When Miriam Met Yanis

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From top: Miriam O’Callaghan interviewing former Greek Finance Minister Yanis Varoufakis; Dr Julien Mercille

The former Greek Finance Minister’s interview on RTÉ’s Prime Time sought to portray him as an arrogant failure next to the likes of Michael Noonan.

Dr Julien Mercille writes:

The former Greek finance minister, Yanis Varoufakis, was in town last week for an appearance at Kilkenomics. David McWilliams invited him and had a discussion session about topics ranging from Greece, Ireland, religion and politics. Varoufakis seemed impressed with the event as he wrote that it had been a “happy day” for him and that although it was his first visit to Kilkenomics, it would certainly not be the last.

However, Varoufakis also had an interview with RTÉ’s Miriam O’Callaghan for Prime Time, which can be watched here.

I’m not sure Varoufakis was very impressed by our state broadcaster.

Indeed, the interview shows O’Callaghan repeating the Irish government’s line uncritically. Her questions could have been taken straight from Enda Kenny’s and Michael Noonan’s notebook.

The gist of her queries was that Varoufakis had accomplished nothing in his negotiations with the troika because he was too arrogant.

If you want to get a quick flavour of the interview, someone made a three-minute video of O’Callaghan’s questions here. It’s good at showing that her 20 questions or so are all trying implicitly or explicitly to picture Varoufakis as a failure, and conversely, to show that the Irish government, and Michael Noonan in particular, was so much better at negotiating with the troika.

For example, she asked:

– “Let me quote the Financial Times, they said that you were regarded in Eurozone capitals as the most unbearably garrulous and irritating man they’d ever dealt with.”

– “Did it make sense, whatever your arguments were, for you not to get on with your EU colleagues, because those personality divisions made it even less likely that you would succeed in getting the billions that you needed for your country?”

But O’Callaghan misunderstands how the Eurozone works, how political power operates, and what determines the outcome of negotiations between the troika and countries that received a bailout.

This is not about “personalities” and “who you get along with”. Are we really to believe that the troika gets the finance ministers from Ireland, Greece, Spain and Portugal in a room, they chat and joke together for a few days, and then a troika official says “oh, Michael Noonan seems like a really nice guy, actually we both love soccer and fishing, and we drive the same car, so I’m totally willing to give him a good deal”.

Whereas another troika official says “you know, that Varoufakis, I really don’t like the way he flips up his jacket collar all the time, let alone that he plays the piano, which I never liked as an instrument, so he’s not getting the money”.

It’s incredible that our state broadcaster would convey such a simplistic interpretation of the one issue that has been at the centre of economic policy for the last six years.

Eurozone negotiations between the troika and debtor countries are about power—and that’s it. A negotiator will be described positively by the media and the troika if he does what he’s told, but if he challenges European authorities, he will be pictured as an arrogant or deranged character.

That’s is exactly what Varoufakis tried to explain to O’Callaghan. He asked her, seeking to make the point that it wasn’t about personalities, “but do you think the troika liked Michael Noonan?” To which O’Callaghan was proud to answer: “I think they probably did”.

Oh I’m sure they loved Noonan too, because he did everything he was told to do. But it has nothing to do with personalities.

It is true that Syriza failed to persuade the troika to present Greece with a better deal. Syriza was able to make some small improvements for the Greek people, but overall, they did not succeed in improving the policy package to which the troika is subjecting Greece. They really failed. But the reasons for that have to do with the fact that the troika has overwhelming economic and political power over the Greek government, so it was able to force Greece to accept its terms.

Another key aspect of power relations is that the quality of argumentation has little to do with outcomes in international relations. O’Callaghan asked Varoufakis:

“If your argument was so self-evident and powerful, why did none of them buy those arguments?”

Well, for about the same reason that when women didn’t have the right to vote, even though they had a pretty good argument to get it, those in power didn’t care. Or when George W. Bush wanted to invade Iraq on zero argument at all, he was able to do it no matter what.

Similarly, fiscal consolidation does not work to revive economies in a downturn, but that doesn’t prevent the troika from doing it anyway.

The last point that was confusing in the interview is the reason why the troika would be so mean as to want to crush Greece. O’Callaghan asked: “But why would the troika want to crush Greece?

Varoufakis explained, correctly, that it is Syriza that the troika wanted to crush, because Syriza was providing an example of defiance toward the troika to all Europeans. The troika was scared that this influence could embolden other forces elsewhere, like Podemos in Spain.

Julien Mercille is a lecturer at UCD. His book Deepening Neoliberalism, Austerity, and Crisis: Europe’s Treasure Ireland is out now. Follow Julien on Twitter: @JulienMercille

115 thoughts on “When Miriam Met Yanis

  1. Roight

    Can’t wait for the comments on this. Thanks for the Monday laughs.
    “an arrogant failure next to the likes of Michael Noonan.” … bet they are quaking in gov building …

  2. Observer

    But the reasons for that have to do with the fact that the troika has overwhelming economic and political power over the Greek government, so it was able to force Greece to accept its terms.

    This was obvious before the original election of Syriza. Yet they still made promises and commitments that ignored that reality. They either lied to the Greek people or believed that through the force of their argument and personality they could change that reality. If it is the case of the former, then Dr Julien Mercille should criticise them as such. If it is the case of the latter, then Miriam’s simplistic narrative is actually on the money; as that is what Yannis and co thought would work.

