privatization, labor-market “flexibility,” and so on). But what are central banks meant to be independent of? The answer seems obvious: governments.

In this sense, the European Central Bank is the quintessentially independent central bank: No single government stands behind it, and it is expressly prohibited from standing behind any of the national governments whose central bank it is. And yet the ECB is the least independent central bank in the developed world.

Graduation ceremony at Rutgers University

Generation Jobless

Italian economist Edoardo Campanella explains why Joseph Stiglitz, Jean Pisani-Ferry, Harold James, and other leading thinkers are so worried about youth marginalization.

The key difficulty is the ECB’s “no bailout” clause – the ban on aiding an insolvent member-state government. Because commercial banks are an essential source of funding for member governments, the ECB is forced to refuse liquidity to banks domiciled in insolvent members. Thus, the ECB is founded on rules that prevent it from serving as lender of last resort.

The Achilles heel of this arrangement is the lack of insolvency procedures for euro members. When, for example, Greece became insolvent in 2010, the German and French governments denied its government the right to default on debt held by German and French banks. Greece’s first “bailout” was used to make French and German banks whole. But doing so deepened Greece’s insolvency.

It was at this point that the ECB’s lack of independence was fully exposed. Since 2010, the Greek government has been relying on a sequence of loans that it can never repay to maintain a façade of solvency.

…click on the above link to read the rest of the article…

Yanis Varoufakis Issues a Major Warning to the Greek People

April 5, 2016

Yanis Varoufakis Issues a Major Warning to the Greek People

Varoufakis said that Schäuble, Germany’s finance minister and the architect of the deals Greece signed in 2010 and 2012, was “consistent throughout”. “His view was ‘I’m not discussing the program – this was accepted by the previous [Greek] government and we can’t possibly allow an election to change anything.

“So at that point I said ‘Well perhaps we should simply not hold elections anymore for indebted countries’, and there was no answer. The only interpretation I can give [of their view] is, ‘Yes, that would be a good idea, but it would be difficult. So you either sign on the dotted line or you are out.’”

– From last year’s post: Everything You Need to Know About the Greek Crisis and ECB Fascism in Two Paragraphs

By now, most of you have heard about Wikileaks’ release of internal deliberations between the top two IMF officials in charge of managing the Greek debt crisis – Poul Thomsen, the head of the IMF’s European Department, and Delia Velkouleskou, the IMF Mission Chief for Greece.

In nutshell, the two discussed whether or not a new credit crisis would be required in order to force EU creditors to agree with the IMF’s debt relief objective. Shedding some much needed perspective on the situation, former Greek finance minister Yanis Varoufakis has chimed in, and he makes one thing perfectly clear — no matter who comes out ahead in this dispute (the IMF or the EU), it will be the Greek people who lose.

Here are a few excerpts from his op-ed published at Der Spiegel.

The feud between the International Monetary Fund (IMF) and the European side of Greece’s troika of creditors is old news. However, Wikileaks’ publication of a dialogue between key IMF players suggests that we are approaching something of a hazardous endgame.

…click on the above link to read the rest of the article…

Lies, Damn Lies, and European Growth Statistics

March 15, 2016

Lies, Damn Lies, and European Growth Statistics

ATHENS – “Greece has at last returned to economic growth.” That was the official European Union storyline at the end of 2014. Alas, Greek voters, unimpressed by this rejoicing, ousted the incumbent government and, in January 2015, voted for a new administration in which I served as finance minister.

Last week, similarly celebratory reports emanated from Brussels heralding the “return to growth” in Cyprus, and contrasting this piece of “good” news to Greece’s “return to recession.” The message from the troika of European bailout lenders – the European Commission, the European Central Bank, and the International Monetary Fund – is loud and clear: “Do as we say, like Cyprus has done, and you will recover. Resist our policies, by electing people like Varoufakis, and you will suffer the consequences of further recession.”

This is a powerful story. Except that it is built on a disingenuous lie. Greece was not recovering in 2014, and Cyprus’s national income has not recovered yet. The EU’s claims to the contrary are based on an inappropriate focus on “real” national income, a metric bound to mislead during periods of falling prices.

If asked whether you are better off today compared to a year ago, you would answer in the affirmative if your money income (that is, its dollar, pound, euro, or yen value) rose during the previous 12 months. In the inflationary times of yore, you might have also accompanied your response with the (reasonable) complaint that increases in the cost of living eroded your increased money income.

To account for this gap between your money income and your capacity to buy things with it, economists focused on your purchasing power by adjusting your money income for average prices.

