Thursday, April 23, 2015

Varoufakis talks to his daughter about economics

Today, Yanis Varoufakis published a post on his blog of which I will copy a substantial part as I find it attractive and interesting. I hope you will find that too. It ends with a sentence that is familiar to me -- see eg my post of 25 April 2008, "The economy is too serious a thing to be left to the economists", or my introduction to the book ""Diversity in Development: Reconsidering the Washington Consensus", published in 2004, in which I say: "Paraphrasing the famous French minister of war, Georges Clemenceau: ‘Just as war is far too serious a thing to be left to the generals, the economy is far too serious a thing to be left to the economists." 

Talking to my daughter about the economy – Preface to the German edition

by yanisv
Last summer (an aeon it seems before my recent sojourn into politics&government) I spent ten days writing a short book in Greek on economics. The idea was to write it as if it were addressed to my young daughter, so as to keep complex ideas simple and to test my capacity to home in on what matters while discarding unnecessary complication. Now, a German edition of that book is about to be published and I was asked to author a preface for my German readers. Here is the result:


One of the enduring memories from my early childhood is the crackling sound of Deutsche Welle radio transmissions. Those were the bleak years of our dictatorship (1967-1974) when Deutsche Welle was the Greeks’ most precious ally against the crushing power of state propaganda. Mum and dad would huddle together next to the wireless, sometimes covered by a blanket to make sure that nosy neighbours would not get a chance to call the secret police. Night after night these ‘forbidden’ radio programs brought into our home a breath of fresh air from a country, Germany, that was standing firm on the side of Greek democrats. While I was too young to understand what the radio was telling my mesmerised parents, my child’s imagination identified Germany as a source of hope.
As I am writing this preface to the German edition of a book aimed at another child, my daughter, I feel the urgent need to recount that memory. To turn it into a small homage to the idea of Europe as a realm of shared democratic ideals. A small gesture of defiance against the recent tendency for European peoples, who were hitherto coming closer and closer together, to be set apart by a… common currency. 
Our European Union began life under the presumption that to achieve political and social union we must first bind together our economic interests; that economics would lead the way to a united European polity. It was a good idea except that, as the years and the decades went by, a problem emerged: our collective understanding of ‘economics’ became increasingly crude. We slipped into a simplistic mindset according to which the sphere of the economy began decoupling, separating itself from that of politics, of philosophy, of culture. As it did so, the economic sphere acquired massive discursive and social power for itself, thus causing democracy, politics and culture to fade out, to become shadows of their former selves. 
We economists were, I confess, responsible for this steady erosion of our collective understanding of the economic sphere. Before we knew it, markets were no longer means to be placed in the service of social ends but emerged surreptitiously as ends in themselves. Under the influence of, on the one hand, financialisation and, on the other, economic theory, we began to resemble Oscar Wilde’s definition of the cynic: one who knows everything about prices and nothing about values. Naturally, our European Union’s institutions also tended towards the conviction that the large decisions should be taken by technocratic committees that constitute ‘politics-free zones’. In an ironic twist the language of economists helped usher in a mindset that jettisoned from the corridors of power and the halls of decision making not only politics and culture but also …economics.
But enough of this now! This book is not intended as a diatribe on Europe, on Germany, on Greece or indeed on anything that would bore… my daughter. It was written in order to test the author’s ability to convince a recalcitrant teenager that economics is too important to be left to the economists. (...) 

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