Dominique Strauss Kahn, addressing “German friends”

“In counting our billions instead of using them to build, in refusing to accept an albeit obvious loss by constantly postponing any commitment on reducing the debt, in preferring to humiliate a people because they are unable to reform, and putting resentments – however justified – before projects for the future, we are turning our backs on what Europe should be, we are turning our backs on Habermas’ citizen solidarity. We are expending all our energies on infighting and running the risk of triggering a break-up. This is where we are. A eurozone, in which you, my German friends, would lay down your law with a few Baltic and Nordic states in tow, is unacceptable for all the the rest.” For the complete text, click here

24 thoughts on “Dominique Strauss Kahn, addressing “German friends”

    • Minus the Varoufakis comments (comments about Yanis handling).

      The “minus” is around 15 minutes of Yves Smith’s interview — a quarter of an hour talking about Yani. She pulls no punches. Ouch!

    • Dean, In the interview Yves Smith mentions two ways Greece can file legitimate legal claims in court against the ECB and against Germany. She seems to feel these actions would indeed yield condensable funds. Do you know if anyone in Greece is taking these actions by any chance?

    • Triada:

      Susan actually mentioned one way re: the loan the Germans took from the Bank of Greece (I believe its gold reserves) and never repaid. She thinks that Greece has a better chance in getting a favorable court judgement which might take 5 years or more to adjudicate. And no I am not aware if anyone in Greece is working on this.

    • Dean I thought she also mentioned in the interview Greece could legally file documents regarding the actions of the ECB toward Greece at the moment of the referendum which in effect cause the Greek banks to close? I believe Yanis called this out at at point earlier in time, at the time of the referendum.

  1. Oh, this is so good. I can’t resist quoting more:

    “The only big mistake of the euroskeptics was underestimating just how much damage the single currency would do.

    The point is that it wasn’t at all hard to see, right from the beginning, that currency union without political union was a very dubious project. So why did Europe go ahead with it?

    Mainly, I’d say, because the idea of the euro sounded so good. That is, it sounded forward-looking, European-minded, exactly the kind of thing that appeals to the kind of people who give speeches at Davos. Such people didn’t want nerdy economists telling them that their glamorous vision was a bad idea.

    Indeed, within Europe’s elite it quickly became very hard to raise objections to the currency project. I remember the atmosphere of the early 1990s very well: anyone who questioned the desirability of the euro was effectively shut out of the discussion.

    Furthermore, if you were an American expressing doubts you were invariably accused of ulterior motives — of being hostile to Europe, or wanting to preserve the dollar’s “exorbitant privilege.”

    And the euro came. For a decade after its introduction a huge financial bubble masked its underlying problems. But now, as I said, all of the skeptics’ fears have been vindicated.

    Furthermore, the story doesn’t end there. When the predicted and predictable strains on the euro began, Europe’s policy response was to impose draconian austerity on debtor nations — and to deny the simple logic and historical evidence indicating that such policies would inflict terrible economic damage while failing to achieve the promised debt reduction.

    It’s astonishing even now how blithely top European officials dismissed warnings that slashing government spending and raising taxes would cause deep recessions, how they insisted that all would be well because fiscal discipline would inspire confidence. (It didn’t.) The truth is that trying to deal with large debts through austerity alone — in particular, while simultaneously pursuing a hard-money policy — has never worked. It didn’t work for Britain after World War I, despite immense sacrifices; why would anyone expect it to work for Greece?

    What should Europe do now? There are no good answers — but the reason there are no good answers is because the euro has turned into a Roach Motel, a trap that’s hard to escape. If Greece still had its own currency, the case for devaluing that currency, improving Greek competitiveness and ending deflation, would be overwhelming.”

    The fact that Greece no longer has a currency, that it would have to create one from scratch, vastly raises the stakes. My guess is that euro exit will still prove necessary. And in any case it will be essential to write down much of Greece’s debt.

    But we’re not having a clear discussion of these options, because European discourse is still dominated by ideas the continent’s elite would like to be true, but aren’t. And Europe is paying a terrible price for this monstrous self-indulgence.

  2. Greece is experiencing a slump worse than the Great Depression, and nothing happening now offers hope of recovery. Spain has been hailed as a success story, because its economy is finally growing — but it still has 22 percent unemployment. And there is an arc of stagnation across the continent’s top: Finland is experiencing a depression comparable to that in southern Europe, and Denmark and the Netherlands are also doing very badly.

    How did things go so wrong? The answer is that this is what happens when self-indulgent politicians ignore arithmetic and the lessons of history. And no, I’m not talking about leftists in Greece or elsewhere; I’m talking about ultra-respectable men in Berlin, Paris, and Brussels, who have spent a quarter-century trying to run Europe on the basis of fantasy economics.

