Yanis Varoufakis: Confessions of an Erratic Marxist /// 14th May 2013

uh hi thanks for coming um uh yanos vakis as you've known that's why you're here is with us here tonight uh he is a Greek Economist who is now with University of Texas and who made a name really for comments on the crisis which were different from what we were seeing in mainstream media and we are thankful to whichever editor picked it up first and then it rolled on uh so I don't think I need to say much more about it he'll give an hour like and then I'll ask one or two brief questions and then we'll uh open the floor and Janice please thank you so much thank you everyone the organizers and especially all of you for being here I'm going to stand up right hope I'm not making your life difficult um okay it all started as you said in 2008 when capitalism managed to have its Second Great spasm after 1929 setting off a chain reaction that uh put Europe into a NeverEnding downward spiral which is now threatening to push Europeans into a Vortex of almost permanent cynicism and misanthropy for the last three three and a half years I've been addressing various exceptionally diverse audiences I have a list here of a address the syntagma square indatus the Federal Reserve Bank in New York uh green members of parliament in the European Parliament in Brussels uh Bloomberg in New York and in London hedge funds series activists in Athens in other cities around Greece schools in the United States the House of Commons the House of Lords exceptional diverse audiences and nevertheless my point has been quite simple to each one of them and that is that the crisis that started in 2008 and which is accelerating not subsiding is not just a threat for particular groups of people or social classes for that matter it's not just a threat for workers for the dispossessed for Bankers for particular Industries for particular countries it constitutes a clear and present danger for civilization as we know it at least that's my view and this is the message I've been trying to carry across to these different audiences once that message had been registered my immediate priority was to put forward pragmatic and realistic proposals for how to stabilize the situation how to stop in its tracks the Juggernaut of human suffering that was progressing viciously from one country to another from one realm to the next now in March 2012 if I'm correct if memory serves there was a blog post by some Anonymous more or less or not very well-known radical Lefty who admonished me for being uh defeatist for putting forward proposals that instead of offering to replace capitalism they were suggesting ways in which capitalism could be saved from itself today here in front of you I want to confess to that I want to say that he was right and actually it hurt quite a bit to read it and I shall be confessing to a a number of other things at the same time but we must always Beware of the fact that confessions are pregnant with what John fyman the great mathematician engineer cold warrior once said about Oppenheimer who used to be his boss at the Manhattan Project because fman and Oppenheimer worked together creating the atom bomb and upon hearing that uh Oppenheimer had turned nuclear anti-nuclear campaigner and had expressed regrets for having contributed to the atom bomb Hiroshima and nasaki the great cold warrior John fman also known as Doctor Strange Love because of the fabulous movie by Stanley curi quipped that open Heimer was confessing to the sin in order to claim the glory now I promise this is not the kind of confession you'll be hearing from it tonight indeed the kind of confession that I want to present to you constitutes as far as I'm concerned a radical strategy a radical strategy that I see as part of a radical humanist political agenda for maintaining in our sights in our heads in our ears a sense of rage towards capitalism why lending capitalism a helping hand in this hour of Crisis because if we stand idly by watching our ruling classes stupidly idiotically allowing capitalism to collapse at this juncture in history the only ones who will benefit will be the misanthropes the racists and the nais the left is not ready at this stage to take the uh burden on its shoulders of uh what will happen as at least European capitalism and of course global capitalism is collapsing so confession as a radical strategy now turning from the political to the personal just for a second when I chose my PhD thesis back in 1982 whenever it was in England I chose a topic and a theme of study that was highly mathematical and in which Marx was irrelevant Marx's theorizing simply made no sense within that context when later on after having received my PhD I got my lecture ships at the University of fex e Anglia Cambridge and so on um there was the implicit contract between myself and the Departments that hired me was that I would be teaching a kind of Economics which left no room for marks in the late 1980s unbeknownst to me I have to say I was hired by the University of Sydney economics Department in an attempt to escape from thater and what I found out later was that I was hired by the right-wing faction of the economics Department who hired me in order to keep a LIF left-winger out then in the 2000s when I returned to to my homeland Greece I got embroiled and that is a serious confession with George Pap andreo and the BOK Socialist Party in in inverted coma Socialist Party in a bit from a personal point of view to participate to participate to lend a hand to the attempt to stem the conservative tide that was ushering the right-wing conservative party into government with a clear anti-immigration and racist agenda of course there we failed and then we had the BAU government destroy our social economy uh more recently the proposals that I've been banding about and been putting to various audiences that I mentioned before if you read them there is not even a whiff of Marxism in the in those proposals they are indeed we call them A Modest Proposal the purpose of which as I said before was to stem the dis integration of European capitalism for reasons which I touched upon very briefly before but I shall return to in in a minute so this was just a a little personal um exposition of a past that if you if you look at what my work and my various moves there's not much marks in there and yet I'm standing here in front of you today with the title confessions of an erratic Marxist why am I calling myself a Marxist if my whole academic career is based on material in that that is completely not at odds with marks but ignores marks utterly and completely well let me say that the way I understand the world was formed by the bearded one from a very early stage of my life I remember when my father who was a metallurgist dealing with metals chemical engineer uh impressed upon me at very early age that before metal technology was developed Humanity was in the realm of prehistory and it was only when we moved from the Bronze Age to the Iron Age that history sped up its velosophy velocity began to be counted in the centuries as opposed to in the Millennia it was only much later with mass production of Steel that history sped even further up and it was counted in the decades and much more recently of course with silicon and microchips every time the iPhone is uh updated history is almost Rewritten and this Triumph of human reason over our technological means empowering us over nature while at the same time exposing the Primitive nature of the relations the human relations and the social relations between us that narrative which I gathered from Marx was essential in in helping me understand what on Earth is going on on this planet um and that historical materialist perspective on the world was uh constantly reaffirmed by the most interesting and unexp expected of ways for instance has anyone watched the episode of Star Trek Voyager called at the blink of an eye if you haven't watched it and you are marxists you should watch it because in 45 minutes you have a wonderful depiction of historical materialism at work the Starship Enterprise is caught up in orbit of that certain planet and the peculiarity of that planet is that time moves 50 times faster on the surface of the planet than in orbit so the people in the the crew of the Enterprise actually watch History evolve in front of their eyes and at first the Primitive humanoids who are residing on that planet are looking up and they see that glimmering Starship and they think it's a God by the end of the episode 45 minutes later of course they have developed their own Technologies and spaceships and they've gone up there and help Enterprise liberate itself from the orbit of that planet now I started reading marks because these were these were revolutionary times in Greece due to the collapse of the the fall of the dictatorship at the age of about 11 12 as I said these were strange times back then and what caught my eye was Marx's unsurpassable mesmerizing gift for writing a dramatic script for human history it's it was a bit like not a bit like precisely like encountering a get together between Dr fa and Dr Frankenstein on the one hand and Adam Smith and David rard on the other creating this narrative populated by figures