Author Topic: Yanis Varoufakis - Adults in the Room  (Read 229 times)

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Yanis Varoufakis - Adults in the Room
« on: October 11, 2017, 02:39:58 PM »

Yanis Varoufakis blows the lid on Europe's hidden agenda
by EFN , Published on May 5, 2017

Adults in the Room: My Battle with the European and American Deep Establishment
by Yanis Varoufakis
Hardcover: 560 pages
Publisher: Farrar, Straus and Giroux (October 3, 2017)
Language: English
ISBN-10: 0374101000
ISBN-13: 978-0374101008
Product Dimensions: 6.4 x 1.7 x 9.3 inches
Shipping Weight: 1.8 pounds

A Work for the Ages!
By Sprachprofion May 4, 2017
Format: Kindle Edition
  "Adults in the Room" masterfully oscillates between the thrilling and
   the lyrical, the very personal and the universal, giving us a unique
   glimpse behind the high walls of power.
   This book will be uncomfortable or even dangerous for many current
   politicians, from Europe's governments and EU institutions to the IMF
   and of course Greece's Syriza party. Former Greek Finance Minister
   Yanis Varoufakis (boy, does that title ever feel inadequate given the
   impact he had and has!) never made a secret of the fact that he comes
   to politics as an outsider. He is not a member of any party, not even
   the one that put him in office (which they couldn't fail to do after he
   won more votes than any other MP). As such, he is not entangled with a
   net of interests and he has no qualms to tell all that he saw during
   his time on the 'inside' of international politics.
   Behind closed doors, politicians like German Finance Minister Wolfgang
   Schäuble turn out to be not monsters but heroes of a classic Greek
   tragedy. Varoufakis is not unkind or unsympathetic to him - which
   should come as a big surprise to anyone who bought into the mainstream
   media reporting of the time, which often presented the 2015
   negotiations as a cock fight between Varoufakis and Schäuble. But the
   mainstream media were/are not uninvolved in the Greek crisis, they have
   a role to play, too, in a system that, like the Soviet Union in the
   late 80s, will deny basic economic and political truths and pretend
   that all is well until the very moment of its collapse.
   Varoufakis came as a non-insider to save the system, flawed as it may
   be, knowing that a collapse would cause untold hardships for tens of
   millions of people. And after having discovered, over the course of the
   time period narrated in this book, that the insiders well know the
   truth, and know what needs to be done, but are unable or unwilling to
   do it, the logical next step is to expose them, so that the light of
   transparency may bring about the change that working with these people
   could not. That is also one of the ideas of the movement he founded
   last year, DiEM25 (Democracy in Europe Movement 2025), which demands
   not just a re-orientation of the EU to serve its people, but also
   complete transparency of all powerful illegitimate (formally
   non-existent) institutions like the Eurogroup.
   I knew that Yanis Varoufakis could make even dull subjects very
   interesting, as proven in the economics textbooks he authored and his
   account of the history of a common currency ("And the Weak Suffer What
   They Must"). Given an interesting subject to start with, one that
   affects everyone who is concerned about the future of the European
   Union, his writing style becomes absolutely breathtaking. Highly
   Comment | 37 people found this helpful. Was this review helpful to you?
A parable about the duplicity of politicians
everywhere, a cautionary tale about the evils of international lending

