How Varoufakis became an Erratic Marxist

13 April 2015

How Varoufakis became an Erratic Marxist

In 2013, almost two years prior to Yanis Varoufakis becoming Greece’s Finance Minister, he gave a speech in Zagreb in which he revealed how his political development had unfolded. He remains an admirer of Marx, but does not believe that the overthrow of the capitalist system in Europe is a realistic goal in the present context. This would, he argues, present the Greek and European peoples with too many major risks.

By Hans van Heijningen

That many women find Greek Finance Minister Yanis Varoufakis extremely attractive, that he dresses unconventionally and that there is no love lost between him and Eurogroup Chair Jeroen Dijsselbloem has probably not passed you by. I met Varoufakis three-and-a-half years in Athens during a memorable meeting that SP leader Emile Roemer, Ewout Irrgang – at the time a Member of Parliament and the SP’s spokesman on financial and economic policy – and myself had with him. After three quarters of an hour Varoufakis suddenly stood up and angrily walked away, incensed by Irrgang’s objections to his proposal that all EU member states’ debts should be put into the same pot, so that the astronomical interest rates that the Greeks had to pay on their loans would be, in one fell blow, substantially lowered.

But honesty is honesty, and in Varoufakis’s case the penny seems to have dropped. In one of his first media appearances after his appointment I heard him declare on television that of course the aim was not to make Dutch and German taxpayers fork out for Greece’s debt problem. Going further still, he said that in his opinion it was not only people in the Mediterranean member states but those of northern Europe who had been the victims of a European political and financial elite who are sheltering the banks, destroying economies, then making the public pay for these policies.

An erratic, inconsistent Marxist

Varoufakis, who has studied and taught in Britain and Australia, was one of the lead attractions at the sixth Subversive Festival, which took place in 2013 in Zagreb. At that time the professor of economics had no idea that just two years later he would be Greece’s Finance Minister. His speech that day covered his own political development, the menacing developments in Europe and the eurocrisis in Greece and the eurozone as a whole. He described himself as an ‘erratic’ and ‘inconsistent’ Marxist. In an analysis full of Marxist ideas and references, the economist made it clear where he stood. ‘This dialectical perspective, where everything is pregnant with its opposite, and the eager eye with which Marx discerned the potential for change in the seemingly most constant and unchanging of social structures, helped me grasp the great contradictions of the capitalist era,’ said Varoufakis to the assembled public. ‘Wealth is collectively produced and then privately appropriated through social relations of production and property rights that rely, for their reproduction, almost exclusively on false consciousness. Because capitalism inevitably puts on the market all that is of value, every aspect of human life, and thereby dehumanises labour, it is digging its own grave.’

For Varoufakis Marxism represents a window which offers a clear view of the world, but is at the same time not without its limitations. In the Greek economist’s view, Marx made two crucial errors. ‘How could he, an exceptionally intelligent man, not see that his most talented allies would climb high on the backs of their own comrades? And what in heaven’s name moved Marx to close his own theoretical system, demand the last word and claim the absolute truth?’ In doing this the founder of scientific socialism developed an authoritarian model and thus severely damage the cause of socialism. ‘Instead of embracing liberty and rationality as their rallying cries and organising concepts, they opted for equality and justice, bequeathing the concept of freedom to the liberals. These people knew how to handle it, loading it with the perspective of the individual and the market. The citizen is gradually reduced to an individual, to a rational economic being and to a consumer.’

Learning from Thatcher

Varoufakis freely admits that his own political development has been all about trial and error. His years living in England – from 1978 to 1988 – saw neoliberalism’s breakthrough. Under Margaret Thatcher’s leadership, the power of trade unions and public institutions was smashed – where necessary with state repression – in favour of capital’s power. Varoufakis acknowledged in Zagreb that he had thought that Thatcher’s policy of verelendungs (Marx’s term for the absolute immiseration of the working class which would be the eventual result of capitalism) would cause the rise of radical, progressive politics, but that he had been mistaken. While mines and heavy industries went under, the financial sector was booming, the corner shop was giving way to the shopping mall, house prices rocketed, and in the next decade Tony Blair was wringing the neck of social democracy and the working class without a revolution breaking out. The lesson that Varoufakis learned from Thatcher was that it was possible to reform the economic structure radically, break trade union power and lastingly eliminate the left.

