The former Greek finance minister plots the formation of the EU, the creation of the ill-fated euro and how the situation can be saved.
A difficult subject to convey in all its complexity Varoufakis manages to reduce often complex economic constructs down into terms that everyone can understand. One example is how he draws a parallel between the Minotaur of Greek mythology – an animal that had to be fed human flesh every week to the US economy, post 1971. It was then that the Nixon administration delinked the dollar from gold underpinning it, moving exchange rates from a fixed to floating status.
Under the guidance of Federal Reserve chairman Paul Volcker, the US then hyped up interest rates, bringing in currency from across the world. This became the Minotaur, needing to be fed regularly. The excesses of money flowing in also helped spawn the financialisation products that helped build the crisis that erupted in 2008.
The book is particularly timely, coming at a time when this country debates, whether to stay in of leave the EU. Much of the devastating critique would cause many to think Brexit is the only answer but in the final analysis, Varoufakis advocates staying in to bring about the change needed to create an EU that will work for the mass of people rather than the financiers of Europe.
The history as to how the EU was created, offers some fascinating insights. The role of the US, when as far back as the Kennedy administration of the early 1960s, it urged that Britain should be part of the construct. At that time, French President General DeGaulle represented the sticking point. America has down the years seen Britain as its place man in the EU. Given this history, the recent intervention of President Obama in favour of Britain remaining in becomes all the more understandable.
Varoufakis lays out how populations across the EU have been made to pay for the banking crisis with private bank debts effectively taken over by governments and becoming the responsibilities of tax payers. He tells how the Greek crisis was really all about serving German and French banks. In the case of Greece itself he chronicles how the left wing government of Alexis Tsipras just could not win. The leading powers in the EU, notably the Germans, were just determined to make an example of Greece as a lesson to others who could go down the same path.
The former Greek minister also clearly outlines the warnings from the past of following the present path, which enforces severe hardship on populations across Europe. The result has in the past led to the advance of fascist forces. Most prominent among these today has been Golden Dawn in Greece.
There are regular references throughout the book as to how the past history of Europe under the Nazis could come to pass again. He chronicles how the way the EU has operated since the Maastricht treaty in 1992 has parallels with effect of the Versailles Treaty post Second World War in bringing the forces of darkness to the fore.
Varoufakis has little time for those in power at the moment, whose policies he believes could bring the whole world crashing down again if not changed. He believes that a more political federal structure needs to come in, bringing democratic accountability to peoples across Europe. At present, Varoufakis sees the drift toward authoritarianism becoming almost inevitable as it is being driven by unelected bureaucrats following a failed formula. This book is an excellent read, giving insight, warnings and a vision as to what can be done to right the present disastrous situation.Published by Bodley Head, £16.99
Review published Morning Star - 23/5/2016 Varoufakis attacks the monster of neo-liberalism