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Comment by toyg | Hacker News Reader

As the most competent economist in the room in any negotiating meeting, he clearly made the mostly-incompetent politicians insecure. I mean, Schauble studied law and was an average accountant, Djesslbloem studied agricultural policies, Lagarde is a lawyer. When he suggested advanced financial instruments of policies, most of them could not understand what he was saying, hence the accusations of gambling and so on.

In that sense, yes, he's better gone: he leaves while on top, having been vindicated by both economists (IMF report) and the public. I fear this might mean Greece will still have to swallow a bitter pill though.

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I think you are leaving out that he wasn't exactly a decent diplomat or politician, calling the creditors "terrorists" and publicly offended the German finance minister. In fact, I'd consider this the biggest reason he has come in disfavour with the other ministers.

He didn't call them terrorists, that was a translation error that inflammatory media outlets didn't bother to correct.

I will concede that. However, I doubt he was speaking about the creditors in a nice manner. And regardless, it certainly wasn't his first diplomatic gaffe in his tenure as finance minister.

However, if his words are commonly misrepresented, then he should be more careful when speaking publicly. Part of being a politician, and particularly a minister, means your every word will be scrutinised in every way.

While he definitely had the ability as an economist, he did not when it came to being a politician nor a diplomat. But his resignation seems to confirm that he himself realises this.

There's something to be said for not pussy-footing around imbeciles.

If one considers their creditors imbeciles (as one might fairly do in this case), it becomes an open question where they plan to get money from in order to continue? Even if they go bankrupt, they have to keep getting money from somewhere.

A sovereign nation do not have to get the money from anywhere, unless one is stuck in thinking in terms of commodity money.

You're right, they have to get goods from somewhere. The currency situation is due to the imbalance between what Greece produces on the world market vs. what it consumes.

Their government can certainly print money endlessly, but it's like issuing more stock: it doesn't just make the value of that country go up, it makes the value of its stock (money) go down proportionately.

So the fact remains that Greece won't be able to buy all the things it wants without outside cash. And who is going to give it any now? If you just print money without limit, you'll soon find that there's nothing to buy with that money due to inflation.

Maybe they can copy Argentina, but when their finance minister's exit speech is basically "haha, later suckers!" I don't have high hopes.

There is also the exchange rate aspect.

If their currency were to lose value, their exports would become cheaper in relation to others.

This in turn would drive up exports.

Right now the euro is trading pretty much on par with USD.

Not likely that this is beneficial for the Greek economy, as it seems very dependent on farming and raw material extraction.

Or insulting the type of people who would let personal insults dictate their decisions affecting millions.

Their room for manoeuvre is ultimately determined by their voters, most of whom have realized by now what little regard Syriza (and most of Greece) have for them.

> He didn't call them terrorists, that was a translation error that inflammatory media outlets didn't bother to correct.

Where do you think the mistranslation happened? Here's the text (in Spanish) from the El Mundo interview. My Spanish isn't great, but it seems quite clear:

(El Mundo) Aunque no haya encuestas, en las calles de Atenas lo que se siente es que la gente cada día que pasa tiene más miedo.

(Varoufakis) Sí, así es. Lo que están haciendo con Grecia tiene un nombre: terrorismo

(El Mundo) ¿De verdad piensa que lo que están haciendo con Grecia es terrorismo?

(Varoufakis) Por supuesto que lo pienso: es terrorismo. ¿Por qué nos han forzado a cerrar los bancos? Para insuflar el miedo en la gente. Y cuando se trata de extender el terror, a ese fenómeno se le llama terrorismo. Pero confío en que el miedo no gane.

Here's a quick translation:

(El Mundo) Even though there are no polls, what you feel in Athen's streets is that people is more scared every day.

(Varoufakis) Yes, that's it. What they are doing to Greece has a name: terrorism.

(El Mundo) Do you really think that what they are doing to Greece is terrorism?

(Varoufakis) Of course I think so: it is terrorism. Why did they force us to close our banks? (They did so) To instill fear into people. And when the objective is to spread terror, that phenomenon is called terrorism. But I have faith in that fear won't win.

---

My personal stance is that he did indeed call their counterparties terrorists. However, he carefully distinguished them from "violent terriorists" such as ISIS et al. Which kind of terrorists are actually more harmful in the long run... that's a matter for personal opinion.

A couple of other terms that could have been used was "spreading FUD" and racketeering (nice nation you have there, would be sad to see anything bad happen to it...).

But the guy have a penchant for not mincing words...

Does Varoufakis speak Spanish, or is that itself a translation? Because El Mundo is also a media outlet.

Was it now?

Googling the actual Greek word he used brings up page after page of arguments that it meant exactly that: terrorism.

Actually he has been insulted for five months by German politicians but stayed polite despite this. The real problem was the perception as being arrogant, which was also fueled by the media.

