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.
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.
Yanis Varoufakis talking:
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.
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.
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 the racists in Israel, the extremist Islamists within Hamas. These are the only people who are celebrating as we speak.
Trump has never made any bones about it. He was always targeting the German trade surplus with—vis-à-vis the United States, and also the Chinese one. He has a mercantilist view. But so does the German government, in a sense. So there’s a clash there. And the combination of giving massive tax cuts to German companies and, at the same time—that’s a carrot. And then the stick is that if they continue to do business in Iran, effectively, they will be frozen out. This combination is effectively rubbing Angela Merkel’s nose in her own helplessness to impose the European Union’s policies on Iran, because, effectively, German business turns around to the German government and say, “You cannot protect us from Trump. We’re going to pull out of Iran, and we’re going to do more business in the United States.” So, that is a victory for Trump, but it’s a very short-term victory.
– Angela Merkel today
As a tragic figure. I have no personal animosity towards her. I actually quite like her, personally. Remember, in 2015, in the summer, when the Syrian refugees started streaming into Greece and into Europe. She did something quite remarkable, especially for a right-wing leader. She threw the borders of Germany open and welcomed them. And that was a magnificent—I felt very proud to be European and very proud of her at that moment. Of course, three weeks later, she realized that she was going to be overthrown by her own party, and she turned around and flipped and did something quite nasty. She had got into—proverbially, into bed with the president of Turkey, effectively bribing the president of Turkey, Mr. Erdogan, to the tune of $6-$7 billion, so that Turkey would allow us Europeans to violate all principles of international law on refugees. So, she’s—you know, she can do the right thing, and then she can do the wrong thing.
But the reason why I’m saying that she’s a tragic figure—I mean, you heard her say that we have to be united in Europe in order to have an impact on Middle East peace, on world affairs, to put our house in order in Europe. That is correct. But every single time that she had an opportunity, since 2010, to get Europe to pull together, she’s always undermined it by imposing austerity, the worst austerity, on the most depressed economies around Europe, therefore destroying the bonds of solidarity and wrecking the European Union, effectively. So, today, she is the most weak chancellor Germany has ever had, even though she started off her career as being the most powerful one. And that’s—you know, that’s the stuff of tragedy, isn’t it?
The European Union, if it were united, if we had a foreign policy, which we don’t—you put the words “European,” “foreign” and “policy” together, and you end up with a joke. But if we were united and had that foreign policy, we could be a bulwark. We could be a counterbalancing force to Donald Trump. But we’re not. Already Trump has been very successful in the way that he’s divided Macron and Merkel, the French president and the German chancellor.
Who both came to the United States. the United States the same week. Hardly anyone knew Merkel was there.
And, effectively, what Trump told Macron was, “I don’t have a problem with you, because you don’t have a trade surplus with the United States.” And Macron turned around and said, “Well, there’s not much he can do against us, because we don’t have a trade surplus with him.” So, the divide-and-rule policy has actually worked, and the European Union is completely and utterly powerless, and therefore it cannot be a good force, in the Middle East or anywhere else in the world.
Now, where does Greece come in? Greece, in 2010, was the first domino that fell in a vicious domino effect dynamic that led to the disintegration—to the economic disintegration and fragmentation of the European Union. The way in which flimsy, little Greece was treated, with the worst combination of austerity and loans for the banking system, poisoned the democratic and economic dynamics with the European Union. So, the fact that we are not united now is a result of the policies that were first tried out in this dystopian laboratory, which is Greece, before exported to Italy, to Spain, to Ireland, eventually to France, leading to the fragmentation of the European Union, which now has rendered the EU and Angela Merkel impotent.
– trade talks between China and the United States, which actually is very significant for the U.S.-North Korea summit that’s going to take place in Singapore, people might not realize, but how this Chinese company, ZTE, fits into this, President Trump saying he’s working to prevent the collapse of the Chinese electronics company ZTE, which has admitted to violating U.S. sanctions against Iran? Now, fascinatingly, the U.S. is saying they’re going to impose sanctions on European companies who do business with Iran. But he’s saying he wants to drop sanctions again ZTE, allow it to thrive, to save Chinese jobs, he says.
Trump operates on the basis of an imminent threat. He wants to create an environment in which his interlocutors, whether they are German companies or German chancellor or the Chinese companies, Chinese government, or North Korea, for that matter, think that he may strike at any time, that there is an imminent threat, like, you know, the sword of Damocles hanging over their head, so that they are constantly on the defensive, and then he can choose when he makes the offer of a deal, you know, the art of his—you know, his famous art-of-the-deal offer.
But when it comes to China, I think that the real game that we should focus our attention upon is not steel imports or exports. It’s not aluminum. It’s not the things that he’s talking about. The main game in China, as far as Trump is concerned, is the massive profits of high-tech companies that China has developed in opposition or in competition with Google, with Facebook, with Amazon, because, as we all know, the Chinese have effectively not allowed these big tech American, Silicon Valley-based industries to move to China, and they’ve developed their own. So China is the only economy that has developed a competitor to Silicon Valley. And the potential profits of those are gigantic. Trump wants, effectively, to end the Chinese wall that prevents those companies being taken over by Silicon Valley companies. There’s going to be a war, hopefully not a real war, but an economic and diplomatic war, and the war of words, about the profits of these companies. At least that’s my estimation.
