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In this remarkable and provocative book, Yanis Varoufakis explores the myth that financialisation, ineffectual regulation of banks, greed and globalisation were the root causes of the global economic crisis. Rather, they are symptoms of a much deeper malaise which can be traced all the way back to the Great Crash of 1929, then on through to the 1970s: the time when a ‘Glob In this remarkable and provocative book, Yanis Varoufakis explores the myth that financialisation, ineffectual regulation of banks, greed and globalisation were the root causes of the global economic crisis. Rather, they are symptoms of a much deeper malaise which can be traced all the way back to the Great Crash of 1929, then on through to the 1970s: the time when a ‘Global Minotaur’ was born. Just as the Athenians maintained a steady flow of tributes to the Cretan beast, so the ‘rest of the world’ began sending incredible amounts of capital to America and Wall Street. Thus, the Global Minotaur became the ‘engine’ that pulled the world economy from the early 1980s to 2008. Today’s crisis in Europe, the heated debates about austerity versus further fiscal stimuli in the US, the clash between China’s authorities and the Obama administration on exchange rates are the inevitable symptoms of the weakening Minotaur; of a global ‘system’ which is now as unsustainable as it is imbalanced. Going beyond this, Varoufakis lays out the options available to us for reintroducing a modicum of reason into a highly irrational global economic order. An essential account of the socio-economic events and hidden histories that have shaped the world as we now know it.


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In this remarkable and provocative book, Yanis Varoufakis explores the myth that financialisation, ineffectual regulation of banks, greed and globalisation were the root causes of the global economic crisis. Rather, they are symptoms of a much deeper malaise which can be traced all the way back to the Great Crash of 1929, then on through to the 1970s: the time when a ‘Glob In this remarkable and provocative book, Yanis Varoufakis explores the myth that financialisation, ineffectual regulation of banks, greed and globalisation were the root causes of the global economic crisis. Rather, they are symptoms of a much deeper malaise which can be traced all the way back to the Great Crash of 1929, then on through to the 1970s: the time when a ‘Global Minotaur’ was born. Just as the Athenians maintained a steady flow of tributes to the Cretan beast, so the ‘rest of the world’ began sending incredible amounts of capital to America and Wall Street. Thus, the Global Minotaur became the ‘engine’ that pulled the world economy from the early 1980s to 2008. Today’s crisis in Europe, the heated debates about austerity versus further fiscal stimuli in the US, the clash between China’s authorities and the Obama administration on exchange rates are the inevitable symptoms of the weakening Minotaur; of a global ‘system’ which is now as unsustainable as it is imbalanced. Going beyond this, Varoufakis lays out the options available to us for reintroducing a modicum of reason into a highly irrational global economic order. An essential account of the socio-economic events and hidden histories that have shaped the world as we now know it.

30 review for The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy

  1. 4 out of 5

    Trevor

    Nothing I like more than a good Greek myth. And the Minotaur has got lots going for it. An angry god, a far too beautiful bull, leading inevitably to bestiality, a monster child that likes to eat people, a master builder and his maze, a clever young hero and a suicidal father. What is there not to like? And as with so many Greek myths, this is a story of characters either having unnaturally too much or too little affection for members of their family. All of which is well and good, but I’ve a fe Nothing I like more than a good Greek myth. And the Minotaur has got lots going for it. An angry god, a far too beautiful bull, leading inevitably to bestiality, a monster child that likes to eat people, a master builder and his maze, a clever young hero and a suicidal father. What is there not to like? And as with so many Greek myths, this is a story of characters either having unnaturally too much or too little affection for members of their family. All of which is well and good, but I’ve a feeling that if you are going to use a myth like this to help you explain what is complex economic theory, well, then the myth has either got to be simpler than the economic theory you are trying to explain, or it needs to be so clearly relevant that it illuminates that theory in ways doing without it could not do. That is how all good metaphors work – taking what is known to help us understand the unknown. The problem here is that the Minotaur story does neither of these things. Admittedly, the author overcomes the problem of the Minotaur story not being all that well known by giving his thumbnail of the story on about a page of the book. But it’s not even that the story isn’t well know that bothers me – it’s that it isn’t clear what the story adds to our understanding of the problem at hand. Most of the elements of the myth just don’t relate to what he has to say about international economic activity. I do understand that international trade deficits and the role of the American dollar aren’t nearly as interesting as Greek myths, but I felt he was working too hard to get the one to explain the other. The collapse of the financial markets and the inability of the US to continue to operate as a recycling mechanism for global surpluses is a story with no gods, no sex with bulls, no maze, no hero… Basically, all that the Minotaur story is used for is the idea that the Athenians were forced to pay tributes and these ended when the Minotaur died, the comparison being made to the tributes the world has been forced to pay the US since the end of Bretton Woods. But even that bit of the myth doesn’t hold with the story the author is telling here, since he is arguing that the tributes have continued long after the Minotaur was killed in 2008. I can’t think of a better myth to help explain this story, if there was one, I think it would probably need to be tidal, but even King Canute doesn’t quite work – so, let’s just go with the story itself and forget about the Minotaur for a minute. The problem with this strategy is that it does leave me in the position of not particularly feeling like an expert in this history – what follows is what I’ve gleaned from the book and from others I’ve read over the years. I take responsibility in advance for the mistakes I am going to make along the way. Since I’m not an economist myself, I’m happy to assume the economics is going to be boring but I’m not sure it will be helped even with women having sex with bulls along the way. After World War Two, the US was in a remarkably powerful position. It was the world’s major superpower, it stood at the centre of economic power and it was one of the few remaining creditor nations. It was the world’s major surplus nation. That is, it produced an awful lot and everyone else wanted to buy that stuff. It was able to use its economic might to rebuild Europe (mostly Germany) and Japan – and it did this to act as a bulwark against the Soviet Union. Keynes had proposed at the Bretton Woods conference that there should be regulations that would essentially force countries to recycle their surpluses and thereby keep the world economy growing and healthy. Such a recycling mechanism is necessary, since some countries will inevitably become debtor nations. In fact, even some regions within countries are likely to always be in debt to more economically advanced regions of the same country. Without a means of recycling the surplus that one region has over another region, the whole system grinds to a halt – something in no one’s interest. Keynes suggested an international currency that could be used for trade – but the US preferred the US dollar to serve this function. The US assumed it would always be in the position of the world’s major surplus nation and that it would be similarly able to redistribute that surplus as it saw fit. And this became central to how the Bretton Woods conference resolved itself. To perform this role of surplus redistributor, the US currency was given a fixed value – expressed in gold. And the US agreed to exchanged dollars for gold at this fixed rate. The problem was that the US had decided to crush some third world nations, as you do, the two it did this openly with were North Korea and North Vietnam in what became remarkably expensive wars. By the early 1970s, the US was faced with stagflation – that is, two things that ought to be opposites and not occur at the same time, stagnation and inflation. The US ended the exchangeability of gold for dollars. You might think that this would be a bad idea and that other nations would then seek another currency to use for world trade. But in fact, what actually happened was that it opened up further the twin deficits that US has created for itself. These were its trade deficit with the rest of the world and the US government’s budget deficit. However, because all countries held so much of their wealth in US dollars, what might otherwise have seemed a weakness placed the US in a remarkably powerful position. The last thing countries wanted to see was the US dollar decrease in value. Also, if there were shocks, money sought a safe haven, and ironically enough, that invariably was US government bonds. This is where the effective tributes to the Minotaur come into the story. The US became a huge vacuum cleaner of the world’s wealth – sucking in goods made in other countries and their surpluses too – the machine that had been created after the second world war to redistribute US surpluses had been rammed into reverse and rather than the US redistributing the world’s surpluses, it dragged them into Wall Street. This provided the US with lots of money, which was then turned by banks into ‘new financial instruments’ – Credit Default Swaps is the example given here – and these are essentially clever insurance policies designed to remove risk from investment. The notion being that if you bundle together lots of loans that you make, the chances all of them going bad at the same time is minimal, and so the ones that remain good will cover the ones that go bad. While there is no such thing as a risk-free investment, these were presented as being as close as the world is likely to get to being just that. This meant banks could engage in increasingly precarious lending practices, and since the loans would then be bundled up and sold on to someone else, effectively immediately, the loans themselves had effectively become risk free to the bankers. And then one day – and this is the best bit of the whole book, where he provides a timeline of the 2008 global financial crisis – the impossible became the inevitable and for a while it looked like the whole financial system of the world was about to implode. This is when he says the Minotaur died. The problem is that just because the old world is dead, doesn’t really mean that the new world is ready to be born. His argument is that now there is no proper mechanism to redistribute surpluses and so we are just going to get bubbles that will burst and cause more harm, while debtor nations will be forced into ever more austerity and therefore crushing poverty – which will do nothing to help either the debtor nation nor the surplus nations grow their way out of these recurring nightmares. Like all such books, he offers some advice that no one will ever take and that is meant to provide some last vestige of hope to the world. I’ve no idea why writers think this is a good idea. I know myths are generally best when they give us a happy ending, but in a world where the US is bankrupt, a pandemic is raging, the ecological basis for the continuation of human, and much of animal life on the planet is threatened, and Donald Trump is still possibly going to win another four years in the White House, we are going to need more than a myth with a happy ending.

