Open letter to a good friend and colleague (who happened to become Greece’s Finance Minister yesterday…)

Dear Yanni,

On the one hand I am writing to congratulate you. And on the other to express my disdain towards those who handed my friend the good ship’s wheel after the vessel has struck the iceberg.

Utterly familiar with your effervescent optimism, I know you mean it when you declare confidence in Greece’s capacity to overcome its current woes. It is the same enthusiasm that made you, back in 1994, to believe, contrary to almost every other analyst within or without Greece, that Greece could be admitted to the Eurozone. That faith of yours you turned, almost single-handedly, into a reality (from your position of chief negotiator with the EU and head of the Council of Economic Advisors).

However, Yanni, this time things are different. Back then, in the mid-nineties, Europe was creating something new and audaciously exciting. The issue then was whether small and fragile Greece could be admitted into this new European construct via a loose interpretation of the rulebook and with the assistance of some creative macro-accounting. Today, we have a wholly different kettle of fish. Today, Europe is disintegrating. That same construct is falling apart unstoppably, and the repercussions of its demise will prove a toxic solvent for the whole European project. Under these circumstances, “a loose interpretation of the rulebook with the assistance of some creative macro-accounting” will simply not do. And it won’t do not just for Greece but for Europe’s hard core either.

In accepting the position of Finance Minister, you accepted two gigantic challenges. The first one concerns, naturally, your forthcoming talks in Brussels on Bailout Mk3. The second challenge is the task of internal reforms, a set of policies on which you have been particularly vocal over the past few years (from your position of head of IOBE think tank).

Regarding the second task, everyone is watching you from the sidelines, eager to see how you will implement the reforms that you have been arguing in favour of for such a long time. All eyes will be on the manner of the implementation as well as on their impact (with your predictions of large positive effects on Greek GDP at stake). You know that you and I disagreed on the likely effect and relative significance of the particular reforms that you have proposed. However, this disagreement is neither here nor there. What concerns me the most is that you may never get a chance to implement your reforms in view of the accelerating derailment of the euro-locomotive and its immediate ill effects on Greece’s capacity to become governable again before your ministerial career is over. To put it bluntly, success in your first gargantuan challenge is a prerequisite for even getting an opportunity to come face to face with your second challenge.

So, let’s concentrate on the first challenge: negotiations with Europe. Yanni, time has run out for prolonging the bankruptcy and extending it into the future by means of longer repayment periods and even greater loans. Bailouts Mk1&2, in the final analysis, were nothing more than exercises in ‘gaining time’ until some solution was found at the European level. You and I disagreed on the wisdom of this strategy. Alas, our disagreement is now ‘academic’. This is so because a third bailout, a Bailout Mk3, will not gain us significantly more time as the sand in the Eurozone’s hourglass is running out. You will not be given more than one or two opportunities to address Econfin. It will be a major waste to use them up in order to seek looser terms, more loans, repayment extensions. If these are the ‘gifts’ that you return to Athens with during the summer, history will bestow upon you the cruelest and most unfair punishment ever exacted: the person who did so much, and with such great passion, to get Greece accepted into the Eurozone will be condemned to sit at his Syntagma Square office and watch helplessly as Greece is leaving a disintegrating euro.

Can you stop the rot all by yourself? I know not. But I shall make a point of conjuring up optimism like that which typifies you to table some thoughts on that which needs to be done: You must bind the Europeans to one or two moves that will deter any thoughts of Greece being chucked out of the Eurozone within the next few months. Moves that will, at the same time, help shift the Econfin agenda in ways that may help avert the impending euro-deconstruction. Which moves?

Move 1: Seek no new loans, even though you know perfectly well that the coffers are empty and the timeline of Greece’s repayments is well and truly off track. Instead of loans, propose that the money that went into Greek banks (the so-called recapitalisation program) does not count as part of Greek national debt and, in exchange, the EFSF retains common shares of these banks (in proportion to the money it placed into them) while the ECB takes it to itself to supervise the said banks (even wind them down, in an orderly fashion if need be). Once the crisis is over, the EFSF can sell these shares at multiples of the purchasing price, thus ensuring that the European taxpayers get their money back.

The advantage of this move is three-fold: It ‘liberates’ 30 billion euros from Bailout Mk2 for other (productive) uses; it creates a de facto alliance between Athens, Rome and Madrid; it turns european institutions into partners of the Greek banking system, thus giving our partners good cause to cease and desist from all talk of expelling Greece from the Eurozone.

Move 2: Based on a multitude of similar examples (e.g. Britain’s loan repayments to the USA after the WW2), demand a moratorium on repayments to the ECB, the IMF and the EU for one year and until the recession ends. From then on, repayments ought to be linked to Greek GDP growth. The advantage of this is that it gives the troika a genuine motive to see the end of Greece’s vicious recession and, to boot, offer Hollande’s team an opening for arguing in favour of a more dynamic involvement of the European Investment Bank (and the European Investment Fund) in pursuing growth strategies for the whole of Europe.

In short, your main challenge is to bind our European partners to Greece’s recovery, to ending all speculation about a Grexit, and to moves that resonate with genuine attempts to save the euro. “It won’t be easy” is the understatement of the century. I very much doubt that it is feasible. What I do know is that, otherwise, if Greece simply secures an extension or more money or looser bailout conditions, the country will almost certainly be expelled from the euro and the euro will cease to exist shortly afterwards. Already, many old acquaintances of your (of which Hans-Werner Sinn is the most visible) are working towards those dystopian ends.

Yanni, 15 years ago you managed to bind the European politicians to admitting Greece into the Eurozone. When you meet them again, in your new capacity, half of them will not recall who you are and the other half will despise you for your achievement (convinced as they are, courtesy of their fallacious analysis, that Greece is responsible for the Eurozone’s problems). During the following weeks you must bind them again. Only this time, you will not be able to do so through smooth-talking, cajoling, creative macro-accounting or your youthful intelligence. This time you must bind them to things that are constitutionally against their gestalt. What they are prepared to give you is more rope to hang yourself (extensions, looser repayment schedules etc.). You must turn it down and demand, instead, a ladder on which they must also climb.

Ending this letter on a more personal note, you know my feelings towards you. Setting our large disagreements over the past two years aside, I am incensed that the corrupt political class only turned to you now that the ship is almost beyond refloating. You are the Minister of Finance of a government made up of the same ancien regime that brought us to the edge of the abyss. You will find precious little genuine support from them. I know that you know that they are too ready to watch you fail so as to unload on your shoulders the impending catastrophe (you see, they are so aggressively stupid that they still believe there will be a ‘later’ for them to dominate). I truly hope you teach them a good lesson and that you succeed. The only help I can offer you at this moment is to re-confirm my feelings for you but also to issue a loud warning that the Eurozone is collapsing all around you and your efforts to save Greece. 

90 thoughts on “Open letter to a good friend and colleague (who happened to become Greece’s Finance Minister yesterday…)

  1. Pingback: Gesprächskreis am 16. Januar 2014 | DenkNachMainz

  2. Pingback: Το Μώλυ » Βαρουφάκης: Να παραιτηθεί, άμεσα, ο φιλογερμανός και ρίψασπις Στουρνάρας

  3. Pingback: Yanis Varoufakis: Greek Finance Minister Reveals Advanced Case of Stockholm Syndrome | naked capitalism

  4. Pingback: Greek Finance Minister Yannis Stournaras Should Resign

  5. Island on, jade-green one, work properly a rhyme hole mansion among them, even no longer minority of.Lead to low volume requirements, the look allows you to protect your hearing damage loud music and also the reasons.
    thomas sabo auThe distance Yu intergalactic and nearer last home in sky buries of ground, the whole noodles shows the elephant of putting out the sky at the same time, let the innumerable fix in fear.”Is really recklessly and blindly do, the empires didn’t take care of this matter,you still have no idea condition?Seem a year often reside big duke of, have already made you lose feeling of impending crisis, today you this decision, have already meant that your life also follows to walk to thomas sabo charms australia end.
    Evil ng dollar of d à in the sky already not at, evil Feng in the sky 72 temples thomas sabo charms cheap but all shine dirty glory.The brand currently comes with 6 headphones products and 6 different earphone products all below the same brand, Monster Surpasses.
    Any decent opponent will play the bluff at this and the beat player will lose more money.The dream is usually a aspiration Monster Headphones, Monster Beats By Dre and ambitions the blossom is also blossoms, dream, the day before you permit hybridization along with sincerity, Monster Beats By Dre been waiting for you to minimize! The flower falls, heartbroken, tears coagulation jampacked, do not want to come to life, continually in Monster thomas sabo pearl bracelet Beats by Dre dreams waiting for the bloom.