Dark clouds over Europe

In 2000 Varoufakis was appointed professor of political economy at the University of Athens, from which position he has seen Greece join the Eurozone, which it did a year later, and fall into a desperate plight financially as a result of the interest on the national debt rocketing from 2008. He has witnessed the ‘aid’ given to Greece by the troika (EU, ECB and IMF), the conditions which were attached to this, and the social crisis which was their result. This led him to understand that the European Union is characterised by a large democratic deficit, which in combination with its ‘rickety monetary architecture’ put Europe’s peoples on the path to permanent recession.

Varoufakis is deeply aware of the gravity of the situation in which Greece and Europe as a whole find themselves. As a result, he is not going for easy solutions such as the country’s withdrawal from the EU, or from the euro. In Zagreb he asked the question ‘What good will it do today to call for a dismantling of the eurozone, or of the European Union itself, when European capitalism is doing its utmost to undermine the eurozone, the European Union, indeed itself?’ Answering it himself: ‘A Greek or a Portuguese or an Italian exit from the eurozone will soon develop into a fragmentation of European capitalism, yielding a seriously recessionary surplus region east of the Rhine and north of the Alps while the rest of Europe is in the clasps of vicious stagflation. Who do you think will benefit from this development? A progressive Left, that will rise Phoenix-like from the ashes of Europe’s public institutions? Or the Golden Dawn Nazis, the assorted neo-fascists, the xenophobes and the spivs?’

Varoufakis recognises the danger posed by the extreme right should Greece be expelled from the eurozone. For him this means that we have to keep the ship of European capitalism afloat during this phase of history, while at the same time taking over the rudder from a European elite which is sailing the vessel rapidly towards the rocks. ‘Not because we love European capitalism, the eurozone, Brussels or the European Bank, but because as people of the Left, we have a duty to ourselves to prevent people having to pay too high a price for a crisis which they did not cause.’

Dangers of co-option

What then does Varoufakis think that the left should do? He argues that we should ‘fight in a radical manner for a moderate programme of social reforms designed to stabilise the capitalist system’. Varoufakis admits to not being all that enthusiastic about this prospect. ‘What makes the situation in Europe so dangerous is that the European elite don’t appear to have understood the nature of the crisis and that they haven’t the remotest idea of the consequences that it still could have.’ In order to achieve greater stability, Varoufakis argues that it will be necessary to cooperate with reactionaries. This brings a danger of co-option for the left’s leaders, of joining the centres of power. This is something of which left parties must be aware and against which they must arm themselves, because if not their leaders will find themselves at odds with the people.

Varoufakis’s guiding strategy as Finance Minister is ‘to prevent Greece declining any further.’ The start of his mandate was a success from a PR point of view. By using his charm he managed to keep attention on himself, which made it possible to reveal how miserable things were for Greece and for ordinary Greeks. Greece must seize the chance to raise discussion of its economy, and jobs and purchasing power must form the basis for the repayment of debt and the payment of interest. Following tough negotiations in which Varoufakis and Prime Minister Alexis Tsipras had to eat humble pie, they managed in February to prevent the ECB from shutting off the flow of money to their country, being granted a few months’ grace. This left a situation intact in which all signs were flashing red, while the European elite seemed ill-inclined to offer the Greek government a real chance to exit the crisis in any fashion other than by squeezing the country’s economy and its people dry. The controversy between Greece and the EU has reached an impasse, in which the danger of an explosion remains as great as ever.


Hans van Heijningen is national secretary of the SP. This article first appeared, in the original Dutch, in the SP monthly Tribune. Yanis Varoufakis’s speech in Zagreb can be read in English at http://www.theguardian.com/news/2015/feb/18/yanis-varoufakis-how-i-became-an-erratic-marxist?CMP=share_btn_link

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