    1. ZeligIsJaded

      They didn’t ignore the reality, the identified it, and promised the Greeks that they would stand up to it.

      They did what they promised but failed to get results.

      1. Observer

        No. They promised to reverse austerity. Not to stand up to it, whatever that means. But to actually reverse it.

        1. offMooof

          its an economic model..remember when we started austerity..well that was switching economic models. So to reverse austerity means to implement a new economic policy. but den ya know dat.

  3. Brendan

    I wouldn’t be Miriam’s biggest fan, but I don’t see why people are giving her a hard time over this. The role of a political interviewer is to act as contrarian, to put forward the opposite point of view, which in this case happens to be the “establishment” or the government or whatever.

    1. Grouse

      If that’s the case, it should be easy to dig up an example of her giving a similarly contrarian interview to a Fine Gael member of government. I’m not saying those interviews don’t exist; I don’t watch enough RTE to know whether they do. Maybe someone else can weigh in.

    2. Joe835

      Yes, exactly. I don’t know if this writer is advocating she agree with him and just congratulate his hard-nosed tactics but that’s not usually how these things work!

      1. jon

        Yes, because the Greek economy was just fine and dandy before those pesky Syrizans got their hands on it. Jesus.

        1. Owen C

          Did i say it was fine and dandy? No, I didn’t. But congratulations on reading things which weren’t there. Syriza’s government someone managed to make the situation significantly worse, and almost fatal, in a very short space of time. This is a simple fact.

        2. Owen C

          No, they should have dealt constructively with the EZ, rather than in the very confrontational manner they did right from the outset (ie saying “the Troika is dead” in the first public press conference with Eurogroup leader Dijsselbloem, claiming Italy was close to bankruptcy). His core mistake was an assumption that the EZ would not be willing to let Greece collapse and exit, and therefore would ‘blink’ first. This turned out to be completely incorrect.

  4. Owen

    Never rated Miriam O’Callaghan as an interviewer, and O agree with Mercille. She tried to play the devils advocate by persisting on the same line of questioning. In essence, all questions were the same, she just didn’t get the reaction she wanted from him – which i assume was the hope he would burst out with some womanising arrogant hammering.

    I understand her reason, but after the first question she should have moved on to some intelligent discussion.

  5. Darragh Byrne

    I was at Kilkenomics interview David McWilliams did with Yanis and the contrast could not be more severe. Miriam was like Bill O’Reily talking to Bernie Sanders. However at Yanis gave a brilliant insight into how Europe works- that the Germans were too afraid to go back to their own people to ask for more money to bail out their banks so instead made the Greeks pay. He said that the French are the real target of not giving the Greeks a fair deal since the Germans need a political union to make EU work. He also talked about politicians becoming technocrats as soon as they enter governments at moment since the civil servants absorb them- almost zombie like. Democracy has become a charade. He was actually very kind about Angela Merkel and expressed admiration for her treatment of refugees and even had sympathy for German finance minister. The character assassination actions of him are so obviously right wing media across Europe who are frightened by what he represents. He is a Keysian economist essentially – not even the Marxist. He wants Europe to go back to its 1970s Social Democratic role. That is what he is proposing through a grassroots movement which is finding favour with Jeremy Corbyn and has echoes here with Right 2 Change and Social Democrats. He seemed an intelligent, charming, kind, funny, conciliatory and brave man to me. Not the arrogant character who Miriam and Enda would prefer. The big question is – would she give Enda or Michael Noonan such a hard line of questions? Is our state broadcaster truly independent from the state that helps fund it? People need to complain to Broacasting Commision about this and last week’s interview on Six One about Web Summit. Hopefully it is some new Fox News consultant that was busting that caused this glitch or our fifth estate is corrupted.

    1. Owen C

      “the Germans were too afraid to go back to their own people to ask for more money to bail out their banks so instead made the Greeks pay”

      Darragh, this doesn’t really make sense. The German banks no longer have any real exposure to Greece. Greece’s creditors are essentially other European (and global, via the IMF) taxpayers. That’s who they would be going back to to explain who would pay for any Greek debt writedown. And Varoufakis has repeatedly overestimated the willingness of European taxpayers to offer such debt forgiveness to Greece. That is ultimately why European governments have been able to play hardball with Syriza, because while there was a certain element of sympathy for Greece’s plight, there was no support for other European taxpayers to take headline nominal losses on their Greek loans. This is where Varoufakis’ ‘personality’ comes in – he was seen by many taxpayers across Europe as arrogant and aggressive in how he conducted his diplomacy with their leaders in the back and forth negotiations.

        1. Owen C

          his own comments, his own actions, the idiotic photo shoot he did for a French glossy…Even his dress sense seemed out of place with politics as the average person understands it. Did he lack so much humility that he couldn’t just wear a nice plain shirt and tie like the rest of them? It’s not that he should be derided for wearing flash shirts and all that, but it gives you an insight into how he views himself and it unwilling to back down from his version of what is right and correct.

          1. MoyestWithExcitement

            “Did he lack so much humility that he couldn’t just wear a nice plain shirt and tie like the rest of them?”

            There you go. It’s not really about his policies, it’s about his non conformist attitude. Your brain can’t handle it.

          2. Owen C

            I’m saying his non conformist attitude (which to come people came across as arrogant and aggressive) did not help with already difficult negotiations, which themselves were a tough balance of politics and economics. I don’t think that’s a particularly controversial suggestion.