  6. Pingback: Offener Brief an Finanzminister Stournaras in Griechenland | Griechenland News

  7. Pingback: Offener Brief an Finanzminister Stournaras in Griechenland

  8. Pingback: Court order for “under the table” USA-Greek deals « Insomniacs Alarm clock

    • I agree, so use your connection with the Minister and try to make him see the wisdom of Iceland and put the Rothchild puppets in Jail! They expect us to believe Greece can bring down the EURO thats a laugh with over 500trillion under their disposal all they can do is make it look like Greece made it fall, if they choose, prosecute the bankers! or our 300 Spartans died in vain!

  9. To all the Merkel fans:

    The new min. of finance is the person that played a major role on behalf of Greece during the negotiations for our permition to join the eurozone.Its hightime that you get your shit together.

    You cant encourage Merkel’s decisions while at the same time playing the accusation card ,about cooked numbers etc.If Greece cooked the numbers without the EU being aware of it as you like to claim,then this guy has some responsibility on the fact.Not that this is the 1st contradiction during the last 2 years.Papademos played a role for Greece’s entrance too but y’all kept ignoring the fact.
    So Merkel preferred someone like him once again.
    You should either start putting Merkel on the same side with Greek politicians or shut the fuck up and quit accusing Greece (and i mean GREEKS) for this mess because you will not make any sense any more.

  10. Save the Euro? Who for?

    This piece was written as part of a debate currently being run by Open Democracy called ”Writing on the wall for the Eurozone”. You can read the other pieces written for the debate at the Open Democracy site.

    http://www.opendemocracy.net/freeform-tags/writing-on-wall-for-eurozone

    The strongest force holding the Euro together is the political force of creditors. Were the currency to collapse, much of the debt would collapse with it.

    So the question is, who are we saving the Euro for?

    Once again, George Soros exhorts European leaders to save the Euro. But what does this curious phrase ‘Save the Euro’ actually mean?

    The Euro is not like the Giant Panda: a cuddly creature that ornaments our world. The Euro is not one thing. It is different things to different groups:

    1) It’s a currency used in day to day transactions by people who live in a group of semi-sovereign nations.

    2) It is part of the underpinning of the European political experiment we call the EU.

    3) It is a settlement currency which rivals the Dollar. As such it is part of Europe’s challenge to American hegemony both financial and political.

    4) It is the currency in which a huge amount of wealth is denominated.

    5) And last but by absolutely no means least it is one of the global currencies in which a truly titanic amount of private and sovereign debt is denominated.

    So when George Soros and various politicians and bankers insist on exhorting us to ‘Save the Euro’ might it not be helpful if they could at least be clear what exactly they have in mind to be saved, who will benefit if it is, who will lose if it isn’t and who will pay either way?

    One question we could ask about the Euro is what exactly will be lost if the Euro were not ‘saved’? Funnily enough, given all the Chicken Little hyperventilating and shrieking of our political class about the end of civilization should the Euro collapse, nations do not depend on the euro. Certainly they would be disrupted and there would be widespread suffering if their currency collapsed. One look at Germany between the wars makes that clear. But it also makes rather clear that nations and their people continue on.

    It’s an interesting thing about currencies, that because we use them to buy things day to day and get paid in them, we equate currencies with wealth.

    But when talking about a nation of people, a political and cultural entity, it turns out that the wealth of nations will not be lost if the euro dies.

    But their debts could well be. And this, I think, is a clue to the panic that emerges – in certain quarters – when default or collapse of the euro is mentioned. It is also one fairly simple thing amidst all the confusion and intimations of doom.

    Currencies do not create wealth they merely denote it and allow its exchange. On the other hand, debt actually depends on the currency in which the debt contract is written.

    Wealth comes from productive activities. Debt comes from honouring an agreement to pay someone an agreed amount. Wealth creation carries on after a currency collapses and soon enough a new currency takes over the job of conveying arbitrary units of the wealth created. Again please see Germany or any other nation – and there are many – who have defaulted or whose currency has collapsed. Debt, however, either does not survive the death of the currency in which it was agreed or does so as a fragment of its former worth.

    It is a troubling aspect of our present financial and political situation that there has been a tendency, I would say a deliberate desire, to confuse wealth with debt; to present them as flip sides of each other when they are, in fact, entirely different. Why should this be?

    Well it might be because much of Mr Soros’ wealth, the wealth of the institutions he owns shares in, the wealth of banks and other financial institutions and the wealth of those who own and run them, is tied up in debt agreements of one kind or another. Your wealth and mine is probably in sovereign issued ‘money’. Most of us don’t have investments. Many don’t have savings to speak of. The wealth of the top 10%, on the other hand, is tied up in debt of one kind or another.

    Since the advent of securitization, that process whereby debts can circulate as a form of currency, which can be used as collateral for issuing loans and can be counted as capital, debt has become a larger repository of wealth than sovereign currencies.

    Why do you think no one talks about the money supply the way they did in the 80’s? Governments do not control the money supply. The issuers of private debt control it.

    This may seem an odd claim, but the amount of debt issued by private banks denominated in euros, dollars, yen and Yuan, is far greater than the amount of those currencies issued by the sovereign nations.

    Derivative agreements denominated in sovereign currencies run to hundreds of trillions.

    Were the debt backed currency, in which those private debt agreements are denominated, to collapse, then those agreements would be worth very little, if anything. They would be like finding a parchment of a debt owed in golden pazoozas from a long lost kingdom. Good luck cashing it.

    I suggest that it is not a concern for the people of Greece, Spain or indeed any of the people’s of Europe that fuels concerns among the banks and the super wealthy about the Euro and its future.

    If the Euro were to evaporate what would happen to all of their wealth that is tied to debt agreements denominated in Euros?

    Now of course people will argue that were the euro to collapse then Greece or Spain would be thrown into the street, so to speak, with nothing in their pockets and no one would lend them a dime for their daily bread. On a larger scale it is argued that civilization would become paralyzed were the Euro to go bust.

    Let’s get a few things straight. First, Europe is one of the three largest economic entities in the world. If we think JP Morgan is too big to fail, what do you think that makes Europe?

    If any nation were to be ejected from the Euro it would survive. The fate of the Euro and the wider European Political experiment would be more drawn out. The country involved would issue its own currency and yes it would find it difficult to borrow. But then again as a sovereign nation with its own currency it would, once again, be able to do what neither Greece nor Spain nor Ireland can currently do: print.

    Would its newly minted currency become instantly worthless? No, of course not.
    Would it be worth less than the Euro? Yes.

    The nation with its new currency would find it was less able to borrow and that imports would be expensive. On the other hand exports would be cheaper by far. And the currency it would print would allow its citizens to continue to carry tokens of their productive labour around with them and exchange them with other citizens. Greece should take a look at Iceland.

    I think the fall out would be more profound for the remaining Euro zone than it would be for the ejected country.

    For a start if one country goes it is quite likely others would follow. If any of them had any sense they would make common cause and find themselves part of another grouping who would not be as powerless as our present leaders would have us and them believe.

