Yanis Varoufakis’s description of Christine Lagarde as being the IMFs “hyperactive managing director”, while contending that she “should have stayed in Washington masterminding operations rather than uselessly and visibly trail blazing around Europe” at least suggests that there might be some sort of a personal gripe here. However, even if there is any sort of shared animosity between the erstwhile Greek Finance Minister and Ms Lagarde, Mr Varoufakis is quite right in his analysis regarding the willingness of the IMF to get involved in the latest deal Greece when he states that many within the IMF convinced that the Greek debt is quite simply unsustainable, despite Lagarde’s committment to that deal.
As Varoufakis says, the IMF, which has already violated its charter once when bailing out Greecce, “doesn’t want to provide new loans to a country whose debt is not viable.” Of course, while we might want to argue that the IMF is normally not interested in debt per se anyway and is normally quite happy to participate in a country’s assets being stripped. Why should it be any different here?
Well, for one thing this is not only about Greece, but rather about the EU as a whole and it is most certainly the case that a stable EU is still viewed as important not only in Berlin and Paris, but also in Washington and London. This, of course, means that a number of scenarios are being played out not only in Athens, but also in the major European capitals and in Washington. Indeed, there is more than enough evidence to suggest that another one time adversery of Mr Varoufakis, The German Finance Minister Wolfgang Schäuble, might have the final word on a “Grexit”, even if Chancellor Merkel is still intent on avoiding this scenario.
Varoufakis actually also favours Greece leaving the Eurozone and it might only be expected that his main concerns are for his own country. However, he also knows that not only is Greece unable to pay back its debt, but that debt worldwide is unsustainable. He quite righty states elsewhere, that while the € is additionally flawed due to the fact that it has no surplus recycling mechanism, there is also no real global surplus recycling mechanism and this means that the total collapse of all fiat currencies is inevitable.
Still, the elites in Washington, Berlin, London, and Paris will prolong the inevitable for as long as possible and that is why we will ultimately see a Greek exit from the Eurozone. However, this exit will only be the precursor to the collapse of the € and to the ultimate collapse of fiat currencies worldwide. It is not difficult to imagine the social and geopolitical ramifications that this will have.