I don’t think there’s an alliance between Iran and Russia. And there will never be one. The two countries are—and two regimes are very skeptical of one another. But faced with a common enemy, there is always a tendency to collaborate, or at least to discuss and to coordinate.
The problem that we should be looking at, from a Western progressive perspective, is that, if you think about it, the two forces in the Middle East that helped us defeat ISIS, the fundamentalist misanthropy of ISIS, on the one hand, was Iran—without Iran, we would not have defeated ISIS—and, on the other hand, were the Kurds of Syria and Iraq. And think of how we are rewarding them. The West, through Trump, is turning against Iran, and we are also allowing the Turkish Air Force and Army, effectively, to destroy those communities of the Kurds who helped us defeat ISIS. What signal are we sending the world from now on? How can good people, like the Kurd fighters, who effectively did our dirty job for us—defeating ISIS—how are they going to look at us in the future, in future conflicts? As credible allies and collaborators? I don’t think so.
I think the West has to accept that the Assad regime cannot simply be discarded, because if it is—and I’m not a supporter of the Assad regime or a defender of the Assad regime for one-hundredth of a second, but remember what happened when Gaddafi was overthrown in Libya. Libya became a failed state, and it’s a cesspool of misanthropy. There has to be an accommodation between the Assad regime and the Kurds and the anti-Assad, more democratic, not so Islamic fundamentalist forces. Not everyone is going to be part of that deal, but it has to be at least a triangle between elements of the Assad regime—even Assad himself—the Kurds and the anti-Assad fighters. But the West has to bring them together. And the West must declare that it is not there for regime change purposes in the way that we were in Iraq and in Libya, creating and paving the ground for the worst kind of misanthropic outcome, as we said—as we’ve seen both in Iraq and in Libya.
DiEM25, our movement, has been campaigning, for two years now, for slapping massive sanctions on the Saudi Arabian regime, treating it as a rogue state, rogue state both domestically—the oppression of minorities, the dictatorial behavior of this government, the state of play regarding women’s role in that society—and, of course, the way in which they are exporting war, famine and devastation in Yemen, but not just in Yemen, elsewhere. The Saudi Arabian regime has been behind almost every misanthropic fundamentalist movement in the region. We need to deal with Saudi Arabia as a threat to stability and a threat to humanity, instead of dealing with them as if they are our best allies.
– Syriza in Greece today
It exists only in name, ever since, in July 2015, the prime minister, and my colleague, decided to overthrow the people. We had a very interesting reversal of fate. For the first time in history, a government overthrew its people, you know, rather than the other way around. The night of the referendum, when the magnificent Greeks gave a 62 percent of backing to oppose the continued madness of our bailouts, the prime minister flipped and turned that no into a yes. Since that day, there is no Syriza government. There is a troika government. There is a government of the creditors. It’s effectively, all decisions and laws are being written in Brussels. And it’s not just that we have this kind of neocolonialism. It’s also that the laws that they write are absolutely absurd, if you think—just to give you one small example, that you are forcing small companies, you know, tiny little companies that are struggling to survive in a state of great depression, to prepay next year’s taxation this year. You just need to state that to realize how mad it is.
it really hurts a lot more when it is your friends and comrades that are turning and start implementing the things you know they disagree with. When we of the left do this, we progressives do this, then we are giving TINA, the toxic dogma that “there is no alternative,” the greatest boost there is. And that makes me very sad.
There is no alternative. That has been the neoliberal mantra that Margaret Thatcher introduced. Now, when the left gains power, it secures the massive backing of the people and then turns against them and says, “Ah, sorry, you know, Thatcher was right: There is no alternative. We have to implement these austerity measures, because this is the responsible thing to do.” That is a massive blow on progressive movements. It really knocks the stuffing out of our collective passion for change.
The fact—the overthrowing of the people, which is my metaphor for what happened that very night. We got them out. We energized them. Remember, in January 2015, we were elected with a majority, a relative majority, 40 percent of the vote. For five months, we were fighting tooth and nail against the creditors. And on the 5th of July, six months later, we, under—in a state of siege, the creditors had shut down our banks. Do you know how hard it is to shut down your banks? Imagine if a foreign power were to shut down every ATM in the United States of America. That’s economic warfare. It’s financial waterboarding, if you want. And yet, our very courageous, brave people voted 62—so, 40 percent had voted for us six months before, and then, when things came to a crunch, 62 percent, even the right-wingers, voted for us, as part of a patriotic move to say, “No, we’re not going to take this.” We brought them out on the streets, against the television channels, that were all controlled by the creditors and effectively warning the Greeks that if they go against the troika of lenders and creditors, there will be Armageddon. And yet they did. And the next day, the left-wing prime minister turns around and overthrows this whole movement. Of course people went back home. And now they are nursing their wounds inside their home, privatizing their fears and privatizing their pain. The anger is there. The pain is there. Nobody believes that Greece is on the mend, which is the official mantra. But, you know, a great depression takes two forms: an economic form and the psychological form. And when you’re very depressed, you don’t demonstrate.
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Yanis Varoufakis
economist, former finance minister in Greece and co-founder of the Democracy in Europe Movement 2025, known as DiEM25.
— source democracynow.org