    Although that is a large statement to make I feel it justified because the nation involved would still be able to produce wealth. What is more it would do so without the crushing burden of its debts. Many of those would have gone much like a fart does in a healthy breeze.

    It is worth remembering that there is international precedent for debt commissions to look at a nation’s debts and dismiss those found to be odious. The idea of a debt commission was in fact discussed by the US government as a way of helping in the ‘liberation’ of Iraq. The discussions only stalled, it is said, when it was pointed out that many of the odious debts were held by US banks.

    But what about the remaining Euro countries and the European Union project? Could it survive the exit of one or more of its members?

    According to John Mauldin in his article, “The Bang! Moment is now”,

    “…Europe is down to two choices. Either allow the eurozone to break up or go for a full fiscal union with central budget controls.”

    I agree those are two possible choices, but I think he is wrong to declare they are the only two.

    This crisis is not about which countries leave the Euro or which countries default on their debt, it is about which countries remain in the Euro but continue to bail out the bad private debts of their banks.

    If our leaders insist on saving the private debts in the private banks within the Euro system then it will break apart.

    It is too easy to become transfixed by Greece and its public debts. Spain is far larger and its problems are private debts not public ones. The same is true for Belgium, Ireland and Cyprus. Sure the private debts have been made public but such debts can and should be repudiated and thereby thrown back on to the private parties who were stupid and feckless enough to make the bad loan agreements in the first place.

    On the charade of national agency, Tony Crurzon Price, argues that,

    “…The game is up not because Europe has won, but because the powerlessness of the nation is being revealed. Watch Rajoy, Hollande, Merkel, Holande, Tsipras and more trip form crisis to crisis as they try to wear the myth of power to the very end.”

    I agree this crisis has shown the powerlessness of the nation. But for me it is powerlessness not in the face of Europe but in the face of international finance. And the powerlessness is not so much financial as political.

    There is simply no political will to force the losses to be taken by those who made them.

    But this, we are told, we cannot do. On the contrary, We Can.

    We put men on the moon and brought them home again. It is not beyond us to close insolvent banks and open new ones. We need a banking system. But it does not have to be made up of the banks, the insolvent banks, that we currently are crippling ourselves trying to ‘save’.

    Would this destroy the Euro? It might. It would certainly destroy much debt backed wealth that is currently held by the wealthiest 1% and is on the balance sheets of Europe’s largest banks. And of course if any nation did leave the Euro then those banks holding their sovereign euro debts might have a hard time collecting those too.

    The Bundesbank could find itself holding agreements under Europe’s Target2 agreement, whereby central banks hold IOU’s from other central banks and nations, amounting to over €600 billion in a currency that no longer existed. That alone is reason to expect that the Euro will survive in some form.

    Of course this is just one aspect of a complicated situation. I understand that. But I think in a world where it suits some to have as much confusion as possible and for economic matters, especially concerning their wealth and our debts, to be presented as being too complicated for us ‘little people’ to follow, let alone have an opinion about, it is important to sometimes hold on to certain simple facts. Like a torch on a dark night, even though they leave most things still shrouded in darkness, they do at least illuminate a way forward.

    Our present crisis is one of democracy even more than it is of finance. It is about a lack of honesty as much as it is a lack of growth. Debt and dishonesty are together strangling European democracy.

    We should rid ourselves of both.

    http://www.golemxiv.co.uk/2012/06/save-the-euro-who-for/

  11. “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.” Winston Churchill

    Professor Varoufakis the above quote illustrates the substantial personal difference between you and Yannis Stournaras on the issue whether Greece has better than a chance under this new government to pull itself, by creative technocratic and Gulliverian efforts, out of the crisis. It saddens me to see you with your Kazantzakian character to distort the truth about the Samaras government that somehow is a continuation of the “ancien regime” when in truth the majority of its members, both from the political and technocratic stables are new and were chosen on meritocratic grounds for their intellectual and technocratic ‘sprints’ and were never associated even in the loosest terms with the major economic policies of either Pasok or New Democracy that brought Greece to the “edge of the abyss.” To say further that Stournaras should not expect any support from this purportedly coterie of the ancien regime and he was chosen only for the purpose of carrying the major burden of a more than probable failure and to be blamed for it, is a most malicious statement that could ever come out from the illustrious portals of Academe.

    It seems to me that your absolute pessimistic views about events in Europe and Greece cancel you from the vocation of a reformist actively and optimistically engaged in the transformation of a bad situation. It is optimists that win wars and not pessimists! Also it appears to me, that your ‘undying’ wish for the disintegration of the Eurozone is directly related to your Modest Proposal so in the event of Europe’s collapse you can say that it happened because the European elites refused to adopt your all perfect remedy. Thus your disparagement of all politicians and technocrats both inside Greece and in Europe such as Papademos, Samaras, Mario Monti, Mario Draghi, and Jean-Claude Trichet, to mention few. In your planetary IMMODESTY to consider yourself the Sun and all the others as satellites that must reflect the wisdom of your Modest Proposal, is haughtiness to the highest degree. And it is not uncommon, that arrogance emanating from an “aggressively” Narcissistic nature defeats even the strongest of characters. Alas, do you think that at the end you will avoid the fate of Narcissus?

    • Hahaha, This penned by someone living in Australia with a presumably substantial Australian pension!

      Of course, Churchill was an important part of WW2. He was also the worst financial manager of the UK in the twentieth century, and would have gone down in history as a political failure had it not been for Adolf Hitler’s plans for Europe.

      So, you see, people have different abilities. Recognition of that fact is a starting point for making sense of the world around us. If you ask me about the abilities of the current government, then all I have to say is that they are mostly failed old men with nothing to offer.

      Of course, we know from your incessant and childish propagandising on this blog that you support the buffoon Samaras and ND. That is all anyone needs to know, in interpreting your continued attacks on Varoufakis. BTW, his interpretation of the reality for Greece now is very close to mine — that there is no room for manouevre, the only hope was for someone younger and more vital, like Tsipras, to scare the Germans and others into action. Now, we are left with useless old people (such as yourself) who understand nothing.

    • Hmmmmmmm, intresting. Not once did you address Prof. Varoufakis actual proposals… You know, argue how they may be unworkable? Not once did you engage his argument. Nice. Instead you engaged in cheap psychologizing. Very intelligent and mature…

    • kotzabasis, You seem much more like a narcissist than anyone on this blog. Have you considered that you never offer data, only “haughtiness” and arrogance in unsubstantiated opinnions. Here’s what Eurointelligence blog replies to your admiratioon of ND:

      Samaras appoints personal friend as chief of largest lender bank

      The chairman and chief executive of National Bank of Greece, the country’s largest commercial lender, were both sacked on Wednesday and Alexandros Tourkolias, NBG deputy chief executive and a personal friend of premier Antonis Samaras, was due to take over both posts, the FT reports. The two top jobs at NBG are traditionally nominated by the incoming prime minister, though the bank operates free of state control for a decade now. (Crony capitalism is back in Greece – and this from the party responsible for the Greek fiscal crisis in the first place. It is a very ominous sign.)

      you:

    • David:

      You claim that the NBG top person replacement is a manufactured affair. Based on what evidence?

      Rapanos who was the first FM selected went through an episode and said that he had to resign due to health reasons.

      So, based on such evidence you say Rapanos had to stay as the top bank person?

      If the guy has health problems (as he says) and those health problems render him incapable for the job, do you think that the same health problems are o.k. for him to continue as the head of a leading bank?

      How come? Where is the logic here?

      Even if the reason is his resignation is contrived don’t you think that he set himself up for his second resignation also?

      How is it humanly possible to be sick for one job, but perfectly healthy to carry on another?

      Either you are sick or you are healthy. If you are sick then you are no candidate for any job.

      Don’t you think?

    • Dean, You are defending the indefensible. Rapanos did not pretend to be ill. He is very ill. Trust me. He is my colleague and I have been terribly worried about his health for quite a few years. Well before he landed the Ethniki Bank job.