who were dramatic Persona who were struggling to harness reason and Science in the context of empowering Humanity but but without unwittingly without intending to unleashing demonic forces that were usurping and subverting their own freedom and Humanity when for instance I read the the lines conjured up machines with gigantic productive Powers but like a sorcerer who has lost control of the power of the Nether world he has called up by his spells we have become their slaves the machine slaves so this dialectical perspective where everything is pregnant with its opposite and the eager eye that Mark had with which he discerned the potential for change in the most seemingly the most constant and unchanging of social structures that to me was exceptionally fascinating and it made me grasp the great contradictions of the era that we've been living in for the last 300 years think about the Industrial Revolution think about about capitalism it is a production a metaphorical production line that produces in the context of joint production two things simultaneously immense wealth and unprecedented poverty poverty that Humanity never experienced before even during the feudal era or even slavery today look at our Euro crisis or look at the crisis of realization in Marxist terms in the United States of America or in Japan people people the official commentary it refers to the debt crisis but they forget that while we have a mountain of debts and banking losses we also have a mountain of surpluses profits that are idle utterly terrified of being invested into productive activity in this environment of Crisis and therefore failing to produce these surpluses the incomes which would be necessary in order to repay the debts and to cancel the banking losses so this dialectical joint production of Good and Evil of wealth and deprivation of spirituality and depravity that dramatic script was exceptionally important in shaping my mind from an economics perspective as I was imagining myself having a future as an economist I'm talking about now 15 16 17 I remember that I consider and I still consider Marx's greatest contribution to economics to political economy his very simple differentiation between let's say electricity generators and human labor a distinction which didn't exist before marks in political economy it didn't exist after and what is the distinction electricity generators are are Commodities and nothing but Commodities in the capitalist order human labor is constantly commodified Capital employers struggle they employ their cleverest tactics to commodify labor and yet they can't but this is a tragic play because if they succeed in commodifying labor fully then suddenly capitalism will die think about the Invasion of the Body Snatchers the 1953 great movie which was remade very badly again and again after that imagine that we have these spes that come from outer space and invade our beings and turn us into empty shells humanoids that have lost all free will all creativity or all subversiveness and instead go through the motions of going to work work of sleeping of eating of producing of consuming and so on and so forth suddenly that posthuman Society will have become nothing significantly different to a mechanical watch a mechanical watch has Parts they all work together and they produce a function an integrated integrated circuit of a computer does the same thing you don't hear a watch maker or a computer scientist talking about the value that is produced by the cogs of the machine because there's no need you can in engineering terms you can tell the whole story about how the watch works or the computer works without the notion of value indeed the moment Capital succeeds in squeezing that indeterminate human Free Will from the laborer as it has drives to do it will be as a system incapable of producing value and then to the extent that it can only Survive by the accumulation of value it will go into recession it will go into a crisis and that will unleash some extra degrees of freedom in the humans that it try to suppress and the cycle will start over all over again that economic concept of the labor input as radically different to all other inputs and labor as the only commodity which can never be fully modified was to me and Still Remains to this day Marx's greatest contribution to our way of conceptualizing the political economy we live in so when he was writing that labor is the living form giving fire that lends value to Commodities he was not just being poetic he was being at its highest level of of economic analysis and when he talked about Capital as a social relation between human beings and a force that we must submit to he was talking about the effect that particular property relations have when we have non-owner workers and non-working owners coalescing in the context of the labor contract that creates a social Dynamic a historical Dynamic where machines cease to be just pieces of machinery and they become a Force that we must subject to and when he says we he doesn't only mean the proletarians the workers he means also the employers who must become part and parcel of the same Machinery losing their own Freedom too terrified that if they don't exploit labor then they will become exploited labor themselves that is the the the the the almost ancient Greek sherian tragedy that he's describing in terms of an economic analysis that in my mind at least as a young person made perfect sense before I went to University since I have mentioned movies already let me conclude this part on Marx's great dialectical contribution to our understanding of the economy by saying that seen from These marxian Eyes Of Mine The Matrix the movie is not a futuristic science fiction film it's a documentary of the world we live in because if you think of this an impressionistic documentary but a documentary nevertheless it describes the world we live in a world in which the inexorable efforts of capital to commodify labor are creating a society of a automata where Humanity only provides in the final analysis the thermal energy that is necessary for the machines to do their job but to the extent that they are successful in getting rid of Free Will through the Matrix if you've watched the movie and I'm sure you have most of you that system cannot produce value anymore and that system can only reproduce itself as a Mindless malange of machinery and in that movie The Band of subversive humans who have escaped from The Matrix and tried to liberate the rest of humanity for me are symbolic of that hostile element of humanity which remains embedded in human labor and must remain embedded in human labor under capitalism so that capitalism can produce value and accumulate moving beyond movies and um the abstract let me share with you not something you don't know of course but let me just recap ulate on some of the insights that this particular perspective Marxist perspective has Beed us and which are essential in our struggle to make sense and sense of the world we live in and to affect it the first one is concerns the nature of wealth we live in a society which is uh procuring the fallacy that wealth is privately created and then appropriated through tax taxation by the state when Marx so beautifully explained to us guided us to the truth of the opposite that wealth is collectively produced and privately appropriated autonomy in this postmodern world of ours there is a lot of work uh discussion about autonomy both from liberals and post structuralists but we keep forgetting that that autonomy is collectively produced and certainly not individually the social democratic tradition has been caught up now in for 70 years in a bogus dilemma between equality and Liberty that Marx dismissed so beautifully and powerfully and unfortunately even the marxists of the 20th century frequently forgot that Marx's critique of capitalism was not that it produced an in inegalitarian society but that it was producing an irrational society that was restraining the freedom of everyone on both sides of the class divide when we talk about climate change as an economist I live and suffer on a daily basis the inanity of my profession that Rush headlong into mark Market solutions for dealing with bads as opposed to Goods with pollutants with CO2 creating emission trading schemes and trying to address the failures of the market mechanisms of capital accumulation by adding more markets and create artificial ones that we create only if you have a Marxist perspective on the creation formation of markets will you ever understand that an emission trading scheme is firstly bound to fail and secondly it adds to the social conventions and the ethos and the morality that is part of the problem with climate change I will finish off in terms of these gems that we owe to Marx and which I owe to Marx by mentioning the Democratic deficit which is one of the major deficits that our societies are facing but Marx would have simply laughed at the crocodile tears that are being shed over the Democratic deficit and the diminution of political Democratic Goods he would think that this is a great success of the capitalist system what was the project of liberalism of B liberalism from the 19th century onwards it was to separate