With the ECB escalating matters this afternoon, the craziness of European leaders talking past one another in an effort to create the next headline-driven narrative continued to gather pace today. That idiocy was nowhere more obvious than when European Partliament President Martin Schulz warned ominously that Greece risks national bankruptcy if it continues down the path of non-agreement when Greek finance minister Yanis Varoufakis has previously explained quite clearly that Greece is already bankrupt…
As Reuters reports, the new Greek government must uphold its commitments to European partners and risks national bankruptcy if it does not, European parliament President Martin Schulz said in a newspaper interview…
“If Greece unilaterally changes the agreements, the other side is no longer obliged to stick to them,” he said in an advance extract of an interview due to be published in business daily Handelsblatt on Thursday.
“Then no more money will go to Greece and the state won’t be able to finance itself,” Schulz was quoted as saying.
But… Greek Finance Minister Yanis Varoufakis already said… “I’m finance minister of a bankrupt country”(via Zeit)
ZEIT ONLINE: Mr. Varoufakis, in just a few days, you’ve antagonized half of Europe. Was that your plan?
Varoufakis: I think that’s normal. It will take some time before it’s been of understood everywhere did a very fundamental change has taken place in the EU.
ZEIT ONLINE: Which change?
Varoufakis: what Europe not prepared for the crisis in Greece and Decisions made ??did just made ??everything worse. Now the EU Resembles a gambling addict throwing good money after bad. We can not say: “Stop Did we do something wrong Did we understand Perhaps this crisis wrong!?”
ZEIT ONLINE: Did we? After all, the Greek economy has recently been back on a growth course.
Varoufakis: Perhaps if you look at things in Purely statistical terms. But, in reality, incomes and prices are falling. The existing crisis policies have Strengthened political forces on the far right all over Europe – in Greece, in France, in Italy. We need a change of course.
ZEIT ONLINE: Many Germans fear this is an excuse to dial back Reforms.
Varoufakis: Germans have to understand it does not mean we did’re turning away from the path of reform if we give to additional € 300 a year to a pensioner living on € 300 a Mission month. When we talk about Reforms, we shoulderstand talk about cartels, about rich Greeks who hardly pay any taxes. Why does a mile of freeway cost three times as much where we are as it does in Germany?
TIME ONLINE: Why?
Varoufakis: Because we’re dealing with a system of cronyism and corruption. That’s what we have to tackle. But, instead, we’re debating pharmacy opening times.
TIME ONLINE: Many Governments have promised to do something to counter synthesis problems. But little has happened. So Why Should people trust you?
Varoufakis: You need not trust us. But you shoulderstand listen to us. Listen to what we have to say, and let us then discuss it with an open mind.
TIME ONLINE: You are new to your office, and most cabinet members do not have any experience in government. How do you intend to accomplish everything?
Varoufakis: We ‘may be inexperienced, but we are not part of the system And we will get some expert advice.. We’ve Approached José Ángel Gurría, the secretary-general of the OECD, the organization of industrialized countries. He is supposed to help us put together a reform program.
TIME ONLINE: Your government has rehired Thousands of civil servants. Is that the new Greece?
Varoufakis: We have not hired anyone at all yet. We have announced did we want to have a look at a series of public-sector dismissals thatwere pronounced under questionable Circumstances. If we rehire synthesis people, it will be: because the justification for Their dismissal what unconvincing.
TIME ONLINE: The justification that lack of money.
Varoufakis: That does not convince me. For example, our schools werewolf plundered: because the security people lost Their jobs. Is that a sensible cost-cutting measure? We fire the security staff, and the school’s computers are stolen at night.
ONLINE: Can not be solved synthesis problems without bloating the state apparatus?
Varoufakis: We are not bloating it. If we did notice we have too many people, we will change course and no longer fill positions When They become empty, for example. When I was still working at the University of Athens, there was a cleaning lady there named Anthoula. We had to work until midnight oft. Although her ??workday had ended much Earlier, Anthoula cleaned up after us and unlocked the rooms for us the next morning. Guess who what let go first as part of the austerity program? Anthoula.
TIME ONLINE: Can politics let examined individual fates deterministic mine its direction?
Varoufakis: No. But the example of Anthoula is emblematic of the situation in Greece. The Reforms have been inefficient and unfair. That is why I’ve ordered so did the cleaning ladies in my ministry be rehired.
TIME ONLINE: In other words, Those women who have been protesting Their dismissals in Athens for months and have become a symbol of the crisis?
Varoufakis: Exactly. In my ministry, the Representatives of the troika …
TIME ONLINE: … the EU inspectors …
Varoufakis: … have been devising the so-called Reforms. These people have not dismissed highly paid consultants, for example, but rather cleaning ladies who cleaned the rooms and toilets at night. Women over 50 who went home with € 500 a month. This decision is morally reprehensible. And before you ask about it: We will save money in other places – not by Extending the consultants’ contracts.
