#THIS IS A COUP – My comments on Paul Mason’s documentary

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Paul Mason’s recently released four-part documentary #THIS IS A COUP, on the crushing of the Athens Spring, offers much food for thought. Paul and I have had many opportunities to discuss the issues it covers, including on stage in London in front of a magnificent audience. When the time comes, I shall publish my full account. But for now, here are some comments for each one of the four episodes, culminating to a general comment at the very end – see below.


11’50” – “…four days to negotiate an extension of the bailout – something he [Tsipras] promised never to do.”

This is quite untrue. Our mandate was all about negotiating a new agreement. To negotiate it was imperative that we secured an extension of the loan agreement (that was ending on 28th February) so as to gain enough time to conduct the negotiations. Remember: A ‘bailout’ comprises three parts – the loans, the loan agreement and the conditions (e.g. harsh austerity) that the money comes with are called Memorandum of Understanding or MoU. What we did was to negotiate an extension of the loan agreement without accepting the MoU or taking any fresh money. This was in concert with our election pledges. Indeed, the reason the first two Eurogroup meetings (11th and 16th February) led to impasse was because we insisted that the words ‘Memorandum of Understanding’ and ‘Program’ stay off the communiqué.

 12’44” – To stop the bank run “Varoufakis is forced to accept whatever is on the table.”

Again, this is wrong. Having brought the first two Eurogroup meetings (11th and 16th February) to an impasse, in my third Eurogroup meeting, on 20th February, an agreement was reached that did not mention the words ‘Memorandum of Understanding’ or ‘Program’. Instead it stated that the Greek government would propose a new list of reforms that the institutions would then approve. This phrase constituted a significant victory for the Greek side. It was quite the opposite of having accepted “whatever” was “on the table”.

 12’51” and 13’01”– Two captions appear

Austerity measures continue” – Recall, once more, that our mandate was to negotiate a New Deal for Greece. The 20th February agreement succeeded in putting on hold the new austerity measures that the Troika was demanding (even from the previous government) until the negotiations’ end. An apt caption would be: “New austerity measures averted – for now!”

Europe gets a veto over all Greek laws” – Not so. The MoU our government inherited, from the previous governments, had already committed all Greek governments to a state of servility to the Troika. The 20th February agreement was in fact a major improvement in that it specified that we would have to consult the creditors only regarding legislation that had a negative fiscal impact or a negative effect on the stability of the financial sector or growth. This left us with many degrees of freedom (since these negative effects were a matter of interpretation) that the previous Greek governments lacked. For example, soon after we legislated to grant free food, electricity and shelter to 300 hundred thousand people without consulting with the Troika. (That they kicked and screamed anyway over this piece of legislation is another matter.) In this sense, the said caption is unfair and misleading.

13’27” – “This deal is so terrible..,” narrates Paul

The 20th February Eurogroup agreement was quite the opposite of “terrible”: it was an excellent deal, all things considered. A game changer. Possibly the first time ever that a Eurozone government had forced a major concession on the Eurogroup/Troika (namely to get an opportunity to re-write, from scratch, the conditions of its loan agreement). The fact that a few days later (on 24th February) the Troika tried to rescind that agreement (in a teleconference of the Eurogroup members) is another matter and does not justify calling the 20th February Eurogroup agreement “terrible”.


1’59” – What Syriza wants is to “cancel Greece’s debt”

That was not our policy or aim. Cancelling Greece’s debt was never something I put to the Eurogroup. Our negotiating policy (that I had been working on for at least two years, in agreement with Alexis Tsipras and his team) was based on a moderate proposal of smart debt swaps that were politically fathomable in places like Germany while, at the same, time offering Greece substantial debt relief – so much so that investors would be attracted again to Greece, recognising that the Greek state had recovered its solvency.

1’55” – “Euclid Tsakalotos now replaces Varoufakis as lead negotiator.”