the economic sphere from the political sphere and to confine politics in the political sphere leaving the economic sphere to Capital and this has been exceptionally successful even in South Africa today this is precisely why thec is finding itself in the the D stat it's finding itself in and why in the end however much we enjoyed seeing Mandela in the presidential Palace there was a precisely that kind of separation and if you don't believe me ask me the miners who lost their lives a few months ago at this point I'm going to turn to the word erratic that I use in in in in the title of my talk and I shall explain why I'm angry with Marx and why I'm certainly not a Marxist Marxist in the sense that Marx once said that he was not a Marxist I believe that Marx made two spectacular mistakes two errors of omission if not commission at least possibly one was Omission the other was commission for from which the left is suffering and because the left has messed up so spectacularly over the last 100 years the world is suffering the first mistake is the most more mild one the error of omission he was insufficiently dialectical insufficiently reflexive he never gave any serious thought and he kept a judicious silence on the impact that he theorizing would have on the world around him for instance I'll just give two examples his theory is exceptionally powerful for reasons that I try to sort of summarize didn't he understand that his disciples that would be privy to these powerful ideas might use that power that they would gain from his theories in order to disabuse their other comrades whether they were um stalinist prison guards or Ministers of the interior in in Bulgaria or indeed tened professors in some British University who gathered around them a band of impressionable young kids another example we very well know that the success of the rational Revolution the emergence of the Soviet Union caused capitalism to recoil and to tolerate and concede for instance the National Health Service in the social welfare state he never imagined that that would happen and he never prognosticated the effect that the rise of the Soviet Union would have in adapting capitalism such a way as to divide the working class both in the East and in the west but these as I said I'm perfectly prepared to forgive who is a prophet after all however what I'm not prepared to forgive him for is his second error which I think is an error of commission the fact that he decided that truth was to be discovered in the equations of his economic models we ended up after years and years of sterile scholasticism in the economics departments where some marxists Marxist Economist worked with what n described as the pieces of mechanism that have come to grief and the reason why that is is because there can be no truth coming out of mathematical economic models the reason we could discuss this later if and I'm sure you will want to ask me questions on this is that it is theoretically and mathematically impossible just as it is impossible to square the circle to combine within the same model mathematical model a theory of value and a theory of growth and if you don't have a theory of value and a theory of growth in the same model you might as well not have any models this is the short version of my critique Marx knew that and that's why I don't forgive him but he was so determined to flatten citizen Western have you has anyone of you read wages prices and profit which is effectively transcript of a talk he gave in a trades Union context in London in which he admonished that poor man trade unionist Western citiz in Western for having D to raise a query that if we workers push wages up through strikes well perhaps prices will go up and then you know we will lose all the benefits of our struggle and man Marx decided to strike him down by proving Beyond Reasonable Doubt scientifically and he called him an unscientific anti-scientific git or words to that effect that in his model a boost in wages will never increase prices because prices reflected labor values when he returned to this question in volumes 2 and three of capital he realized that that wasn't true he realized that it is impossible to close your model mathematically like having a system of two equations in two announce and solving it while allowing for complexity for different degrees of capital utilization in one sector compared to the other and yet he wanted to steamroll this mathematical economic logic over his disciples in order to argue in a 19th century mechanistic deterministic way that the truth is to be found in those equations the truth of capitalism that was effectively the worst own goal in Marx's life because if I'm right in what I was saying before that his greatest contribution was to explain to us so beautifully poetically succinctly and analytically correctly the that it is the indeterminancy of the labor input that makes capitalism a fundamentally unsustainable and contradictory crisis prone system that in determines means what it means you cannot have a labor input in your system of equations that is mathematically determined so if you insist that the truth will have to come out of your mathematical equations you are effectively destroying the very IND determinacy that you have elevated to the level of an important economic analytical category and he knew that he did it but because he was completely and utterly convinced that the trades unions movement the workers movement needed to have a scientific background a mathematical model that can be solved like classical mechanics he pursued with it even though you can find in footnotes and various pages in volume three that he knows that what he's saying is not completely right so strange are the rituals of emptiness but even stranger are the rituals of marxist economists who for decades have been wasting their lives trying to work out Marxist economic models in just opposition to the boua economic models which are just as irrelevant even they all economic models are irrelevant regarding the understanding the grasping of capitalism this is where I believe it is Progressive and very radical to bring an enemy of the left in in within our midst John manard KES because John manard KES being a free-spirited boura thinker and intellectual in the midst of the recession the Great Depression he wanted he was quite happy to break free of the marshallan tradition that he was following the bouris neoc classical Trad marginalist tradition that you was following and to say folks none of our dogmas work look wages are collapsing and employment is falling too it's not increasing employers are not hiring more people because wages are going to zero interest rates are collapsing there's the liquidity trap there's no investment so something is happening here and he made a discovery which was very simple to make what happens is in capitalism you have an end determinate system with what we call in economics multiple equilibria do you know what this means that anything goes that we are as as my Australian an Australian student of mine once said Professor are you telling me that John KES said that we're buggered if we know I said yes this is precisely the you know the one Insight by John manard kanes we're buggered if we know we don't know what capitalism will do tomorrow it may fall in its face and not get up again the animal spirits idea of can is a very radical idea it's theide a that that Marx first introduced and then crashed because of his commitment to economic models which canes started off from but then abandoned in order to understand the Great Depression so we need we don't need a general theory it's a horrible book don't read it what we need from Kan is this idea that capitalism is an indeterminate Beast which is perfectly capable of falling down and finding it abs absolutely unable to pick itself up through Market forces that is a radical idea that Marx should have had in the middle of DUS Capal but he didn't have possibly because of 19th century mechanism now let me go back to the personal again to my own self because I did mention that I started my academic career selecting very mathematical models mathematical economics model traditional conventional bouro mathematical economic models and this was what I chose to study when I was at University and to write my PhD dissertation on and then to build a whole career on that well let me at first defend it as a choice as a strategy when I was making these decision was the late 70s and early 80s it was at a time when it was the writing was on the wall that Progressive economics whether it was Kian ketan John Robinson in Cambridge uh uh not to mention mark was out that mathematical economics was a dominant Paradigm and anyone who didn't speak that language would simply not be heard by the might and mighty and high and I remembered reading in marks a description of his own method which he called imminent criticism what is imminent criticism comprise of it means you take your enemies theories you don't challenge their assumptions their premises you say okay so this is what you're assuming let's see what you're assuming let's asse let's accept what you're you're assuming and see whether what you think is the conclusion from your assumptions is truly