By Graham H. Seibert on October 5, 2017
Format: Kindle Edition | Verified Purchase
  "Adults in the room
   Varoufakis' introduction compares what happened between Greece and its
   creditors to a Greek drama or a Shakespearean play. It is a tragedy, in
   which the individual players are usually neither good nor evil, but
   trapped by their own limitations and compelled to lead the drama toward
   a tragic conclusion.
   He names the major players: Wolfgang Schäuble, Christine Lagarde, Mario
   Draghi, Barack Obama, Jack Lew, Larry Summers, Bernie Sanders, Angela
   Merkel, and Emanuel Macron. He says that among the people he dealt with
   were two types: fascinating and banal. "The banal went about their
   business ticking boxes on sheets of instructions handed down to them by
   their masters. In many cases, though, their masters – politicians such
   as Wolfgang Schäuble and functionaries such as Christine Lagarde and
   Mario Draghi – were different. They had the ability to reflect on
   themselves and their role in the drama, and disability to enter into
   dialogues with themselves made them fascinatingly susceptible to the
   trap of self-fulfilling prophecy."
   He credits Lagarde with saying they needed "adults in the room" to
   resolve the drama. That gave him his title.
   This book ends in July, 2015. An article that appeared just as I write
   this review in October, 2017 confirms Varoufakis' worst fears about the
   deal that Europe forced on Greece. Google "Greek Debt Crisis: Why
   SYRIZA Continues to Lose."
   ** Democracy is the theory that the common people know what they want,
   and deserve to get it good and hard. H. L. Mencken **
   The book is a chronology of Varoufakis' tenure as the finance Minister
   of Greece, from the election of the left-wing SYRIZA party in January
   2015 through his resignation in late June after Greece proved unable to
   come to an adequate understanding with its European creditors. It ended
   when a Greek referendum on June 25, 2015, voted 62% in favor of
   refusing to pay the IMF, and thus exiting the euro, and Varoufakis'
   prime minister, Alexi Tsirpas and a majority of the cabinet refused to
   follow through.
   Born in 1961, Varoufakis was an established economist in academia when
   he answered the call to join Greece's government. He had been raised
   and educated in England and Australia as well as Greece and was living
   and teaching in Austin, Texas.
   Greece's economic crisis had been dragging on since 2010, with the
   second bailout faltering as of the time of the election. The problem
   was simple. After joining the European Union the government was able to
   borrow in euros far more than they ever could have borrowed in drachma.
   The country's congenitally corrupt politicians and oligarchs borrowed
   copiously and stole the money, leaving the common people on the hook to
   pay it back. They could not.
   The lending institutions – the IMF, the European Central Bank, and
   European banks, did not want the money back. This is how they operate.
   They prefer to keep debtor countries such as Argentina, Brazil, Haiti
   and most of Africa in perpetual bondage. They make their money
   originating new loans and confiscating and selling assets, or having
   assets sold at depressed prices through privatization actions.
   Not wanting their money back, these institutions refused to accept that
   Greece was bankrupt. They insisted that there was no solvency problem,
   only a liquidity problem which could be solved by injecting more money.
   They kept injecting money, making it increasingly impossible for Greece
   to ever dig its way out from under. As always, the oligarchs stole the
   money leaving the common man on the hook. The lending institutions, the
   troika of the European Central Bank, the European Commission and the
   IMF, insisted on austerity measures such as cutting pensions and
   government salaries, raising the value added tax, and cutting payrolls.
   This had the effect of decreasing income, leaving even less that could
   be taxed. It was a vicious spiral.
   The book is organized chronologically, in three parts:
   (1) Winters Of Our Discontent - the election
   (2) Invincible Spring – seeming agreements with duplicitous Eurocrats
   (3) Endgame – SYRIZA's total capitulation, and Varoufakis' resignation
   The first chapter starts with some philosophical musing. Varoufakis
   starts with a meeting with Larry Summers, who posed the question:
   ‘There are two kinds of politicians,’ he said: ‘insiders and outsiders.
   The outsiders prioritize their freedom to speak their version of the
   truth. The price of their freedom is that they are ignored by the
   insiders, who make the important decisions. The insiders, for their
   part, follow a sacrosanct rule: never turn against other insiders and
   never talk to outsiders about what insiders say or do. Their reward?
   Access to inside information and a chance, though no guarantee, of
   influencing powerful people and outcomes.’ With that Summers arrived at
   his question. ‘So, Yanis,’ he said, ‘which of the two are you?’
   "When a large-scale crisis hits, it is tempting to attribute it to a
   conspiracy between the powerful. Images spring to mind of smoke-filled
   rooms with cunning men (and the occasional woman) plotting how to
   profit at the expense of the common good and the weak. These images
   are, however, delusions. If our sharply diminished circumstances can be
   blamed on a conspiracy, then it is one whose members do not even know
   that they are part of it. That which feels to many like a conspiracy of
   the powerful is simply the emergent property of any network of super
   black boxes.
   "The keys to such power networks are exclusion and opacity. Recall the
   ‘Greed is great’ ethos of Wall Street and the City of London in the
   years before the 2008 implosion. Many decent bank employees were
   worried sick by what they were observing and doing. But when they got
   their hands on evidence or information foreshadowing terrible
   developments, they faced Summers’s dilemma: leak it to outsiders and
   become irrelevant; keep it to themselves and become complicit; or
   embrace their power by exchanging it for other information held by
   someone else in the know, resulting in an impromptu two-person alliance
   that turbocharges both individuals’ power within the broader network of
