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This article arises from increasing frustration and irritation about the way that the debate about Greece, and in general about austerity, is framed. My frustration is not only with the policy thugs who are implementing austerity, but also, to a degree, with their critics – which includes the failure of most of the critics of growth to actually get involved in this controversy and argue their own point of view. There have been attempts, for example by Nicola Hinton of the Post Growth Institute. It seems like a tough one to argue for degrowth in the context of the Greek crisis and as an alternative to austerity – but then all the more reason to try. Otherwise a movement for degrowth will never get out of the university lecture rooms into the real world. It will never become a guide or a narrative for the future of society to be realised in practical and popular politics.

Austerity – elite terrorism against ordinary people

So let’s start by reframing the debate about austerity. When Yanis Varoufakis describes what has happened to Greece as “Fiscal Waterboarding” he is part way in the direction that I mean. His description of austerity as a form of terrorism is also right.

The purpose of austerity is to create insecurity and instill fear in the general population in order to protect the finance and banking sector from popular rage against the crimes the participants of this sector have committed against ordinary people. This rage ought to have given rise a long time ago to legal actions and desperately needed fundamental reforms to take away from bankers the right to create money, a right which they have abused at tremendous cost to ordinary people.

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

When the next crisis comes, which movements will seize the opportunity?

August 16, 2015

When the next crisis comes, which movements will seize the opportunity?

You, too, could be caught in a situation where people are ready for an alternative, yet your group has none to offer.

It’s understandable. We who work for change seem years away from convincing a critical mass of people that it is both stupid and wrong to have a school-to-prison pipeline, or a rate of carbon emissions killing hundreds of thousands of people, or a “national security strategy” that mainly breeds insecurity.

Historic change does not always have the gradual-then-accelerating curve shown by the LGBTQ movement. At times, a system goes into crisis. In 2007-2008 financial sectors in many countries skidded toward the cliff; Iceland’s even went over the cliff. Crisis equals opportunity, for those who are ready to use it.

I asked a Washington, D.C., friend who works among progressive Democrats what he heard after the Wall Street disaster. Did people in his circle discuss organizing the strong, grassroots anger into a push for major reform? He knew of none. As it turned out, that anger was organized by the right and became the Tea Party. Polls show that even today many people identifying as Tea Party members express hostility to Wall Street.

All this missed opportunity should be seen in the context of Barack Obama’s presidency, since it was he who said, during his candidacy, that the Swedish solution to its own banking crisis had been correct: Seize the banks rather than bail them out. (In a recent New Yorker article on Greece, former finance minister Yanis Varoufakis said President Obama told him that the U.S. bailout was against his personal politics.)

Presidents do what they do, given the existing power realities they face. The lesson for us in the United States is: In 2009 we lacked a powerful movement that had a vision, and was willing to mobilize direct action on behalf of that vision.

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

Beware of American econ professors!

August 15, 2015

Beware of American econ professors!

How Krugman, Sachs and Stiglitz led the Greeks astray.

In countless public utterances and interviews since his resignation, former finance minister Yanis Varoufakis has spoken of how he urged the prime minister to authorize the issue of a parallel currency, to declare that Athens would default on €3.5 billion in Greek government bonds owed to the ECB on July 20 and to seize control of the Bank of Greece. Such an aggressive move would have led inevitably to the introduction of a new currency.

Recently, the newspaper I work for, Kathimerini, revealed excerpts of a conference call in which Varoufakis participated on July 16. In the call, the former minister tells an assortment of hedge-fund executives and other investors of plans he had to hack into the database of the general secretariat of public revenue at the ministry.

The idea was to use the personal data of Greek taxpayers to secretly create parallel accounts that would facilitate payments in case of a major liquidity squeeze. These accounts would be denominated in euros, but if the need presented itself, they could be turned into the new drachma “at the drop of a hat.”

Varoufakis is not the only one to have harbored revolutionary plans.

“They have served Greece’s cause very poorly indeed.”

On July 14, a few days before he was dismissed from the cabinet for voting against measures mandated by the agreement reached between Tsipras and Greece’s creditors, Panayotis Lafazanis, the head of the Left Platform, the influential far-left faction within Syriza, suggested seizing the national mint and expropriating up to €22 billion in reserves (his figure).