  2. 5 out of 5

    Randal Samstag

    Continuation of the review of the book Modern Political Economics with additional material about Varoufakis's solo book, The Global Minotaur The second part of Modern Political Economics includes an historical analysis of the post-World War II world. The authors divide this time frame into two periods: 1) The Global Plan: the period following the Bretton Woods conference in 1944 which set up the gold-backed dollar as the world’s dominant currency and 2) The Global Minotaur: the period after the b Continuation of the review of the book Modern Political Economics with additional material about Varoufakis's solo book, The Global Minotaur The second part of Modern Political Economics includes an historical analysis of the post-World War II world. The authors divide this time frame into two periods: 1) The Global Plan: the period following the Bretton Woods conference in 1944 which set up the gold-backed dollar as the world’s dominant currency and 2) The Global Minotaur: the period after the breakup of the Bretton Woods system leading to the financial crash of 2008. This is the story of a march to devastating collapse. The third period would be our current time, the period of aporia following 2008. This story is also retold in a solo 2011 book by Varoufakis, The Global Minotaur (TGM). The Global Plan The Global Plan begins during the waning of WWII at the international conference convened by Franklin Roosevelt at the Mount Washington Hotel in Bretton Woods, New Hampshire in July 1944. The conference provided a face-off between the two primary partners in the Allied war effort: The United States, represented by Harry Dexter White, and the United Kingdom, represented by none other than John Maynard Keynes. The conference was focused on two ostensible goals: 1) design of a post-war monetary system and 2) reconstruction of Europe and Japan. Underlying issues, however, were how to prevent future lapses into Great Depression and who would be in control of what was recognized needed to be an international approach to managing the world economy. At this conference Keynes made one of the most striking proposals to ever reach the bargaining table of an international conference: an International Currency Union (ICU) that would provide a single currency (which Keynes christened the “bancor”) for the whole capitalist world. This would replace the Gold Standard that had been killed off by the Great Depression. The ICU would provide the stability provided by gold without the severe restriction that killed the Gold Standard: “the fact that by restricting the quantity of money in each country to a pre-specified level linked to gold deposits, it prevented governments from dealing with catastrophic declines in effective demand (e.g. the Crash of 1929) by means of increased public expenditures.” Keynes thought that this mechanism would provide a means to deal with two devastating problems: catastrophic crashes and systematic trade imbalances. The ICU would guard against trade imbalances by allowing member countries to borrow at zero interest up to a deficit of 50% of the country’s average trade volume. Beyond that there would be s fixed interest rate. This would give an incentive to minimize excessive debt. For countries exceeding a certain percentage of their trade volume interest would also be charged and its currency would therefore have to appreciate and in the process transfer that surplus to deficit countries. Keynes’ brilliant idea was an idea before its time. The United States, as the emerging victor in the world war, was in no mood to give up its hegemonic position. White vetoed Keynes’ plan and in its place proposed the system that was adopted: a system of fixed exchange rates with the dollar as its base, albeit tied to gold. To address the problem that there was no mechanism here to deal with depression or fiscal default, the adopted plan established the International Stabilization Fund which became the International Monetary Fund (IMF). White was to go on to the job of executive director of the IMF before being forced out under a cloud of Cold War mania. The problem of trade imbalance went unaddressed. It took another 30 years before the United States would find itself as the world’s largest deficit economy and come up with the system which made a virtue out of apparent economic failure (deficit). The Global Plan was administered by New Dealers who had been trained following the insights of Keynes from the General Theory but who, as representatives of the world hegemon, needed to turn their attention to maintaining that hegemonic power. During the years following WW II the United States was a surplus economy and it recycled its surplus by supporting reconstruction in Europe and Japan. The German Deutschmark and the Japanese Yen became supporting currencies to the dominance of the US dollar. But the Global Plan came to an end with the end of the 1960s when the Vietnam War and the Great Society turned the United States from a surplus to a deficit economy. An interesting side-story in MPE is the story that it tells about encouragement of the Middle Eastern oil price rise by Secretary of State Kissinger with the thought that while the United States would be harmed by oil price inflation, Germany and Japan would be harmed more. The inflation that followed in the seventies doomed the Global Plan. When the French sent a warship to the United States to redeem their dollars for gold, Nixon unhooked the United States from gold convertibility and imposed wage and price controls. The Global Plan was dead. But what was to follow? What was to follow was an ingenious scheme for the United States to maintain its hegemony even as a deficit economy: The Global Minotaur. The Global Minotaur The Minotaur, of course, was the monstrous result of the coupling of the wife of King Minos of Crete with the beautiful white bull given to King Minos by Poseidon. Aphrodite had driven the wife mad with love for the bull, which Minos had kept in his household, instead of sacrificing it, as Poseidon had intended. This offspring, being an unnatural result, had no sense of proper nourishment and desired human flesh as food. Minos hired Daedalus to design him a Labyrinth in which to house the beast and required the Athenians, who were under his power as a result of a successful military campaign, to send young men and women to Crete for sacrifice. For Varoufakis the myth of the Minotaur provides a fitting image of the power of the United States to maintain its hegemony over the world economy even as it became a deficit economy. The system, as described in MPE and TGM, is one in which the United States had accumulated massive fiscal and trade deficits in the Post-Reagan years. The trade deficit reached nearly $800 billion dollars per year by 2007. The current post-2008 fiscal deficit is over one trillion dollars per year. The Matrix Economy makes a showing here as a steadily rising productivity accompanied by stagnation in real wages. Where did the increased productivity go? It went into average real profits, of course, which, by the time of the 2008 crash had reached 7 times the amount at the beginning of the Global Minotaur era in the 1970s. But how does this work? How is it possible that a country massively consuming less than it produces and accumulating debt can keep afloat? Well, the long-term answer is that it can’t; for this has led to the crash of 2008 and to our current crisis. But how is it that it lasted so long? The answer that Varoufakis gives is “financialisation”. The surpluses accumulating in the Central Banks of China and Germany during the last 20 years have been recycled by purchase of United States Treasury Bonds and other securities with the money passing through the financial centers of London and New York. With the United States maintaining a reasonable control of internal inflation, US investments became not only less expensive, but more secure. Loans