      As for your argument that if he is too sick for the MinFin job, he must be too sick for the Ethniki job, this is simply not so. His Ethniki Bank job was not particularly demanding. He was not the CEO. He was merely the Chair of the Board (with Tamvakakis as CEO). Rapanos’error was to let his ambition to be FinMin cloud his own estimation of his physical stamina. His fainting was genuine. And it is true that his doctors advised him to resign the MinFin position. But he could go on as Chair of the Board at Ethniki without a problem – at least in the medium term. The fact that he was decapitated by the same man who offered him the MinFin position (PM Samaras) has nothing to do with his illness and everything with the pressures exerted on PM Samaras, from the conservative party’s officials, to give jobs to their ‘boys’. Plain and simple. And Samaras was happy to oblige. (After all, he is the guy who, while Minister of Culture, ensured that almost every new member of staff at the New Acropolis Museum came from Kalamata – his constituency. Your faith in him was utterly misplaced. On this you may trust me.)

    • Yiani:

      What I don’t understand is this. If what you say is true about Samaras why would he go through all this trouble to just replace Rapanos with Zanias as the head of NBG?

      Isn’t Zanias a PASOK guy? Wasn’t Zanias the right hand man for Venizelos and the only person that has been part of the negotiating team with Brussels from day one?

      http://en.wikipedia.org/wiki/George_Zanias

      So, I really don’t get it. Why would Samaras (if his aim as you say is to appoint one of his guys as the head of NBG) put a Venizelos person as the head of NBG instead?

    • Zanias is most certainly not a Venizelos person. In the clash between Papandreou and Venizelos, Zanias was firmly against the latter. The answer to your question is that the Chair of the Board is only there to sign on the dotted line (without knowing what he is signing) and provide legitimacy for that which the real ruler of the roost (the CEO) is doing. So, Samaras let a non-ND, low-ability person (that Venizelos is not close to) play the role of legitimiser while giving the CEO position to one of his cronies.

  12. I have been reading the opinions expressed in your articles during the last two years with great interest. I don’t know if I understood wrong, but I had the impression that you considered the expulsion of Greece by the Eurozone impossible and technically unfeasible at the same time, arguing it would be much more plausible that Germany would choose to leave the Eurozone first. So now, under the current circumstances, you think that the Eurozone members will chuck out Greece withing the next few months. We should assume that this option isn’t unprofitable for the rest of the Euro countries anymore?

  13. Pingback: Le nouveau ministre des finances grec devra lier la stratégie de ses partenaires…

  14. Mr Gkinis above speaks of the kickbacks and the commissions that the ministers receive for each deal they close on behalf of the government. With this in mind, every single minster should be taken to court for high treason, even if it is law to allow for these commissions. Reform must start with the political system. Then move to regulation of the banking and the financial sector. Then and only then will we begin to see worthy politicians in power. If there is little to be gained financially, the politicians that will strive to be elected will have different motives; personal glory and patriotic duty. Not so bad in my view…

  15. Pingback: Links 6/28/12 « naked capitalism

  16. Pingback: GreeceWatch: Getting worse, artful dodgers, more | eats shoots 'n leaves

  17. I feel sorry for the Europeans for having to deal with the beast of Berlin. The situation is really beyond description, but in some sense you deserve what you got.

    And before some of the notables here begin to attack me as a Eurobond proponent, let me state for the record that I couldn’t care less about eurobonds or any other euro-nonsense.

    It so happens that Greece at current 2% financing rate has already received its equivalent treatment of an imputed eurobond issue.

    So, here is what I want you to do.

    Use the next three years in attacking each other within the “european family”. Good luck with your squabbles, your petty fights and your compound morony. We don’t want to hear anything about your troubles, problems or concerns. We are done with you people.

    And don’t forget to say hello to Hades as you cross the Gates.

    Enjoy your pathetic leader:

    http://www.spiegel.de/international/europe/chancellor-angela-merkel-outlines-german-stance-ahead-of-eu-summit-a-841267.html

  18. Yanis,

    Judging from some reader’s, even Greek ones, reaction to this post (and to its Greek language version in protagon.gr) as well as to a lot of your other articles, I think that it would be a clever idea to discuss again in depth why even the most determined efforts at this time to fix Greek malignancies under the terms of the Memoranda would be uttetly fruitless.

    That would counter effectively all strawman type arguments which are based on the misrepresentation of counter-memoranda opinions as opinions which dismiss all and any internal Greek problems as non-existant or not requiring rectification. In effect, I urge to discuss and summarize the arguments on why the so called structural changes are irrelevant at this time, regardless if, at least some of them, are a neven ecessary pre-condition for Greece’s recovery after Europe sorts itself (and Greece) out or after Europe explodes in flames.

    • Pls. correct ‘neven ecessary’ to ‘necessary’ in the last sentence of my comment above

  19. Yani, thank you for your letter. Much enjoyed, but it is quite different to be a wine-critic versus a wine-maker. Sitting in your “academic” throne, without many real solutions is not particularly admirable or helpful. The alternative of fighting it out, is indeed grim. I disagree with horizontal cuts, but as a nation we have to be prepared for change….
    To me this is not about Euro vs Drachma or Mnemonio vs Non-Mnemonio, but rather about making structural changes that will get us to reform the country in substantive ways that a small slice of the population (eg unions) is trying to resist….
    Let the bold moves come in, let us try to modernize, let us try to get up on our feet after so many years!!!

    • Pericles

      I think most people in here understand that reforms are necessary.

      The problem is ,since we are caught in a deflationary trap ,most of the reforms asked at this time will have the opposite effect. They will increase the debt even faster ,by stalling the economy even more.

      Look at Spain and Italy.

  20. Yiannis,
    Very impressive article sticked to the point. Thanks
    However i doubt that anyone will take seriously our countries requests.especially now, as the fire is already at home countries and not just in the yard.
    i am personally almost convinced that Germany has already decided its exit from Euro. and I cannot really interpret otherwise the delay in decisions to enhance the stability of the euro currency.
    if the above houghts are possible then the new minister has to prepare also a plan B.

    Respectfully

  21. My prediction is he will take ANYTHING offered by the troika,

    Samaras has, again, demonstrated the Greeks have elected a coward. Will Stournaras have courage?

  22. There are two points to make.

    At any time, if the need arises, even though you are now the FM, please remember that there are those of us willing to help in any way you feel appropriate.

    Use the power of the internet; this site is an excellent example; to debate any issues.

    By far the majority of us wish you every success and admire you for showing the courage to take on the appointment.

    Live long and prosper.

  23. Dear Yanni, that was a VERY pessimistic letter for all us Greeks! A Greek expel in the next 3 months??? No turning points left??? I remember that SYRIZA was your choise in elections! I really wonder if there could be any different scenario with SYRIZA in government! An even more quick (forced again) exit maybe???!!! It seems like perfect deadlock to me!

  24. Yannis, although I dont always agree with you on how Greece got to the abyss, I fully concurr with your open letter. Greece, and I mean, the present and past leadership did the country no favours in their mismanagement of the state and its financial affairs. Borrowing more with no light at the end of the tunnel is counterproductive and immoral in my view as soon to be hundreds of thousands of Greek citizens will be forced into poverty not to mention social disintegration. Until we see the surplus economies begin real investment in the periphery there can be no unified Europe but merely a sham of a union that favours no one in the end. I remain without confidence that the present coalition will be able to do anything at this time. For the most part its the same crew that brought us to the abyss that is now telling the Greek people that all will be better this time around. Its like asking a thief to guard one’s money and expect a positive result. You are correct in your past post, “Greece is finished” in its current form …I truly fear the future for this country! Thanks for your candid analysis…

  25. Mr. Stournaras, is the epitome of a hero. Idealist but pragmatic, has taken up an impossible task to save the country. As any hero, he was sent to battle by moronic self serving cleptocrat leaders – politicians, to fix their epic screw ups. He will meet a hero’s end i.e. he will be defamed and slandered. If, in our lifetimes, these politicians are not severely, personally and physically punished in some meaningful way, there will be no more heroes. As for those who rejoice, when their neighbor’s house is on fire, well, as they say “soon in a theater near you”

    • @Dean

      Pangalos makes himself ridiculous, these days. I am sorry to say it, because when I have found him to be a decent and educated man. However, his attack on Tsipras is ignorant and unacceptable. Pasok has to accept that its demise is primarily the result of putting an idiot as its leader, and expecting to get away with it because of the idiot’s family history and name. A dignified exit is all that they are entitled to, and it seems they cannot even manage that!

