Saturday 10 December 2016

Former Greek Finance Minister Yanis Varoufakis: 'Ireland is a not a model of successful austerity - your government adopted a 'model prisoner' strategy'

Published 05/11/2015 | 20:40

Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.
Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.

Ireland is not a model of successful austerity, former Greek finance minister Yanis Varoufakis has said.

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The former Greek finance minister - who is a member of the ruling Syriza party and a member of the Greek parliament from January to September 2015 - claimed the Irish government had adopted a "model prisoner" strategy, which meant it would do everything it was supposed to do in the hope of being released.

Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.
Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.

"I didn't have any expectations of special support from the Irish finance minister [Michael Noonan]," Mr Varoufakis said, ahead of his appearance at the Kilkenomics festival in Kilkenny tonight.

"And the reason that I didn't have those expectations is because this government has adopted the strategy of the model prisoner - 'do everything we're being told and one day we hope to be released'.

"Our government was elected on the basis of a completely different strategy. Simply because our country had been trying to be a model prisoner for five years in previous governments with disastrous effects, with a humanitarian crisis," the economist said.

"It was clear for governments that had imposed upon their own populations the model prisoner model ... their worst nightmare would be our success."

Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.
Pictured is former Greek finance Minister Yanis Varoufakis during the press conference at Butler House in Kilkenny city before he opened the 6th Kilkenomics festival in St Canice’s Cathedral on Thursday night, with a special one to one interview with David McWilliams. Photo: Pat Moore.

Mr Varoufakis was speaking ahead of the opening event at the Kilkenomics festival, where he spoke to economist David McWilliams in front of a large audience.

The former Greek minister said that to elevate Ireland to the "pantheon of macroeconomic successes is to stretch credulity too much".

"The reason why Ireland is doing so much better than Greece is twofold. First,you did not have to suffer the austerity that we did," he said.

"The troika did not insist, for instance, that the minimum wage is reduced by 40pc. You escaped that. If the same policy parameters were imposed on you, you would not be where you are today. You would be in a far, far worse place. Ireland is not a paradigm of successful austerity. It is the opposite. It shows that austerity is not as bad if it is not as much."

Mr Varoufakis also said that the main reason why Ireland is able to attract so much foreign direct investment was because of the low corporate tax rate.

"If we all had it, then you wouldn't be successful," he said.

He said his biggest regret was that he "played along too much" in terms of his dealings with the Troika, and that he signed the Greek bailout extension beyond the end of February.

Mr Varoufakis announced his resignation in early July, a day after Greeks delivered a resounding 'No' to the conditions of a new bailout package.

The minister said his Government did not come close to printing drachmas at the height of the crisis this year, but said his government did have contingency plans in place in case of a Greek exit from the Eurozone.

"But that was never either a plan that we wanted to activate, or a threat that we were prepared to use in order to get a better agreement,'' he said.

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