          3. MoyestWithExcitement

            Controversial? No, it just shows that fear of difference is what’s really at play here. People are afraid of him and need to think of reasons to justify it.

          4. SD

            Well, he could have done that , but then again , he got more attention , that worked for the better. Do you people know what we dealing with or what? Everything should be used against this monster that is swallowing humanity . The first game theorist was Ulysses. Varoufakis does mention him at the end of the first Euro Group.

          5. mick

            Imagine the peace process falling apart because David Trimble thought Gerry Adams had a surly attitude. Nope me neither! Not the way the world works.

            Greece is tiny in the european context, but it they had got a deal Spain, Portugal and Italian would have been under pressure for electorates, as to how they hadnt secured better deals. Germanys, Finland, Netherlands
            are under pressure not to ‘help’ Greece. Greeces recovery under a new deal would have made a lot of people look very silly. Its public record (Tim Geithner) that Europe went out to punish Greece before, so its not impossible this time.

            The European overwhelming focused on is character, and not his proposals. Which is the highest level of bad journalism.

        2. mick

          Clampers Outide…

          Varoufakis: “here a rational proposal, inline with the IMFs proposals, which will allow Greece, and you to pay you back as much as possible. especially as Greece follow the troika plan and it failed”,

          Troika: “I dont like your sass!”.

          its a laughable arguement

      1. Darragh Byrne

        Why are you all attacking his personality? His idea of a grassroots alternative to EU collapsing under the weight of unsustainable debt is sound. If the British leave the Euro we are stuffed. If the French elect LePen who will fight over refugees with Merkel they might leave too. Ireland and Greeks are only casualties in all this. Yanis is proposing a return to social democratic principles uncoupled from crony capitalism. He wears nice shirts. I really don’t care. Why is someone’s personality or clothing an issue? What if Gandhi or Martin Luther King or Nelson Mandela were assholes? Indeed I am the British, the American and South African governments all said they were arrogant and agressive too. It is a simple smear tactic. First they laugh at you, then they attack you, then you win. Laugh at his shirts, attack him over his arrogance but please debate his ideas. I personally wish we had a Yanis as economic minister in every government in Europe- someone who understands that economics should be disconnected from the social contract. The market needs to be tempered by a sense of humanity. Otherwise what is the purpose of the EU? Falling for stereotypes about lazy Greeks and Irish drunk on money they didn’t have is not helpful. The reality is the EU either embraces its original principles or disintegrates under the pressure of the refugee crisis and Tory style neo-liberalism.

    2. serf

      That’s not intelligent discussion, its the ranting of an adolescent conspiracy theorist. Why does he keep talking about banks debts when no European banks have any exposure to Greece? Also, why does he never mention that the banks that did have exposure were all forced to write down their debts in the 2012 PSI deal? So the only creditors left are taxpayers in other countries (including emerging markets that fund the IMF). There’s a level of tough realpolitik around all this that poor old Yanis seemed unwilling or unable to grasp.

      1. Darragh Byrne

        The frugal Germans had to bail out their own banks as well. The German government couldn’t blame their banks- they are Germans after all- banking is what they do right supposedly. But instead of facing up to this they blamed the grasshoppers in the sunshine in Greece who must be responsible. This was lazy stereotyping to avoid reality. Germany just can’t take responsibility for the Euro being a failure and are doing everything they can to scare the French into a political union.

      2. mick

        “Realpolitik Poor old Yanis cant grasp,” there is a Realeconomik that he does. Austerity has never increased a countries ability to pay debt, and continuing the same way can only decrease it through contraction. 3% Primary Surplus is insane. IMF agrees broadly with Varoufakis. The more they can grow the more they pay back. that wouldn’t be hard to explain to the public.

        The previous bailout was botched, it wasn’t high enough, and they continued austerity meant that it was irritant as they had to contract with continuing austerity.

        http://www.nytimes.com/2015/07/03/business/international/greece-referendum-bailout.html

        http://www.theguardian.com/business/2015/jun/30/greek-debt-troika-analysis-says-significant-concessions-still-needed

        https://www.youtube.com/watch?v=VfFejPFAcXg

  6. Charger Salmons

    The inescapable fact is this clown was sacked by his own ultra Left-wing party of amateurs because even they he was giving Greece a bad name.
    A subject of derision in the rest of Europe you can see why impressionable fools in Ireland fall for his schtick.

    1. Darragh Byrne

      He is not ultra left wing. He was actually offering a very 1970s social democratic Keysian solution. Things have gotten so right wing across the political spectrum that someone like Yanis or indeed Jeremy Corbyn is called Ultra Left or Marxist. In 1985 they would have been in the centre. Our own Labour Party are now more right wing than the Tories.

      1. Owen C

        European politics is not right wing. It is high tax and strong on government intervention in much of the economy. What it is is quite conservative in that it seeks to maintain the status quo. That status quo currently involves protecting the European banking industry given its importance for creation of credit (quite distinct from the US model of bond markets and origination&distribution), promoting the idea of competitive export driven economies (at the expense of domestically driven demand), and ensuring the European project remains intact via strong fiscal rules. You can argue about whether these policies make sense or not (the fiscal stuff is flawed for sure, though not necessarily outright ‘wrong’, the export driven stuff is too blunt, the banking stuff will take a decade or more to create an alternative), but they are not being protected by right wing ideologues. They are being protected by conservative politicians in the sense of politicians who seek stability and retention of the status quo.