the conclusion from your assumptions and to challenge their own logic not their own assumption because nothing upsets the dominant Paradigm more than to say I shall accept your assumptions but I shall prove to you that you are failing your own principles this is what he did with Adam Smith and David Ricardo he took David Ricardo and Adam Smith extended their theory of value to answering the question so what determines the the wage and in volume one showed that capitalism is bound to be um crisis prone using Adam Smith and David's analysis not his own he only tampered with it in a way that Ricardo couldn't resist had he been alive when he was doing it so I thought I would do the same thing I would you see take financialization take the neoliberal macroeconomic policies of the 70s ' 80s ' 90s today what are they predicated upon the so-called General equilibrium model they say all right there is somebody in Princeton at Harvard you know Kenneth Arrow or Gerard de BR very abstract mathematical economics economists who have created this economic model and it shows what that it is possible to have a capitalist market economy which is in equilibrium and therefore efficient okay so in order to bring that economy about we need to introduce privatization blah blah blah blah okay so my intention was to employ the strategy of imminent criticism say all right let's take this General equilibrium model which by the way the macroeconomic policy makers never understood because it was too mathematically complex for them to understand so I thought I'll make it my business to understand better than they do in order to argue that their Bible is teaching a different Dogma to the one they think that it it is teaching uh that was my first mistake it was a mistake because even though it allowed me to be a professor of Economics simply because the neoc classical Economist the rightwing did not realized that I'm not one of them because they couldn't even read the mathematics that I was doing so they gave me jobs thinking that I was one of them that's why the rightwing of the City University Department of Economics employed me and of course after a while they regretted their decision I'm pleased to say but that was my first mistake and I'll tell you why because I had this Bourgeois view expectation that if you presented these Anglo-Saxon Anglo Celtic professors colleagues with a mathematical proof that their model is wrong that they would care they don't they used to you know people like Frank Han and Kenneth har and so on the older generation cared about the seaworthiness of their theoretical vessel this lot now don't give a and it is very discouraging um on the other hand I have to tell you that the same thing applies to Marxist economists who will pursue their mathematical economics models and errors with the same Zeal and lack of intellectual curiosity economics is bad for your mental health and for your intellect whether you're on the left or on the right my second great error would happened almost immediately as soon as I arrived in Britain in October of 1978 remember the dates April 79 Mrs tcher comes in I remember I was politically active from the day one when I arrived in England I remember having bous arguments with my English leftwing student mates and I was arguing that it would be good for thater to get in that what the working class and the middle class in Britain needed was a short sharp shock I had assumed it would have been a short shock that it would be sharp I had I had not um I had no doubt about but my very naive childish view was that things had to get bad before they get better you see had red Lenin year after year after ther got in things got increasingly worse and worse and worse every year we used to think that things have gone so bad they can't go get worse than this and they did inexorably that was a great lesson for me instead of radicalizing the left instead of rad radicalizing progressives in British Society what this Tail Spin of the British social economy did between 1978 79 and 1985 was it destroyed any possibility of progressive change in Britain and that is a lesson that I Carri to this day and it's one of the reasons for the kind of stance that I'm taking in the context of the Euro crisis today and why even though it hurts I have to confess to what the Blogger of that leftwing uh site said about me that I am not proposing I'm not going out there arguing for replacing capitalism but for saving it from itself so let's come to the euro crisis I won't give you a lecture on the Euro crisis I've done so many and I'm sure you've heard so many in the past let's just assume that we are on the same page on what happened just very briefly the Euro Zone was not designed to sustain a major shock like the great financial crisis the crash of 2008 it was bound to start unraveling it was only predicated upon a kind of global Surplus recycling that uh was uh conducted and orchestrated by Wall Street and primarily the twin deficits of the United States of America that's my thesis anyone who's interested in that I'm presenting it tomorrow in a book launch at 6:00 so I won't bother you with that but what has happened in Europe is that the European leadership's reaction to this systemic implosion that began in 2008 and which were nowhere near the end of as we speak as I speak the reaction the institutional reaction of the Euro group of the European Union Council of the European Central Bank now of the European stability mechanism will go down in intellectual history as an example of orchestrated idiocy at its worst there are not going to be any winners here this is not a typical class struggle where the labor share of income goes down so that Capital share goes up here we're going to have an A postmodern 1930s where in the end everyone except the Nazis the bigots and the misanthropic racists will be a loser we are a continent divided by a common currency almost a Marxist dialectical uh celebration fiscal rectitude now in the Euro Zone and in the European Union more generally is being banded about like democracy was in Iraq after it was invaded it is just a term which is being used in order to hide to disguise a helpless establishment which has no clue of the crisis that has befallen it and which resorts to the only that it does know how to do and that is to squeeze the labor share of income and attack the weak and the dispossessed in order to minimize in their eyes the costs of what I call bankruptcy which is the new regime we live in after 2008 ruled by bankrupted Banks now bre in the three Penny Opera said that wrote brute force is out of date why send out murderers when we can employ Bays I'm going to add to that by saying well why send out the vermar if you can have monthly troa visits in Athens in Dublin Portugal soon in a city near you always aware of our Collective guilt as left-wingers over the industrial feudalism that in the end became of the Soviet Union I shall nevertheless make uh a connection between the European Union and the Soviet Union they're very similar in the sense that they're both disintegrating with a few decades apart and yet you've got a completely uniform Party Line running from Brussels to Frankfurt all the way down to the last capital of Europe whether it's Malta or nikosia it's like an extreme Christian sect where you know it acknowledges facts only if they are congruent with the established official prophecies Mr ol and I mentioned that in a discussion a couple of days ago came out officially in a press conference and admonished the international monetary fund not Sira the IMF for having done what the IMF came out and did a mayor kulpa admitted to having ER in Computing in estimating in prognosticating the effects of austerity on growth and all Ren this unelected bigot had the audacity to turn around and accuse the IMF of making comments which are which were unhelpful because they stirred concern and doubt in the mind of the European people about the course that the European Union was following I don't think even BR would have said that so personally I am determined not to commit the same error I committed in the fall of 19 78 and the spring of 1979 I am not going to say that well let European capitalism crash and burn it deserves it let's build a better radical alternative on its ashes I don't believe the left is ready um I hope I'm wrong but I know I'm not so this is why together with Stuart Holland and Jamie galra we're pushing for what we call a modest proposal for resolving the Euro crisis because I believe that those of us who hate the Euro and I am one of them I campaigned against the euro in the 1990s have a moral almost authority authority a moral obligation to try to save it because its destruction is going to push us into a 1930s which is may be even a worse TR tragedy not just not be a fast but be a worse tragedy not only because not I'm not I don't want to prognosticate a war but what I'm saying is because there won't be a World War that Great Depression could last last 50 years because there will be nothing to stop it so let me end by saying that when I go around and I talk to hedge funds to parliaments to universities to school children in that attempt to forge strategic alliances I often come up with statements