Summary of And the Weak Suffer What They Must?

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And the Weak Suffer What They Must? book summary
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Rating

8

Qualities

  • Analytical
  • Innovative
  • Controversial

Recommendation

Yanis Varoufakis was a controversial figure as Greece’s finance minister in 2015. But he is also an economics professor, and it shows in this analysis. He describes the history, workings and fault lines of the international economic system, as he places recent euro issues in a historical context. As the euro zone shows, a common currency accelerates bank lending from countries with a trade surplus to their deficit neighbors. Such flows can fund booms, but major financial shocks can deflate borrower nations’ economies. That puts Greece’s predicament at the heart of Europe’s crisis, Varoufakis says. His academic analysis reads like a John le Carré spy novel with a cast of post-WWII government and financial institution leaders trying to outwit each other. The narrative goes back and forth in time and over geographic locations. The book is worthwhile, but intense and detailed. While always politically neutral, getAbstract recommends the author’s strong arguments and articulate economic points to those who want to understand the different viewpoints affecting Europe.

About the Author

Yanis Varoufakis is a professor of economics at the University of Athens. He is best known as the former Greek finance minister who outspokenly fought the EU’s austerity policies in 2015.

 

Summary

The Euro Dilemma

A passage in the Peloponnesian War by Thucydides recounts a statement made by the victors to a vanquished people that “the strong actually do what they can and the weak suffer what they must.” The quote is an apt description of the consequences of a common currency without political integration, as is the case in the euro zone. The 2008 global financial crisis and resulting credit crunch snowballed; Greece’s government teetered on default in 2009, and in early 2010, banks in the European periphery countries became insolvent. The calamities in the weak nations are as much a result of aggressive bank lending by the trade-surplus countries as of profligacy in the periphery country. So do you only blame the drug addict, or do you also consider the drug pusher? Do you blame only the trade-deficit countries, when banks in the trade-surplus nations of Germany and France pushed loans onto them? Greece suffered harsh penalties, and EU authorities compelled it to accept rescue in the form of new loans in amounts sufficient only to make debt payments. Thus, it could avoid default but only under severe austerity measures that defunded its social obligations...


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    S. B. 2 years ago
    Not for everyone!
  • Avatar
    J. S. 2 years ago
    This guy is a whack job. How he's teaching economics is beyond more intelligent people.