    2. mick

      Com’on!! read a book!!!
      Varoufakis is still highly regarded, his policies are mildly right-wing Keynesian. Name one Sryzia. Its always same, just responding to what they hear people say. Before you call someone Marxist, you at least have to know what there economic policy actually is!! That’s shouldnt be a hard concept to grasp.

      Greece only disagree mainly on the primary surplus, and repayment scedules and slightly slowing reforms so That the country can grow so they are stronger, which means they can pay back more

      The IMF want a similar package to Greece
      “a very moderate right-wing Keynesian program that wanted simply to alleviate some of the conditions that created havoc in Greece.”- Vassilis Fouskas, a professor at the University of East London
      http://www.bloomberg.com/news/articles/2015-06-19/compromise-is-a-dirty-word-for-tsipras-backers-in-aid-standoff.

    3. mick

      “Ultra left wing”…lol, really? Go on.. name the ultra left wing policy? Even saying that shows you havent looked it up, at all. Google is your friend.

      Syriza economic proposal is mildly centre right Keynesian, and the IMF broadly agree with them. Those IMF Maoists again eah!!

      http://www.bloomberg.com/news/articles/2015-06-19/compromise-is-a-dirty-word-for-tsipras-backers-in-aid-standoff.
      http://www.nytimes.com/2015/07/03/business/international/greece-referendum-bailout.html

      Impressionable Irish Fools, uurrr well, you thought Syriza was a ultra left wing, lolcakes, thats pretty impressionable. I guessing your going to start the FG started the recovery silliness. Nope, Euro devaluation, QE and bond buying did. we’d 0% growth for 3 years, jump 4% mid 2013. Euro was devalued in mid 2013.

  7. whatthefupp

    “intelligent discussion”. I hope you are not suggesting this column is an indication of intelligence.

  8. Snickers

    Of course she’s right; what Greece should have said was what Ireland said – “Yes, sor, oh, thank you, sor, the poor will be homeless, sure aren’t they used to it, sor, thank ye kindly, sor, and a rod for my back, sure you’re too generous, sor, Paddy loves a bit of th’oul rod for the back, sor, thankee, sor.”

      1. Snickers

        342 people have died homeless on the streets in France already this year, average age at death 49…

  9. 15 cents

    i expressed my dissapointment with her on twitter and she didnt write back, but did start following me. eerie.

  10. Eoin

    I’d expect nothing less from the states propaganda network. Not even making any attempt to mask their extreme bias towards the establishment position, no matter how indefensible and ridiculous that position might be. And they make us pay for it. Fair play to Varofakis and Syriza and the Greek people. At least they tried to make a stand against the oppression of the EU. More than I can say of this nation. What happened to us? How did we end up as the Judas goat of Europe?

    1. Owen C

      “What happened to us?”

      We decided that an economic recovery was a better option than “throwing out the Troika” (originally Sinn Fein, later copied by their Marxist commrades in arms at Syriza).

      1. ollie

        “What happened to us?”

        We (the citizens) took on the private bank debt and will pay back every cent, including interest. This country is so indebted that it will not survive the next economic collapse which is about 3 years away.
        We punished those in society who need our help most; we make people in their 90s lie on hospital trollies for days, we made our school classes the largest in Europe.
        That’s what we did Owen.

      2. Mick

        The austerity failed, according to the IMF, you do know that, don’t you? Contracted the economy greater than gains cuts. Ireland had 120% at for 4% with flat growth. We needed a primary surplus of 5.5% for 15 years to get out of debt- that’s impossible, you do know that? No country in the history has recovered form a debt crisis without default of devaluation (IMF). The situation was so desperate that the ECB printed 1.5tn to massive subsidies bond yields, and devalued the euro by 30%. The ECB had a massive battle with the Germans to do that. You do know that, that was the only reason Ireland left the Bailout was because the QE. Without the ECBs desperate intervention, Ireland mathematically couldn’t recover? You do know that the head of the Troika in Ireland said that Noonan could have gotten a much better deal?

        Absolutely no economist regards Syrza proposals as Maxist, they are mildy Keynesian, removing tax evasion, and market reforms. its on the internet. Varoufakis is still highly regarded in the economic community. You do know that right? You do know that its public record that Merkel went out to punish Greece as a warning to others, and knew that the 2010 bailout would fail 2011?

        You do know that Varoufakis doesn’t want to default a single penny of Greek debt? A continual 3% primary surplus is mathematically impossible in a supply side export economy, and that SSE economies can only work because no one else is doing it? You do know that Greece fulfilled the Troika program before time which was four times as harsher as ours? You do know that the IMF wanted almost exactly what Varoufakis suggested, and have predicted the program deal will fail?

        You do know that the crisis was caused by a banking crisis and became a sovereign crisis because citizen were forced to bailout private loss? There was factually no orgy of public spending? The bank bailout cost 5tn? The citizenry 100% insured the assets of the very rich who caused the crisis? You do know that French, German and Dutch banks were bankrupt in the crisis. Deutsche bank moreso that the entire US big 6, and one dutch bank was geared 40:1? That 93% of the Greek bailouts are going to core banks? And the US government has accused Germany of beggar thy neighbor mercantilism.The QE made the investor class much richer, with very little trickling down to the citizen as intended. You do know Australia was the only country to not go into a recession in the crisis because the slammed on the consumer side stimulus? The euro-zone hasnt any of the 5 requirements of an Optimal Currency Zone, and there for can work in its current form? The current neo-liberal economics austerity approach is creating another private debt bubble bigger than the last?