were made by US-based banks during the sixties and seventies to developing countries in Latin America and several former members of the Eastern Bloc at low interest rates. As interest rates rose in the mid-1970s, these developing countries were caught in a debt repayment squeeze. Forced to go to the IMF for help, these countries were told to dismantle their public sectors and to sell off valuable public assets, like water and telecommunications utilities, which were scooped up by Western companies at bargain basement prices. “To recap, the nexus between geopolitical power and the centrality of the dollar’s role in maintaining the Global Minotaur grew stronger and stronger. A brief perusal of the Fed’s research papers during the 1990s confirms that US authorities saw the greenback as a strategic asset. The drive to use political influence in order to dollarise whole foreign economies, especially in Latin America in the 1990s, is to be understood as part of the same mindset. Dollarisation meant that the dollar became the country’s de-facto local currency. . . . . As dollars were increasingly demanded by foreigners also for their own domestic purposes, the United States’ balance of payments played a decreasing role in shaping the dollar’s value in the international money markets . . . . The deep, and deeply wounding (for local societies), crises that dollarisation led to in the later 1990s were, in this sense, mere collateral losses during the process of maintaining the Minotaur.” The Rise of Private Money By 2003 the United States was devouring over 70 per cent of global capital outflows. “Mountains of cash flowed to Wall Street and from there to US corporations in the form of equity and loans.” This caused an enormous increase in the profitability of US financial corporations. This flow of cash was magnified by the creation of what amounts to private money, the new forms of derivative investments known as “collateralized debt obligations” or CDOs and their evil twins, credit default swaps, or CDSs. “The CDOs were options or contracts. In reality, and since no one knew (or really cared to know) what they contained, they acted as a form of private money that financial institutions and corporations used both as a medium of exchange and a store of value.” Friedrich Hayek had actually proposed with favor a system of private money in an astounding 30-page paper from 1976, Denationalisation of Money. Hayek blamed the Federal Reserve for the Great Depression. He thought that they had printed too much money in the 1920s. The moral that he drew from this story was that government could not be trusted to print money and that private banks should have the right to issue their own money. It seems to the authors that this is exactly what happened in the run-up to the 2008 crash; A fitting testament to a truly strange Nobel Prize winner in the strange “science” of economics. The authors end their story of the Global Minotaur with the following summary: “Keynes believed that he had a simple solution to capitalism’s tendency to stumble, fall and refuse to pick itself up without a helping hand from the state . . . . judicious fiscal and monetary adjustments . . . He was wrong. Capitalism cannot be civilized, stabilized or rationalized. Why? Because Marx was right. Increasing state power and benevolent interference will not do away with crises. . . . Marx too thought he had a simple answer for capitalism’s troubles. Convinced that its own contradictions would, effectively, force it to commit suicide; he believed that a new rational order . . . was inevitable. He too was wrong. Why? Because it has Keynes (or someone with similar ideas) on its side. . . . Regulation and state intervention do save capitalism from itself, in the limited sense of preserving property rights and buying time for capital to overcome the authorities’ renewed ambition to reign it in. . . . . The hegemon minding the shop decided to help itself to the till. . . . . Then the bubble broke, the private money burnt out . . . . and a ping-pong game began with private losses turning into public debt. . . . The problem with this type of cycle is its irregularity. Like an out of control pendulum, it threatens to exhaust the state’s capacity to bounce back because of a collapse of the state’s financial position.” The Post-2008 World The Crash of 2008 has deeply wounded or perhaps killed the Global Minotaur. But what will replace it as the Global Surplus Recycling Mechanism (GSRM)? In TGM Varoufakis proposes two possibilities. The first is a “grand coalition of emerging countries, which would forge a de facto GSRM on the basis of planned investment and trade transfers between them. . . . . Such agreements between Brazil, China, Argentina, India, Turkey, and selected African countries could act as a GSRM that would promote stable growth. The fact that it would leave our Western bankruptocracies out on a limb would be icing on the cake.” The second takes off from Keynes’ proposal for an ICU at the Bretton Woods conference. He quotes the now disgraced Dominque Strauss-Kahn (DSK) in favor of this possibility. Given the enormous military might of the United States, the prospects look pretty grim to this reviewer. But why not end on an upbeat note: “Perhaps centuries later, our own Minotaur’s death will inspire the poets and the myth makers to mark its demise as the beginning of a new, authentic humanism” (the concluding lines of TGM.) For another review of this book see: http://monthlyreview.org/2011/06/01/t....

  3. 5 out of 5

    Luke

    I have to hold my hands up and admit to being a virtual novice when it comes to the intricacies of economics. Like many, I find both the study and application of economic theory testy at best, but reading The Global Minotaur behooved me to question what it was that made me so about the never-ending obsession with the world of monetary policy and globalised finance. This book helped me understand just how much of what we are told about the global economy, austerity and international trade is eith I have to hold my hands up and admit to being a virtual novice when it comes to the intricacies of economics. Like many, I find both the study and application of economic theory testy at best, but reading The Global Minotaur behooved me to question what it was that made me so about the never-ending obsession with the world of monetary policy and globalised finance. This book helped me understand just how much of what we are told about the global economy, austerity and international trade is either extremely skewed or outright fallacious. Like many acclaimed leftist economists, the-many-times-vindicated Varoufakis is often treated by mainstream pundits and commentators (yeah, *those* guys) as little more than a dogmatic marxist technocrat. Of course, Varoufakis (who has time and again imbibed a frankness and dynamism into a rapidly stagnating contemporary Westernised political arena) is anything but. Always communicated in an accessible yet mercurial style of prose, his methodology is informed more by statistics and hard facts than basic neo-Marxian ideology. This shines threw in the depth of his research, his interrogation of ideas, anecdotes concepts and dissection of predominant "economic actors". In many sections of the book, it actually read more like a historical text, such was the quality and comprehensiveness of the research contained within. Put simply, Varoufakis is a breath of fresh air amidst all of the neoliberal apologia we see on our tv screens, and one of the most brilliant thinkers of out times. For those looking to make sense of the state of global economics since the end of ww2 and the role of the U.S. in enslaving us all to the whim of capital (or as Varoufakis appropriately refers to it, "The Minotaur") put Picketty et al to one side for now and read this instead. You won't regret it. This excellent extrapolation of mid to late capitalism is too good not to read immediately.

