As Greece leaves the three-year bailout program, former financial minister Yanis Varoufakis came up with a radical solution. He reportedly urged Athens to ditch the euro and return to drachma.
In an article with the title “Ditch the euro and bring back the drachma” the Times quoted Varoufakis as saying that the Greek government should make contingency plans for bringing back the drachma.
The left-wing economist and former finance minister said plans for bringing back drachma should be prepared by the Greek government after emerging from the multibillion-bailout.
Yanis Varoufakis, the radical economist who once described the strictures of three loan programmes imposed on Greece as “fiscal waterboarding”, said on Sunday that the government should make contingency plans for bringing back the drachma.
>Discussing the end of the last bailout program Varoufakis was quoted saying: “For the most part of this decade, Greece has lived through the biggest peacetime economic catastrophe since the Great Depression. “It is therefore absolutely necessary that the country be prepared to return to its national currency.”
However, the radical economist immediately reacted to the article and said:
Another shameful distortion of what I said (evident to anyone who actually reads the article. My line "we must be prepared for Grexit in order to fend off Grexit" was presented as "Greece must ditch the euro". Trump has nothing on you when it comes to wilful distortion
— Yanis Varoufakis (@yanisvaroufakis) August 20, 2018
The former finance minister is an outspoken critic of the EU-enforced austerity package.
He once described the strictures of three loan programmes imposed on Greece as “fiscal waterboarding
Before he was sacked on the Referendum he operated a top secret task force to begin planning for a breakdown of negotiations with creditors, the famous Plan X.
In an interview with German newspaper BILD, Varoufakis said among others on the occasion of Greece’s exit from the bailout program:
Varoufakis: “What has really changed? Greece’s state debts have not become lower, but higher. We just have more time now to pay back even more debts. Despite two debt cuts over several billion euros, the debts have grown: the state is still broke, private citizens have become poorer, companies still go bankrupt, and our gross national product has decreased by 25 percent. The cutback demands limit consumption and investments. Companies owe money to each other and to the state. The state owes enormous sums in refunds to companies. Everybody owes money to everybody – but nobody has money to pay back their debts. Since 2010 young people have been leaving the country, in recent years at the rate of 15000 every month. If this continues, we’ll soon only have old people here who either stayed or came back from abroad when they retired. Plus there are the people who work for them, or in tourism. I call this desertification. The Roman Tacitus used the expression ‘They made a desert and called it peace’. In Greece they call it ‘fixed’.”
Stressing that “It was not the Greek banks that were saved, but the Deutsche Bank and the rest of France’s and Germany’s banks,” Varoufakis said that Greece should have been allowed to go bankrupt, suffer the consequences but then be allowed to pick ourselves up and move on – something that these bailouts prohibited.”