ZEIT ONLINE: Have they been a mistake?
Varoufakis: A huge mistake. Greece collapsed under its debts. How did we deal with that? We gave even more loans to an over-indebted state. Imagine one of your friends loses his job and can no longer pay his mortgage. Would you give him another loan so he can make payments on his house? That cannot work. I’m the finance minister of a bankrupt country!
ZEIT ONLINE: So, where does that lead us?
Varoufakis: We should approach the problems with the eyes of an insolvency administrator. And what does an insolvency administrator do? He tries to reduce the debts.
ZEIT ONLINE: Germany’s federal government has ruled out a debt haircut.
Varoufakis: I understand there are terms that have been discredited in certain countries. But we can also lower the debt burden without touching the amount of money owed itself. My proposal is to peg the amount of interest payments to economic growth.
ZEIT ONLINE: So, if the Greek economy didn’t grow, creditors would have to waive the interest. You’ve been quoted in German newspapers as having said: "No matter what happens, Germany will still pay."
Varoufakis: The quotation has been ripped from its context. I did not say that the Germans will pay and that this is a good thing. I said that they have already paid far too much. And that they will pay even more if we do not solve the debt problem. Only then can we refund the money that people have loaned us in the first place.
ZEIT ONLINE: Do you believe you’ve been deliberately misunderstood?
Varoufakis: I hope it’s only a misunderstanding.
ZEIT ONLINE: Immediately after the election, Alexis Tsipras visited a memorial to those who resisted Nazi Germany. That has also been understood as a provocation. Is that a misunderstanding, as well?
Varoufakis: The Golden Dawn party has risen to become the third-strongest force in our parliament. They aren’t neo-Nazis; they are Nazis. We must fight them, always and everywhere. Laying down roses on the monument was a message to the Nazis in my country. It was not a signal directed toward Germany.
ZEIT ONLINE: In your view, has Germany become too powerful in Europe?
Varoufakis: Germany is the most powerful country in Europe. I believe the EU would benefit if Germany conceived of itself as a hegemon. But a hegemon must shoulder responsibility for others. That was the approach of the United States after World War II.
ZEIT ONLINE: What could Germany do?
Varoufakis: I imagine a Merkel Plan based on the model of the Marshall Plan. Germany would use its power to unite Europe. That would be a wonderful legacy for Germany’s federal chancellor.
ZEIT ONLINE: Merkel would say she has a plan.
Varoufakis: What kind of plan is that? A Europe in which we get even more loans that we will never be able to pay back? Back then, the United States forgave the lion’s share of Germany’s debts. From the ongoing EU aid programme, there are now €7 billion lying on the table that I can take just like that. All I have to do is quickly sign a document. But I wouldn’t be able to sleep well if I did because it wouldn’t solve the problem.
ZEIT ONLINE: As a result, you have another problem: Your money could run out in a few weeks.
Varoufakis: That’s why we need a bridging loan. The European Central Bank should support our banks so that we can keep ourselves above water by issuing short-term government bonds.
ZEIT ONLINE: In doing so, the ECB would be acting on the fringes of legality.
Varoufakis: But it wouldn’t be the first time that it took up such a task. And it’s also not about a long-term solution. We will have our plan ready at the beginning of June.
ZEIT ONLINE: Will you ask Russia for help?
Varoufakis: I can give a clear answer to that: That is not up for debate. We will never ask for financial assistance in Moscow.
This interview has been edited and condensed for length and clarity. This is the English translation of the original German version.