        The above are verifiable mainstream facts. I know I’m being harsh, but expressive voting is really dangerous (look that up). If a political opinions are platitudes attacked to strong emotion, and know a knowledge of the detail, it leads to

        1. Owen C

          Mick, that was a rant and a half. You do know that, right? I mean, its a long and frenzied stream of conspiracy style claims. Bonus points for dropping in Deutsche Bank into the mix for no real apparent reason.

          One quick point: “You do know that, that was the only reason Ireland left the Bailout was because the QE”. ECB QE only started in March of this year, and Ireland exited the bailout in December 2013. So that’s mathematically impossible, to use your own phrase (look it up if you don’t know what it actually means).

          1. mick

            Challenge accept! I apologist that I was kurt in my post. I have to compile a the list for a college project anyway, I well provide comprehensive evidence for my argument, from reputable sources tomorrow. No conspiricy, just fact.

          2. mick

            There you go!!! Every single “crazy conspiricy” claim backed up from a respected emperical evidence from highly respected sources, and yours thoroughly debunked. id it mostly done for a college project it was copy and paste and some annotations. enjoy

            Arrogance and condescension can only be used if you are actually someway informed. Your post through out have the same bad attitude. I get that Sinn Feinn (Im not a fan) probably stood you up at prom, but to expand that into a world view without looking up any of the details is foolish. Ignorance is not a virtue. Appology??

            If you genuinely want to make informed opinions, I posted 4 excellent links at the very end. Reality is reality, its complex and requires effort to understand.

            Freshfish Ill let you off because that was funny.

            Pure Austerity failed badly in Ireland. IMF 2012
            http://www.irishexaminer.com/ireland/imf-we-got-effect-of-austerity-wrong-210285.html

            “The report says the IMF believed that for every €100 of austerity through higher taxes and spending cuts, the effect on economic growth and unemployment would be the equivalent of €50.
            But in reality the effect has been between double and three times that — stripping the economy of €90 to €150 for every €100 taken out in budgets agreed with the troika.”

  11. Nilbert

    “when George W. Bush wanted to invade Iraq on zero argument at all, he was able to do it no matter what.
    Similarly, fiscal consolidation does not work to revive economies in a downturn, but that doesn’t prevent the troika from doing it anyway.”

    ….ehm can anybody else understand this magnificent leap of logic? Not that I disagree with either of the sentiments individually, but this is analysis at the level of an intermission year debating class. Pointless, and worthless from an academic perspective, regardless of whether or not one agrees with him.

    1. whatthefupp

      This column is shockingly bad ,not even worthy of BS debate. Accusing Noonan as an arrogant failure and Miriam as simplistic reeks of delusion, given Mercille’s very obvious lack of ability. Have we become so stupid as a nation that we deign to entertain this douche?

      1. Charley

        Noonan’s appointment as finance minister was an attempt at character rehabilitation, remember his Max Clifford influenced appearance on Frontline the week after they had a section on Alzheimer’s , FG were hoping that some crumbs from Europe would whitewash over the view held by many that Noonan is a nasty piece of work who hounded Bridget McCole to her death and denied the victims of HepC their rights.

    2. J

      @ Nilbert: I prefer the playing dumb defiance of
      “Eurozone negotiations between the troika and debtor countries are about power—and that’s it. A negotiator will be described positively by the media and the troika if he does what he’s told, but if he challenges European authorities, he will be pictured as an arrogant or deranged character.”

  12. rotide

    This guy got fired for being a bit of a douche – That’s the common perception of the situation. Of course she’s going to take that line of questioning.

  13. Joe835

    Mr Varoufakis’ line is admirable, that the debt is punishing and things can’t go on like this. And they can’t. But there’s also realpolitik, the reality that after years of laying down the law to countries like ourselves, Portugal, Spain, whoever, the decision-makers in the Eurozone have politically painted themselves into a corner with previous policies.

    In business, U-turns are painful and often necessary. VW could have denied the truth for months, years even, if they weren’t facing not only customers who can choose not to buy their products but also shareholders, who may decide to dump their stock en masse and strip the company of its value. Rather than let that happen and let unknown risk bear down on them, VW decided to be upfront, offer compensation to all and sundry and all told, they may not have much change from €80bn, which is what it costs to bail out a small country these days.

    In politics, U-turns are not so simple. In politics, governments can ignore the truth, manipulate it, deny it and get away with it because their shareholders, the voters, don’t all have the same goal as VW shareholders, which is a solvent organisation with good prospects ahead of all other considerations. In politics, throwing your hands up in the air and admitting you’d got it wrong and that compensation programmes, aka quantitative easing, burning bondholders, will begin immediately would be suicide.

    Mr Varoufakis thought he was dealing with CEOs who could see the writing on the wall and adjust their policies to reflect the new fiscal realities. He wasn’t; he was dealing with cowards who want to hold on to power and keep the rhetoric of austerity. They may have been open to compromise if he led them to it, if he tempered his public pronouncements and didn’t portray them for the cowards they are at every opportunity.

    So yes, I think he was the wrong man for the job.

    1. meadowlark

      I don’t mean to sound ignorant. My grasp of economics is not great. I found your comment very interesting. I’m wondering if you’d answer a question for me. Why do those in power wish to maintain austerity? What is the benefit in that?