  4. 4 out of 5

    Carrie

    TOO MANY METAPHORS. The minotaur. The dragon The tiger. The domino effect. Helen. The myth of Europa. Disparate mountaineers.

  5. 4 out of 5

    Abraham Lewik

    The historical reach of Mister Varoufakis book combines with remarkable brevity of letter. We, the reader, are not inundated with statistical economic data, which most of us cannot comprehend. The elaboration of the post-WWII Global Plan, it's subsequent development into the eponymous Minotaur, then the final crisis and implications are the stuff of illusory, megalomaniac conspiracy. Mister Varoufakis in seems to resist delusion (who I am to judge?), nor do any delusions of grandeur besmirch thi The historical reach of Mister Varoufakis book combines with remarkable brevity of letter. We, the reader, are not inundated with statistical economic data, which most of us cannot comprehend. The elaboration of the post-WWII Global Plan, it's subsequent development into the eponymous Minotaur, then the final crisis and implications are the stuff of illusory, megalomaniac conspiracy. Mister Varoufakis in seems to resist delusion (who I am to judge?), nor do any delusions of grandeur besmirch this humble paperback. The language is clear, the basic cycle preceding the 2008 Financial Crisis is something I want to remark upon here. Let us say that Korea produces 1 000 mobile phones, 200 are sold domestically. The 800 surplus to domestic demand are exported. [If we all held our mobile phones for as long as the traditional Nokia lasts, there would be minimal export market. This is not the case, and is one quality of the over-consumption actively encouraged within Capitalist society.] So these 800 surplus phones are sold to the USA, producing capital value for Korean mobile phone makers. Then USA deficit value will increase. The Korean capital invests into the USA for the returns offered by CDO's, the security offered by the most dominant currency internationally, and because investing in China is too much work. CDO's produce value out of proportion with the value paid into them. Poorer US citizens slowly paid there mortgage into the CDO, however, the value extracted from their mortgage by financialisation exceeded the rate of return then burst on the global economy like a bag hung beneath the streetlights where pelicans perch. This then leads to Bankruptocracy, or ptocho-trapezocracy as the natives say it.

  6. 5 out of 5

    Luke McCarthy

    Or: it's all debt and surplus, stupid!

  7. 4 out of 5

    John Da ega

    Awful book. Inaccurate data, wrong math, wrong definition of basic concepts as QE and company valuation. I share some of the conclusions, but the book is full of propaganda.

  8. 5 out of 5

    Mariella

    fascinating shorter and more accesible than the big short. it also details history of capitalism from the industrial revolution to the hegemon today mixed with game theory. highly recommend.

  9. 5 out of 5

    Max Hristov

    Varoufakis at his best. Though he’s a bit of a broken record on his surplus management theory, it has really held up. The book’s written with great flair, usage of historical events and analysis on how the world economy is structured. Rare to see an author both come up with a theory of his own rather than just repeating what has already been argued, and explain it so understandably.

  10. 5 out of 5

    Bobby Damore

    Very illuminating!

  11. 5 out of 5

    Aria Rezaei

    Good account of global economy after WW2 and what led to the Crash of 2008. Plenty of metaphors based on Sci-Fi movies and Greek Mythology along the way. It was really fun reading this book.

  12. 4 out of 5

    Keen

    4.5 Stars! “This is no longer a financial crisis. It is not even an economic crisis. It has become a political crisis.” Varoufakis is everything that Wall Street doesn’t want economists to be…informed, accessible, well-connected and left of centre. This was a fascinating insight into the background and impact of some of the US’s more significant and controversial economic policies of the 20th Century and how they have impacted on the rest of us. He shows us how America implemented the Global Plan a 4.5 Stars! “This is no longer a financial crisis. It is not even an economic crisis. It has become a political crisis.” Varoufakis is everything that Wall Street doesn’t want economists to be…informed, accessible, well-connected and left of centre. This was a fascinating insight into the background and impact of some of the US’s more significant and controversial economic policies of the 20th Century and how they have impacted on the rest of us. He shows us how America implemented the Global Plan at Bretton Woods back in 1944, and how that eventually led to Japan and West Germany getting heavily protected and greatly bankrolled by the US in order to create new markets and provide buffers and outlets for them. He’s good on the creation and eventual disintegration Bretton Woods in 1971 which heralded the start of the phenomenal wealth and greed of those at the top, whilst keep the vast majority down, what he calls the Global Minotaur. Varoufakis states that in real terms purchasing power from wages in the US hasn’t improved since 1973, whilst at the top salaries have soared beyond all reason. He’s good on the horror of Reaganomics and how its legacy still lingers and looms large today, as well as various financial deregulations which took place under both Democrat and Republican leadership. He nicely illustrates and translates what the likes of your CDS (Credit Default Swaps), LTCM (Long-Term Capital Management) (hedge fund), GSRM (Global Surplus Recycling Mechanism) are, explaining what role they played in the financial crash and beyond. There are many box panels which come with all sorts of interesting titbits of information and history, that bolster his overall points. Most people are aware of the devastation wreaked by 1929 and 2008, less will know of Black Friday and the dotcom bubble bursting, the East Asian crisis of 1998 and maybe handful of other financial crashes, but as Varoufakis illustrates there have been many more which occurred with predictable results, but are less talked about and show just how deeply flawed and fragile the capitalist system is. This is an eloquent, and thoroughly enjoyable piece of work and shows why Varoufakis remains one of the most engaging and compelling economists in the current global climate and I would highly recommend this to anyone with even a slight interest in the subject. I sometimes wonder what people in the future will say or think about the financial crisis of 2008?...Vile, unforgiveable and perhaps above all sad. It is a state of affairs which confirms our worst fears about what humanity is capable of. An on-going devastation where not only did the guilty get away with it but they managed to get their victims and the public to bail them out and spread the suffering and misery as far and wide as possible, and now they are stronger, greedier and more powerful than before. It beggars belief. As we look to the States with another election coming up, the rest of the world endures another round of endless lies and deceit from some of the loudest, brashest and most cynical people you could ever meet as they desperately seek out power. It is deeply depressing when we see the two best candidates the so called greatest country in the world could produce last time round. Trump got nearly 63 million votes but lost the popular vote, Clinton gained nearly 66 million votes, but no one likes to mention the real elephant in the room, apathy, more than 90 million Americans felt so hopeless and ignored that they didn’t even be bother to vote, and so it seems that apathy won by a landslide. Non-voters are consistently patronised and told they can’t complain unless they vote. But there is maybe a little more to it than that. Choosing not to choose is still a choice and also a right. Generation upon generation has shown these people just what politicians and voting has done for them. Whether Detroit, MI, Camden, NJ or New Orleans after Katrina, it’s there in black in white. School shootings, black killings, wide scale corruption, foreign wars, hyper-surveillance and prescription addiction epidemics to mention only a few. And yet the same Americans go out every election year like battered wives returning to an abusive husband. This time will be different. But it never is and there is always another excuse, but no responsibility taken. The Republicans hammer them with a right and the Democrats batter them with the left and after the latest batch of broken promises, and a new group of lying thieves have enriched themselves, the wages remain stagnant, hours grow longer and conditions worsen as people get deeper into debt, the rich grow wealthier and the lies keep on coming. I am willing to make a prediction, come the next election the victors will be Wall Street. After all that is who really runs America and that is why more than 90 million of them will probably not even vote.