The main change at the end of April was that the Prime Minister (under pressure from the President of the Eurogroup) assumed direct control over the behind-the-scenes negotiations and the concessions made to the Troika, with George Chouliarakis (my Deputy at the Eurogroup) as his effective adviser and orchestrator of the day-to-day talks with the Troika’s officials. Euclid Tsakalotos was given a coordinating role but very little authority over our side’s concessions. For my part, I continued to negotiate with finance ministers and the Eurogroup, from a position of greater weakness (given the above).


40” – “There is now only 9 days of bailout money left”

Paul gives the impression that we had a stock of bailout loans, from which to pay our way, and that this stock was running low – leaving us with only 9 days before its depletion. This is false. Our government did not need bailout money to run our state; e.g. to pay pensions, salaries, suppliers, for schools etc. Indeed, we were running a (small) primary surplus and could continue to pay our way ad infinitum. (New bailout funds were only necessary to meet repayments of our debt to the Troika. (This is what made our negotiation on debt restructuring so pivotal.) So, the “9 days left” that Paul mentions was the time left before the ECB could decide (as it did) to pull the plug from the commercial banks upon the expiration of the extension of the loan agreement that we secured in the 20th February Eurogroup meeting. Nothing to do with the state running out of (bailout) money.

5’08’ – Caption: “Bank run begins”

No, at that point a bank run that had begun in December ended tragically – with the banks’ closure. It is important to recall that the bank run initially was started well before we were elected, courtesy of a scare campaign by the Greek Central Bank (a part of the ECB) whose explicit purpose was to scare Greeks off voting for Syriza. Then, after our election, the ECB made a sequence of aggressive moves to engineer an accelerating bank run in order to put pressure on our government to capitulate. By end of June, the ECB closed the banks by announcing it would no longer offer the banks’ liquidity. [There is nothing easier than a central bank starting a bank run and closing down the banks, when while its purpose is precisely the opposite: to prevent a bank run and keep them open.]


37” – “Greeks voted by 61% to deft Europe and reject austerity”

It is a mistake to conflate the Eurogroup/Troika with Europe. Greeks did not vote to defy Europe. They voted to say no to a catastrophic economic program imposed upon Greece, before transplanted into other European countries to the detriment of Europe.

9’18” Caption: “Europe lends Greece €86 billion”

Perhaps it is useful to note that none of this money will go to the Greek state. Not one cent! A small part will go to the Greek banks and the rest will be used to refinance existing (unsustainable) Troika loans. A typical case of extending-and-pretending; of a bankrupt debtor being given new loans from which to pretend to be meeting her debt repayments while the debt mountain grows taller and debtor more and more bankrupt.


There is a presumption running through Paul’s and Theopi’s documentary that is never properly stated or interrogated. It is the view that, in the final analysis, we (and other Eurozone member-states) face only two options: Capitulation to the troika or exit from the Eurozone.

While this was always the Troika (and Dr Schäuble) line, with which to scare governments into submission, it should not be taken for granted. It has always been my view that, had we remained steadfast, Mrs Merkel and Mr Draghi would step in and avert Grexit at all cost. An honourable agreement would have transpired, instead of the document of surrender also known as the 3rd Greek bailout.

Did we have the right to take this risk? We had, I believe, a duty to do so. Indeed, my interpretation of the 62% NO referendum vote is that the majority of Greeks instructed us as follows:

  • We do not want a clash with Europe.
  • We do not wish to leave the Eurozone.
  • But, if Brussels-Frankfurt-Berlin demand our surrender and acceptance of a deepening Great Depression under the threat of Grexit, tell them: Do your worst. We are not budging!