          1. MoyestWithExcitement

            It might have been curt but I mean it. I don’t think they’re consciously thinking ‘austerity will keep us rich’. It’s that, I think, they genuinely believe that national economies can be run like a household budget. Of course there are *some* people who are consciously transferring wealth from the middle class to “The 1%”…..overall though, I think it’s stupidity to blame.

          2. meadowlark

            Thanks for giving a full answer. I’m not joking when I say my grasp of economics is poor. Its all a bit over my head. So thanks again.

          3. meadowlark

            But it’s interesting to read his take on it. Do you think austerity is being deliberately maintained? I know it isn’t as simple a question as just that though.

          4. :-Joe

            @Meadowlark. Yes, it is deliberate and the economic stupidity of it all makes it even more obvious.

            Everything the IMF & World Bank and affiliated groups are involved in, is all focused intentionally on usurping a nations sovereignty and controlling their economy through “DEBT SLAVERY” and exporting their own corporate economic dominance and continue building US hegemony.

            The US is not alone but generally runs the game and both the IMF and WB were started in the US over 50 years ago.

            A quick summary of what I’m talking about by an IMF Whistleblower …
            https://www.youtube.com/watch?v=m-dsiufhMu0

            The always great, John Pilger made a documentary about it over 20 years ago.
            https://www.youtube.com/watch?v=8bfDOGNboE8
            https://www.youtube.com/watch?v=WYCH1Ylncxc -Short edited version

            Watch this excellent documentary for a detailed recent example about the mechanics of it all and the effect it has on Jamaica.
            http://www.lifeanddebt.org

            Another good recent doco film to watch about global economics is “The Four Horsemen”:
            https://www.youtube.com/watch?v=5fbvquHSPJU

            First world European countries are just as vulnerable and we are witnessing it right now at the moment.. look at Greece, Spain, Portugal Ireland etc. it’s all exactly the same idea repeated over and over again…

            Hope some of it helps you to understand current global economics and globalisation(whatever that means) a bit better.

            :-J

  14. Colum McCaffery

    This article is the kind of thing that makes leftism look silly. The problem with media treatment of V. is that he is allowed to take up contradictory positions. One of those positions (Greece wants to pay her debts.) would have been music to the ears of the creditors. Yet the Greek Govt. had to replace him at the negotiations. In the absence of information about what the hell was going on behind closed doors of course attention turned to personality issues.

    It remains that V. and Syriza 1 offered to end “austerity” by standing up to creditors. They knew that this couldn’t possibly work and did it anyway. They attracted a public defeat, made matters worse for Greece and highlighted the weakness of left unity. When leftists defend failure on this scale, the right smile and uncommitted people turn to right wing argument not because they like it (They’re not stupid and can see the bad outcomes.) but because the outcome won’t be calamitous.

    1. SD

      They (syriza) And V promise a good fight, and fight they did . Thats what put a smile in the Greek faces. They were sick with accepting without a fight all these years. No $ can buy that . Alexis had to give in when they played sick games and closed the banks, because he is responsible for the country. Yanis on the other hand is responsible for its moral and ithos. Nontheless I feel the whole thing as a stategy for the long run . Look how many Europeens are realizing what is happening!! I think they knew they are going to lose . But as the poet CAVAFIS sais in THERMOPYLEs : GlORY And WORTH to the ones that protect the idea of thermopyle even as they know the barbarians will win at the end…a heroic soul makes life worth living and that makes you a WINNER

      1. MoyestWithExcitement

        “Look how many Europeens are realizing what is happening!! I think they knew they are going to lose.”

        Interesting theory. That was supposedly Pearse’s motivation for the Rising. He knew he was going to lose but he felt the movement would win public sympathy and that would drive change.

        1. SD

          No wonder then the Greeks dedicate Brendan Behan poem with Theodorakis music (The smiling kid ) to Pearse, Lambrakis, and recently to Varoufakis !

    2. mick

      He didn’t leave Greece any worse than before, they were forced into the same terms they came with. The Troika wouldn’t move, so the compromise argument is absurd to the point credulity. It didn’t matter what he did, they wanted submission. Full stop. They were shook down by their own central bank, that’s almost certainly illegal.

      Varoufakis is still very highly regarded in the economics community. Another thing, he was objectively, empirically correct.

      The Nobel Prize Winner Joseph Stiglitz, “Few finance ministers have such a talent for economics as Yanis Varoufakis,”

      Notice how O’Callahan didn’t deal with a single detail in the entire interview. this was a 20min ad hominem attack. The anti-Greek brigade never use anything other that crude characteristics, and the odd out of context figure.

      The personality argument again is utterly ridiculous, at that level its mostly maximisation of self interest, the creditors are the European public so political goals trump creditor return, they have no skin in the game, to think that it all fell apart because he was uppity is painfully ignorant. The personality narrative just distracts from the facts. Greece was bankrupt 5 years ago, which the troika knew, but if they went so did France, Germany and the Eurozone, core European banks were ridiculously bankrupt.. Greece followed their program perfectly, there is no example of a country recovering from Greece’s position in 2010 with austerity. No credible economist believe it could work. It’s disproved economics. Enforcing odious debt is technically illegal, if we actually had proper rule of law. 93% of the Greek ‘Bailout’ went to creditors. Debt can only be paid back through growth. The 3% (it was four) primary surplus mathematically requires a equal trade deficit else where. A consistent large primary surplus can only be tolerated by heavily export geared economies, which there are only 4 or 5 in the world, which only works precisely because others aren’t doing. That 3% has to come from the private sector, every single year, their major trading partners demand is flat so they literally have no one to export to grow, to make the primary PS, therefor it has to come from private debt. Varoufakis proposals, which are online, were very moderate, and almost identical to what the IMF want. A 1.5 primary surplus and debt pushed out, in a very low inflation environment, this stop choking off the economy allowing it to grow and enabling to pay as much as possible. Syriza would go after the oligarchs and tax avoider, rent seekers because they fucking hate them. And they tied to a bailout agreement for funding on the spending side frugality.