   insiders. As further sensitive information is exchanged, this
   two-person alliance forges links with other such alliances. The result
   is a network of power within other pre-existing networks, involving
   participants who conspire de facto without being conscious
   Enlarging on the Greek tragedy theme, Varoufakis says that the world is
   ordered by a series of black boxes so complex that even their creators
   don't understand them. The black boxes include financial instruments
   such as the derivatives that have been implicated in the collapse of
   2008; the devices used by the central banks such as quantitative
   easing; the borrowing and bond issuing mechanisms used by central
   governments; the loan administration policies of the IMF.
   The establishment, epitomized by Larry Summers, believes that
   ultimately the black boxes will sort things out in a reasonable way.
   Varoufakis believes this is not the case. He would like to open up the
   black boxes for examination.
   So ultimately, there is no conspiracy. Or rather, the conspirators are
   not aware that they are involved in a conspiracy. They are each acting
   in their own interest, blind to the fact that they are heading toward
   catastrophe. Or, equally frequently uneasily aware that they are on a
   course to disaster, but unable to steer the ship, and aware that if
   they jump ship and announce the impending disaster it will have no
   effect. They would be sacrificing themselves for nothing.
   Jack Lew advised him that he would be under attack from the pCommentowers that
   be in Europe. The owners of the black boxes would defend their turf.
   Varoufakis writes "the following chapters relate to networks' violent
   reaction to trade Greece's emancipation for privilege spot inside one
   of their black boxes."
   Varoufakis tells a story of his mother and father, tough people who
   refused to be intimidated during the hard times of the late 40s and
   50s, when they were pressured by both Communists and the right. They
   refused to give in. He owes his character to them.
   Greece was already bankrupt in 2010. It was bailed out by €110 billion
   loan from the IMF, the largest in loan history. This was to be enforced
   by the troika – three insiders. One is from the European commission, a
   second from the European Central Bank, and third from the international
   monetary fund. These representatives were in Athens to impose measures
   guaranteed to reduce greases national income in place most of the
   burden of the debt on the weakest Greeks.
   "They knew that the celebrated ' rescue' or' bailout' package was
   nothing more than a one-way ticket to debtor's prison. How do I know
   they knew? Because they told me."
   The troika presented a package. He quotes Christine Lagarde as saying
   "You are right, of course, Yanis. The targets that they insist on can't
   work. But you must understand we have put too much into this program.
   We cannot go back on it. Your credibility depends on accepting and
   working within this program."
   Generalizations to take home:
   Politicians are incredibly duplicitous. They would tell Varoufakis one
   thing in private and then absolutely change the story when they got to
   a public forum. They reneged on promises all the time. It seems
   incredible that he would continue to negotiate with people who showed
   such bad faith. And, in retrospect, it appears that he should not have.
   Instead of wasting endless nights pursuing will 'o the wisps, he should
   have stood firm and allowed Greece to default in the first place.
   The duplicitousness of the Eurocrats in the European Central Bank and
   European Commission are well known. The disastrous effects of IMF loans
   the Americas – Argentina is the poster child – and Africa are well
   known. They should not be allowed to continue. However, politicians
   invariably pursue short-term goals, usually at odds with the long-term
   best interests of their people. Having money to spend in the short term
   is much more attractive than the long-term health of the country that
   they lead.
   This case study of how it worked out in Greece should be required
   reading for any other country that is being courted by the
   international Monetary Fund, European Development Bank, World Bank or
   other international agencies, and even private banks. Very little good
   usually comes of it. It will usually result in significant, highly
   visible infrastructure projects. One that sticks in my mind is the
   Yacireta on the Argentine – Paraguay border. The people of neither
   country really wanted it, but the bankers were eager to loan the money
   and friends of the government were eager to bid on the construction
   projects. The result was a dam that nobody really needs, one which
   dislocated tens of thousands of people in its floodplain, one which
   saddled the countries with debt that they cannot repay. Perhaps the
   only saving grace is that Argentina did have the courage to default on
   its lenders.
   Writing from Ukraine, I caution my acquaintances that the country
   should not to accept poison candy from smiling Westerners. The
   newspapers continually trumpet that if Ukraine enacts the right
   legislation, cleans up its court system and so on the IMF will do them
   the favor of loaning more money. No! They should clean up, true, but
   they should not take the money.
   The oligarchs have stolen significant fractions of the IMF's loans to
   Ukraine. Victor Yanukovych, the most corrupt president in the country's
   history – and it is a tough competition – stole most of the $4 billion
   that Vladimir Putin loaned to the country. Ukraine has had the courage
   to tell him he's not getting it back, on account of the ongoing war in
   the Donbass. But such loans are otherwise very hard to repudiate. If
   Ukraine needs money it should issue bonds in local currency to be
   bought by its own citizens. If the local citizens refuse to buy, the
   country should respect their wisdom and go about cleaning up the
   investment climate before getting indebted to smiling strangers with
   briefcases. "

``I hope that the fair, and, I may say certain prospects of success will not induce us to relax.''
-- Lieutenant General George Washington, commander-in-chief to
   Major General Israel Putnam,
   Head-Quarters, Valley Forge, 5 May, 1778