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

The Greek Coup: Liquidity as a Weapon of Coercion

July 31, 2015

The Greek Coup: Liquidity as a Weapon of Coercion

“My father made him an offer he couldn’t refuse. Luca Brasi held a gun to his head and my father assured him that either his brains, or his signature, would be on the contract.” — The Godfather (1972)

In the modern global banking system, all banks need a credit line with the central bank in order to be part of the payments system. Choking off that credit line was a form of blackmail the Greek government couldn’t refuse.

Former Greek finance minister Yanis Varoufakis is now being charged with treason for exploring the possibility of an alternative payment system in the event of a Greek exit from the euro. The irony of it all was underscored by Raúl Ilargi Meijer, who opined in a July 27^th blog:

The fact that these things were taken into consideration doesn’t mean Syriza was planning a coup . . . . If you want a coup, look instead at the Troika having wrestled control over Greek domestic finances. That’s a coup if you ever saw one.

Let’s have an independent commission look into how on earth it is possible that a cabal of unelected movers and shakers gets full control over the entire financial structure of a democratically elected eurozone member government. By all means, let’s see the legal arguments for this.

So how was that coup pulled off? The answer seems to be through extortion. The European Central Bank threatened to turn off the liquidity that all banks – even solvent ones – need to maintain their day-to-day accounting balances. That threat was made good in the run-up to the Greek referendum, when the ECB did turn off the liquidity tap and Greek banks had to close their doors. Businesses were left without supplies and pensioners without food. How was that apparently criminal act justified? Here is the rather tortured reasoning of ECB President Mario Draghi at a press conference on July 16:

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

Banker Occupied Greece: Requiem for a Failed State

July 17, 2015

Banker Occupied Greece: Requiem for a Failed State

It’s all over but the obituary. Rubber-stamp Greek parliamentarians overwhelming approved transforming the nation into a banker run colony – by a 229 – 64 vote. Six lawmakers abstained.

Coalition partner Independent Greeks leader Panos Kammenos and likeminded party members voted “yes” after rhetorically rejecting Troika terms.

The vast majority of bailout funding goes to pay bankers and other creditors – nothing for economic recovery and growth. The price is deeper punishing austerity, greater poverty and unemployment than already, and far more human misery ahead with no end in sight.

Only 32 of SYRIZA’s 149 parliamentarians voted “no” – including banished Finance Minister Yanis Varoufakis, Finance Ministry Secretary General Manos Manousakis, Energy Minister Panagiotis Lafanzanis, Deputy Labor Minister Dimitris Stratoulis and ousted Speaker Zoe Konstantopoulou.

She called the bailout proposal “social genocide.” Other austerity opponents denounced it as “a new Versailles Treaty.”

Sovereign Greece no longer exists. Troika bandits own its soul. Democracy’s denouement became official in its birthplace.

Meanwhile, police clashed violently with thousands of anti-austerity protesters outside parliament demanding promised relief – social justice, not sellout.

Prime Minister Tsipras rubbed salt on the wound he inflicted saying he “does not believe in (the) irrational” capitulation plan he demanded and voted for.

He lied claiming he had no choice. Terms were forced on him, he said. Responsible leadership would have rejected them outright, walked away and stood tall ahead of being welcomed home as a national hero – challenging Troika bandits courageously, saying “no” when it matters most.

Instead he showed he’s like all the rest – pledging one thing, doing another, betraying his constituents in the process, proving he and likeminded SYRIZA officials are pretense populists, more contemptible than right-wing austerity supporters.

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

The Troika And The Five Families

July 14, 2015

The Troika And The Five Families

Personally, like most of you, I always thought Germany, besides all its other talents, good or bad, was a nation of solid calculus and accounting. Gründlichkeit. And that they knew a thing or two about psychology. But I stand corrected.

The Germans just made their biggest mistake in a long time (how about some 75 years) over the weekend. Now, when all you have to bring to a conversation slash negotiation is bullying and strong arming and brute force, that should perhaps not be overly surprising. But it’s a behemoth failure all by itself regardless.

First though, I want to switch to what Yanis Varoufakis told the New Statesman in an interview published today, because it’s crucial to what happened this weekend. Varoufakis talks about how he was pushing for a plan to introduce an alternative currency in Greece rather than giving in to the Troika. But Tsipras refused. And Yanis understands why:

“Varoufakis could not guarantee that a Grexit would work …

…[he] knows Tsipras has an obligation to “not let this country become a failed state”.