      The accepted mainstream theory of Mundell’s Optimal Currencies Areas, states that a currency-zone must have a federal state. Mundell is “the father of the Euro”. The EUs own McDonnegal Report ’77, stated that a 10%GDP federal budget was the very least necessary for a common currency to work, we’re at 1%.

      5 trillion was spent on the bank bailouts, the European public paid the price when the richest in society of assets insured for free. They were then given interest free money to buy bonds at 4-5% (example is Spain), with a 5% spread, which the spanish people, I shit you not give back to Banks. This was first and foremost a banking crisis, the sovereign debt crisis arose because we don’t have a real central bank with the power to deal with the crisis. The biggest perpetrator made record profits and salaries, since the as the citizens of all countries suffered. And they are just as exposed as before the crisis, so an worse crash is waiting to happen. Quantative easing, and general inequality have left record levels of free (0%) capital, yet there is little productive investment as corporations are paying down debt, and aggregate demand is stagnant so productive investments are cannibalistic. The excess capital is creating a massive asset bubble.
      The ‘bailouts’ was the bailing out of a reckless investor class, paid for by the European citizens
      German workers haven’t had a real wages raise in 15 years. The real moral hazard is the investor class. You would gamble recklessly on anything if you knew you would get fully paid, even if you lost.

      Politicians couldn’t admit that they let the banks run rampant, and couldn’t admit that they were using trillions, to virtually 100% insure Billionaires assets, which were trash. So the narrative was focused on the lazy feckless Southerns. Austerity in a debt crisis has never worked without default of devaluation according to an 2002 IMF. The primary surpluses in a pan-euro-zone contracting exaggerate demand situations, can mathamatically only lead to contraction or increasing private debt.

      The narrative focus on a moral outrage against the South especially Greece. When the North was a profligate and over exposed as the South. Any credible economist would know this. Notice the arguments are always vague and have little or no specific detail. This is on purpose. They are either; emotionalised vitriolic condescension “Lazy Greeks”; childish ‘kindergarden metaphors; “it’s like a house hold, you have to balance your books”, or “its like in your neighbourhood, and your neighbour borrowed to much to fund his life style, and then came looking for handouts”. The other common tactic is nitpicking, “oh, the Greeks don’t pay their taxes; this is because the Troika let the corrupt establishment protect the oligarchy, while trouncing the common man. Any time you hear a truism in economics, it is always always wrong!

      I studied Marketing, I tailed into Political Marketing, and PR. The principal seminal book of the two latter is “Public Opinion”- by Walter Lippman (1920). Its theory is that people can’t comprehend all information in the world, so we create simplified (fliters) stories called pseudo-environments, the individual the filters information through these pseudo-environments. Once established these pseudo environments are very difficult to change. Lippman suggested that political communication must be vague as people will differ on specifics- “you must pay your debts.. moral hazard”. However, speaking in vague term allows people fit the message to their believes, The speech arouses emotion, then the politician attaches this to a symbolic representation- in a similar way to classical conditioning. The individual eventually forgets the specifics, and the association remains- Germany good (smilie face), Greece bad (frownie face). Negative emotions set to symbolic representation- Syriza. The strong emotional attachment to the simplified belief disrupt ration consideration. This is why people all sort of crazy things.

      Another tactic is invoking our tribal instinct, we have a very strong impulse to side with our group. This instinct is primitive and is possessive of group resources. The narrative targeted a North v South animosity. The true is far more nuances and any of the truthyisms. Every country and institution messed up; in capitalism over-lending is as much a sin as over-borrowing.

      You don’t seem stupid, so I attach three short videos, explaining why the euro-zone and austerity cannot work, and German Mercantilism. the article is from 1992 and clearly outlines how the Eurozone without a federal state would lead to a human catastrophe. It’s hard to read, seeing how ignorant and vicious nastiness it has become. Greece is a Libertarians wet dream. If the situation doesn’t change drastically towards the general direction of Varoufakis’ economic plan, there will be a catastrophic.

      Steve Keen. https://www.youtube.com/watch
      ?v=VfFejPFAcXg

      Marc Blythe. https://www.youtube.com/watch?v=NQGCoiakycQ

      Mercantilism: https://www.youtube.com/watch?v=iPFH-yXm9VY

      Maastrict and All That. http://www.lrb.co.uk/v14/n19/wynne-godley/maastricht-and-all-that

  15. John Boyle

    Mercille – “O’Callaghan misunderstands … how political power operates”

    ah no, to be fair, given that she is never off the airwaves, and is milking RTE for every penny she can, I think the empirical evidence says that she has an advanced understanding of how political power works.

    She is the mouthpiece of the regime and as such has zero interest in letting any criticism of it look valid

  16. Clampers Outside!

    Reminds me of a Marian Finucane piece a couple of months back on Sunday / Saturday on RTE Radio 1. They were talking about all of Ireland’s past taoiseach s(?) and spoke about how they were ‘good in front of the camera’, ‘good with journos’, ‘carries himself well’, etc…. there was not one single comment about any leaders’ credibility or integrity or any real attributes that matter beyond what they looked like….. probably because she knew none of them had any.