  3. Warren Mosler was interviewed this past Friday on a Boston radio station. He was asked to discuss the done deal. For those of you unfamiliar with him, he is a currency expert and the go-to man that central bankers/finance ministers consult when they require a refresher on how their public monopoly works. Anyway, he lamented that “a huge teachable moment was lost” — and added that the Troika and the Greek negotiators, unfortunately, were on the SAME paradigm. By that he means that they don’t understand how a modern economy works — particularly, what public debt means.


    • Finally you found a guy that sounds and looks sharp. Mosler is correct about his assessment about to euro and I tend to agree with him. He is also correct when he says that trying to run a government surplus kills the private sector. These are lessons which the Ayatollah of Austerity (aka Schauble) seems to be unaware of or disinterested to learn.

    • Recall the last time I brought up Mosler’s name? This is what you wrote:

      Why do you keep name dropping marginal and unknown people who basically have neither the tools nor the networks to do anything positive for Greece at this stage?

      Why Mosler a sportscar engineer – among other things – who lives in St. Croix have anything to do with Greece? Who ever heard of these people? Are you listening to alternative radio about UFOs and conspiracy theories in Canada?

      Btw …it’s true that I listen to alternative media.

  4. Germany is a lost cause for this idealistic model of Europe.

    Mr Strauss-Kahn is wasting his time trying to appeal to the germans. Those few of us who would even listen to someone like him already know what is going on and the rest is forever trapped in a platonic cave and they are neither willing nor able to get out of it and take a look at the real world instead of staring at distorted shadows of it.

    This country is ruled by radical conservatism in its worst possible incarnation – a very deep and nearly subconcious fear of change and a similarly irrational hatred towards anything that might bring it about and it is entirely self-sustaining. Capital has become our true religion, and I mean that literally. The german ‘Sparer’ (engl.: ‘someone who is saving(money)’) has become the last remaining role model for our whole society. The sparer’s only goal in life is to constantly try to put aside a portion of whatever little he earns in order to build up ‘capital’ – however miniscule and ridiculously irrelevant it may be, and to feel like being part of the giant globalized redistribution scheme from the bottom to the top that is the german ‘business model’.

    And since he has been fed, and has swallowed and internalized this basest of all self-deluding lies right down to the tiniest fibre of his entire being for many decades now, nothing will ever make him doubt this conviction of his. Not the suffering of Millions within or without Europe, not the destruction of European democracy and most of all not the desperate calls for logic and decency by Greek politicians, hundreds of economists across the world or fallen former french IMF officials trying to redeem themselves by writing passionate letters and appealing to common sense.

    There is no room for history, philospophy, or simple human decency in this model. It is based on denial of all these things and everything else that can not be expressed in numbers and added to the german Sparer’s savings account. They are luxuries only available to those who can afford them.

    Forget Germany and get out while you can.

  5. DSK is fighting a rearguard action to preserve the European “dream” – which shouId properIy have been caIIed the European IIIusion Iong before the crisis occurred. That is, the moment the appalling Maastricht Treaty was signed, the catastrophe we face now was baked in.

    Within France he is differentiating himself from his feIIow SociaIist, the spineIess HoIIande, by evoking the GauIIist view of a Europe that naturally incIudes Russia in some form….and which, by enormous, unspoken impIication, is not a puppet of the USA.

    The American project of exporting its ex-British CoIoniaI administrative modeI of a federation of states [found aIso in Canada, AustraIia, India and New ZeaIand] and imposing it on Iarge swathes of Europe but not aII [the current EU is a misnomer geographically and not synonymous with the continent] for US bureaucratic and security purposes – furthermore, one in which the vaIue of each nation / culture is defined onIy by [ie reduced to] its fiscaI/monetary vaIue in this ever-expanding whoIe – is cIearIy not a heaIthy or realistic vision for European citizens to adopt. As with Britain’s Iong defunct CoIoniaI Office, decisions are made by unaccountable bureaucrats etc., and in this case aIong the Iines of an unacceptable corporate neoIiberaIism, which further weakens nationaI sovereignty and impoverishes the population. As with the CoIoniaI Office, this was undertaken with the coIIaboration and seIf-enrichment of the various IocaI “eIites”.

    The sad fact is that the European Ieft supported this project for so Iong, knowing fuII weII the truth. Why was the Ieft so eager to be ruIed by Washington/ US capitalism and occupied by NATO? InternationaI solidarity has never been at odds with sovereignty, if one accepts that sovereignty is the onIy means to protect a nation and culture, the Capodistrian view. Capodistrias was against empire and the subjugation of peopIes….

    Interesting and important for Greece now and Europe as a whoIe is that the force in Greece that rose up to question the Troika, the uneIected EU institutions and CentraI Banking/euro shouId not be described as a government of the “radical Ieft” but a coalition of right and Ieft. This not onIy served a purpose inside Greece of ennabIing voters across the poIiticaI spectrum to rise above partisan definitions and support the coaIition according to their conscience but bespeaks a future in which the vaIues of both sides shouId ideally start to enrich the other. In the same way in which the Ieft in Europe is now undergoing a radical seIf-reassessment, so can reaI conservatives wake up to a radical reassessment of conservatism – in which true smaII ‘c’ conservatism [the conservatism traditionally safeguarding nationaI culture, sovereignty and vaIues] must be reclaimed from the extreme radical neoIiberaIism of the financiers – which has nothing “conservative” about it.

