A Political Economy Thriller

Yanis Varoufakis is like the treacly spread product Marmite – which people either love or hate – there seems no compromise between the two positions.

 I happen to think he’s a very good analyst and writer – if rather too prone to court the headlines for sllck comments.

I had first come across him in 2012 when I enjoyed The Global Minotaur – America, the True Origins of the Financial Crisis and the Future of the World Economy (2011) and had then followed his elevation and performance as Greece’s Economics Minister - for 6 brief months - in 2015 with great interest.

I have just got around to reading his And the Weak Suffer what They Must? – Europe, Austerity and the threat to Global Stability (2016) which clearly draws on his experience of his harrowing 6 months in the eye of the financial and political storm - but which resists the temptation to elaborate on his personal encounters with the various European and international players in that “Drama” (which is actually also the name of a small Greek town very near the border with Bulgaria in which a problem with fuel injection once forced me to spend a night!).

Such an elaboration, he told us, needed a bit more distance – but it was not all that long in coming – in the form of Adults in the Room – published earlier this year which Paul Mason has described as one of the greatest political memoirs…..

Although “And the Weak Suffer…..” has been published for more than a year, it has (if Google is to be believed) attracted surprisingly few reviews.

It seems fairly obvious that Varoufakis has offended so many of the powerful figures in politics and academia that only people such as Mark Blyth and Paul Mason are willing to put their heads above the parapets and write positively about him……

But one fan is an Australian academic whose review of the book on the Open Democracy website is, for me, a model of how a review should be conducted with a focus on both content and style;    

This book is far more than a re-statement of Varoufakis’ 2011 book, The Global Minotaur…but it is that first book which provides the structure here – as a play in three acts.Act One is set in the years 1944 to 1971. When the present global economy was set up at Bretton Woods, the US was gripped by a New Deal fear of international financial chaos but was not prepared to let its dominance of the post-war globe slip in order to generate a truly self-balancing global economy.

This led to the US rejecting Keynes’ plan to construct a genuinely international currency and a genuinely international set of surplus and deficit rebalancing institutions but…….., by investing their own surplus into Germany and Japan in particular, the US was able to re-build Europe and Asia and recreate them – politically and economically – in something like its own image. On the whole, things worked exceptionally well for what we now call the post-war boom (1949– 1971). But when the astronomical expense of the Cold War kicked in and the US stopped running a surplus, the Bretton Woods system simply fell over, leaving the globe in a mess.

 Act Two the US was able to maintain global dominance as a deficit economy. The Nixon Shock of 1971 produced the stagflation sickness of the 1970s which was then ‘cured’ in the 1980s by the staggering success of financialized and transnationalized corporatism. But the architecture of the post-Nixon area was inherently unstable, inherently disconnected from sustainable human and economic realities, and it all came crashing down in 2008.

 Act Three starts in 2008. Here, after acts one and two have both ended in tears, the global economy is terminally wounded and must either die or face radical reconstructive surgery. Now, despite the various appearances of recovery, it is simply the case that the mechanisms and institutions that used to keep the global economic order in some sort of functional balance have all failed. We have only just started Act Three, but it could end quickly, and violently.

The reviewer than asks one of the questions so few bother to – “So, how does “And the Weak Suffer as they Must?” take up this narrative and tell us things we did not know and need to know now?” 

Reading “And the Weak Suffer as they Must?” is like reading a gripping thriller. It is a page turner because the plot itself is a relentless sequence of astonishing twists and turns driven by the cunning ingenuity and hubristic folly of its key protagonists.Even if you know a lot about the Eurozone, Varoufakis’ carefully researched account, with its vivid glimpses into the motivations and outlooks of key players, and its expansive breadth in appreciating the global dynamics pressuring localized decisions, is unerringly startling.

Yet it is no novel. Varoufakis’ book has something made-up stories can only mimic; the texture of real history. But here is the key thing that Varoufakis has so carefully noticed. In the texture of real history, convenient illusions are typically a great deal more influential in the circles of power and normality than is truth.

It is for this reason that, in real history, truth usually seems stranger than fiction. And yet, Varoufakis also notices that the texture of history is such that truth always has the last say, no matter how hard the powers of illusion and convenience seek to keep the dream alive by helping us to stay asleep. Varoufakis’ insight into the relationship between what normal mainstream people and the great and powerful want (even need) to believe, and what is actually going on, is a key feature of the significance of this book.

He weaves his intricate and tense narrative fabric out of illusion and reality (the texture of real history) by constantly shifting our gaze between three interconnected focal lengths.

- With the first, Varoufakis enables us to see how the world looks through the myopia of the common man’s desire to doggedly hope that our leaders know what they are doing while we just get on with our lives. This myopia is savagely reinforced by the news media and integrated with the myopia of European high power.And that high power cannot see past the end of its own nose, defined as it is by the bureaucratic echo-chamber of self-perpetuating institutional power. 

- This short-sighted focal length insight is then overlaid with a 20 20 focal length perspective provided by Varoufakis’ forensic knowledge of how Eurozone power actually functions. Here we get a nauseating sense of how badly awry things are when very basic macro-economic realities are simple banished from the ‘negotiating’ table laid out by the powers that be. 

- This perspective is in turn overlaid with a telescopic focus, the far-sighted and sweeping historical panorama which shows us why the Eurozone is what it is. This enables us to see – in the one account – the disjunction between ‘normal’ financial and public affairs orthodoxies, the ‘realism’ mandated by prevailing power interests, and what is actually happening to Europeans.

This is one of those books which needs to be read a second time – and more closely…..and rates up there along with Mark Blyth’s Austerity – the history of a dangerous idea (2013). In a few months, another (smaller) book will come from Varoufakis. I already have the German version which is called “Time for Change; how I explain the economy to my daughter”. The English version bears the title “Talking to my daughter about the economy; a brief history of capitalism”

A Varoufakis Resource

https://www.yanisvaroufakis.eu/; his website

https://www.opendemocracy.net/can-europe-make-it/paul-tyson/varoufakis-%E2%80%93-new-kind-of-politics (2015); a profile of the man
The Global Minotaur - the full book!! Which is one of the very few which clearly explains the working of the global economy of the past 50 years. It succeeds simply because, for once, an economist has the courage to put the story in a geopolitical context.  

Reviews of "Adults in the Room"

https://www.adamtooze.com/2017/07/01/reading-varoufakis-frustrated-strategist-greek-financial-deterrence/ a sympathetic review 
https://adamtooze.com/2018/02/24/europes-political-economy-reading-reviews-varoufakiss-adults-room/; a good overview of reviews of "Adult in the Room", structured by ideological slant

https://www.opendemocracy.net/can-europe-make-it/paul-tyson/adults-in-room-by-yanis-varoufakis-london-bodley-head-2017; a good review of his latest book
http://www.cadtm.org/Yanis-Varoufakis-s-Account-of-the; a serial critique of Adults in the Room 

https://www.theguardian.com/books/2017/may/03/yanis-varoufakis-greece-greatest-political-memoir; Paul Mason's review of Varoufakis' expose

https://verfassungsblog.de/losing-to-the-european-union-a-review-of-yanis-varoufakis-book-adults-in-the-room/; a critical assessment from a Greek centrist

https://www.nakedcapitalism.com/2017/06/yanis-varoufakis-latest-eurogroup-statement-keeps-greece-on-the-austerity-rack.html; an example of some of YV's doodles!