that are quite appealing to very rightwing people so for instance when in January 2010 um I outlined it was on the BB BBC World Service a program for a Greek default within the Euro Zone suddenly I had calls from Ron Paul's strategists in the United States from Tor MPS in Britain from right Wingers all over the place and Bloomberg who were very interested because they thought that this is a very sensible policy so what do you say to them I hate you I'm not going to go to bed with you no you try to create alliances that will minimize human suffering a Greek default in the in January February April in 2010 would have severely reduced the poverty that we are now having on the streets of Athens of Patra of irao however this is my final confession and it's the the most serious one The Lure of power must never be underestimated anybody who's watched misto I want to make this parallelism taken seriously by the high and mighty by hedge funds by the FED it crept up on me that sense of satisfaction which is a very conservative very non-radical and very corruptive sense my personal nadir came at an airport it was last April I was invited to give a talk in Berlin by a very rich outfit that was creating uh a conference in Berlin uh with the head of the ACB ausen and so on and I was invited to go there and at the time I was in the United States so the purchased was it a business class ticket first class ticket for me and I can tell you this is a genuine confession on the way back after I had already had two or three legs of flying first class there was a moment when my heart did not manage to remind my brain of what I always knew that nothing succeeds in reproducing itself as a sense of privilege founded on a false sense of entitlement I can tell you that there was that moment which was very critical to me when there was a huge queue of people waiting to go through the checkpoint the X-ray machine at the airport and I was AED in very quickly because I had a first class ticket deep down I suddenly realized I felt that I deserved that which of course I didn't and I you know who else could I confess this to but you folks I couldn't do this in Berlin they would have laughed at me so just to quote Prospero this thing of Darkness I acknowledge mine and this kind of radical confession is indeed I believe programmatically impossible if you agree with me that we have to forge Alliance alliances with very unlike ly forces and institutions like for instance the IMF many Greeks especially leftists found it very strange to hear me a few months ago declare that the future ciza government should try to forge an alliance with the IMF against the ECB but I believe it should the problem is that the moment you go into bed with bastards like the IMF your soul can be very easily corrupted and you can find yourself in the position of socialist of yesterday year who instead of changing the world man to change themselves so this is why I believe that radical confessions as a means never to lose sight of the misanthropy which is part and parcel of capitalism and its institutions is essential in the context of forging this alliances the purpose of which is to minimize human suffering at least in the short term thank you thanks yanice now I have one question it's um it's a bit broad but given you're in a confessional mode I've got to confess that I've got no great belief in such analytical mode as confessional mode so I'm I'm kind of prone to distrust you uh it's it's always when I whenever I see the confession it's okay what are you trying to hide when you're confessing all this you know throw throwing the the stars but yeah it's a convincing it's convincing story so that's one question if you want to tell us what what what did you didn't confess that you would like to tell us for you know what what was the mode of confession hiding that's one question and it's the first idea I had when I read the I said okay what is he I think so I got tell this and and then on upon hearing you and reading and you've you've addressed already some of the things we discussed earlier but not be captured in economic equ in mathematical equations yes labor input correctly fine we agree uh however it is the basis of all wealth creation labor fine fine third third Point uh and we can't have theory of value and growth uh they can't be given together for all those reasons so no mathematical Theory mathematical Theory there a difference right didn't say you can't have a theory of value and growth you can't have a mathematical model which is closed neat yes and solvable yes so given all that uh in a political sense what is the purpose of Economics uh what is the point of trying to use such analytical mode of of thinking uh such such abstraction of of of life around us uh what are its uses where are where do you see its boundaries given especially that you've seen you know you've been inspired by marks like many of us here have been but you have this benefit of seeing the other side because you've studied mathematics and you you know you've seen the Enemy Inside Out and you've taken enemy apart to bits in the modern political economics with your colleagues so given you've seen both sides politically speaking why economics and and may maybe perhaps to throw in Simon KET because one thing you haven't addressed in your book extensively is is National accounting and I wonder you know he said there is no we can't speak of economic modeling without knowing what's the purpose of economic activity uh so so that's the question okay regarding the first point what is it that I have not Spilled Out I shall need a good psych analyst for this because I really try to spill out what what I could so I need to be either hypnotized or put on the couch in front of everyone in order to come up with something else I can tell you lots of horrible stories about my private life but I don't think anybody will be interested in that uh from my intellectual point of view I think that I spilled the beans to the extent that I can the second question what is the purpose of economics in a radical intellectual agenda well I'll give you two answers the first one is by John Robinson the for you know the great uh economics professor from Cambridge and student of kanes when students used to ask her after hearing very similar critique of Economics to the ones that I put forward so Professor why should we bother with economics if you're saying that it's such rubbish why should we bother with it and the answer was a kind of voltarian answer so that economists can't fool you because let's face it if you if you if you go to any library at any University and you pick out a copy of the American Economic Review any copy of the American Economic Review and you don't understand economics and you don't don't understand mathematics you will not be able to understand a single sentence when you don't understand it's very easy to be convinced that you don't understand because you're are inadequate and it's impossible to engage with people who have claim to have proven theorems which prove that privatization is welfare enhancing so we need to study the Bible in order to attack the theists and if this is the Bible at the moment it needs to be studied the tragedy is that unlike the Bible which you can read in a few months and if you're clever enough you you can I find it very hard when an 18-year-old student comes to me and says you know yeah should I study economics you know I'm radical a political activist I just don't think that I have the moral authority to say to her or to him do it because it's a very added existence you have to go for years it's it's like being you know being recruited for the intelligence Services you have to go Behind Enemy Lines you have to dissemble for years you have to be to pretend to be interested in something that you're not really interested in that you're simply trying to subvert you have to be mered in a foreign language you have to hide your own predispositions if you're going to get a good Master's position you know be admitted at PhD level and get the lectur ship um I didn't so much hide it but I was economically with the truth in interviews I would never claim to be a Marxist if somebody asked me I would say it but nobody even imagin of asking me whether it was a Marxist so it's a life of loneliness but it is important it's just that you know once upon a time in the economics departments where I was there was always some eccentric not always left-winger sometimes left-winger sometimes eccentric in a humanist manner that was an oasis for students of economics and allowed them a human contact with a member of Faculty that was important thatcherism the research assessment excis in Britain the metrics which ensure that only those who publish in the journals that have the maximum number of browny points in economic departments have eradicated all eccentrics so suddenly you know if you choose to do I wouldn't do today what I did back in the 70s because there would be firstly back then we I was imagining that neoliberalism was a passing phase and very soon you know we would storm the the citadels of academic economics again it's not happening uh all intellectual life is dying Marxist Economist have something to do with that because of the