  13. 5 out of 5

    Joao Vargas

    This book was an incredible surprise for someone who didn't know anything about Yanis Varoufakis except the eccentric Greek Finance Minister that shook European Union for a couple of months. But Varoufakis (I know it now) is much more that a Leftist character with an empty speech against capitalism. In this book he shows his great and deeper knowledge on economy which would embarrass most of the capitalism prophets. He sketches a good overview of how USA lead the world economy towards a very cle This book was an incredible surprise for someone who didn't know anything about Yanis Varoufakis except the eccentric Greek Finance Minister that shook European Union for a couple of months. But Varoufakis (I know it now) is much more that a Leftist character with an empty speech against capitalism. In this book he shows his great and deeper knowledge on economy which would embarrass most of the capitalism prophets. He sketches a good overview of how USA lead the world economy towards a very clear goal, taking the best from their European (lead by Germany) and Japanese servants and makes it clear that the chaos of 2008 crisis was not only predicted but somehow intended by some US officials. On a second part of the book, Varoufakis focus on how Europe, specially Germany, handled the 2008 crisis and why it was not yet resolved. This is definitely a book worth reading by a wide audience - a lot of people can benefit from this teachings and put their beliefs on world economy in perspective.

  14. 4 out of 5

    Jake

    From the postscript : “Not once, but twice, the United States smashed pre-existing realities to fashion new ones. The first time, it had no choice. World War II had thrust America into the role of an unwilling reality-fashioner. It responded brilliantly, with a Global Plan that delivered global capitalism’s finest hour. And when its Global Plan reached its sell-by date, the United States spent no time dithering, or ‘studying’ the existing reality. Instead, it actively sought to disintegrate the de From the postscript : “Not once, but twice, the United States smashed pre-existing realities to fashion new ones. The first time, it had no choice. World War II had thrust America into the role of an unwilling reality-fashioner. It responded brilliantly, with a Global Plan that delivered global capitalism’s finest hour. And when its Global Plan reached its sell-by date, the United States spent no time dithering, or ‘studying’ the existing reality. Instead, it actively sought to disintegrate the degenerating reality, to cause a major, worldwide crisis that would spawn a newer, hyper-vibrant reality: the Global Minotaur. It was the second time in its history that America had reshaped the world not so much in its image but in a manner that converted a creeping weakness into majestic hegemony.”

  15. 4 out of 5

    Ben Delaney

    What a read! Incredibly well informed and referenced insight in to not only the crash of 2008 but where the history behind it lay.

  16. 4 out of 5

    Vassiliki

    Cannot be read by an average reader , i quitted ... + He usually gets lost in streams + thoughts

  17. 4 out of 5

    Diana

    “Never before have so many powerful people understood so little about what the world economy needs in order to recover,” says Yanis Varoufakis in the Global Minotaur. And what the world needs, he says, is an international mechanism for balancing economies, a Global Surplus Redistribution Mechanism (GSRM). In general, any economic system contains units that are prone to showing surpluses and others that are more likely to report deficits. To maintain balance, the system must feature surplus recycli “Never before have so many powerful people understood so little about what the world economy needs in order to recover,” says Yanis Varoufakis in the Global Minotaur. And what the world needs, he says, is an international mechanism for balancing economies, a Global Surplus Redistribution Mechanism (GSRM). In general, any economic system contains units that are prone to showing surpluses and others that are more likely to report deficits. To maintain balance, the system must feature surplus recycling mechanisms that maintain the flow of surpluses from the future to the present, from the urban centres to the rural areas, from the developed regions to the less developed ones, etc. The recycling, whether global or local, may be in the form of payments such as benefits and public services, or it may be investment in production facilities in deficit regions. This chaos the world has experienced since 2008 is not due to financialisation, deregulation, greed and globalisation as is generally supposed, but to the lack of a GSRM. To explain this he goes back to the crash of 1929, where a boom followed by bust decimated the economy. In 1932 Roosevelt introduced the New Deal which took the US off the Gold Standard and invested in social programmes. Then during the second world war, the state liberated all finances, spending and growing the economy. After the second world war the US emerged as the world’s powerhouse with large trade surpluses with the rest of the world, but they were spending money like water and afraid of another crisis around the corner. The US sought to avoid the imbalance of boom and bust, with a Global Plan which involved recycling its surplus to Europe and Asia. This would stimulate international development to balance growth in the US, and create markets for its exports. Germany and Japan, two countries that were devastated during the war, were chosen to be the local mini-minotaurs in their respective continents. The dollar was pegged to gold and other countries had to maintain exchange rates fixed to a 1% range. This arrangement lasted from 1950 to 1971 when it finally fell apart due to the costs of the Vietnam war, welfare payments. The flaw in the Global Plan was that they failed to include an international currency union which would automatically keep trade imbalances in check. The Global Plan only worked as long as the US was the surplus nation, when it went into deficit and began to build up mountains of debt, this meant that other governments had to increase the volumes of their own currencies in order to maintain exchange rates, which led to inflation. Unable to sustain the dollar’s gold peg, in 1971 the US ended the Bretton Woods gold agreement. From there on forward, the US was now a deficit nation, but rather than give up its position as the GSRM, the US maintained its position but reversed the flow of capital. The US absorbed the world’s exports and got the rest of the world to finance its deficits by attracting capital inflows into the US through a) increasing competitiveness and b) raising interest rates. The Global Minotaur was born. The Minotaur was a mythological creature, half human, half bull, which lived in a labyrinth in the political hegemon of Crete, to which weaker states were required to pay tribute to in the form of the yearly sacrifice of seven young boys and seven young girls. "The Athenians’ gruesome payments of tribute to the Cretan Minotaur were imposed by King Minos’s military might. In contrast, the tribute of capital that fed the Global Minotaur flooded into the United States voluntarily. Why? How did US policy makers persuade capitalists from all over the world to fund the superpower’s twin deficits? What was in it for them? The answer turns on four factors. To stick with the mythological narrative, let’s call them the Minotaur’s charismas." The four charismas are: a) Reserve currency status, which means that any commodity transaction, whether it involves the US or not, increases demand for the US dollar. b) Rising energy costs, which benefit US as an oil producer and US multinationals. c) Cheapened, productive labour, productivity has increased in the US but real wages have remained flat. d) Geopolitical might, used and abused, to secure mineral supplies from the Third World and Afghanistan. By the 1990s, American growth had caught up with the rest of the world, and the Global Minotaur worked its magic, right up until the crash of 2008. The success of the US economy convinced the world that the American model was the one to follow. Unable to see the Minotaur in the room, the elites believed that they could all achieve this if they too adopted unregulated labour and financial markets. The Minotaur was supported by four handmaidens: -Wall Street with its mergers and takeovers and hedging instruments -Walmart, a new type of business that squeezed wages and suppliers -Trickle down economics, benefit the poor by making the rich richer. -Supply side economics which argues that economic growth is best achieved by investing in capital, and lowering taxes on production, which inspired deregulation, real estate speculation and toxic derivatives. "It was a heroic time, during which money seemed to be growing on trees. Traditional companies – those that actually produced things – were derided as old hat. What steel producer, car manufacturer or even electronics company could ever compete with Wall Street’s amazing returns." But the fantasy economics and fantasy money was blowing up a bubble that was bound to pop sooner or later. It eventually did, when people who should never have been given mortgages were unable to pay them, and the subprime crisis set off the crash. Now the US is no longer able to absorb the world’s exports and the crisis continues to spread, causing havoc in different places. The American economy is below capacity, demand is low, unemployment is growing. Globally, most governments have chosen to keep the banks afloat, but haven’t introduced any mechanism to stimulate growth and restore balance. Varoufakis calls this new state of affairs a bankruptocracy. "In a typical zombie-movie setting, the undead banks drew massive strength from our state system and then immediately turned against it! Both in America and in Europe, politicians are quaking in terror of the very banks which, only yesterday, they had saved. Thus, the very financial sectors that were at the heart of the problem are now held in awe by our politicians. Not only does this make it impossible to implement sensible policies to deal with the ongoing Crisis, but it also stifles all rational public debate on what really happened." Blame has been put on the risk taking and lack of regulation in US markets, and in Europe the peripheral states of Greece, Ireland, Spain and Portugal have been blamed for living beyond their means, when in fact, although Greece was in deficit, Ireland and Spain were in surplus in 2008 and Portugal was no worse than Germany. The Minotaur is dead, but the ugly handmaidens are alive and kicking. Banks are creating private toxic money again, underwritten by taxpayers’ public money. Walmart-type firms are exploiting people and places, and free market fundamentalism is used to justify austerity for the masses. What happens when the bullying master is taken ill and the handmaidens take over? That depends on the handmaidens. Unfortunately we are saddled with rule in a way that preserves the worst aspects of the Global Minotaur’s rule (the inequities, the boorishness and the instability) without offering the important function it used to fulfil – to keep generating sufficient overall demand for Europe’s and Asia’s surplus output by recycling the world’s surpluses. The world needs a new Minotaur, says Varoufakis, though this time a benevolent, democratic one. He calls for an international coalition of countries to create a mechanism for planned investment and trade transfers, or for an International Currency Union, which manages recycling of goods, profits, savings and demand. But then he finishes the book on a defeatist note, saying that he doesn’t believe this will ever happen because Europe is in disarray and the emerging nations have no tradition of mould building on a global scale. The only way forward he sees is for the US, the world’s only possible hegemon, to take up the role of building a new GSRM. Beyond the need for a GSRM, the reality that this book reveals is that Capital has a life of its own, with objectives and desires and values that have nothing to do with what’s best for humanity. It is not the interference in Capital through greed, or mismanagement that caused the Crisis, but rather the lack of interference in a system which clearly needs regulation to operate effectively. What we need to do is rid ourselves once and for all of any notion of free market magical solutions, (or of any Essentialist magical solutions) and take control of Capital for our own purposes. Varoufakis asks if the Minotaur’s demise is our chance to realise how destructive it is to subjugate our will to that of Capital.