What this means is that Tsipras was told by the Troika behind closed doors, to put it crudely: “we’re going to kill your people”. He was made an offer he couldn’t refuse. And Tsipras could never take that upon himself, even though the deals now proposed will perhaps be worse in the medium to long term, even though it may cost him his career.

Criticism of the man is easy, but it all comes from people never put in that position. Varoufakis understands, and sort of hints he might have had second thoughts too if he were ever put in that position.

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

Everything You Need to Know About the Greek Crisis and ECB Fascism in Two Paragraphs

July 14, 2015

Everything You Need to Know About the Greek Crisis and ECB Fascism in Two Paragraphs

Screen Shot 2015-07-13 at 4.15.12 PM

Yanis Varoufakis just sat down for his first interview since resigning as Finance Minister of Greece. He talked frankly with Harry Lambert of the New Statesman. Here are the two most important paragraphs from the transcript.

There is no democracy in Europe. None.

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 programme – 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.’”

Any questions?

Check out more of the interview here, I strongly suggest it. Also read about Spain becoming a police state in:

The Beatings Will Continue Until Morale Improves – Spain Officially Becomes a Police State

Troika Says Greek Proposal Not Enough To Meet Targets, Serves As “Basis For Negotiations”

July 11, 2015

Troika Says Greek Proposal Not Enough To Meet Targets, Serves As “Basis For Negotiations”

Early on Saturday morning, the Tsipras government passed the Greek bailout proposal which it told the Greek people to reject – which they did – less than a week earlier. The grotesque farce continued until the very end when 15 Syriza lawmakers who voted yes said they nonetheless are against the reform package and expressed their opposition to the government’s proposal in a joint statement issued immediately after the vote in parliament.

Seemingly unclear how this “democracy” thing works in the country that supposedly invented it only to spawn its biggest mutant yet, the “dissenters” added that they voted for the proposal in order not to give an excuse for the undermining of Alexis Tsipras government. What they really meant is what the angry people finally crack down on yet another government, they hope to have a get out of jail card. Literally.

Other were far more vocal in their condemnation of the capitulation: Energy Minister Panagiotis Lafazanis, Deputy Labour Minister Dimitris Stratoulis as well as the speaker of parliament, Zoe Constantopoulou, all called “Present”, in effect abstaining from the vote and withholding their support from the government. “The government is being totally blackmailed to acquiesce to something which does not reflect what it represents,” Constantopoulou said.

At the end of the vote, the Tsipras government narrowly escaped the loss of a parliamentary majority, as 17 Syriza lawmakers, which holds 149 seats in parliament, abstained, were absent or voted no. Among legislators who were absent were former Finance Minister Yanis Varoufakis (who went on holiday earlier to his wife’s island vacation house), Speaker of Parliament Zoe Konstantopoulou (who penned the famous Greek “Odius Debt” declaration) and two cabinet ministers.

The ruling coalition’s parliamentary majority was saved by the deputies of the right-wing Independent Greeks, who hold 13 seats in parliament. Additionally the three opposition parties handed Tsipras the mandate to negotiate and bring back a debt deal.

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

Greek Businesses Accept Lira, Lev As Grexit Looms

July 10, 2015

Greek Businesses Accept Lira, Lev As Grexit Looms

With the Greek drama headed into its final act and Alexis Tsipras stuck between an obstinate Germany and a recalcitrant Left Platform, many wonder if the introduction of an alternative currency in Greece is now a foregone conclusion.

Even if Athens and Brussels manage to strike a deal over the weekend, the country still faces an acute cash shortage and a severe credit crunch that threatens to create a scarcity of critical imported goods.

Amid the chaos, the Greek Drachma has made two mysterious appearances this week (see here and here), suggesting that the EU is on the verge of forcing the Greek economy into the adoption of a parallel currency andwhile this week’s Drachma “sightings” might properly be called anecdotal, a report from Kathimerini and comments from deposed FinMin Yanis Varoufakis suggest redenomination rumors are not entirely unfounded.

Now, with the ECB set to cut Greek banks off from the ELA lifeline on Monday morning in the absence of a deal, some businesses are mitigating the liquidity shortage by accepting foreign currency. FT has more:

Like many Bulgarians, Kostadin Dobrev, is a regular visitor to the beaches and bars of northern Greece. But this week, the holidaying firefighter immediately noticed things were different. First, the shops were half-empty. Then, even more surprising, he found Greek hotels and restaurants were happy to accept the Bulgarian lev.