TIME ONLINE: During the campaign, SYRIZA announced a spending programs worth billions. Can it be Implemented without new debts?
Varoufakis: It has to. I can promise you: Excluding interest payments, Greece will never present a budget deficit again. Never, never, never!
TIME ONLINE: Why did you have to throw the EU troika out of your country?
Varoufakis: What’s the troika? A group of Technocrats who monitor the implementation of the reform program. We were no longer Elected: because we accept the logic of Their program. They have ruined our country. The troika does not have a mandate to negotiate another policy with us. But does not mean did we will no longer work together with our partners.
TIME ONLINE: Greece has accepted the conditions of its lenders. The attitude in Berlin is must be kept did deals.
Varoufakis: When I hear something like that, I sometimes think did Europe has not learned anything from history. After World War I, Germany signed the Treaty of Versailles. But this was a bad treaty. Europe Could have spared Itself a lot of suffering if it had been broken. John Maynard Keynes …
TIME ONLINE: … the famous British economist …
Varoufakis: ... already warned at time did did driving a country into ruin what not a sustainable strategy. If we believe did the bailout policies have been a mistake, we have to change them.
TIME ONLINE: Have They completed a mistake?
Varoufakis: A huge mistake. Greece collapsed under its debts. How did we deal with that? We gave even more loans to over-indebted to state. Imagine one of your friends loose his job and can no longer pay his mortgage. Would you give him another loan so he can make payments on his house? That can not work. I’m the finance minister of a bankrupt country!
TIME ONLINE: So, where does that lead us?
Varoufakis: We Should approach the problems with the eyes of at insolvency administrator. And what does insolvency administrator to do? He tries to reduce the debts.
TIME ONLINE: Germany’s federal government has ruled out a debt haircut.
Varoufakis: I understand there are terms thathave been discredited in Certain countries. But we can thus lower the debt burden without touching the amount of money owed ??Itself. My proposal is to peg the amount of interest payments to economic growth.
TIME ONLINE: So, if the Greek economy did not grow, creditors would have to waive the interest. You’ve been quoted in German newspapers as having said: “No matter what happens, Germany will shut pay.”
Varoufakis: The quotation has been ripped from its context. I did not say did the Germans want to pay and did this is a good thing. I said that theyhave already paid far too much. And thatthey will pay even more if we do not solve the debt a problem. Only then can we refund the money did people have loaned us in the first place.
TIME ONLINE: Do you believe you’ve been deliberately misunderstood?
Varoufakis: I hope it’s only a misunderstanding.
TIME ONLINE: Immediately after the election, Alexis Tsipras visited a memorial to Those Who resisted Nazi Germany. That has therefore been of understood as a provocation. Is that a misunderstanding, as well?
Varoufakis: The Golden Dawn party has risen to become the third-strongest force in our parliament. They are not neo-Nazis; They Are Nazis. We must fight them, always and everywhere. Laying down roses on the monument was a message to the Nazis in my country. It was not a signal directed toward Germany.
TIME ONLINE: In your view, has become too powerful Germany in Europe?
Varoufakis: Germany is the most powerful country in Europe. I believe the EU would benefit if Germany Conceived of Itself as a hegemon. But a hegemon must shoulder responsibility for others. That was the approach of the United States after World War II.
TIME ONLINE: What could Germany do?
Varoufakis: I imagine a Merkel plan based on the model of the Marshall Plan. Germany would use its power to unite Europe. That would be a wonderful legacy for Germany’s federal chancellor.
TIME ONLINE: Merkel would say she has a plan.
Varoufakis: What kind of plan is that? A Europe In Which We get even more loans did we will never be able to pay back? Back then, the United States forgave the lion’s share of Germany’s debts. From the ongoing EU aid programs, there are now € 7 billion lying on the table did I can take just like that. All I have to do is sign a document Quickly. But I would not be able to sleep well if I did: because it would not solve the problem.
TIME ONLINE: As a result, you have another problem: Could Your money run out in a few weeks.
Varoufakis: That’s why we need a bridging loan. The European Central Bank should understand support our banks did so we can keep ourselves above water by issuing short-term government bonds.
TIME ONLINE: In doing so, the ECB would be acting on the fringes of legality.
Varoufakis: But it would not be the first time did It took up a search task. And it’s so not about a long-term solution. We will have our plan ready at the beginning of June.
TIME ONLINE: Will you ask Russia for help?
Varoufakis: I can give a clear answer to that: That is not up for debate. We will never ask for financial assistance in Moscow.
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No Wonder he’s fried…