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Review of “Adults in the Room” by Yanis Varoufakis

theguardian.com

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Re: Review of “Adults in the Room” by Yanis Varoufakis

#121

Post by crdoconnor »

davrosthedalek wrote: post #89
nickbauman wrote: post #70

Earlier quoted context omitted.

It has some sharing, but it's not enough. For example, California sends 180 billion in tax revenues to the fed while accepting approximately 30 billion in federal spending. In the EU this kind of thing occurs only in the single digit billions.

Indeed. The problem is that populist politicians in "paying" countries can use this as an argument for an EU exit. See Brexit. It's hard to sell to pay billions, especially if stuff like hours/week, retirement age etc. are often nicer in those countries that need the money.

The problem is that the populists are able to make that argument at all. Most establishment politicians in Europe are trying to be as much like Weimar as possible in all the wrong ways (austerity, wage repression, pension slashing, privatizations, etc.).

Re: Review of “Adults in the Room” by Yanis Varoufakis

#122

Post by crdoconnor »

Tomte wrote: post #106
atmosx wrote: post #67

Earlier quoted context omitted.

> As does the EU. Are you trolling? What kind of mechanism does the EU have? How does Germany have such a high surplus if such a mechanism is in place?!

Trade surplus is neither evil nor a problem in itself.

Trade surplus without a safety valve (the ability to devalue a currency) is very much a problem since it leads to unsustainable debt buildups.

Germany should be running a trade deficit with the rest of Europe right now but it refuses to.

Re: Review of “Adults in the Room” by Yanis Varoufakis

#124

Post by nickbauman »

Tomte wrote: post #106
atmosx wrote: post #67

Earlier quoted context omitted.

> As does the EU. Are you trolling? What kind of mechanism does the EU have? How does Germany have such a high surplus if such a mechanism is in place?!

Trade surplus is neither evil nor a problem in itself.

Unless your currency policy is fixed by those you buy from. That's the fundamental problem here.

Re: Review of “Adults in the Room” by Yanis Varoufakis

#126

Post by nickbauman »

davrosthedalek wrote: post #85
atmosx wrote: post #67

Earlier quoted context omitted.

> As does the EU. Are you trolling? What kind of mechanism does the EU have? How does Germany have such a high surplus if such a mechanism is in place?!

It has TRADE surplus. You were talking about funds. There is a substantial amount of money flowing from Germany, France and others into less fortunate countries via EU governed programs.

Not the same kind of money, though. This is money that is part of the problem. The money goes in and the debt goes up twice as much. Not the same as the California example above.

Re: Review of “Adults in the Room” by Yanis Varoufakis

#127

Post by cinquemb »

return0 wrote: post #109
cinquemb wrote: post #55

Earlier quoted context omitted.

> Furthermore, you can't just default on the debt just by saying so. There's a naivety among mostly Greeks that just by going back to drachma and defaulting on our debt will magically solve all of our problems. In a country that imports pretty much everything that would be catastrophic. Well thinking from a trader perspective, by defaulting and going back to the drachma (and leaving the EU), Greece would have more fl…

This would require a big plunge in the greek economy that people are not willing to take. To be able to recover swiftly from such a crash, the greek economy would have to switch from a very inflexible and sclerotic one (that it is now) to an adaptible, flexible and liberal one. The demographics of Greece do not support such swift action - greece is aging rapidly and the brain drain has gotten really intense. With reg…

The thing is, Greece, IMO, doesn't even need to leave the EU, they just need leverage (in the same way Turkey's leverage is in flooding the EU with more refugees), and they can get leverage in trade by ignoring EU diktats that stipulate what goods they can import in practice (while officially denying everything). International traders would pay a slight premium to be able to have land access to the EU from shipping. Hell, I personally know a couple of traders in SE asia who would pay tens of thousands of dollars to do so.

But I guess the consensus will be in favor of trying continue to squeeze blood from stone until there is none left. And when it gets that far, compared to the threat of cheaper citric acid, steal, etc imports hurting "blessed" EU suppliers, you'll have surplus kalashnikov's coming in from the ME, which I guess is even more profitable for traders ;)

Re: Review of “Adults in the Room” by Yanis Varoufakis

#128

Post by tutufan »

geezerjay wrote: post #118
ravingraven wrote: post #21

Earlier quoted context omitted.

It borders on the impossible to fake data on this scale and in such amounts. The deficit forecast for 2009 (the year the crisis started) was 3.7 which got revised to 12.5 percent at the end of that year. Any sufficiently large institution or cooperation that wanted to have access to the real data, could have done so with minimal effort, you can't hide a 10% budget gap. The false data Greece reported to get into the E…

> It borders on the impossible to fake data on this scale and in such amounts. It's quite far from being impossible. Actually, it's a widely known fact that a string of greek governments systematically falsified Greece's books, and it actually culminated with Greece going as far as hiring Goldman Sachs to hide their double-digit deficits. > The false data Greece reported to get into the Eurozone was an open secret, T…

This is silly. The idea that Greece was systematically hoodwinking the rest of Europe and no one had any idea is absurd. They're not fools.

Re: Review of “Adults in the Room” by Yanis Varoufakis

#129

Post by andybak »

geezerjay wrote: post #120
andybak wrote: post #58

Earlier quoted context omitted.

> I think all the finger pointing at Wall Street or Germany is asinine. 1. They knew what Greece was up to. 2. They facilitated it - or turned a blind eye. 3. They benefited from it. I don't see how it's unreasonable for everyone to share the blame for this. Sadly the cost can't be shared as equally as the blame.

So your big argument that everyone is to blame is that somehow you assume that others might have suspected that Greece did extensively falsified their accounting to hide double-dgit deficits and massive debt? Because I'm pretty sure that greek governments decided all for themselves to pile up even more debt and falsify their records to hide it from the public.

> So your big argument that everyone is to blame is that somehow you assume that others might have suspected that Greece did extensively falsified their accounting to hide double-dgit deficits and massive debt?

Well. Yes. And even in your reformulation, it sounds like a fairly reasonable argument.

Re: Review of “Adults in the Room” by Yanis Varoufakis

#130

Post by lmm »

andy_ppp wrote: post #9
pif wrote: post #6

Earlier quoted context omitted.

Why? What did he do, apart from letting the Greeks believe they could choose not to refund the debt?

Morally it's on those who give out loans to make sure that they can be repaid. It's wrong that Greece took these huge loans as well, but also it's wrong to suggest that they have to pay them back. Everyone has the option to default when they are unable to pay and this was clearly the situation for Greece (and probably Spain and Italy, maybe even UK soon enough).

Disagree. Default is something we allow out of grace, it shouldn't be treated as something you're entitled to.
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