And the Weak Suffer What They Must?

April 11, 2016
The financial catastrophe that nearly undid the euro, the flawed, fragile currency of most of Europe, is placed under a microscope by Varoufakis (The Global Minotaur), an economics professor whose seven-month tenure as Greece's finance minister in early 2015 was marked by debt crisis and bitter disputes with more powerful Eurozone members, particularly Germany. To tell this story, he delves back into economic history, starting with the "Nixon Shock" of 1971, which unraveled the Bretton Woods global monetary system installed at the end of WWII. Economists will debate the rightness of Varoufakis's convictions, summed up by a quote from ancient Greek historian Thucycdides that "rights are only pertinent between equals" and that strong powers "actually do what they can and the weak suffer what they must." He sees this principle in the decades-long development of the euro, a process marked by fractious debates between France and Germany. At his pithiest, Varoufakis is a trenchant criticâhe observes that the bridges and arches decorating euro banknotes are as fictitious as the political unity they representâbut the density and jumpiness of the book makes it difficult to understand how his proposed solutions to Greece's, and the Eurozone's, problems might be achieved. Agent: Wendy Strothman, Strothman Agency.

The former Greek finance minister argues that the lack of political will and democratic consensus in the euro crisis portends a drift toward authoritarianism. Having served as finance minister in 2015 during the face-off with the Eurogroup on behalf of Greece--the weakest defaulting European Union member--Varoufakis (Economic Theory/Univ. of Athens; Europe after the Minotaur: Greece and the Future of the Global Economy, 2015, etc.) reaches back into not-so-distant economic history to make a convincing case that the EU is bungling the current debt crisis, especially in regards to the weakest links in the union. The original design for a viable worldwide financial system was hammered out at Bretton Woods by the Allies in July 1944, as D-Day was just getting underway--although, the author notes, the Nazis had first envisioned a European monetary union as early as 1938. The United States pledged to bolster European currencies, a shock-absorbing system already put in place in the U.S. The deal worked until 1971's "Nixon Shock," whereby Washington grew exasperated with the recalcitrant Europeans and jettisoned them from the dollar zone. Thus, the Europeans were set adrift to conjure their own Bretton Woods, culminating in the euro, yet without the shock absorbers, causing massive debt default in the crisis of 2008 and prodding "Europe to turn in on itself." How could this have happened? With scathing humor, Varoufakis portrays the dramatic characters: the deficit-phobic Bundesbank; the exquisitely efficient, autocratic French administrators in Brussels; and the earnest Americans (especially Secretary of the Treasury Timothy Geithner), who warned against "teach[ing] the Greeks a lesson." Indeed, the lesson posited by this well-read Greek academic is the necessity of respecting the demos lest the beleaguered people "come back to strike at the foundation" of the state. The appendix is an extract from "A Modest Proposal for Resolving the Eurozone Crisis," which the author co-wrote with Stuart Holland and J.K. Galbraith. A defensive but astute, cerebral, and engrossing polemic that conveys knowledge and authority. COPYRIGHT(1) Kirkus Reviews, ALL RIGHTS RESERVED.