Yanis Varoufakis has issued a stark critique of the European Union, declaring that it has failed to seize significant opportunities for reform and is now facing a prolonged decline. In a conversation with AnewZ Editor-in-Chief Guy Shone during the Web Summit in Doha, Qatar, the economist and former Greek finance minister voiced concerns about the EU’s trajectory, asserting that he sees no realistic pathway for transformation beyond mere rhetoric and bureaucratic documents.
Varoufakis, a self-proclaimed committed Europeanist, stated emphatically, “a flat no” when asked about the potential for the EU to reform effectively. He highlighted fundamental design flaws within the eurozone as the source of its failures, noting that the creation of the euro established “a central bank without a treasury,” which left the bloc exposed to vulnerabilities. In contrast, he pointed out that newer EU member states now suffer from “treasuries without a central bank” capable of supporting their banking systems.
He further elaborated on how these structural issues have contributed to severe crises in currency, finance, and banking within the eurozone. Varoufakis emphasized that the real failure lies not solely in economic mismanagement but in a political failure to learn from past mistakes, articulating a sentiment of stagnation: “We learned nothing, and we forgot nothing.” He criticized the institutions established following the euro crisis, including the European Stability Mechanism and quantitative easing, for having merely rearranged problems without producing meaningful change.
The impact of the COVID-19 pandemic was addressed as another missed opportunity for genuine reform, which Varoufakis described as a “magnificent opportunity” to create long-term eurobonds backed by a functional treasury. However, he pointed out that the subsequent recovery package, known as the NextGenerationEU programme, fell short, lacking the independent taxing and borrowing powers necessary to establish reliable bonds. He characterized the issued bonds as effectively “subprime,” leading markets to view them as unreliable for maintaining liquidity.
Varoufakis also expressed concerns about the deteriorating state of democratic debate within the EU, claiming years of mutual accusations between northern and southern member states had poisoned discussions. He argued that the true divide is not national, but rather one of financial elites acting together against the interests of the general population. After two decades of this environment, he stated that calls for “more Europe” now evoke fear rather than confidence, with citizens feeling forced to “hide under the table” at the thought of deeper integration.
In a closing assessment, Varoufakis lamented that the EU is stuck in a contradictory situation, enjoying “federal money without the prospect of federation.” With no political movement capable of advocating for a federal Europe, he warned that the continent is facing an uncertain future defined by stagnation, forecasting a troubling potential of “maybe half a century, maybe more, of steady European decline.”
His reflections underscore the pressing need for critical dialogue within the EU as it navigates a myriad of complex challenges, emphasizing that innovative solutions and genuine reform are essential for the union’s survival and future prosperity.