  18. 5 out of 5

    Ed

    An extraordinarily useful book outlining what I might call the political economic history of the US and global economy since 1945. He is particularly good on the Nixon era when the disastrous imbalances/inequality really got going, but his take is far from the current orthodoxies of Neo-Liberalism and it is a refreshing and well written read. What he is weak on, because I am not sure there are any, is solutions. Which is a pity and the book is a few years out of date but focusing too much on the An extraordinarily useful book outlining what I might call the political economic history of the US and global economy since 1945. He is particularly good on the Nixon era when the disastrous imbalances/inequality really got going, but his take is far from the current orthodoxies of Neo-Liberalism and it is a refreshing and well written read. What he is weak on, because I am not sure there are any, is solutions. Which is a pity and the book is a few years out of date but focusing too much on the immediate situation, is why the coming Stock Market crash will be such a surprise. And of course what I think he most shows up is that the left has no Plan B if Neo-Liberalism takes a hit. the left has been mentally asleep at the wheel for 50 years or more: no new ideas, no systemic alternatives.

  19. 5 out of 5

    Linda Elder

    The Global Minotaur is a fast course in the economic workings of capitalism, covering the major players only, and starting at the 1944 Bretton Woods conference. Central to the author's thesis is the principle that any monetary system requires mechanisms for transferring resources and capital from supply areas to deficit areas. At the end of World War II, the West had an efficient surplus recycling system in place. US was the supply country, recycling its excesses to the rest of the world, but es The Global Minotaur is a fast course in the economic workings of capitalism, covering the major players only, and starting at the 1944 Bretton Woods conference. Central to the author's thesis is the principle that any monetary system requires mechanisms for transferring resources and capital from supply areas to deficit areas. At the end of World War II, the West had an efficient surplus recycling system in place. US was the supply country, recycling its excesses to the rest of the world, but especially to the former enemies, Germany and Japan, whom it favoured for development to the detriment of all others, even including the US itself. This went swimmingly until 1971 when excesses of the Vietnam war moved US into a deficit position. At that point, America made an audacious strategic decision. Instead of reining in spending to tackle its twin deficits, they decided to do the opposite: to boost those deficits. Thus, the roles of the players were reversed, and for the next several years, the leading surplus economies, i.e. Japan, Germany and later China recycled almost 70% of their profits back to the US – they gave their money to Wall Street! The Minotaur, a monster from Greek mythology, is Varoufakis’ metaphor for the aberrant structure of the monetary system after 1971. This monster has four charismas and three handmaidens. Charismas are: the American dollar, American firepower, rising energy costs, and cheapening labour costs. Handmaidens are: Wall Street, Wal Mart, and toxic economic theory built on mathematical hoaxes. For non-economics types like me, this book is a steep learning curve. Luckily, there are on-line interviews with the author and these are a great help. I came to realize just how immense is the structure of exchange in goods and capital, and also how carefully planned. Yes, Jennifer – there is a conspiracy. But as it turns out, that is the good news. Varoufakis claims that surplus recycling could easily solve the present Euro crisis. He contends that known mechanisms are not being discussed because the biggest players enjoy too much their own hegemonic positions. The author challenges us to look again at the Keynes proposal of 1944, which was passed over at the time in favour of an American model. Keynes had envisioned a global currency with a global surplus recycling mechanism or GSRM, to be administered by an international central bank. Keynes GSRM was as follows: each member country would have the right to borrow at zero interest up to 50% of the country’s trade volume. Loans above 50% of trade volume could also be made but at the cost of a fixed interest rate. This would give the deficit country flexibility to boost demand without having to devalue its local currency. Secondly, any country with a trade surplus exceeding a certain percentage of its trade volume should be charged interest, which would force its currency to appreciate. These penalties would, in turn, finance the loans to the deficit countries, acting as an automatic GSRM. The Keynes system, as described, has a nice ring to it and for this reason I would recommend The Global Minotaur for everyone with eyes trained on the future. Many countries are non-players in the book which can only mean there is a sequel to write.

