Old player Varoufakis stages a comeback

Old player Varoufakis stages a comeback

He has been admired and criticized, even ridiculed, like few other public figures in Greece; he returned to Greece from various academic posts abroad to become an economic advisor to then- Prime Minister George Papandreou at the beginning of the Greek financial crisis in 2004; yet he eventually turned into a harsh critic of his policies.

A professor of economic theories with an interest in game theory, this flamboyant figure with an affluent background, who calls himself a “libertarian Marxist,” became something of a celebrity during the public protests against the austerity measures imposed by the various governments in Greece during the years until the election of the leftist Syriza in January 2015. A prolific blogger and online analyst, he managed to build a sizeable follower base that became convinced that the solution to the country’s economic collapse was simple: just say “no” to its creditors. 

The victory of Syriza in January 2015 came as a natural outcome of a new hope created by a concept of defiance and resistance toward the stiff attitude of Greece’s creditors – the International Monetary Fund (IMF), the European Bank and the European Union - and Yanis Varoufakis was appointed as the new Finance Minister and took on the onerous task to negotiate a new economic package for Greece.

Eventually, the whole operation ended in disaster as Greece’s lenders refused to re-negotiate; they eventually counter-offered a new reform and funding formula in June 2015, to which Varoufakis disagreed. Tsipras, retaining a high post-election popularity, chose to take the country to a referendum on whether the new formula should be accepted. The result was an overwhelming “no” with 61.5 percent, but Varoufakis resigned from his post claiming that his resignation was asked for by certain EU figures.

Eventually, in a turnaround move, the Syriza government adopted the new formula with the backing of the opposition parties but lost many of its deputies who accused its leadership of ideological “treason.” Tsipras called for a snap election in August, Syriza won but with a much-reduced percentage and had to team up with the small conservative-nationalist party of the Independent Greeks.  

More than two years later, the political landscape in Greece had dramatically changed. Syriza’s initial popularity has dropped. The Conservative official opposition is ahead under a new leader, Kyriakos Mitsotakis. The government has been entangled in a long and arduous negotiation process with its creditors to close the review of the measures it had to take to get the promised funds. There is hope that this process may end by the end of May, but more sacrifices may be demanded. 

It is at this particular crucial moment that Varoufakis made a second coming to Greece. In the meantime, he had formed his Europe for Democracy Movement (DiEm25), to make Europe a “union for the people.” 

He chose Thessaloniki as his launching location because as he explained in his press conference, there, “This is the city where a labor movement was organized even before the city was part of the Greek state; this is the city that led the movement for democracy in 1936 against a budding dictatorship.” 

Greek observers are claiming that he will transform his movement into a party. And he already proposed a series of measures such as “drastic tax cuts, restructuring of the public debt and even a Public Non-Bank Payment System.”

“Greece will stay in the Eurozone for as long as it is necessary until the official Europe decides to open a real dialogue on these proposals,” he said. 

He still believes that Greece has been insolvent since 2010 and he already prepares to take part in the coming European elections in 2019. 

Varoufakis will be an interesting possible opponent to Tsipras, or even for the official conservative opposition, if he comes to power by then.