  26. This is a comparison of mixed economy vs neoliberalism from the site

    http://anotherangryvoice.blogspot.com.es/2011/09/mixed-economy-vs-neoliberalism-uk.html

    ———–
    I decided to make this comparison after reading yet another baseless and generalised attack on the concept of socialism, which went along the lines of:

    “Government’s are not very good at spending money. This is one of the reasons socialism doesn’t work”.

    So how about looking at the track records of state socialism and neoliberalism in the contexts of UK public spending and socioeconomic trends before we start accepting sweeping generalisations like this?

    The Post-War Consensus mixed economy (a mix of state socialism and regulated capitalism).
    •1947-1979 (32 years).
    •Key influences & personalities: John Maynard Keynes, R. H. Tawney, William Beveridge, Clement Atlee, Nye Bevan, Harold Macmillan.
    •Origins: Started in the wake of a massive debt crisis (WWI + inter-war economic chaos + WWII).
    •Budgetary responsibility: 28 consecutive years of budget surpluses, only three years of budget deficits.
    •Government Debt: Reduced national debt burden from 237% of GDP in 1947 to 43% in 1979.
    •Economic stability: Other than the economic turmoil of the mid-late 1970s which was used as excuses to destroy the Post-War Consensus, an era of relative economic stability despite the loss of Empire and the Cold War partition of Europe.
    •Poverty: Massive reduction in levels of absolute poverty.
    •Consumer spending power: Provided ordinary working people with levels of discretionary income never seen before (or since).
    •Employment: Kept unemployment low on a long term basis.
    •Housing: Massive reduction in levels of slum housing and gradually improved access to decent housing for hard working people.
    •Public Health: Introduction of the National Health Service to provide health care “free at the point of use”.
    •Overview: Long term economic stability, massive public debt reduction, commonly referred to as “the golden age of capitalism”.

    The neoliberal experiment (based on the bankrupt ideological dogma of amoral neoliberalism).
    •1979-2011 (32 years)
    •Key influences & personalities: Milton Friedman, Frederick Hayek, Margaret Thatcher, Ronald Reagan, Augusto Pinochet, Gordon Brown.
    •Origins: Started in the wake of a few relatively* minor crises (1973 oil shock, late 70s industrial unrest) with the lowest levels of government borrowing in over a Century.
    •Budgetary responsibility: Only managed to record budget surplus in 17 of 32 years with a best run of 7 consecutive years (1983-1991) which was partially funded by the firesale of heaps of state infrastructure (privatisation).
    •Government Debt: Increased levels of national debt from 43% to 164% (including bailouts 91% GDP & PFI scams 15% GDP, which are misleadingly kept off the national debt figures).
    •Economic stability: A period of increasingly violent economic instability despite the end of the Cold War partition of Europe, exponential improvements in IT capabilities and the influx of cheap Asian commodities.
    •Poverty: Massively widening of the poverty gap and the creation of pockets of absolute poverty in formerly industrialised areas.
    •Consumer spending power: Squeezed levels of discretionary income, especially since Osborne’s “self defeating austerity” programme and VAT rises kicked in.
    •Employment: Kept unemployment high on a long term basis, with several nasty unemployment spikes during recessions caused by the instability of deregulated markets.
    •Housing: Increased levels of slum housing (via unregulated something-for-nothing slumloring) and increasing difficulty for working people to find access to decent housing due to unsustainable speculative house price inflation.
    •Public Health: Erosion of free public health provision (dentistry & eyecare), and the gradual privatisation of the National Health Service (PFI hospitals, private sector providers, 2011 Health & Social Care Bill).
    •Overview: Resulted in the Neoliberal Economic Crash and “the crisis of capitalism”.

    * = By “relatively” I mean in comparison to the economic consequences of the World Wars or the Neoliberal Economic Crisis.

    ————–
    Although there were still plenty of political and socioeconomic problems during the Mixed Economy years I’d say that overall this basic comparison makes a pretty convincing case for a return to the mixed economy. However the ruling Tory led coalition are insistent that the bankrupt “greed-is-good” neoliberal show must go on and that ordinary working people are going to have to pay through the nose for the huge economic failures of the establishment’s defunct neoliberal dogma via deliberately stagflationary Tory economic policies, while the financial sector elite laugh all the way to the (taxpayer subsidised) bank.

  27. This is a letter send to Herman Van Rompuy about Iceland.

    ——————-
    Reposting it from Gunnar Skúli Ármannsson at http://greekleftreview.wordpress.com/about/
    ——————-

    Reykjavik 18.03.2011
    Mr Herman Van Rompuy
    President of the European Council
    European Council
    Rue de la Loi 175
    B-1048 Brussels
    Belgium

    Dear Mr Van Rompuy

    The Icelandic banks (90%) collapsed in autumn 2008 and with the banks Landbanki’s subsidiaries in London and Amsterdam (the Icesave deposits). According to the principal rule of the European Economic Area Treaty, the concept of market equality is the basis of co-operation within the European Community as stated in the Agreement on the EEA Part I: Objectives and principles, article 2, item e:
    „the setting up of a system ensuring that competition is not distorted and that the rules thereon are equally respected…”. (Highlighted by signatories) It is clearly stated that the principal rule of the EEU co-operation is to prevent distortion of competition.
    In this light, British and Dutch authorities were obliged to ensure that Landsbanki branches in London and Amsterdam had satisfactory securities from The Depositors’ and Investors’ Guarantee Funds within their own borders. If that were not the case, it would have been marketing distortion.
    Britain and Netherlands unilaterally decided to make the Icesave deposits a political issue instead of a legal one. On that basis, they have demanded that Icelandic taxpayers pay the Icesave deposits which under EU regulations should have been covered by British and Dutch Depositors‘ and Investors‘ Guarantee Funds, as is clearly stated in European Economic Area treaty.
    The first reaction of the Icelandic government was that Iceland was being bullied and the Icesave dispute should be resolved in courts. Britain and Netherlands refused but prior to that the British government had taken the unprecedented action to use anti-terrorism legislation against Iceland and Landsbanki. As a consequence, Kaupthing bank operations (Singer & Friedlander) in Britain were closed down and with it fell Iceland‘s biggest bank.
    Due to these harsh actions taken by British and Dutch governments all flow of capital to and from Iceland was stopped. Iceland state finances were taken hostage by a foreign power. As a consequence, Iceland was forced to negotiate the Icesave deposits if the country was to get assistance from the International Monetary Fund. The IMF demanded that Iceland negotiated the Icesave deposits due to pressure from Britain, Holland and European Union countries.
    The current Icesave agreement can cost Iceland up to half of its state budget. If the Emergency law of October 2008 will not stand up in court of laws, the Icesave deposits will amount to double state budget. The people of Iceland have found it hard to accept being forced to pay for actions made by reckless and irresponsible bankers: burdens which according to EEA-regulations actually belong to British and Dutch Depositors’ and Investors’ Guarantee Funds as applied to fair and equal competition within the European Economic Area.
    The Icelandic nation will vote in a referendum on the latest Icesave-agreement on the 9th of April 2011. We refused to accept the last one in a referendum. We therefore feel compelled to get answers to the following questions before the referendum.
    1. What is the moral value of an agreement between three parties (latest Icesave-agreement) where two parties (Britain and Holland) force the third party (Iceland) to the negotiation table when the matter should be on the table of The Depositors’ and Investors’ Guarantee Funds in Britain and Holland?
    2. Why has Iceland not been able to defend itself in courts of law against British and Dutch claims?
    3. In the light that Landsbanki had to apply to British law, why was the bank allowed to open saving accounts before it had made the necessary arrangements with the Depositors’ and Investors’ Guarantee Funds?
    a. Did it not distort competition as Landsbanki was not obliged to make arrangements with the Guarantee Funds in Britain and Holland?
    b. Was the interest of British and Dutch consumers not looked after, as Landsbanki did not have to pay to the Guarantee Funds like its competitors?
    c. Is the European Union going to let Britain and Holland violate the principals of the EEA-treaty on equality of competition?
    4. Is it in accordance with EU policy to let the taxpayers bear the burden when private banks go bankrupt?
    5. Are Depositors’ and Investors’ Guarantee Funds of any country within the European Union strong enough to guarantee deposits in the case of (90%) banking collapse?
    6. What will be the reaction of the European Union if the people of Iceland reject the latest Icesave agreement on the 9th of April 2011?