    • Thanks for this post, Elenits, and thanks to Hubert Marcks again. I only differ in what you describe as “real conservatives”. As far as I can see, the conservatives, not only the german ones (CDU, FDP, green with their “we play oh-ah-subversive but like Merkel” or SPD – it’s nearly the same) are since at least 20 years no hope, because they are nearly nowhere to find. Conservatives, at universities, in parties western-wide, are nearly all utterly neoliberal, I tend to think, but of course hope your view was more appropriate.

      The worst may be those who supported Merkel’s etc. austerity ways but want to cheat by not voting now, it est: the “greens”. They are truly horrible, by even cheating people who would resist to austerity and what Merkel DARED to describe in the lines of “solidarity” with Greece.
      35 years ago maybe, just the then new green party had indeed conservatives you would probably like, those were people we could learn of, most of them are dead and we never met them. The conservatives by name-today cling to an economic model which utterly needs austerity and are people who wanted to break the Syriza government, like you say.
      But in fact this all is so sad and against all rests of rationality killed sometimes around 1990-today by “postmodernism” or however one likes to call it, I would hope what you write would be true. What do I know.
      Because of course the radical neoliberalism shares nothing with what you describe as conservatism. Are there people in Greece you have in mind?
      Maybe it is betraying and leads to wrong conclusions to live in Germany – but what you describe as conservative, Elenits, seems to be powerful only amongst a very small minority of people 70+ years of age…and is nowhere else to be found. Yet I remember an old blog article where Yanis Varoufakis described exactly this – that in times like these one had to co-operate. He spoke, if I remember right, about positions he didn’t too much like, not something we all could learn from.

      After everything in our western societies turned to, not even “neoliberal”, but spineless subdivisions of majorities wandering aimlessly around and caring for nothing (if their staring at smartphone-apps even keeps them alive in a way so they knew where they are), following the next cool-hype, the next change of the winds, fighting first of all a real left movement as “too old” “monocausal” or whatever the posh spoke through their noses (yes, they did) – I think what we needed were more “erratic marxists”. Totally new ways, building from what was oppressed more or less for decades now.

      Even in Germany, Hubert Marcks, there are – again, small minorities, but now not only the minority being over 70 years of age (but they can help a lot too) – some intelligent voices left. But all in all, and in our political parties apart from main parts of the 8-9% strong “Linke”, it is a nightmare, like you describe.

      The very few are not enough, the people Yanis would not have to sing the swedish national anthem to. Which (I teach myself swedish but did not much like what I read in their papers about Greece) is a nice anthem, in fact. But I think Yanis should have preferred, if he had chosen to sing actually, to the neoliberals and the ones who from January 25 wished to destroy Greece

      Thou shalt break them with a rod of iron; thou shalt dash them in pieces like a potter’s vessel.

      That’s not from some terrorist group, that is nicely sung in Handel’s “Messiah”.

      For those who speak german, I want to show you one professor. He works hard for explaining why despite the fact that so many countries didn’t vote for neoliberal majorities, neoliberalism now seems to win every time.
      The man’s name is Mausfeld, His lecture is called “Why are the lambs so silent. Psychology, democracy and the management of indignation”, obviously quoting the film, and the leftist psychologist manages it to show how not only media are so successful as they were, europe-wide indeed, in telling false things about Greece and Syriza in various, various ways. How many succed in “canalising” indignation and possible revolts. If you, all of you, have someone to translate it to you, watch

      The professor might also represent what you might call conservativism in a good way. It is a lecture not precisely about Greece even though the media distortion is mentioned. Yet is is a treasure, believe me. I have not much spare time, but I might some day translate his lecture. Some of us here should get in touch anyway.

  6. I notice that Iater in the text DSK reverts to DeGauIIe’s formuIa ‘from the AtIantic to the UraIs’ by including in his definition of Europe
    “the snows of the UraIs”. Fighting words foIIowing his NYC ‘perp waIk’?

  7. Dear Yani,

    The message of DSK that Germany should not dictate terms to Europe is appealing (despite its unappealing source). The problem however from a Greek perspective is that it is not sufficient to decry the German diktat without offering something to counter it. For all the rhetoric emanating from you, the end result of Syriza’s efforts has been populism, as I explain in my article ( ). I am very disappointed that in your time as FinMin you were not able to offer a pragmatic and effective counter-narrative to the German one.

    • But that’s the whole point. Comments from the same ideological “morons of Europe” camp carries a lot more punch than an another impotent and self-righteous Leftist lament (of which they are a dime a dozen and have zero effect anyway).

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