scholasticism that I mentioned and why why not just read some good books instead of getting immersed in these equations so that the bastards don't confuse you but is is that is that uh the way I'm hearing you is that not just a critique of extreme use of mathematics rather than the economics per se because if you had a a Critic of Economics per se then why would you argue for and against of Euro Zone surely you you know you're basing your arguments that you're making publicly so widely and so passionately based on certain insights that you gain by learning how economics uh uh how how it operates I mean economic systems how do how do they operate well let me tell you this and that's another confession none of my interventions in the political and economic Arena of the last few years have been informed by economic models they are well and truly irrelevant to really existing capitalism what allows me however to be heard and to be invited by central banks and so on is the fact that I have this label professor of Economics which one can only get if one loses half his life or her life being immersed in inan mathematical models now don't get me wrong this is not a critique of mathematics this is a critique of Economics it's not ma the Tool's fault if it is being misappropriated and and abused mathematics is one of the highest forms of human intellectual activity and it is one of the few weapons Humanity has had in order to conquer the threats around it and it will remain a great source of inspiration to all of us it's very good too because it it sort of sharpens our minds but the moment you try to seek the truth about politic the political economy we live in inside a mathematical model constitutionally you secure you secure you ensure you guarantee that you will never be able to recognize really existing capitalism even if it were to hit you with a stick over the head so before we open can we conclude and me open the floor can conclude that you know the truth of your critique is that it's the class struggle is the moment where you know the value is being split you know where the wealth is being distributed that is that is the in in determines that we can't capture we can't say in advance what what the split will be between the labor and the capital not just class Str structure struggle I mean class struggles of course is the um the the foundation of the labor contract but it's not just a labor contract you can have all sorts of social phenomena that are happening with then look one of the Beauties in Marxist analysis that even schet appropriated many many years later is that you know think about it for a thousand years now the market has been spreading its tentacles into every activity even inside our DNA soon if they can sell the moon they will right uh and privatize it women's wombs have been commodified uh uh DNA has been commodified and yet there is a very interesting Market Free Zone it is the company the Enterprise The Firm once you sign the labor contract that was Marx's great Insight you enter into a social relational production suddenly you may actually love your your employer and your productivity may be huge so it's not just class struggle it's social relations of production which are irreducible to commodity exchange thanks a lot let's open the floor mat here third floor third row hi so you mentioned serus are Justin passing so my question is very concrete as everybody in you especially in the European left is very hopeful of Sera whether it is founded or unfounded what is your what do you think if Sera wins the next election in Greece is it realistic to expect if they if they succeed in maintaining some sort of uh left leftist program is it realistic to expect them to do something concrete and can that be some kind of uh at least inspiration for the left in Europe in other countries to do something in short yes in a slightly longer version what is of the essence now in Greece but also in other countries Spain Portugal Ireland is stabilization the social economy now is spinning out of control downwards you have a complete breakdown in the circuits of credit small businesses large businesses no businesses can borrow money so even the ones who are potentially profitable are closing down the public sector is in complete disarray the private sector is uh deleveraging the combination of public expenditure and private expenditure is GDP national income and therefore it is crashing and together with this imploding economic activity both public and private what you have is a society which is completely ill Attis with itself giving uh the oxygen or that is necessary to the Serpent's egg to hatch Golden Dawn so series's number one PRI priority is to establish a 100 day program let's say during which 100 days it will have to do two things firstly attend to the humanitarian needs of the dispossessed and save them from the Clause of Golden Dawn who are going around the neighborhoods Distributing food on condition that you have to prove your racial Purity secondly and simultaneously sirisa must establish a negotiating position with the Tria establish a plan B and a fallback position plus one or two or three very precise demands that it won't be willing to budge from once they are rejected by Mrs Merkel and Mr dragi now this is not an easy task but is it impossible no and if it succeeds this will be a major inspiration not just for the rest of Europe but for the world further questions comments provocations because otherwise we'll go into psych analytical mode which trust me you don't want to hear okay there's a question over there and then one there um for your uh political strategy so to go in the b in uh in the bat with the Enemy and that for that help other human beings uh are you really convinced that by that you're not uh doing really bad political strategy in that way that you're reinforcing this I don't know uh bad Force of capitalism or Society uh for example in history you have numerous examples where uh some left or Progressive political forces went into an alliances with right or bad political forces to call it and they lost because they thought they they could control for example uh in history they thought they could control Nazis or Nationalist and they went to alliances with them but then in the end they lost so do you think that this political strategies isn't it going in the same direction do you really think that you can control uh I don't know this hch funds or IMF or St or uh institutions like that by trying to change them from within there are no certainties and there are no easy solutions indeed there may be no Solutions but in this very d moment of in history we have to each one of us has to imagine to try to conjure up what we think is the strategy that has the best chances of minimizing human suffering I insist on that so take Greece Spain Portugal we are in a common currency which is asphyxiating our social economies okay so let's say that CA gets elected tomorrow you get elected in one of the Euro Zone peripheral uh member states what do you do do you get out of the Euro Zone do you say I'm not going to have negotiations with the powers that B I'm going to Simply erect barriers at the borders create my own currency see it dimin value by 95% and try to go for a key there is a case for this there is a case for this uh Argentina more or less did that and I support what they did entirely but Argentina had two major uh advantages that Greece and Portugal and Ireland don't have the first one was that it had its own currency the peso existed it was only a matter of cutting the peg with a US dollar and then defaulting and allowing the PES to fall the second it had was huge tracks of land producing the goods that China wanted to buy precisely at that moment Chris doesn't have either of these we don't have the dragma to devalue we have to create a currency it will take my in my estimation at least eight months to create it so it's like this is a bit like announcing an8 months in advance devaluation do you know what this means there will be nothing left8 months from now after the new currency is created so if I'm right in that and not everybody agrees with me on the left um if but if I'm right in that the only alternative is negotiations so who do you negotiate with the equivalent of the verar today is a troa as I said before the troa is the European Central Bank it is Germany it's called the European commission but really it's Germany behind it right and it's the IMF now the ECB refuses to speak on any of these matters it simply does as it's told by the European commission and primarily its governing Council where there is a terrible terrible terrible mix of board members primarily Mr aosen Right and Mr vidman who is you know the good cop and the bad cop so you can't talk to the ECB and you have to negotiate with Germany through the European commission the IMF perhaps the most misanthropic organization of the last 30 years who are responsible for so much human suffering in Africa in Asia everywhere for the last few years they've been changing their tune and they' have been breaking their alliance with Germany I know that people in the IMF are livid with a German position on Greece on Portugal and so on and so forth I see no alternative than