    Sincerely and with requests for good answers

    Ásta Hafberg, student business management
    Baldvin Björgvinsson, certified electrician, teacher
    Björn Þorri Viktorsson, supreme court attorney
    Elinborg K. Kristjánsdóttir, journalist, student
    Elías Pétursson, CEO
    Guðbjörn Jónsson, retired consultant
    Guðmundur Ásgeirsson, software developer
    Gunnar Skúli Ármannsson, cand med
    Haraldur Baldursson, technologist
    Helga Garðasdóttir, student
    Helga Þórðardóttir, teacher
    Inga Björk Harðardóttir, teacher, artist
    Karólína Einarsdóttir, biologist and teacher
    Kristbjörg Þórisdóttir, cand. psych.
    Kristján Jóhann Matthíasson, retierd fisherman
    Pétur Björgvin Þorsteinsson,deacon, Evang.Lutheran Church
    Rakel Sigurgeirsdóttir, teacher
    Sigurjón Þórðarson, biologist
    Sigurlaug Ragnarsdóttir, bachelor of fine arts
    Steinar Immanúel Sörensson, ideologist
    Þorsteinn Valur Baldvinsson Hjelm, surveillance officer
    Answers and/or questions should be sent to
    Gunnar Skúli Ármannsson Cand. Med.
    Seiðakvísl 7
    110 Reykjavík
    Iceland
    e-mail: gunnarsa@landspitali.is

    A copy of the letter has been sent to several officials within the EU and EFTA as to the ministeries of Britain, Holland and Iceland to whom this case belongs. A copy has also been sent to several European newsmedia.

  28. https://rodeneugen.wordpress.com/?s=greece

    Greeks failure is unique
    Posted on June 26, 2012 by rodeneugen

    To try to predict what will be, first we have to ask what really happened and will happen to Greece and Spain as debtor on one side, and what happened and will happen to Germany, France and other creditors from the other side?

    As to Greece, since for 10 years it borrowed unlimitedly to increase the level of consumption of its citizens and nothing or very little it borrowed for investment, it not only did not increase the basis of its potential production capacity of merchantable products and services, but in contrary, it decreased it, by creating overpaid jobs in non merchantable service sector. Now when the creditors decided to stop borrowing more money (they give up the hope, they will ever be paid back) Greece has no basis to support these non merchantable services and has no alternative employment for those employed in these services.

    As contrary to Greece, Spain is trapped in normal economic downturn, when one of his major industries, the real estate, that used to sell see shore dwellings mostly to foreign citizens, because of external economic crisis lost its customers. Yet Spain did not created nonfunctional economy, that can’t create add value, so it still has the capacity to heal.

    As to the creditors, their economy is potentially robust, since in the past they had to supply Greece and other debtors within the EU with their merchandise. On the short term they have a problem to cope with enormous quantity of bad debts, they were paid with for their products. This means they or their bank system lost part of their assets and with it the equity, that was or will be restructured that or other way by the central banks. Now learned their lesson, they will try to channel their financial resources to more productive goals, than the Greek consumption or non merchantable services. This can only be for help to the healthy and strong economic entities, who existed before the crisis and still exists and are looking for markets alternative to Greece, that can pay for their products.

    Sorry for the Greeks, but their failure is unique and is no precedent for anybody else. The Greek economic bomb was already neutralized for Europe.

    • No. It is not our failure only.

      The partners just loved it when they uncontrollably gave loans everywhere and first sold their third rate military equipment.
      Do not forget the German corporation corruption.

      Nothing happened in Greece that it wasn’t the will of Germany as well.

      When Germany got wealth we were all one. Now that there is a problem we are Greece and the rest.

      Do not sorry us. We pity you.

    • You make a claim, then completely fail to substantiate it with either evidence or argument.

      So, ok, make your hostile claims public. What is the point? We have already plenty of ignorant Germans stating their bigotries without a Jew added to the list. One can only assume that your opinion derives either from a personal dislike of Greece or Greeks or from some political ideology that leads you to the same conclusions.

      Whatever the reason, this is not an intellectually serious position to be in. Rather, it looks like troublemaking.

    • There is no doubt that we Greeks failed to retain our debt under control.
      But there is also no doubt that the way eurozone was built sooner or later would heat the competitivness and thus the deficit of the weaker countries.Please do not underestimate the later.Else you have to explain the problems in Portugal, Italy,etc,
      I remind you that there should exist at least two parties in any transaction and loan agreement. Excessive borrowing is not only borrower’s fault.
      In addition please consider how monetary policy was exerted by North Europe (mainly German) for its own wealth and not the whole eurozone.

      Be sure that we Greeks are more angy than everyone else about our politicians and ourselves for the situation. But the same time cannot accept to try and resolve this issue by destroying whatever has left in our country.

  29. In your letter, you seem to be conceding that Greece can be ‘chucked out’ of the Euro. But, previously, you have stressed ad nauseum that no mechanism and no possibility exists for a forced Greek exit and this won’t happen. Have I misinterpreted something or has there has been a change in your view regarding the chances of Greece being eased out of the eurozone and adopting a new currency?

    • Read it again. What I said was that the euro as a whole is probably beyond the point of no return. In this context, they may well chuck us out before the rest of the edifice collapses.

    • @yanisv

      So what, if they chuck you out before the rest of the edifice collapses?

      Lucky you, the debris will not fall on your heads as you will be out of the edifice.

      Get the prime mover advantage and be on recovery before anyone else. Aren’t you a pride country, cradle of civilization, philosophy, rational thinking, democracy, the real brain and masters of the Eastern Roman Empire under the ‘roman’ name? Forget the Ottoman period and go ahead. Life has ups and downs or it would not be life.

      Some real numbers from Wikipedia. Australia is a federal monarchy with 22 million people. Spain is a federal monarchy with 47 million people. Why would a united states of Europe make more sense than a united states of Oceania?

      If not, why to stick to such a construct?

  30. Pingback: Varoufakis’ Letter to the New Minister of Economy: MP Stournaras « Greek Left Review

  31. Not going to leave a comment on the text itself, which i enjoyed a lot as usual. But as regular a reader, and disseminator of your views I request a +1 button on this site

  32. Suggesting that the new Finance Minister has any freedom to act with prudence is like saying that a train conductor could take a left turn and head South disregarding the rails that guide him. At last, the can kicking will stop, one way or the other. I think we both know it will happen in the uglier of the two ways…

  33. What a disgusting form of arrogance. You really think that Greece is in a position to demand anything, do you? Delusions of grandeur seem to be a disease of many Greeks. I am sure that the new finance minister is a bit smarter than you are. And he has for sure more social competence than you have! But in one point you are right: Greece will be expelled from the euro. Because you cannot change the character of a failed nation over night and those who would like that seem to be a minority. Those who live in another world are the majority. Nikos Dimou know that very early what clowns you are.