20 thoughts on “#THIS IS A COUP – My comments on Paul Mason’s documentary

  1. It’s really a shame to compare Pinochet’s, a dictator, referendum with the referendum in Greece. All voters could not understand the dilemma, it was a financial agreement, but they were sure that this agreement was a malicious one to the Greek people. There is no need to know details, just the experience and intuition can guide people’s vote. In a few words, Greece does not trust troika, her proposals, even anything that comes from them. The reason is too simple: They destroyed the Greek economy, they had not been a self-criticism about their false prediction, nothing. So Greeks do not trust troika. Even there is no trust to institutions of Europe. Just a capitulation and a proud people on knees. Disappointment, no hope for a better future is the dominant feeling in Greece now. And less trust to parties and the political system. Whatever it takes for the future.

    P.S. Yani,
    Of course you have the right to defend your choices in the past. But you are still in the past, all this is History now. Life is going on. The problem and the intriguing issue is to fight for the future. Europe cannot change even if Dr Sch. leave or die, the problem is a general problem of function of institutions in Europe. Also, the conservatives are the dominant force in Europe and I cannot see a way to leave us alone. In a few words, there is need to take care of the trees not the big image, the forest, Greek people is already afflicted by SYRIZA policy (taxes, pensions, loans). And you have the task to talk about all these. Unless you don’t care about the everyday life of a mean Greek.

  2. “Some of the key domestic actors in Greece during the first Tsipras government – chief among them former finance minister Yanis Varoufakis – are now engaged in retroactive narrative building. Busy on the international speakers’ circuit and with an unrelenting appetite for media attention, Varoufakis is seeking to underline that the “Athens Spring”, as he calls it, was “crushed” by a combination of the troika institutions, shadowy market forces and his preferred default villain residing in the finance ministry in Berlin.
    Yet, this perspective is at odds with numerous facts on the ground in 2015. While Syriza harnessed the protest vote against five years of memorandum policies in Greece, ministers such as Varoufakis or the former energy minister Panayiotis Lafanzanis peddled economic policies based on wishful thinking. Their narrative could also benefit from them taking a deep look into the mirror and asking themselves “where did we go wrong?” instead of automatically pointing the finger at domestic opponents and foreign intervention.”
    – See more at: http://www.macropolis.gr/?i=portal.en.the-agora.3498#sthash.3mdkO3Ek.dpuf

    • You must be joking….quoting ex Troikanaut Jens Bastien. It’s the same as quoting Jeroen Djiesselbloem. What else would you expect him to say but the Sheuble party line? But I forget, you are all 3 in the “alter reality” business. i.e. if you say it enough times (“the moon is cheese”) it must be true. Well, the clock is ticking on this and by now you are really only talking to each other.

  3. I have just read the below interview with the Austrian Finance Minister who is talking about several things, including his experience with the Greek negotiations. He praised the new Finance Minister Tsakalotos: “While he is as much of a leftist as Varoufakis, he is also very pragmatic. He is not a showman like Varoufakis. He recognizes problems and tries to find a solution. Varoufakis never did that. I once said to Varoufakis: ‘Yanis, at this point I would really like to have some hard facts from you, facts and numbers’. But he replied: “I don’t want to talk to you about facts and numbers. I want to talk to you about politics'”.

    The Austrian Finance Minister has been in politics for only a couple of years. Before, he was a very successful CEO or a large Austrian company which he turned around from near-bankruptcy to success. People from the real word have a habit of quickly differentiating between sophisticated talkers and pragmatic doers.


    • So you came on this site to insult Yanis? And continue wafting your ridiculous opinions and nonsense as if they are Truth? No, KK, your hour is quickly drawing to a close and when the expected crash really hits – instead of the slo-mo version we have now – I predict there will be no more (supposed) “Klaus Kastner”. You had a good long run but it is finishing.

      The “pragmatic doers” in the corporations, banks and Wall Street have proved not only incompetent but criminal. Nor are they exactly heroes but the creators of today’s financial catastrophe sweeping the world. As for your beloved Pinochet, the famous murderer and dictator, he sold Chile to sharks and destroyed the country. Meanwhile, but not least, Austria’s banks are engaged in a slow motion serial collapse that could very easily bring down the Eurozone and beyond.

      Enough is enough.