As Europe’s politicians prepare for a weekend summit to decide whether Greece can stay in the eurozone, Mr Dobrev’s experience highlights how the old certainties are collapsing. By early next week Greeks could be preparing for life outside the euro and a possible return to the drachma.

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

Varoufakis’ Stunning Accusation: Schauble Wants A Grexit “To Put The Fear Of God” Into The French

July 10, 2015

Varoufakis’ Stunning Accusation: Schauble Wants A Grexit “To Put The Fear Of God” Into The French

Earlier we reported that Yanis Varoufakis, seemingly detained by “family reasons” would be unable to join his fellow parliamentarians and personally vote in what is likely the most important vote of Syriza’s administration: the one in which he and his party capitulate to the Troika and vote “Yes” to the proposal he and Tsipras urged everyone to reject just one week ago.

Subsequently, it was made clear what these family reasons are:

The self-described “erratic Marxist” will be on the nearby holiday island of … Aegina. In fact, he Tweeted that he reason for his absence is “family reasons”. Nevertheless, two hours before his Tweet was posted, the once obscure academic was spotted on the ferry boat “Phivos”, headed for Aegina, where his wife owns a stylish vacation home.

The author of the “global Minotaur” nevertheless sent a letter to the Parliament president saying he would vote “yes” for the proposal, although the letter will not be counted, given that Parliament regulations stipulate that only deputies on official Parliament business are allowed to cast votes via correspondence.

Judgment aside about his decision to take a holiday from a vote that his strategy guided Greece into, it was clear that he has Wifi on the ferry because this afternoon, While V-Fak may well have been in transit, the Guardian released an Op-Ed penned by Varoufakis titled “Germany won’t spare Greek pain – it has an interest in breaking us.” Readers can read it in its entirety here but here is the punchline:

The Greek People Should Vote No

July 2, 2015

The Greek People Should Vote No

Protesters clash with policemen during riots at a May Day rally in Athens, cc Flickr Joanna

Greece has defaulted on its 1.3 billion euro payment to the International Monetary Fund and the euro zone is still intact, but nobody has any clear idea about what will happen after next Sunday’s referendum.

Prime Minister Tsipras and Finance Minister Yanis Varoufakis, a game theory expert, have been playing a game of chicken with the troika ever since their Syriza party won the elections last January. All the Greek government wants is to be able to choose the shape of Greek public policy. All the troika – and some of its European partners, namely Germany – demands is for Greece to honor its commitments if it wants more ‘help.’ Unfortunately, the two demands are irreconcilable because they have only one aspect in common: austerity. Greek, indeed European, fiscal policy has been very austere over the past several years. The euro’s rise was pegged to the Deutschmark while the overarching preoccupation of the ECB has been to control inflation, forcing a collapse of the generally Keynesian policies that characterized the economies of many of the euro zone partners. Since the euro came into use in 2002, European governments have faced pressure to cut costs. Since 2010, despite the alleged Greek profligacy, Athens has cut spending more drastically than any other government in Europe. There have been double digit reductions in pension payments, jobs, salaries and investment. Unemployment has reached an optimistic 25%, youth unemployment is beyond 65%.

The troika’s aid has been pegged to Greece showing some signs of growth. Of course the spending cuts, with corresponding tax increases, have only dug austerity deeper. No growth is possible under such circumstances; Europe as a whole must change its tune and resume a more Keynesian outlook if Greece and the euro zone are to survive in the long run. Many will cite Greece’s moral obligations to repay its loans and honor its obligations.

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

Varoufakis Confirms Greece Will Default To IMF Today

June 30, 2015

Varoufakis Confirms Greece Will Default To IMF Today

May as well spoil the ending of what happens at midnight local time today. Nothing (as previously reported). From Reuters:

GREEK FINANCE MINISTER SAYS GREECE WILL NOT PAY IMF ON TUESDAY.

Visually:

And:

U.S. STOCK INDEX FUTURES PARE GAINS SLIGHTLY FOLLWING GREEK FINANCE MINISTER’S COMMENT THAT GREECE WILL NOT PAY IMF ON TUESDAY

The default may be in the books, but the bluff continues: can Greece default in the Eurozone as Varoufakis has claimed all along, or will the collapse of the Greek banking system tomorrow after the ECB makes the ELA illegal topple the government? Find out in a few short days.