  20. 5 out of 5

    Jemma

    This is quite a masterwork, positing a deeper structural problem with postwar and certainly post 1971 world Economics. Over the years since the Crisis, I've come to realise (with dismay) that I'm much better informed on Economic matters than most. An A Level in Economics and an lot of Socio-Economic History in my History Degree, somewhat worryingly is enough to give me a comparatively and reasonably deep understanding of Economics. So, it is refreshing to read something where I know I don't know This is quite a masterwork, positing a deeper structural problem with postwar and certainly post 1971 world Economics. Over the years since the Crisis, I've come to realise (with dismay) that I'm much better informed on Economic matters than most. An A Level in Economics and an lot of Socio-Economic History in my History Degree, somewhat worryingly is enough to give me a comparatively and reasonably deep understanding of Economics. So, it is refreshing to read something where I know I don't know enough to say whether the thesis is correct or not. Frankly, this is where I would expect to be in a subject I don't have a degree in and Varoufakis restores some faith that there are others who understand the situation better who could be left to remedy the situation. Neither simply Marxist, nor Keynesian, Varoufakis's critique seems to plough it's own ideological furrow. Indeed, for the first time I've encountered the term "shallow Keynesian" which I believe is what I am. If this thesis is true, then I am still on the right lines in my approach to this subject but a true and lasting resolution will be much more difficult than I expected. The only critique I would make is that the central metaphor doesn't work terribly well. If we all knew the Minotaur legend more thoroughly, then we might find the theme of tribute to the modern Myceans (i.e. the Americans) as inspired; whereas we tend to think of the monster, which can be confusing. I presume that Greeks are more profoundly schooled in their myths and legends though, so this is perhaps the only aspect in which Varoufakis's nationality is evident. Otherwise, this could be by any Western academic, so this work should not be dismissed as the work of Greeks with an axe to grind - as I'm sure many will try to portray it.

  21. 4 out of 5

    Alejandro Shirvani

    This is a passionate, direct left wing challenge to mainstream economic thinking and offers an interesting explanation of the development of postwar global economics: first there was an era of US global economic management, with the US producing trade surpluses that it invested in to Germany and Japan; then following the Vietnam war and the US beginning to run up both large budget deficits and trade deficits, the US became a 'global minotaur' that required 'feeding' with large capital inflows. H This is a passionate, direct left wing challenge to mainstream economic thinking and offers an interesting explanation of the development of postwar global economics: first there was an era of US global economic management, with the US producing trade surpluses that it invested in to Germany and Japan; then following the Vietnam war and the US beginning to run up both large budget deficits and trade deficits, the US became a 'global minotaur' that required 'feeding' with large capital inflows. However this position gave a certain stability to the world economy because it provided a mechanism for recycling global surpluses (a core theme of Varoufakis' book) and the collapse of the minotaur means the global economy is now unstable due to a lack of global surplus recycling mechanism. Well written and self-confident in its opinions.

  22. 5 out of 5

    Joseph Jammal

    The central thesis of the book ie the world economy requires some form of agreed upon global surplus recycling mechanism is insightful. However, the book seems to overstate the importance of trade and currency questions while overlooking the microeconomic reasons that growth is created. Furthermore, in the historical and evidence sections of the text the author has a tendency to lapse into hyperbole which undercuts what should be some very strong arguments. Certainly a good read, however, The Gr The central thesis of the book ie the world economy requires some form of agreed upon global surplus recycling mechanism is insightful. However, the book seems to overstate the importance of trade and currency questions while overlooking the microeconomic reasons that growth is created. Furthermore, in the historical and evidence sections of the text the author has a tendency to lapse into hyperbole which undercuts what should be some very strong arguments. Certainly a good read, however, The Great Rebalancing is a more balanced and insightful read that approaches a similar question but from a more diverse set of perspectives.

  23. 4 out of 5

    Bjoern Rochel

    Fits perfectly in line with Naomi Kleins Shock Strategy, George Packards The Unwinding and Michael Lewis Big Short & Flash Boys. What I like about the book is that it tries to explain why we ended up in the mess we're currently in and what role the US might have played on the way. Varoufakis might no get everything right in his theory but he's the first author who at least delivered a convincing reason of why destabilizing the world might be in the strategic interest of he United States. Highly r Fits perfectly in line with Naomi Kleins Shock Strategy, George Packards The Unwinding and Michael Lewis Big Short & Flash Boys. What I like about the book is that it tries to explain why we ended up in the mess we're currently in and what role the US might have played on the way. Varoufakis might no get everything right in his theory but he's the first author who at least delivered a convincing reason of why destabilizing the world might be in the strategic interest of he United States. Highly recommended read!

  24. 4 out of 5

    Malcolm Pellettier

    May've even understood it too. bonus.

  25. 5 out of 5

    Constantinos Kalogeropoulos

    A very interesting examination of the post-Bretton Woods capitalist system of accumulation by one of the foremost academic minds alive today.

  26. 5 out of 5

    Aine

    While Yanis Varoufakis’ star may have faded somewhat, he will forever be remembered by many of a certain age for having spoken out against the “There Is No Alternative” brigade during a moment of intense group-think amongst the economic and political elites of Europe, but also he was weirdly hot, had a cool accent, and spoke in metaphors. The Global Minotaur really feeds on the whole crazy metaphors thing. From the end of the Second World War to 1971 was Varoufakis’ golden era, the era of the “Glo While Yanis Varoufakis’ star may have faded somewhat, he will forever be remembered by many of a certain age for having spoken out against the “There Is No Alternative” brigade during a moment of intense group-think amongst the economic and political elites of Europe, but also he was weirdly hot, had a cool accent, and spoke in metaphors. The Global Minotaur really feeds on the whole crazy metaphors thing. From the end of the Second World War to 1971 was Varoufakis’ golden era, the era of the “Global Plan” when the US was the world’s creditor. Trade relied on a single currency and was financed from a single epicentre (Wall Street). The US also built up two strong currencies to act as shock absorbers: Germany and Japan. Bother were underpinned by heavy industry and adjacent trade zones. (The Marshall Plan was the progenitor of the EU because a precondition was the erasure of intra-European trade barriers and the start of economic integration). Then the Global Plan fell apart. It did so, as Keynes had predicted, because of the lack of any automated global surplus recycling mechanism that would keep systematic trade imbalances in check. The costs of the Vietnam War and the Great Society led the US government to generate debt, flooding markets with dollars. France tried to stare the US down but the US broke with Bretton Woods. So began the era of the Global Minotaur, pushed on by the US’ twin deficits: the trade deficit and the federal government budget deficit. The US absorbed a large portion of the rest of the world’s surplus industrial products and the profits earned by the surplus countries were returned to Wall Street in search of a higher pay-off. Wall Street then used the foreign capital to provide credit to US consumers, as direct investment into US corporations, and to buy US Treasury Bills. The “four charismas” of the Global Minotaur were that the $ was the reserve currency of the world, increasing energy costs (Europe and Japan relied on imported energy more than the US), cheapened and productive labour, and the US’ geopolitical might. And then the crash. Financialisation (aka private money minting by Wall Street banks) added energy to the system but also led to it falling apart. The US banking sector could no longer use the twin deficits to finance enough demand with the US to keep the net exports with the rest of the world going. In Europe, hedge funds and banks used some of the public money they had been given to bet that sooner or later the strain on public finances would cause one or more of the eurozone’s states to default. Varoufakis’ response for Europe was threefold: the ECB makes the continuation of the assistance to the banks that those banks write off a significant portion of the deficit countries’ debts to them; the ECB takes on a portion of the public debt of all members states (financed by ECB-issued bonds that are the ECB’s own liability); and let the EIB to borrow surpluses from around the world and invest them into the EU’s deficit regions. Varoufakis knew this would not happen and it didn’t. That all seems perfectly reasonable. But the main take away from the book is that something is wrong and Varoufakis is very smart. The constant and continued metaphors, the broad geographical scope, and the assumption that the US will (presumably through technocrats or enlightened hedge fund managers) end up with a book high on literary aspirations but without the associated ideals. It was probably an important injection into the public debate at the time but time has moved on.