to try to form um an opportunistic short-term Alliance so that in the first 100 days of a CZ a government we can be given some breathing space during which to consider our options can we be usurped by the M are they reliable allies we can be usurped and they are not reliable allies but this is the the hand that we have been dealt hello uh I have two questions uh one is uh you said u i don't I can cite you exactly but so socioeconomic system is pregnant with its opposite but uh what if I tell you there's a country with 45% unemployment which Almost Doesn't produce any value now you're talking about stabilization uh of of the Greece so it doesn't get uh more down what about growth what about growth after what uh what we still go as a left with internistic and protectionis measures uh building our industrialization through new uh building of a new bouri uh so to say uh or or what to do what to do how to build the opposite how to get pregnant uh again because I'm talking about about Yugoslavia with uh in the industrialization concretely bosnan herova has 45% of Unemployment uh industry the industry was sold to uh scrap metal what to do now and the second question is uh ol Stone uh asked uh in the opening ceremony uh who would who would you uh he U asked the uh the audience who would you want to act uh to play uh Lenin when you could choose an actor uh would you agree if I say uh Patrick Stewart thank you let me start from the end I I have to confess I don't know who Patrick Stewart is oh I Patrick Stuart that pck St no I prefer him as captain of the Enterprise regarding the first question look our small and almost destroyed countries whether it's Bosnia or Greece or Portugal in this era of injured globalization injured after 2008 have no capacity to industrialize I on the basis of autarchic economic policies North Korean style once upon a time it was mildly possible in the year of Breton woods and in the era when they were counterbalancing forces including the Soviet Union in the world economy let me tell you why I said before and I think that connects to your question that those of us who loath the Euro the most have the greatest moral imperative to try to save it imagine that we go this way imagine that the Greek government gets out of the Euro tomorrow regardless of what the cost to the Greek social economies let's say that we agree that that's something we should do that that's the least of our bad options the better of our bad options do you know what's going to happen next Portugal will be out immediately because Portugal is in exactly the same thing situation there will be a flight of capital from Portugal that will lead to a to the imposition of capital controls as in Cyprus and the moment that happens Italy is on the on the verge and when Italy goes then France goes and then before any of this happens of course Germany will be the one that leaves the Europe they will reconstitute the Deutch MK which is in my estimation exactly what the buddhis bank is is campaigning for and they will create a new Europe east of the r and north of the Alps including Holland Poland Austria Finland the Czech Republic Slovakia and the rest of Europe is going to be a patchwork of monetary unions or independent caces hit by simult simultaneously by inflation and high unemployment St inflation whereas the doar leban real wider space is going to be hit by the revaluation of the Deutch Mark or whatever they call that northern Europe massive shutdowns in Industry the German poor are going to be converted into the the the German Working Poor are going to become German unemployed poor the total microeconomic effect on the planet of these developments is going to be detrimental to the prospects of Brazil Argentina including and China Japan is already Morant so we are going to be creating the circumstances for a new Great Depression Galore to the end is this the environment in which we're going to try to create a new bourjois within our small Balkan States and hope for industrialization I don't think so right so who's left not depressed enough okay the left the left is not depressed enough let's ask there like to I would like to come back to what Yan said regarding the alliance between Sy and the IMF um can you be more more specific on this kind of Alliance on what grounds will it be based and isn't it the IMF adjustment programs throughout the world which promote privatizations um low uh levels of employment dismissals and uh low wages it certainly is not going to be an alliance based on Marxist leninist principles of course not the IMF is look the IMF of the two pillars of the troa the IMF is less keen on austerity it is still keen on austerity for the reasons that you suggested than German's they explicitly say that austerity has gone too far that reductions in pensions should stop the IMF has actually said that it should not have gone that far and it should if anything be reversed and I'll explain why I think that is happening it's not that they are going to be become Keynesian suddenly and that will approve of a CZ program for borrowing from the IMF let's say in order to infuse funds into the Health Service or the pension system that's not going to happen where I think there is clear ground for an alliance an alliance an agreement a short-term agreement opportunistic agreement concerns the banks at the moment as you know the Greek tax bankrupt taxpayer is borrowing 50 billion EUR from the European taxpayer to give to the banker Banks when that money is simply going to go into a black hole and disappear it will simply be used for the by the bankers in order to retain control of their Banks the media and their strangle hold over you know Greek society as somebody said about Goldman Sachs they're like a giant squid on the face of society and that is being funded by the Greek taxpayer and the European taxpayer who is lending to the bankrupt G taay to do that that we should stop and the IMF would be with us on that because the IMF is completely and utterly against the way that the banks are being recapitalized so when somebody says to them and I know this from personal experience why don't you we just give the those bloody Banks away if deutche Bank wants to come and get Alpha Bank take it we can use our own resources in Greece um resources that have not been privatized yet in order to create a new Investment Bank a newva for instance in order to promote growth internally instead of privatizing but the banks that we have should either consolidate or close down or be given to foreigners who w't take it if we want to stay in the Euro Zone we can't stay in the Euro Zone and have a national banking system when the bankers are bankrupt and the state is bankrupt that is something that the IMF would agree with and they would be able to utilize it as a Bull workk against the way that the Germans and the French are Clinging On to this cozy and corrupt relationship between politicians polit local political Elites in France and Germany and local Bankers Ben PBA Deutsche Bank I think that is very important this is this is something that Sera should utilize uh and I've been saying this now for some time it's not going to be an alliance that will last and it's not going to be pleasant and it's not going to solve our problems but if we can get the bankers off the face of Greek society it's something question there uh thank you I have a common slash question uh first of all thank you for your wonderful speech um nevertheless I think that you're speaking too much for from a position of power as if the left is governing the European Union I completely understand that uh we should do a compromise with the uh rightest economic discourse of accepting the liberal economic policies uh and on the other side trying to push our um political stance of democratization the economic policies etc etc however um I think that you should um you should understand actually that the position of the rights is uh the problem that they're not accepting our compromise uh in a sense that we should uh push the European Union to a uh more political uh Democratic development so we can um so we can sued the the compromise that you are that you are projecting um that's also my question how do you how do you think uh that our strategy should be in order to um convince the rightest economics to accept our compromise well for a start I don't see why you're saying per permit me to challenge you in this that I'm taking for granted that the left is in power I take it for granted that the left is nowhere near power uh but in places like Greece in which CA has a realistic chance of being in power in the foreseeable future this is the context in which I've been talking about what a c a government should be doing uh on the broader question of how do you how do you change the European Union the European Union is um a construct that is predicated on a number of myths but the reality is not at all mythical or Pleasant or pretty it was never meant to be Democratic it was never a bullwark against fascism it was never really a European project it was always an American project from day one the Europeans we love to think of of the European Union as something that we've created we didn't create it it was the Americans that designed it