    • All of us? And who are ‘we’ Sir? Your prose is a stark reminder of the kind of chauvinism that we ought to expect following a major crisis. Thank you for reminding us.

    • GDQ

      “You really think that Greece is in a position to demand anything, do you?”

      And Germany is in a position to order everybody around?

      People like you make us think that the only reason countries were accepted in the EZ ,was for Germany to acquire more wealth and then play the bully.

      Take your fascist ways and hop your way to the cliff your leaders lead you to.

    • ” the character of a failed nation” ? Really? Does anyone other than Neonazis (actually from the lingo I would say not so neo) talk tis way? Wow…Romanticism really did a number on your head and collective psyche didn’t it?

    • “Then expel us. I would like to see the mechanics of such.”

      Me too”

    • Germany is hardly alone in the Eurozone in having a government and a population skeptical of Greece. Germany is in fact typical.

      Singling out the Germans is a tactic of questonable utility.

    • @ Mr. McDonald
      It is one thing to be sceptical and/or critical of the Greek government, and quite another to make racist sweeping generalizations, and essentialist claims like those made by GDQ. It cheapens all discussion and relegates it to mindless dribble, and it is a thoughtful person’s responsibility to call a spade a spade.And who said that only the germans are susceptible to the effects of romanticism?

    • And me 4. But the point here is that you ain’t got the tools. So, why are you threatening something you can’t perform?

      Do you think that we would be stupid enough to initiate such action voluntarily? What for?

      Our aim is to maximize damage and injury to you. As payback for what some innocent Greek folk is suffering through today.

  34. Yani

    In several statements you’ve made to the media, you’ve said that what made Greece the first domino to fall were its weaknesses and ‘feebleness’ relative to the other economies of Europe. In particular you’ve called them ‘malignancies’. This letter to the new FinMin hints that you have he been debating the merits and type of reforms that would elevate Greece from its current depths. I think an informative and extremely interesting post would be an analysis of these ‘malignancies’. Perhaps another open letter to Mr. Stournaras continuing your debate.

    • It would be interesting, I grant you (and I have published my views on these malignancies). But it would also be irrelevant now. When a lung cancer patient requires immediate surgery, discussing the perils of smoking (instead of operating) is misanthropic.

    • Dear Mr Varoufakis,

      Taking MurkeyWatters comments one step forward, I think at some point (sooner than later), you “ought to” present a quantitative rather than qualitative analysis of the Greek crisis’s causes.

      It is obvious that there are two lines of analysis of the Greek crisis, one attributing it absolutely to our internal “malignancies” (unproductive public sector, tax evasion, corruption, etc.) and the other, which even if it acknowledges those, identifies the structural deficiencies of EU/EZ and the global capitalistic crisis as the main contributing factors (and possibly partially responsible for the former). These almost dogmatic approaches (in the sense that they both leave no room for a “proportional” explanation studying both factors) are apparent in all expert articles, leader argumentations in the media, and, especially, readers’ posts, here, in protagon.gr and in other blogs. That, I am afraid, does not exclude you :) .

      What I would like to see (and nowhere have I found, so far), is a QUANTITATIVE, comparative analysis of the contribution of both categories of causes to the macroeconomic indices demonstrated by Greece in the last 20 years, and especially the last 3 years within the crisis. My desire to see such an article is triggered by my “spiking” anger every time I read a nulistic reader’s comment (“all Greeks are lazy, useless, corrupt and deserve what they/we got”) or an ideoleptic neoliberal article basing its conclusions on argumentation of the first kind, not really substantiated by evidence (or only partially, to deliberately bias the conclusions).

      Would that be possible, even, with a certain subjectivity level involved, derived by the assumptions and predictions that will need to be made? Wouldn’t that be useful for allowing the public to form a more firmly established opinion? And wouldn’t that, after all, enhance your own argumentation in favour of the second explanation, or at least move the debate to more constructive territory?

      I disagree with your comment that such an analysis seems irrelevant at this point. First, there might still hope of reversing the disaster if people are convinced by solid arguments and withdraw their support to policies that raise their support exactly by the first line of argumentation and second, when the total disaster arrives and the scary time of responsibility-delivery arrives, it will be useful as a tool to attribute responsibility to those that actually carry it, rather than some scapegoats.

      Thanx a lot for considering this recommendation.

  35. I think that the insight that there is a broader ‘game’ at play than purely the Greek one is an important one, that will doubtlessly help the new minister of econmics in his daunting task. At the same time it would be sheer hubris (and utter stupidity) to pretend that Greece is a big player in this larger game and that its can therefore take huge steps because of its position. Greece is not a big player, its political elite has neer zero clout as it has reaffirmed time and time again its lack of credibility. It would be an even greater shame and utterly reprimandable if the new minister decided to forego the pressing domestic needs of the country simply to roll dice in the courts of Frankfurt and Brussels…

  36. Yiani:

    You a bit off base on this one.

    Greece does not care what happens with Merkel, nor it is Greece’s assignment at the moment to save Europeans from their own stupidity.

    The most important part is our economy which we must and will solve under our own terms and in our own sweet time (just to piss the bitch off).

    The lesser and least important part is what happens in Europe. Just because Syriza has made it a task to renegotiate terms it does not mean that this is what we ought to do. It simply means that this is what Syriza would like to do. Not Greece. BTW, if Syriza could then by all means renegotiate terms if you can, however, let me be harsh here and say that the last elections in Greece were not about ideology rather they were all about money in the coffers of political parties and here is the proof:

    http://www.protothema.gr/politics/article/?aid=206986

    Therefore, I think you are mistaken if you think that Stournaras’ job is to care or have a renegotiation of terms as his first priority. His job would be to implement certain structural changes/reforms, a task which admittedly he might be good at according to the testimony of those who have worked with him in the past.

    Greece has nothing more to sacrifice to the European experiment or towards reversing the apparent Merkel nonsense of compound errors and omissions. We are done with this part and if for some reason we are left outside the EZ as many believe to serve as an example of avoidance then we will torpedo the whole thing just for the fun of it.

    And anyone who stands in our way will go straight to….

    • Dean

      For all of our sakes it was Greece’s responsibility to do the right thing for Europe as well.
      And that is exactly what we tried to do. While everybody thought the right thing was the opposite just because the “leaders” said so.
      Now Troika got the government it wanted.

      Well now ,if Greece is to be the ultimate scapegoat ,i would love to see the whole structure collapse.
      Yes ,i am being mean i know but it is not Greece’s assignment to do more as you say. Our economy is finished already thanks to stale bagel Merkel. But we are not.

      The can kicking by the European leaders can very well prove to be a blessing for Greece.
      This way we stalled too from helping them worsen the situation even faster. Because that is exactly what would have happened.

      I think the time is near where our geopolitical aces will come into play.
      As long as the freaking Greek traitors be betrayed themselves by their European masters. Many possibilities that they will.

      In all honesty ,right now i want out.
      This is not our Europe. Let them keep it.

      And let them feel it.

    • Demetri:

      Let me rephrase. I would actually stay still. I really want to see how they are gonna get us out and in the process gather valuable court evidence for the lawsuit to follow. (right the one that Germany loses for $30 Trillion)

  37. The only problem being that, without the support of the corrupt lunatics in power in Greece, all this is probably not achievable… And even if I’m wrong and it is, they will be ready to reap the fruits of ‘their’ success, thus strengthening their grip on the electorate and further undermining the country’s future. Greece can only reach long-term salvation if economic and financial reform is accompanied by the transformation of Greek politics. Makes you wonder whether the whole thing should in fact fail to finally get rid of this deceitful, arrogant, power-crazy lot…

  38. In an 2010 interview with “Süddeutsche” your friend Stournaras said, and it is quoted again today in the german newspaper:
    “She” (Merkel) “is right to fry us in the pan”

    The interview (german) is here: sueddeutsche.de/geld/griechenland-oekonom-stournaras-merkel-braet-uns-in-der-pfanne-1.935081
    Interestingly, “Süddeutsche” only quotes half of the sentence in the article of now! In 2010 Stournaras had added:
    “but she has exaggerated it”.
    They left that out this time. Well…many journalists are in no way better than many politicians are. It’s a mistake not to be able to understand this, media also cause a lot of trouble in times like ours.

