Greek Finance Minister Resigns
Yanis Varoufaki, the Greek Finance Minister, published a statement on his blog entitled “Minister No More” announcing his resignation.
In his statement he noted that shortly after the results of the referendum he was “made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my… ‘absence’ from its meetings.” He believes the it is “essential that the great capital bestowed upon our government by the splendid NO vote be invested immediately into a YES to a proper resolution – to an agreement that involves debt restructuring, less austerity, redistribution in favour of the needy, and real reforms” and does not want to stand in the way of achieving a solution to the crisis.
He went on to conclude:
We of the Left know how to act collectively with no care for the privileges of office. I shall support fully Prime Minister Tsipras, the new Minister of Finance, and our government.
The superhuman effort to honour the brave people of Greece, and the famous OXI (NO) that they granted to democrats the world over, is just beginning.
He said he would “wear the creditors loathing with pride.”
Varoufaki’s lack of selfishness is showing grace and loyalty to the people of Greece and to Prime Minister Alexis Tsipras, we have no doubt he will continue to play an important role outside of government. He did an excellent job as Finance Minister and will continue to be an asset to Syriza and the Greek people. Thankfully, he does not have the infection of narcisism that so many in public office seem to suffer from.
Tsipras:“Democracy cannot be blackmailed; Greece has made a brave choice and one which will change the debate in Europe.”
Today, the people of Greece voted in a landslide to refuse to accept the demands of austerity by the Troika by a vote of 61.31% to 38.69%. The vote, along with an IMF report critical of the austerity plan, should open a new round of negotiations in the upcoming week. Syriza is now in a slightly stronger bargaining position and the EU now has to decide whether democracy matters. Forced austerity by bankers was put to the test and the people resoundlingly said “no.” The vote shifts the risk to the Troika and Germany, they are talking angrily to Greece while the people of Greece celebrate the vote, but if they come to their senses the bankers will realize they were wrong, acting in a counterproductive way and should negotiate a fair deal with Greece. Will the bankers come to their sense?
Greece’s Prime Minister Alexis Tsipras said the rejection of the bailout deal meant creditors would be forced to address the question of easing the country’s massive debt.
“This time, the debt will be on the negotiating table,” he said in a televised address, insisting that an International Monetary Fund report seen this week “confirms Greek views that restructuring the debt is necessary”.
Tsipras said that the referendum results did not mean Athens was headed for a so-called Grexit.
“This is not a mandate of rupture with Europe, but a mandate that bolsters our negotiating strength to achieve a viable deal,” AFP news agency quoted him as saying.
Greek finance minister Yanis Varoufakis has hailed the landslide “no” vote and reached out to European leaders saying:
“As of tomorrow, with this brave ‘no’ the Greek people handed us … we will extend a helping hand towards our lenders. We will call on each one of them to find common ground. As of tomorrow, Europe, whose heart is beating in Greece tonight, is starting to heal its wounds, our wounds. Today’s No is a big Yes to democratic Europe.”
RT reported “Greece’s chief negotiator, Euclid Tsakalotos, expressed confidence that, thanks to the referendum’s result, the country would now be able to reach an agreement with its EU-IMF creditors quickly. ‘The first thing is that the IMF report proves that the debt [load] is not viable, and secondly that there is a new popular mandate, as it would seem from the apparent result of the referendum.’”
The best advice we have seen in the few hours after the vote came from Forbes, where Steve Keen wrote that Syriza’s position has been strengthened and now it is time to play hardball. This means putting the impact of the Troika’s failed policy on the table and demanding a new deal. He writes:
“So now it’s time for Syriza to return the hardball tactics that the Troika has thrown at them. Go back to the meeting with a plan for debt restructuring—and a significant one. Include not only the restructuring that the IMF admitted last week is needed, but also a write-off of the 20% of the debt that effectively represents the failure of the Troika’s program. Submit a budget with a 3% deficit as allowed by the Maatricht Treaty (the Treaty also insists on a maximum government debt ratio of 60% of GDP, but even Germany breaches that with a ratio of about 75% of GDP). A 3% primary budget deficit would provide a huge stimulus to the Greek economy, and end the Great Depression the Troika’s failed austerity program has caused.
“If the Troika still refuses to negotiate, to compromise on its own failed program, then Syriza should threaten total default—a move that would send shock waves through Europe while simultaneously taking a major burden off the Greek economy. That would then present the Troika with a choice: what are you more committed to? Austerity, or the Euro?”
The European Commission released a statement on the Greek referendum:
The European Commission takes note of and respects the result of the referendum in Greece. President Juncker is consulting tonight and tomorrow with the democratically elected leaders of the other 18 Eurozone members as well as with the Heads of the EU institutions. He will have a conference call among the “Euro-Institutionals” (with the President of the Euro Summit, the President of the Euro Group and the President of the European Central Bank) on Monday morning. He intends to address the European Parliament in Strasbourg on Tuesday.
But Martin Schulz, the President of the European Parliament while calling for people to respect Sunday’s NO vote in the referendum, expressed his pessimism regarding Greece’s future and warned of a humanitarian crisis in the country, saying “This is a difficult day: here’s a broad majority in Greece and the promise of Prime Minister Tsipras to the Greek people that with the ‘no’ vote, the position of Greece for negotiating a better deal would become better is, in my eyes, not true…” 
The German Economy Minister, and Vice Chancellor, Sigmar Gabriel, was even more negative saying “he could not conceive of further negotiations after the Greek people rejected the rules of the Eurozone.” He went on to accuse Tsipras of tearing down “the last bridges on which Greece and Europe could have moved towards a compromise”
The New York Times summarized the risk the Troika takes if they reject the will of the voters of Greece:
“If they refuse the Greek government’s demands and cut off funds, the Greek banking system will collapse and the country will no longer be part of the eurozone, sending a signal that the European Union is deeply fragile. Greece would sidle closer to a hostile Russia. A modern European democracy — indeed, the original democracy — could well collapse into something chaotic and unstable. Oh, and all this may end up costing the rest of Europe more money than even the most generous of bailouts, as Greece would default on its obligations outright rather than merely restructure them.”
We are in solidarity with the people of Greece because most people of the world, including the Untied States, live in unfair economies with great inequality; inequality created by corrupt governments working with big business interests. Nick Dearden the director of Global Justice Now highlighed this reality:
“The people of Greece have stood up to the bully boys of the Troika and the violent imposition of their neoliberal policies. Our deeply unequal global economy relies on ordinary people having no real voice over economic decisions, so this ‘no’ vote strengthens the battle for a fairer, more humane, people-centered Europe. For the first time in history, austerity politics have been put to a popular vote and they have been resoundingly rejected. We must stand with the people of Greece to secure deep debt cancellation, an end to austerity policies, redistribution of wealth within the EU and serious banking regulation.”
There is a lot of confusion and unpredictable paths ahead. The simpliest path is a better deal from the Troika with less austerity and restructured or preferably, forgiven Greek debt, but some of the comments by EU and German finance leaders indicate that is unlikely. A more difficult path with lots of unpredictable repercussions is a Greek exit from the EU and the return to the Greek drachma currency. The choices are difficult, let’s hope that the vote today is the beginning of a fresh start and much greater fairness and common sense from the Troika; with true respect for democracy.