…click on the above link to read the rest of the article…

The Balkanization of Europe

February 25, 2016

The Balkanization of Europe

Danae Stratou, Ilargi, Yanis Varoufakis and Steve Keen Feb 16 2016When my mate Steve Keen took me to meet Yanis Varoufakis for dinner last week when we all happened to find ourselves in Athens together, I at least sort of regretted not having the time and space to talk to Yanis about his DiEM25 project for the democratization of Europe. It was a private occasion, there were other people at the dinner table, Steve and Yanis had no seen each other for a while, it was simply not about that.

I did think afterward that it would be great to do this kind of get together more often, and get ideas running, but then realized we are all workaholics and we all live thousands of miles apart, so the odds of that happening are slim at best. And that in turn made me think of how inspiring the years were when I toured the world with my Automatic Earth partner in crime Nicole Foss, how important it is to have people around to bounce off your ideas of what’s going on, how much faster that crystallizes your own ideas.

But as things are, and as they happened, I didn’t have that time with Yanis. And not nearly enough with Steve either, for that matter, who has/is a brain that I would love to pick for days if not weeks, he’s such a brilliant mind. When you have just a few hours, though, the time is filled with drinking wine and catching up with what’s happened in each other’s personal lives, it had been 3 years since we met, and professionally, since Steve knows Nicole very well, they did quite a few presentations together, yada yada.

Immensely gratifying, of course, to be able to renew a friendship like that, but almost as frustrating to not be able to expand on it.

…click on the above link to read the rest of the article…

The Varoufakis Effect?

January 26, 2016

The Varoufakis Effect?

ATHENS – In his end-of-2015 missive, Holger Schmieding of the Hamburg investment bank Berenberg warned his firm’s clients that what they should be worrying about now is political risk. To illustrate, he posted the diagram below, showing how business confidence collapsed in Greece during the late spring of 2015, and picked up again only after my resignation from the finance ministry. Schmieding chose to call this the “Varoufakis effect.”

There is no doubt that investors should be worried – very worried – about political risk nowadays, including the capacity of politicians and bureaucrats to do untold damage to an economy. But they must also be wary of analysts who are either incapable of, or uninterested in, distinguishing between causality and correlation, and between insolvency and illiquidity. In other words, they must be wary of analysts like Schmieding.

Business confidence in Greece did indeed plummet a few months after I became Finance Minister. And it did pick up a month after my resignation. The correlation is palpable. But is the causality?

image: http://www.project-syndicate.org/flowli/image/varoufakis14-graph/original/english

Consider the following example. Business confidence fell in September 2001 (following the terror attacks on New York and Washington, DC), while Paul O’Neill was US Treasury Secretary. Would Schmieding label a chart showing that decline the “O’Neill Effect”? Of course not: the drop in business confidence had nothing to do with O’Neill and everything to do with fears about global security. The correlation with O’Neill’s tenure was irrelevant.

Similarly, in the case of Greece, the collapse in business confidence happened under my watch. But the cause was that our creditors, the so-called Troika (the European Commission, the European Central Bank, and the International Monetary Fund), made clear that they would close down our banking system to force our government to accept a fresh extend-and-pretend loan agreement.

…click on the above link to read the rest of the article…

Greece’s Two Currencies

January 7, 2016

Greece’s Two Currencies

ATHENS – Imagine a depositor in the US state of Arizona being permitted to withdraw only small amounts of cash weekly and facing restrictions on how much money he or she could wire to a bank account in California. Such capital controls, if they ever came about, would spell the end of the dollar as a single currency, because such constraints are utterly incompatible with a monetary union.

Greece today (and Cyprus before it) offers a case study of how capital controls bifurcate a currency and distort business incentives. The process is straightforward. Once euro deposits are imprisoned within a national banking system, the currency essentially splits in two: bank euros (BE) and paper, or free, euros (FE). Suddenly, an informal exchange rate between the two currencies emerges.

Consider a Greek depositor keen to convert a large sum of BE into FE (say, to pay for medical expenses abroad, or to repay a company debt to a non-Greek entity). Assuming such depositors find FE holders willing to purchase their BE, a substantial BE-FE exchange rate emerges, varying with the size of the transaction, BE holders’ relative impatience, and the expected duration of capital controls.

On August 18, 2015, a few weeks after pulling the plug from Greece’s banks (thus making capital controls inevitable), the European Central Bank and its Greek branch, the Bank of Greece, actually formalized a dual-currency currency regime. A government decree stated that “Transfer of the early, partial, or total prepayment of a loan in a credit institution is prohibited, excluding repayment by cash or remittance from abroad.”

