- Yanis Varoufakiseconomist, former finance minister in Greece and co-founder of the Democracy in Europe Movement 2025, known as DiEM25.
In the latest economic fallout from President Trump’s decision to pull the United States out of the landmark Iran nuclear agreement, top White House officials said Sunday that the Trump administration is prepared to impose sanctions on European companies that do business with Iran. We get response from former Greek Finance Minister Yanis Varifoufakis, who was the chief negotiator of Greece’s bailout with the European Union and International Monetary Fund. He also discusses the opening of the U.S. Embassy in Jerusalem and calls it a “civil rights catastrophe.” His new book is titled “Talking to My Daughter About the Economy: Or, How Capitalism Works—And How It Fails.” Varoufakis served as finance minister in Greece in 2015, before resigning from the Syriza government. He is also co-founder of Democracy in Europe Movement 2025, known as DiEM25.
AMY GOODMAN: This is Democracy Now! I’m Amy Goodman. Our guest for the rest of the hour is Yanis Varoufakis, the economist and author of the new book Talking to My Daughter About the Economy: Or, How Capitalism Works—and How It Fails. But we’re going to start by talking about the latest economic fallout, from President Trump’s announcement that he’s pulling the United States out of the landmark nuclear agreement with Iran. Top White House officials, making the rounds on Sunday morning news programs, said the Trump administration is not only prepared to impose sanctions on Iran, but on European companies that do business there. This is White House National Security Adviser John Bolton on CNN’s State of the Union.
JOHN BOLTON: I think the issue here is what the Europeans are going to do, if they’re going to see that it’s not in their interest to stay in the deal. We’re going to have to watch what the Iranians do. They’d love to stay in the deal. Why shouldn’t they? They got everything they wanted from the Obama administration. But I think the Europeans will see that it’s in their interest, ultimately, to come along with us.
AMY GOODMAN: Last week, European nations scrambled to save the Iran deal, after Trump announced he’ll pull the U.S. out, Trump’s decision upsetting the U.S.’s European allies, casting uncertainty over global oil supplies and raising the risk of conflict in the Middle East. The 2015 agreement worked out by the United States, five other world powers and Iran.
For more, we’re joined here in New York by the former Greek finance minister, Yanis Varoufakis, chief negotiator of Greece’s bailout with the European Union and International Monetary Fund.
It’s great to have you back, Yanis. Talk about the significance of this and what this means—at the same time that the U.S. is saying they will sanction European countries, companies that work with Iran, they are telling the Chinese company that is also believed to have worked with Iran, that the U.S. said they were sanctioning, ZTE, that they are going to save Chinese jobs for that company, and, as President Trump tweeted, “be cool.”
YANIS VAROUFAKIS: What is happening, of course, there many different dimensions. One is the real issue about peace in the Middle East and the detrimental effect of this pulling out of the Iran deal is going to have upon it. But from Trump’s perspective, what he’s doing is he is luxuriating in rubbing the German government’s face in its own helplessness, because, let’s face it, Germany has a large trade surplus with the United States. When you have such a large trade surplus, you’re exposed to the United States and to whatever the U.S. administration wants to do. To be more specific, there are about 4,800 German companies that are doing business in the United States. And their business is—the balance sheet is about $600 billion. That’s a lot of money. The combination of the tax cuts that Trump is giving those German companies and the threat of third-party sanctions, if they do business in Iran, is a fantastic technique by which Trump is effectively taking his revenge upon Angela Merkel and making her look extremely weak within her own Cabinet. So there is this dimension, which, of course, in the grander scheme of things, is insignificant compared to the damage of what he’s doing to America’s and the West’s credibility in the Middle East.
AMY GOODMAN: And talk about the dangers of destabilizing the Middle East through pulling out of this multilateral deal, and as Trump is headed to a summit with North Korea, his national security adviser—who didn’t have to be approved by Congress, as he didn’t have to be approved under Bush to become U.S. ambassador to the United Nations, because he knew he couldn’t get approved by the Senate—has been threatening Iran, and Iran right through to what’s happening in Gaza right now, with the U.S. opening this embassy in Jerusalem, to say the least, a highly provocative act to the Palestinians.
YANIS VAROUFAKIS: Well, let me give you just one example. Take Syria. To civilize Syria, to end the bloodbath in Syria, we will certainly need a multilateral agreement, an agreement that will take a long time to work out, which we’re nowhere near yet working it out, but there has to be an agreement. There has to be a multilateral bargaining process that will lead to a credible treaty.
By pulling out of Iran, of the Iran deal, that took 10 years to hammer out, effectively, Trump is signaling that the United States is not a credible partner to peace anywhere—in Syria, in Iran, in North Korea, anywhere. What Trump wants to say is that “Anything that has been done before me does not have any hold on me. Whatever Obama has agreed, I will just tear it up, because it was a Obama. And now you have to deal with me.” And so, he’s going to enter into some agreement with North Korea, saying, “Oh, this you can trust,” because you’ve done—but this is not the way to conduct world affairs. It is not the way to pave the ground for what we need internationally, which is both at the geopolitical level and also the economic level, a kind of new Bretton Woods, a new agreement between the three main economic blocs—China, the United States and Europe. Unfortunately, the only power, which is the United States, that can lead the way towards a new kind of deal—International New Deal, if you want, in the old-fashioned language of FDR—is noncredible. He’s effectively forfeiting all credibility.
AMY GOODMAN: And Gaza, what this means right now, both from Gaza to Jerusalem? The significance of—you just heard this—these, to say the least, bigoted pastors that were sent to attack everyone, from Jews to Muslims to gays and lesbians, to lead the opening of the embassy with Jared Kushner, the son-in-law, apparently going to unveil his Middle East peace plan soon?
YANIS VAROUFAKIS: Well, firstly, this is a—
AMY GOODMAN: As Palestinians are being killed.
YANIS VAROUFAKIS: Today is a very bad day for progressive Israelis, for progressive Arabs, for progressive Americans. It is a tragic day—the scenes that we’ve seen from Gaza, the scene of the U.S. Embassy inauguration and, effectively, the death knell of the two-state solution and any chance of a two-state solution. This is what he’s signaling to the world, Trump, through the opening of the U.S. Embassy in Jerusalem.
And what is the alternative? One plausible alternative would be a single, unitary state, where Palestinians and Jews and Israelis can live together. But that is not on the table. So, we are ending up with a striking case of a civil rights catastrophe—effectively, apartheid within one ill-defined state. Diplomatically, it is as if Donald Trump is trying to empower other bigots and nasties around the world. Because think about it. Who is really happy today? The hard-liners in Tehran, who did not like the Iran deal—
AMY GOODMAN: We have five seconds.
YANIS VAROUFAKIS: —the hard-liners in—you know, the racists in Israel, the extremist Islamists within Hamas. These are the only people who are celebrating as we speak.
AMY GOODMAN: Well, and President Trump. Yanis Varoufakis, this is Part 1. Part 2, we’ll put online in web exclusives at democracynow.org. Yanis Varoufakis, the former chief finance—the finance minister of Greece.
That does it for our show. I’ll be speaking at University of California, Santa Cruz, May 17th. Happy Birthday, Erin Dooley!