    • You have to be kidding! Hans Jörg Schelling a successful guy? He does not even have a wikipedia reference in English! The man is a nobody!

      “He is one of six vice presidents of the Austrian Economic Chamber and heads the supervisory board of the partially nationalized bank Österreichische Volksbanken AG. In the past, Mr. Schelling was also head of Austrian retail furniture chains XXXLutz GmbH and Kika-Leiner Gruppe.”

      Retail furniture is a basis for qualification as a finance minister??????

      Tsakalotos with his Oxford education is 10 times more qualified than this furniture chain salesman.

  4. mr. Varoufakis, while I did and still do respect a lot of your views and actions, calling the February 20 agreement an “excellent deal, all things considered”, is like calling the Munich Agreement of 1938 “an excellent agreement”. “All things considered”, it really gave Greece nothing, and the lenders eventually everything. The troika’s rescinding that agreement is definitely not another thing, it’s what you get when you sign an agreement under which the other side has all the leverage and you have none.

  5. If one wants to know what a serious referendum is like, one ought to take a page from Switzerland. The Greek referendum was a farce, if there ever was one. Varoufakis has his interpretation of what the referendum was all about, others have other interpretations. The point is: a proper referendum does not allow interpretations. There are clear choices to be made; they are being discussed at length beforehand and everyone knows what the consequences are of each choice.

    The Greek referendum reminded me of the referendum Augusto Pinochet staged back in September 1980. If one read the small print, one would have known that it was a yes/no vote about the new constitution. Pinochet & Co. rallied the Chileans with populist/nationalist propaganda suggesting that the whole thing was about the existence of Chile as a country. 65% voted with “yes”. Pinochet interpreted this as meaning that more than two-thirds of the voters were behind him even. He was not quite wrong because the new constitution stipulated that he would retain authoritative powers for another 18 years, but no one really cared about that at the time.

    All Tsipras has proven with the referendum is that the Left can be just as manipulative as the Right.

    • Time for deliberation was not given by the creditors, nor did they reveal in advance what they would do to Greece if the exit path was taken. Would they confiscate deposits? They did not say, not publicly at least.

      Still the referendum should have been between “Surrender to the creditors and stay in the Eurozone” or “Leave the Eurozone, stay in the EU and issue our own currency. This path is risky but lets us run our country and guarantee basic human rights”. This is a small and clear enough question to print on the ballot paper, and if it was already past the press it’s something you can explain on television. And it’s not meaningless. Its a vote you can act on, in fact you’d have no choice.

      That this question wasn’t posed, but the referendum was really for nothing, ought to consign Tsipras to the dustbin of history.

    • I agree with you Pavlo. As far as I am concerned we are just twiddling our thumbs until Tsipras retires to the dustbin where he consigned the Greek nation last July, and against their clear mandate. There was no excuse for what happened – never has a politician asked for and received such a clear answer – and this in spite of the unclear question. Ignoring it was against the Constitution. He betrayed us.

      Compare this to Metaxas, who had 5 minutes to react and without consultation. Yet I have never heard a single Greek criticize his decision. In spite of the consequences.

    • The question on the Greek referendum was crystal clear. The question posed to the Greek people was:

      “Do you support the terms offered by the Troika creditors”?

      The answer was a resounding NO.

      In my opinion it could not get any clearer than this and therefore in terms of clarity the Greek referendum was rated near the top as far as referenda go.

    • … and that is the plain and simple truth, along with paper gold market manipulation to prop up fiat.
      It’s staring us right in the face but so very few can (or want to) really see it,
      … and that is the problem

  6. In principle you’re right. In practice, the ECB forced a choice between surrender or issue a new currency so that the state can guarantee banks and payments (and best the risk of inflation and deposit loss).

    Rejecting this choice was counter productive. Sometimes life blackmails you and the way to keep your freedom and your relevance is to take one of the paths open to you. Greece chose to surrender. Many of us think exit was the right option.

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