(AP photo)
As an experienced economist, Greek Finance Minister Yanis Varoufakis argues economic logic in his meetings with eurogroup counterparts. What's sorely lacking is political logic. Needed is a compromise that he and his counterparts can all explain to their voters back home. Varoufakis thinks he has framed his arguments with inescapable logic, but all his counterparts see is a bag lady with a big mouth. And they're tired of it.
Twice now Varoufakis has met with his counterparts in the eurozone, most of whom represent countries that have lent Greece large sums of money to pay off loans to banks, pension funds, and other investors.
Those loans came with dire conditions that sent Greek consumer spending plunging. The loans, essentially a string of bailout programs, replaced the loans to the private sector that Greece found it was no longer able to repay after it turned out that previous governments had been cooking the books, inflating Greece's gross domestic product and income. Now Greece is on the hook mainly with eurozone nations and with institutions like the International Monetary Fund.
Varoufakis has toured eurozone capitals and met with creditor nations twice in the eurogroup meetings that bring together the eurozone's finance ministers. During these meetings, Varoufakis publicly and vociferously reminds all who will listen of the democratic mandate Greek voters overwhelmingly gave him and Prime Minister Alexis Tsipras to end the vicious cycle of bailouts, repayments, and conditions.
Things came to a head last Monday evening when Varoufakis irked his counterparts by having his diplomats publicly leak a draft proposal by the eurogroup - a proposal Varoufakis refused to sign. This was irksome, but in line with Varoufakis' political stance, which from day one has outright irritated Eurozone pols.
Judging by his public comments, it appears that Varoufakis does not understand that his is not the only elected government in the eurozone. That whereas Greek voters want Varoufakis to abrogate the current debt agreements, his counterparts represent the majorities across Europe that want Greece to pay back every last eurocent - with interest. German Finance Minister Wolfgang Schaeuble has for years been promising just that to his voters, as have his colleagues from other countries.
Despite this,Varoufakis has assumed a "take it or leave it" approach. He seems to lack the basic understanding that when you publicly take up an extreme position in a political arena, you force your counterparts into their own extreme opposition. A public retreat from such a position then becomes very difficult to pull off without some form of face-saving measure - especially when the other side would in fact be perfectly happy to ‘leave it'.
The spectacle brought on by Varoufakis shows why politicians like to discuss sensitive matters in closed rooms, outside of the public view, where compromises can be hatched without fear of voter outrage.
So this is the situation Varoufakis has created with his no-holds-barred bluster: Each side is dug in deep. Whatever armistice proposal Varoufakis dreams up, it will have to be something that saves face, for himself and his government, but also for his colleagues in the other eurozone capitals. The question is whether Varoufakis cares to understand this.