  17. nellyb

    Early feudal states were probably very “left” for slavery practicing states back in the times. I am not surprised some view Canadians or Scandinavians as communists. Grow up.

    1. mick

      Miriam, didnt mention a single fact. Her questioning revolved around his manner, not policy. Which doesn’t matter much in high level negotiations. The are confrontational by nature. If it did we should world worry, Our representatives are supposed to be rational.
      We wouldnt have the peace process if David Trimble walked out because he though Gerry Adams was uncoot.

  18. Paul

    Another shout out for McWilliams. Mercille is taking to the Irish way of networking like a duck to water. Quack, quack.

  19. Journowatch

    The former Greek Finance Minister’s interview on RTÉ’s Prime Time sought to portray him as an arrogant failure next to the likes of Michael Noonan. (boohoo I don’t like blue)
    Dr Julien Mercille muses:
    The former Greek finance minister, Yanis Varoufakis, was in town last week for an appearance at Kilkenomics, where Economics marries Ego.
    David McWilliams ( love you Dave, will you get me a spot on RTE ?) kissed his rather pert and oh so firm derriere and had a discussion session about topics ranging from Greece, Ireland, religion and politics. Varoufakis seemed impressed ( he winked at me, Daveboy didn’t even get a look in ) with the event as he wrote that it had been a “happy day” for him and that although it was his first visit to Kilkenomics, it would certainly not be the last. (ooohh will fly the pink fly for you next time. I yearn for you, Yanis. )
    However, Varoufakis also had an interview with RTÉ’s Miriam O’Callaghan for Prime Time, which can be watched here. ( For the BS commentariat, who are too thick to gogole)
    I’m not sure Varoufakis was very impressed by our state broadcaster. ( Who the fupp does Miriam think she is… Headgirl…. leave MY YANIS alone. )
    Indeed, the interview shows O’Callaghan repeating the Irish government’s line uncritically. Her questions could have been taken straight from Enda Kenny’s and Michael Noonan’s notebook. ( should have joined me at the Sinn Fein Summer School , tut tut)
    The gist of her queries was that Varoufakis had accomplished nothing in his negotiations with the troika because he was too arrogant. (*pout* *preen* )

  20. mick

    Why would they want to crush greece. Greece is a tiny part of the economy. So it doesnt matter to the core much either way. Giving them a saner deal is politically unpolular with the electorates. Troika money is public money, the politicans themselves have no skin in the game. Admitting being wrong is difficult for politicians and economists. They did it before

    http://www.thepressproject.net/article/69079/Timothy-Geithner-EU-leaders-were-obsessed-with-crushing-terrible-Greeks

  21. :-Joe

    The fact that anyone watches RTE for anything more than breaking news and sport is beyond me, and why this obviously intelligent and pro-active citizen of Greece would bother talking to RTE after Noonan tried to shank him is just unfortunate. The usual idiotic Irish business party agenda-led crap interview from our biased state propaganda machine. Fuppety fup RTE and it’s circus of clowns…

    The problem here is everything the IMF & World Bank and affiliated groups are involved in, is all focused intentionally on usurping a nation’s sovereignty and controlling their economy through “DEBT SLAVERY” and exporting their own corporate economic dominance to continue building US hegemony. The US is not alone but generally runs the game and both the IMF and WB were started in the US over 50 years ago.

    Why would they not see logic and sense and at least discuss the idea of less money being loaned to former Greek Finance Minister Yanis Varoufakis?

    ANSWER: THE IMF DON’T WANT ANYONE IN POWER WHO WILL ASK QUESTIONS OR ACTUALLY DO WHAT’S GOOD FOR THEIR SOVEREIGN NATION BECAUSE THAT WOULD GO AGAINST THEIR ECONOMIC AMBITIONS OF OWNERSHIP AND CONTROL THROUGH CORPORATE GLOBALISATION.

    A quick summary of what I’m talking about by an IMF Whistleblower …
    https://www.youtube.com/watch?v=m-dsiufhMu0

    The always great, John Pilger made a documentary about it over 20 years ago.
    https://www.youtube.com/watch?v=8bfDOGNboE8
    https://www.youtube.com/watch?v=WYCH1Ylncxc -Short edited version

    Watch this excellent documentary for a detailed recent example about the mechanics of it all and the effect it has had on Jamaica.
    http://www.lifeanddebt.org

    Another good recent doco film to watch about global economics is “The Four Horsemen”:
    https://www.youtube.com/watch?v=5fbvquHSPJU

    I could give hundreds of examples…

    First world European countries are just as vulnerable and we are witnessing it right now at the moment.. look at Greece, Spain, Portugal Ireland etc. it’s all exactly the same idea repeated over and over again…

    If you want equality and justice and no more intentional austerity and wars for oil and control in the middle east then you need to stand up and fight in the war against global corporate economic imperialism.

    Campaigning to block TTIP and all the other dodgy greedy trade deals would be a good start.

    Educating people about the true nature of the IMF, WB, WTO, etc etc. and general EU economics and finance wouldn’t hurt either.

    It”s all a big racket and you’re not in line for a slice of it, ever.

    I gladly await the abuse, trolling and false accusations of wearing tin-foil hat’s etc…

    :-J

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