The eurozone authorities thus permitted Greek banks to deny their customers the right to repay loans or mortgages in BE, thereby boosting the effective BE-FE exchange rate. And, by continuing to allow payments of tax arrears to be made in BE, while prescribing FE as a separate, harder currency uniquely able to extinguish commercial bank debt, Europe’s authorities acknowledged that Greece now has two euros.

…click on the above link to read the rest of the article…

The Great Greek Bank Robbery

December 16, 2015

The Great Greek Bank Robbery

ATHENS – Since 2008, bank bailouts have entailed a significant transfer of private losses to taxpayers in Europe and the United States. The latest Greek bank bailout constitutes a cautionary tale about how politics – in this case, Europe’s – is geared toward maximizing public losses for questionable private benefits.

In 2012, the insolvent Greek state borrowed €41 billion ($45 billion, or 22% of Greece’s shrinking national income) from European taxpayers to recapitalize the country’s insolvent commercial banks. For an economy in the clutches of unsustainable debt, and the associated debt-deflation spiral, the new loan and the stringent austerity on which it was conditioned were a ball and chain. At least, Greeks were promised, this bailout would secure the country’s banks once and for all.

In 2013, once that tranche of funds had been transferred by the European Financial Stability Facility (EFSF), the eurozone’s bailout fund, to its Greek franchise, the Hellenic Financial Stability Facility, the HFSF pumped approximately €40 billion into the four “systemic” banks in exchange for non-voting shares.

A few months later, in the autumn of 2013, a second recapitalization was orchestrated, with a new share issue. To make the new shares attractive to private investors, Greece’s “troika” of official creditors (the International Monetary Fund, European Central Bank, and the European Commission) approved offering them at a remarkable 80% discount on the prices that the HFSF, on behalf of European taxpayers, had paid a few months earlier. Crucially, the HFSF was prevented from participating, imposing upon taxpayers a massive dilution of their equity stake.

Sensing potential gains at taxpayers’ expense, foreign hedge funds rushed in to take advantage. As if to prove that it understood the impropriety involved, the Troika compelled Greece’s government to immunize the HFSF board members from criminal prosecution for not participating in the new share offer and for the resulting disappearance of half of the taxpayers’ €41 billion capital injection.

…click on the above link to read the rest of the article…

Schäuble’s Gathering Storm

October 23, 2015

Schäuble’s Gathering Storm

Europe’s crisis is poised to enter its most dangerous phase. After forcing Greece to accept another “extend-and-pretend” bailout agreement, fresh battle lines are being drawn. And, with the refugee influx exposing the damage caused by divergent economic prospects and sky-high youth unemployment in Europe’s periphery, the ramifications are ominous, as recent statements by three European politicians – Italian Prime Minister Matteo Renzi, French Economy Minister Emmanuel Macron, and German Finance Minister Wolfgang Schäuble – have made clear.

Renzi has come close to demolishing, at least rhetorically, the fiscal rules that Germany has defended for so long. In a remarkable act of defiance, he threatened that if the European Commission rejected Italy’s national budget, he would re-submit it without change.

This was not the first time Renzi had alienated Germany’s leaders. And it was no accident that his statement followed a months-long effort by his own finance minister, Pier Carlo Padoan, to demonstrate Italy’s commitment to the eurozone’s German-backed “rules.” Renzi understands that adherence to German-inspired parsimony is leading Italy’s economy and public finances into deeper stagnation, accompanied by further deterioration of the debt-to-GDP ratio. A consummate politician, Renzi knows that this is a short path to electoral disaster.

Macron is very different from Renzi in both style and substance. A banker-turned-politician, he is President François Hollande’s only minister who combines a serious understanding of France’s and Europe’s macroeconomic challenges with a reputation in Germany as a reformer and skillful interlocutor. So when he speaks of an impending religious war in Europe, between the Calvinist German-dominated northeast and the largely Catholic periphery, it is time to take notice.

Schäuble’s recent statements about the European economy’s current trajectory similarly highlight Europe’s cul-de-sac. For years, Schäuble has played a long game to realize his vision of the optimal architecture Europe can achieve within the political and cultural constraints that he takes as given.

Read more at https://www.project-syndicate.org/commentary/germany-versus-france-italy-by-yanis-varoufakis-2015-10#BYuW6MBRmDtgTE3W.99

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