The People Must Be Overthrown

June 26, 2015

The People Must Be Overthrown

Perhaps I should apologize for writing about Greece all the time. Thing is, not only have I just arrived in Athens last night (and been duly showered in ouzo), but Greece is the proverbial early harbinger of everything that’s wrong with the world (not to worry, I know that’s a hyperbole), and of everything that could be done about it.

That places a responsibility on the shoulders of Syriza leader Alexis Tsipras and his team that maybe they don’t want, and for all I know don’t deserve either. But they’re all we have, and besides, they’re all their own people have. In that sense, this is not about everything that’s wrong with the world, other than that’s the same as everything that’s wrong with Greece.

I was struck last night, talking to people here in Athens, by how much their appreciation of Tsipras, his overall composure and the way he handles the Troika talks, has increased over the past five months. They were doubtful about him before the Syriza election win; they no longer are.

Still, the negotiations are nice and all, but they’re not going anywhere, and they never will. The Troika side of the table is interested in one thing only: to humiliate Athens and force it into ultimate submission, along the lines of those photographs we’ve come to know of Abu Graibh.

Yanis Varoufakis labeled the Troika policies vis-a-vis Greece ‘fiscal waterboarding’ when he started out as finance minister, and here’s thinking he should have stuck with that image in a much more persistent and a much louder fashion.

Yes, we know, Syriza doesn’t have the mandate to take the country out of the eurozone. A daily dose of fear tactics in the domestic and international media still have Greeks, even Syriza voters, scared stiff about going it alone.

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

What’s Next in the Greek Farce and Why

June 17, 2015

What’s Next in the Greek Farce and Why

The Man They Hate with a Passion

Euro area politicians and IMF bureaucrats really hate Yanis Varoufakis’ guts with a passion. The media are full with denunciations of the man as “unprofessional”, negotiators of the euro-group let it be known (anonymously, natch) that “it got to the point where eyes roll”, that they were “sick and tired of being lectured about austerity and the effects of the crisis”, in short, it was “impossible to do business with him”.

Why do they hate him so much? Allegedly ,“any sympathy for Greece was eroded by his failure to draft concrete proposals.” Typical Mediterranean lazy bum is the message, in other words. Big on vacuous emoting, but doesn’t want to waste time on doing his homework (plus, he wears no tie…you have to be clad in the technocratic uniform if you want to be taken seriously).

varoubike The eurocrats really hate this one. They’re probably all trying to channel Tony G when they meet Varoufakis.

Photo credit: Alkis Konstantinidis / Reuters

Forgive us if our BS meter starts twitching when they are quoting unnamed officials with such pronouncements all over the mainstream press and are hammering the message home with unwavering regularity on Europe’s state-controlled TV stations. The reality is probably this: they hate him because he isn’t one of them.

Varoufakis is no politician, and apparently has no intentions of becoming one. His economic views may be a bit blue-eyed given his alliance with a bunch of lefties, but where and when has he said anything about the Greek situation that was not substantially correct?

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

Austerity, Economics and Religion

May 28, 2015

Austerity, Economics and Religion

There are many things going on in the Greece vs Institutions+Germany negotiations, and many more on the fringe of the talks, with opinions being vented left and right, not least of all in the media, often driven more by a particular agenda than by facts or know-how.

What most fail to acknowledge is to what extent the position of the creditor institutions is powered by economic religion, and that is a shame, because it makes it very difficult for the average reader and viewer to understand what happens, and why.

Greek FinMin Yanis Varoufakis has often complained that he can’t get the finance ministers and others to discuss economics. As our mutual friend Steve Keen put it:

Steve Keen said the finance minister was frustrated with the progress of Greece’s talks with the euro zone, adding Varoufakis had compared the talks to dealing with “divorce lawyers”. Keen said the finance ministers of Europe refused to discuss certain euro policies, according to Varoufakis. [..] When asked what [Varoufakis and he] mainly discuss at the moment, Keen said, “Mainly his frustration, the fact that the one thing that he can’t discuss with the finance ministers of Europe is economics..”

“He goes inside, he is expected to be discussing what the economic impact of the policies of the euro are and how to get a better set of policies, living within the confines of the euro and the entire European Union system, and he said they simply won’t discuss it. He said it is like walking into a bunch of divorce lawyers, it is not anything like what you think finance ministers should be talking about..”

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

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