Last weekend, we pointed out [7]that while completely irrelevant if Varoufakis had "stuck Germany the finger" in whatever context, that the German media would have a field day with it. Little did we know the firestorm that the German press would unleash, and how obssessed Germany would become with the topic of the Greek finmin's middle finger (which he claimed was faked, and promptly a German spoof emerged that alleged that the video was indeed fake... before that spoof itself was said to be fake too!).
The problem with this latest fiasco is that it took attention away from the key issues: not just the Greek insolvency, but - at the core - how the European Union is only such when it suits the interests of the majority, bringing Greece once again to the edge of expulsion from Europe.
However, Varoufakis' middle finger was useful in one specific way: to rip away the facade of solidarity and freidnship in Europe, and reveal just how ugly the undelrying truth is, and to hint just how much uglier it will become once the money runs out not only for Greece, but for everyone else, or as Varoufakis himself who in a blog post today summarized his "middle finger" best when he said that it "has sparked off a kerfuffle reflecting the manner in which the 2008 banking crisis began to undermine Europe’s badly designed monetary union, turning proud nations against each other."
Sadly for Europe, which faces an ever uglier face every time it looks in the mirrer, he is right.
* * *
From Yannis Varoufakis [8]:
Of Greeks and Germans: Re-imagining our shared future
Any sensible person can see how a certain video[1] has become part of something beyond a gesture. It has sparked off a kerfuffle reflecting the manner in which the 2008 banking crisis began to undermine Europe’s badly designed monetary union, turning proud nations against each other.
When, in early 2010, the Greek state lost its capacity to service its debts to French, German and Greek banks, I campaigned against the Greek government’s quest for an enormous new loan from Europe’s taxpayers. Why?
I opposed the 2010 and 2012 ‘bailout’ loans from German and other European taxpayers because:
- the new loans represented not a bailout for Greece but a cynical transfer of losses from the books of the private banks to the weak shoulders of the weakest of Greek citizens. (How many of Europe’s taxpayers, who footed these loans, know that more than 90% of the €240 billion borrowed by Greece went to financial institutions, not to the Greek state or its citizens?)
- it was obvious that, at a time Greece could not repay its existing loans, the austerity conditions for giving Greece the new loans would crush Greek nominal incomes, making our debt even less sustainable
- the ‘bailout’ burden would, sooner or later, weigh down German and other European taxpayers once the weaker Greeks buckled under their mountainous debts (as moneyed Greeks had already shifted their deposits to Frankfurt, London etc.)
- misleading peoples and Parliaments by presenting a bank bailout as an act of ‘solidarity to Greece’ would turn Germans against Greeks, Greeks against Germans and, eventually, Europe against itself.
In 2010 Greece owed not one euro to German taxpayers. We had no right to borrow from them, or from other European taxpayers, while our public debt was unsustainable. Period!
That was my ‘controversial’ point in 2010: In 2010, Greece should have borrowed not one euro before entering into debt restructuring procedures and partially defaulting to its private sector creditors.
Well before the May 2010 ‘bailout’, I urged European citizens to tell their governments not to even think of transferring private losses to them.
To no avail, of course. That transfer was effected soon after[2] [9] with the largest taxpayer-backed loan in economic history given to the Greek state on austerity conditions that have caused Greeks to lose a quarter of their income, making it impossible to repay private and public debts, and causing a hideous humanitarian crisis.
That was then, in 2010. What should we do now, in 2015, that Greece remains in crisis and our people, the Greeks and the Germans, have, regrettably but also predictably, descended into a mutual ‘blame game’?
First, we should work towards ending the toxic ‘blame game’ and the moralising finger-pointing which benefit only the enemies of Europe.
Secondly, we need to focus on our joint interest: On how to grow and to reform Greece rapidly, so that the Greek state can best repay debts it should never have taken on while looking after its citizens as a modern European state ought to do.
In practical terms, the 20th February Eurogroup agreement offers an excellent opportunity to move forward. Let us implement it immediately, as our leaders have urged in yesterday’s informal Brussels meeting.
Looking ahead, and beyond current tensions, our joint task is to re-design Europe so that Germans and Greeks, along with all Europeans, can re-imagine our monetary union as a realm of shared prosperity.
—————————–
[1] Whose showing derailed an otherwise constructive discussion on German television.
[2] First in May 2010 (€110 billion) and then again in the Spring of 2012 (another €130 billion).