  27. 4 out of 5

    Goosejack

    It's a narrative-building book, moreso than an in-depth economic study. Interesting in places, but there isn't nearly enough research, to the point you can't really trust some of the book's points without blind-vesting in the author's authority. He has a tendency for glibly spewing explanations which seem to be contentious or at least not obvious, without a citation in sight. That being said, the worst part about this book is the writing style. It's written with so much aplomb and willful styliz It's a narrative-building book, moreso than an in-depth economic study. Interesting in places, but there isn't nearly enough research, to the point you can't really trust some of the book's points without blind-vesting in the author's authority. He has a tendency for glibly spewing explanations which seem to be contentious or at least not obvious, without a citation in sight. That being said, the worst part about this book is the writing style. It's written with so much aplomb and willful stylization its difficult to tell what exactly he means, and even harder to tell when he's elided a seemingly important facet of the explanation. He uses euphemisms for just about everything, as indicated in the title, and often refers to one thing three or four different ways. Never, ever write a scholarly work this way. There's some important stuff in here, such as the important of intersystematic surplus recycling mechanisms and the extreme power of the dollar's reserve currency status as the underpinning of the deficit strategy, but even these aren't elaborated on enough. I had many questions at the end of the book. Apparently this is the populace-level version of a more in-depth work of the same material he did earlier in his career, and he refers the reader to it at the end, along with an article they wrote explicitly answering questions people had to this book. So, basically, blind authority vesting is the only way you're getting the intended effect from this book if you're using only this book. Also, his line of reasoning seems to lead to the conclusion that the dollar is going to hard-crash one day and lead to a global great depression at worst or America's bankruptcy at best, but he doesn't actually say this or even seem to think about it.

  28. 4 out of 5

    Kit

    Utilising the metaphor of a crazed, half-human monster that regularly devours human sacrifices to ensures it docility in its labyrinth prison, Varoufakis paints a lurid picture of the US-led global economy that crashed so spectacularly in 2008 and has been revived but kept in the ICU ever since. Varoufakis summarizes the arc of the US economy in three chunks. He starts in the lead up to the Crash of 1929, the war-inspired upsurge of America to global economic and military eminence under the Glob Utilising the metaphor of a crazed, half-human monster that regularly devours human sacrifices to ensures it docility in its labyrinth prison, Varoufakis paints a lurid picture of the US-led global economy that crashed so spectacularly in 2008 and has been revived but kept in the ICU ever since. Varoufakis summarizes the arc of the US economy in three chunks. He starts in the lead up to the Crash of 1929, the war-inspired upsurge of America to global economic and military eminence under the Global Plan that lasted until 1971, and finally its replacement by the hell-bent push for more and more in the era of the Global Minotaur that collapsed in 2008. Varoufakis uses a scholarly, though easy-to-follow, and engaging style to bring the reader into the tumultuous events and personalities that defined each period covered. It's an entertaining educational work that's worthy of a thorough study, just don't look here for hope or prescriptions to fix capitalism's many continuing ailments. Ostensibly this was written for the lay student of economics, but a rudimentary grounding of economics will arm the reader well as Varoufakis doesn't provide a glossary of repeatedly used terms throughout the book. The Zed 2015 edition has many tiny charts and graphs in shades of grey that are hard to clearly read or discern their implied import.

  29. 4 out of 5

    Aslihan

    If you've read your Marx and Adam Smith or the following generation of Keynes and Polanyi, the first half of the book has very little novelty to offer. The lengthy reference to the 1929 economic crisis remains rather descriptive, while the opportunity for a deeper comparative analysis with the 2008 crisis is not well taken. The second half of the book does provide a detailed yet descriptive account of the way 2008 crisis progressed, with some cross-country analysis and the spillover effect, yet If you've read your Marx and Adam Smith or the following generation of Keynes and Polanyi, the first half of the book has very little novelty to offer. The lengthy reference to the 1929 economic crisis remains rather descriptive, while the opportunity for a deeper comparative analysis with the 2008 crisis is not well taken. The second half of the book does provide a detailed yet descriptive account of the way 2008 crisis progressed, with some cross-country analysis and the spillover effect, yet the book as a whole is disheartening and disappointing because of its theoretical weakness. We already live in a post-crisis setting and to think of future possibilities is more interesting than whining for the past. The author is superbly equipped with the necessary theoretical capacity, but does not use it to develop a deeper, more questioning analysis. The expressive prose enriched with heavy symbolism does not save the day for Varoufakis.

  30. 5 out of 5

    Choudhry Shuaib

    Great breakdown of the economic crises of 1929 and 2008 and the intervening years between them. Describing America's rise as an economic power during and after the 2nd world war and how it implemented its hegemony to becoming the greatest producer and also how the new dealers more benevolent economic policies that were borne out of their childhood in the years of the great depression manifested themselves. Then the book goes on to describe a few economic crises during the 70's and America switch Great breakdown of the economic crises of 1929 and 2008 and the intervening years between them. Describing America's rise as an economic power during and after the 2nd world war and how it implemented its hegemony to becoming the greatest producer and also how the new dealers more benevolent economic policies that were borne out of their childhood in the years of the great depression manifested themselves. Then the book goes on to describe a few economic crises during the 70's and America switch to being the world's greatest consumer and thereby increasing its twin deficits as well as getting rid of the dollar fixed rate exchange mechanism where the dollar acted like a gold standard but one that could be adjusted accordingly during economic peaks and troughs, unlike gold which depends on the reserves which depend on the arduous process of mining. Also describes how economic crises are inherent within a capitalism system, which is essentially a Marxist perspective.

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