    In 2010 Professor Stournaras had the following ideas in the above mentioned interview. It might be interesting to know, as he was, generally, optimistic back then.

    – radically cut the defence budget. (Did it happen? You know better, we just heard that Germany again sold Panzer and had a share in this mess. No outcry was to be heard in my country, funnily enough.
    Greece traditionally bought more weapons than many other NATO-countries. Background being the old arms race with Turkey. Professor Stournaras mentions this in his interview. Germany sells too many weapons, so this all was going on rather silently in my country…).
    – Close the 4000 state-controlled companies and fire the people.
    – Do not perform wage reductions in private sectors, that would be the wrong decision, Sournaras said. ( well…sadly enough…)
    – Greece is, he said, a mixture of a clientele patronage system and an old-fashioned socialism. (Later many journalists used sentences like these to build their dubious prejudice, it has to be said. Sentences like these were of course and instantly misused by many european media.)
    – Merkel was right to hurt Greece but she exaggerated it – it must stop now, said he in 2010. Well, it did never stop. Merkel built a kind of spider-web instead, and nobody in the old greek government was able to say no!
    – Merkel (Germany) had given out so many contradictory statements that it confused the markets, Stournaras rightly said.
    (Well, it is so sad, and this is important. Concentrating on each one’s job and being “optimistic” alone can end in a desaster, sometimes. Merkel IS a living contradiction, her only motivation is to stay in power and follow old neoliberal ideas. Nobody knows if she believes in them or just wants to make her loyal right-wing-clientele happy. In 2008 she sounded like a kind-of-rightwing-socialist; 2 years later she re-found Thatcher’s “market-confrom democracy” and forgot what she had proposed before. Examples like this are so many, boring for you, painful for many.
    This is not an unfair statement – this is what time since years had shown. To not learn this fast…. turned out to be a desaster for a whole lot of conservative and other party-leaders of Europe.
    Now we start to talk if Germany was on its way to – again – acting like the big bad boss, if a new nationalism was on the rise. This is probably all wrong. There is no “nationalism” in globalized worldwide politics. It is about ruling, yes, but has nothing to do with nationalism. A lot of german people will suffer from neoliberal european politics too, in the future. You might laugh, but do you know that 600-800 000 germans are too poor to pay their electricity even now? They are cut off…simply.)

    – Are you an optimist? Süddeutsche asked in 2010. Here is Stournaras’ answer.
    “Yes. Because I tend to think rational and pragmatical. And because I tend to think that also the Germans are rational. I think they are aware of their historic responsibility”.

    The first reactions of german papers after they heard Professor Stournaras is chosen now is “relief”. (Focus, wallstreet online, and more.)

    It would be extremely worthwhile for us readers here if you got any answer from your friend, Professor Stournaras, to learn what he thinks of your ideas. Surely we would learn much from both of you in this situation.

    • Greece traditionally bought more weapons than many other NATO-countries.

      As a NATO member, Greece has more than met NATO’s recommendation of at least 2% of a member’s GDP going to military spending. Greece’s spending is around 4.3%. Germany’s spending, also a NATO member? Not even close: 1.5%! Btw, most of the military hardware to Greece comes from (where else) … Germany.

      Seriously … these Germans want to have their sauer kraut and eat it too!

  39. Very good letter. It will not make any difference of course and it would be more important I think to have a debate on all the measures mr Stournaras favored and you opposed. Maybe another time. Is there any chance of an international version of your piece on the Greek Lifo paper today? Your conclusions need to be voiced somehow and as you know there is absolutely nobody in the Greek government or anywhere else that i know of that would dare to do such a thing.

  40. Don’t ever believe my good friend, whoever you are, that we do not know the solution to the problem many years ago.
    The issue here is different; it is the motive that we have to set up loans
    You should know that here in Greece the Minister concluded a loan agreement and receives a very good profit on the amount of the loan.
    So the problem is not to save Greece but to save the pocket of each Minister

    Do you understand now why we take constantly loans to live and not looking to change the infrastructure of this country?

  41. I don’t think this can be handled in sequence, as in financial alchemy via the EU 1st and only then tackle the things Greece herself can do.

    The implementation of (contractually committed but long overdue) structural changes and improvements must right now happen, fast and successful, in parallel to financial negotiations.

    Otherwise the creditors and spenders will and can not be inclined to ease some of the conditions attachexd to the support. A broken promise is a broken promise.

    • I’m honestly failing to grasp how structural changes in law and taxis will make that much difference. Mr. Varoufakis hints at disagreements with Stournaras on these issues. Maybe if the reforms ONLY mentioned law and not taxis, it would be more convincing. Still, Greece’s MPs and ministers can undertake bribes, scams and corrupt practices without being prosecuted. That would be the place t start. The tie between rich clients and the democratic representatives of the people have not been broken. The reforms demanded are only those that intend to break the backs of labor.

      In Greece, the problem hasn’t been labor.

    • “I’m honestly failing to grasp how structural changes in law and taxis will make that much difference”

      You have to stacountless delays and breaches of contracts by the former government(s) there is not much trust left – understandably so.

      As for what reforms: there are so many necessary, one simply can’t rule out any area. They range from installation of a working tax collection and land registry office system to a complete labor market reform.

      And, of course, tax the rich! It is for instance unacceptable that per Greek constitution shipping company owners don’t have to pay taxes on the profits they make with their business (and it is an extremely lame excuse if this constitutional rule is defended by our host here with the claim that the Greek shipping compnay owners have their businesses based in London anyway. Grotesque!)

      It is BTW extremely disturbing that so far the Greek governments imposed a lot of hardship on the lower and middle class people only, but spared the rich completely. You should press your new government to change this approach immediately.

    • “I’m honestly failing to grasp how structural changes in law and taxis will make that much difference”

      You have to start somewhen, and considering the countless delays and breaches of contracts by the former government(s) there is not much trust and time left – understandably so.

      As for what reforms: there are so many necessary, one simply can’t rule out any area. They range from installation of a working tax collection and land registry office system to a complete labor market reform.

      And, of course, tax the rich! It is for instance unacceptable that per Greek constitution shipping company owners don’t have to pay taxes on the profits they make with their business (and it is an extremely lame excuse if this constitutional rule is defended by our host here with the claim that the Greek shipping compnay owners have their businesses based in London anyway. Grotesque!)

      It is BTW extremely disturbing that so far the Greek governments imposed a lot of hardship on the lower and middle class people only, but spared the rich completely. You should press your new government to change this approach immediately.

    • The tax revenues / GDP is lower in Greece than in Switzerland. Tax haven!

  42. You Move1 is very logic considering what James Mackintosh of the Financial Times said on twitter:

    “JP Morgan estimates only €15bn of €410bn total “aid” to Greece went into economy – rest to creditors. No wonder they are cross”

    I wish everybody in Europe would know this!

    • It went into the economy a few years ago, not now. Otherwise there would be no creditors.

  43. So ,he is the culprit of Greece being in the EZ. Booooo.

    I am optimistic about Greece surviving but i am not optimistic about surviving in the EZ or even EU. The “good” and “oh ,so honest” partners ,want a scapegoat. And that is exactly what Greece is. Nothing more ,nothing less.

    I am still waiting for the bang-bang at the end of the year.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s