The idea that any of those leaders would have been intimidated by or felt insecure around Varoufakis is laughable. He was a mildly amusing technocrat given a specific mission by his delusional government, a mission he failed miserably at while mostly working to maintain his own brand. National leaders keep trained monkeys of their own in the room to explain or even negotiate the details, the key issues are in making sure that major points are accepted by both sides. I would not say that is is leaving "while on top", he is just leaving.

This is no longer a negotiation regarding greek debt, it is a determination of the process for greek exit from the Euro.

>This is no longer a negotiation regarding greek debt, it is a determination of the process for greek exit from the Euro.

Which was the only possible solution for Greece (outside of 50% debt relief which would have been optimal, but politically impossible due to conservative culture). So in a way he delivered.

Given that Syriza came to power claiming the could both eliminate austerity conditions and keep Greece in the Euro, I have a hard time believing that this is delivering in any way, shape, or form. Greece is now going to have an unpleasant austerity imposed on it by collapse of their banking system and exit from the Euro. In the long-run this is possibly better, but it is going to be very unpleasant for quite a while.

Having permanent depression is always unpleasant. Anyway Euro is not a big deal. Membership in EU is. They have access to Schengen, EU markets and borders.

You might think that, but it's a fact that he managed to move the debate from "more austerity to repay all" to "the unsustainable debt has to be renounced". Both the IMF and the public agreed with him. The fact that he didn't need "trained monkeys", unlike his counterparts, is exactly why they clearly felt threatened and spent six months name-calling him.

> It is a determination of the process for greek exit from the Euro.

It might well be the determination of the process for Euro dismemberment. It's now clear that a country not useful to the current "enlarged deutschmark" will be just thrown to the wolves, so the clock is ticking for Italy and Spain.

> Both the IMF and the public agreed with him.

From my reading of the IMF report abstract, it seems that they believe the debt is unsustainable given that Greece didn't follow the plan laid out in the 2012 framework. Hardly a change of message, I'd say.

Relevant passage:

> By late summer 2014, with interest rates having declined further, it appeared that no further debt relief would have been needed under the November 2012 framework, if the program were to have been implemented as agreed. But significant changes in policies since then—not least, lower primary surpluses and a weak reform effort that will weigh on growth and privatization—are leading to substantial new financing needs.

http://www.imf.org/external/pubs/cat/longres.aspx?sk=43044.0

> not least, lower primary surpluses and a weak reform effort that will weigh on growth and privatization

Here's a wonderful anecdote about their glacial and incompetent privatization:

http://www.forbes.com/sites/timworstall/2015/07/03/the-airbu...

Note the marvelous bit about the hundreds of clients the non-selling of 4 Airbus planes provided jobs for.

They stopped following austerity because things were getting intolerable for the average person. By the time the medicine could have 'worked', the patient would have been long dead. So the change in policy was inevitable, as it was debt relief. If Merkel and Schauble had agreed to debt relief 6 months ago, accepting that it was a price worth paying for the stability and long term wealth of the eurozone, things today would be looking rosy. Unfortunately, they could not get themselves to reveal to their electorate that the 2012 bailout was for European banks and arms dealers rather than the Greek people (which is now long overdue), and here we are.

Hmm, it seems to me that "advanced financial instruments" that helped mask persistent corruption and tax evasion are a big reason why Greece is currently in a no-win financial deadlock.

And it's a bit rich to talk about the "competent" Greek economist vs. his "incompetent" EU counterparts when they're the ones with the money and he isn't.

When it comes to the Greek debt fiasco, Shakespeare said it best 400 years ago: "Neither a borrower nor a lender be, For loan oft loses both itself and friend, And borrowing dulls the edge of husbandry."

Sure, they're the ones with money and he isn't, but that's hardly his fault, and it's a bit rich to suggest that this implies competence, when part of the reason Greece doesn't have any money is thanks to the policies of these EU counterparts (and their predecessors).

> And it's a bit rich to talk about the "competent" Greek economist vs. his "incompetent" EU counterparts when they're the ones with the money and he isn't.

So you mean that all competent economists are in rich countries, and all incompetent in poor ones?

Does the same apply to other disciplines? Like all good mathematicians are in the US and India? All good painters are in the Netherlands? etc

How sad! I now realize that coming from a country with less than average literary achievements, no matter how I try I won't be ever able to write! I thank you for saving me the effort to try!

What a funny world!

It is a bit rich to imply that J.K. Galbraith is a competent economist and Donald Trump is not, when Trump is the one who has money and J.K. isn't.

Right? :-)

A nice way of saying the Greek govt was mostly Idiocracy (2006) incarnate. Sounds like there might be a leadership vacuum and hard, effective work ethic may not be appreciated (or it was a personality conflict).

One positive note: most organizations are culturally self-selecting. So if it didn't work out, that means he's freed up to land a better gig even if he could have made an larger impact if allowed, it's clear the leadership either blames him, feels they have irreconcilable differences or doesn't want him to succeed. It appears he gave it a good go, but perhaps insiders think otherwise. Reiterating the maxim of never burn bridges and always take the high road when leaving employment (and never gossiping/speak ill of anyone in an exit interview.)

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