Angela Merkel and the Minotaur

Listening to Stavros Xarhakos, the beautiful Aman … Amen

How can, will, must Angela Merkel deal with the new Greek minister of finance Yanis Varoufakis (who wrote this book on the Minotaur that I didn’t read) ?

My earlier weblog discussion on Varoufakis was in May 2012 and it still gives my position.

I read the Modest Proposal by Varoufakis & Holland – not the version with Galbraith joined up – and discovered that I didn’t need to write a reaction. It is better that they, on their turn, read my analysis.

In 2011 I got two emails from Varoufakis that he would read my Economic Plan for Europe (for economists) and get back to me. Apparently the paper & plan did not inspire him, or, there was another reason not to further respond.

Parts of my analysis have been published in the international community of economic research or in an online Greek newspaper. Unfortunately without a response by Varoufakis. Well, other economists didn’t react either. Somehow I still think that when your economy is in Depression like in Greece, Spain or Portugal, you would want to show some interest in a new analysis by an economist from Northern Europe, even an economist from Holland who gives severe criticism about his own minister of finance Jeroen Dijsselbloem – but no.

Bull leaping in Crete (Source:

Bull leaping in Crete (Source:

Varoufakis now is in the spotlights. I am afraid that it will not help to focus on Greece, since no Northern European country will trust proposals coming from them. Varoufakis already lost his “benefit of the doubt credibility as a new face”, by killing the Troika in his first contact with Dijsselbloem, and sending confusing signals about a “write-off” versus “a swap for growth bonds”.

Instructive reads are by Frances Coppola earlier on the Modest Proposal and recently on what would really work for recovery and reform. See also Klaus Kastner who has been trying to talk sense to Varoufakis for some years now. Paul Krugman has some kind of Game Theory tabulation of the Game of Chicken, with the Greek population held at ransom. Angela Merkel would not want Syriza to win but neither wants the blame caused by Greek unreliability and incompentence. The problem is that Krugman hasn’t studied my new analysis.  Martin Wolf in the Financial Times with his overview of the Game of Chicken rather than stalemate. For the solution approach, I would include Economic Supreme Courts, resolution of the cause of the Great Stagflation, rational use of money, National Investment Banks, and for Greece and Southern Italy Investment Zones under International Law (leases like Hong Kong originally).

Jos Collignon - The caged mouse that roared (Source: (c) Collignon, reproduced here with permission)

Jos CollignonThe caged mouse that roared (Source: (c) Collignon, reproduced here with permission)

Rather than Greece, it is more important to look at Holland. Like we had “Greek statistics” there is also “Dutch economics”. This has an abuse of power and censorship of economic science. I call on the world to boycott Holland till scientific freedom of thought is restored in Holland. See here.

Observe: the reason that you will not find so much of my work in the peer reviewed journals is that, of course, censorship must be lifted before the work can be published.

To return to the opening question: How can, will, must Angela Merkel deal with the new Greek minister of finance Yanis Varoufakis ? Well, it is part of the phenomenon of an economic crisis without national Economic Supreme Courts that this question will be hotly debated, with a rather risky outcome too.

PS 1. See also “Cause and Cure of the Crisis

PS 2. Bull-leaping is something else than the Minotaur, but I need a damsel in the picture to represent dr. Merkel.

PS 3. When I was in gymnasium I could draw the ancient plan of the Labyrinth at Knossos from memory, but these brain cells have been lost, while the current economic crisis anyhow is a maze:

maze refers to a complex branching (multicursal) puzzle with choices of path and direction; while a single-path (unicursal) labyrinth has only a single path to the center. A labyrinth in this sense has an unambiguous route to the center and back and is not difficult to navigate.” (quote in wikipedia)

PS 4. The title Modest Proposal is a satire by Jonathan Swift of 1729, that the poor people of Ireland offer their children for consumption by the rich, so that they at least serve some purpose. Copying this title by Varoufakis suggests satire, or it is a wrong choice. This fickleness on the title is a telling sign. I haven’t further checked Varoufakis’s work. If he did more on mathematics and Game Theory than econometrics as an empirical study, then we might see another case that mathematical abstraction can lead astray into wishful thinking. In that case I should perhaps read the version written jointly with Galbraith, whom I regard as an excellent and empirical economist. But the problem is not that I haven’t read this yet, but that they haven’t read my work (or responded with questions about what they don’t agree with or don’t understand yet). You cannot communicate something new if it isn’t read.


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