conceptualized it and banged heads together until the French and the Germans got together in the early 50s to do it and now that American Germany has died the European Union is fragmenting and when a an undemocratic Beast is fragmenting the result is not moved towards democracy is moved towards autocracy and nothing good is going to happen to to to to to to emerge from this until and unless the left gains 30 or 40% of the vote in each country is this going to happen tomorrow well I don't know but you know if two years ago you had said to me that series I would be having 30% of the vote I would have laughed in your face okay here first floor and then we'll get some in the back but let's get one here you hear me yes okay uh I mentioned hegel's thought that from history people never thought anything I I come back to this uh discussion uh not only uh this evening people think that they can return back in history and all the discussions not only here all around the world tend to uh think how to go back in history as things were before but things changes not because we want we cannot stop it uh history goes on uh doesn't matter if we pleases with with this or not so the forces on the ground on a historical ground nowadays are mostly uh connected with financial system uh nation states comes from the 19 century my question is taking in consideration all the existing forces whether uh National states can exist in the next Century as well what do you think thank you please let's have the mic in the back and let's get three more questions all the hands that are up there collect the questions and then Janis can answer because we only have 10 minutes to go okay I'll be brief um given poor prospects of industrialization under allar conditions that is protectionis protectionism in um countries that are anyway depressed um that you mentioned before uh and given the um on the other hand uh poor prospects of growth uh in Portugal Spain Greece and all the the rest of the countries that experiencing enormous problems uh which relevance do you see for uh commoning practices in these economies uh because well at least mainstream economies usually disregard the common practices that might uh be extremely helpful for exampling for example issuing complimentary currencies um even at National levels which was um one of the uh suggestions for for Greece for example so which relevance do you see for these Solutions hello uh with respect to your thesis uh about the Greek default in 2010 would be a better situation than what we have today uh can you briefly elaborate on that um because we still don't have a fiscal Authority Central we didn't experience any inflation in the northern part of monetary Union and on the other hand you already mentioned what would happen with the new drma and the uh value of it so just if you could answer on that thank you uh thank you for very enlightening lecture as I understand main characteristic of capitalism is Vitality of Entrepreneurship entrepreneurship begins with self-employment in order to establish and maintain fam uh uh family for self reproduction why is the family declared the main enemy of marxist ideology or why is the family subversive idea for subversive ideas we are considering right I'll start from the the last one and then move forward um marks and Angel attack the family not because they wanted to attack the idea of a couple getting together and pulling their resources having children and being happy he was attacking the property rights of employers over the male member of the family and the extraction of surplus value from him while he extracted Surplus label from his wife at home therefore allowing the employer to have two people with one wage it was if you want a critique simultaneously of the social contract and the sexual contract and the slavery of male workers and female attendants to the male workers it was not an attack on the family it was an attack on the institution of the family especially as uh articulated in the 19th century uh moving on to the next point about um I can't even remember you mentioned the question about parallel cences and to what extent could these be helpful in uh in the context of the crisis let me say this while a parallel C currency per se would be a complete utter flop there are ways of introducing Quai currencies so let me put it this way if Greece were to introduce a draa in parallel to the euro firstly doesn't have the right to do it according to Treats but let's ignore that let's say that we break this treaty uh Gram's law tells us something very simple that the bad money drives out the good and it it it's a very simple idea why would you want to be paid in drmas if you knew that the dragma was created in order to be devalued so effectively unless that the state imposes the new parallel currency as the currency in which taxes are paid it simply won't catch on it will simply flop but there are ways of introducing as I said proxy uh parallel currencies and I've made such suggestions one of the things that the state could do is it could issue tax credits little pieces of paper which uh can be cashed in let's say next year you buy one for ,000 or1 today and can be cashed in next year with your tax return and it extinguishes 1220 Euros of taxes that you you owe the state and if these are made transferable and electronic and transferable over mobile phones as in Kenya you can have a very good Euro parallel currency that is not controlled by the ECB and that would give lots of degrees of freedom to a progressive government um on common practices Civil Society finds ways around problems I remember back in in Australia Australia in the 1991 recession there was a village up on the Blue Mountains that developed its own currency and it was based on I us between people so I would paint your house and uh I would get you know three credits for that and then you could use it I could use it in order to to buy groceries from the local store the local store would then pass it on to somebody else who would Supply them with Agriculture and it actually worked very well the problem with these practices of course is that they rely on trust and they're highly Lo localized and to create a degree of parochialism because these people who operate these uh villages they can neither accept newcomers nor transfer you know go to the big cities or travel and use those those um spontaneously emerged currencies so they're an excellent device for shortterm localized protection against the collapsing economic system but it can't be the basis in the foundation now let's not be pessimistic however about what can be done within the Euro Zone in in the Euro zone for instance as I said before we have gigantic quantities of unused money corporations in Europe have about three and a half trillion Euros sitting there doing nothing the ECB the European Central Bank is planning to introduce negative interest rates negative interest rates on banks that Park money with ACB why do they why why would the bank Park money with ACB and not lend it because it is scared it won't get its money back this is what the crisis does there is money around to be invested but it's not being invested because of fear it this coordination failure if everybody fears that the recession is going to be terrible and the recession is terrible this is a Kian point about animal spirits so there is nothing to stop us without treaty changes without Federation to have for instance the European Investment Bank which is three times the size of the World Bank Embark Upon A New Deal investment Le recovery program for Europe up to 10% of GDP being invested in small Enterprises large Enterprises in collaboration with the ECB that should back 50% of these projects because the a issues its own bonds for 50% anyway so all that that takes to do this is a political will and the election of progressive governments that will go to the European Union say we are not leaving from here until we agree on that you got you've got one minute on national state if you wish one minute I'm getting old um of course we live in the era of finance and finance is uh the quick silver quality that as Marx and angel said in the Communist Manifesto have brought down not not just with commodities but with Finance too the Chinese walls and all those impediments to free intercourse around the globe so erecting barriers and um uh mining the borders in order to go back to the nation state developmental model is neither feasible nor desirable Marx would never have it he was an internationalist he was celebrating globalization he was not celebrating capitalism there's a big difference there uh so you're quite right but don't forget Finance has imploded in 2008 that whole edifice of financialized products exploded and now it is the dispossessed who are paying for these losses making sure that political power is exercised in order to minimize the losses of the bankers let's thank yanis and the translators together [Applause]

Channel: SkriptaTV

Views: 220,699

Keywords: yanis, varoufakis, janis, varufakis, toni, prug, capitalism, social, democracy, economist, 2003, greece, troika, imf, ecb, germany, europe, european, union, default

Id: A3uNIgDmqwI

Length: 97min 8sec (5828 seconds)

Published: Sat May 18 2013