Giving Germany the Middle Finger

A video of the Greek finance minister flipping off Germany has started a controversy, which says a lot about the country's relationship to its creditors.

Greek Finance Minister Yanis Varoufakis  (Alkis Konstantinidis/Reuters)

Update, March 21: This article originally stated that the 2013 video of the Greek finance minister Yanis Varoufakis raising his middle finger during a speech about defaulting on credit owed to Germany is a fake, based on a confession made by the German satirist Jan Böhmermann. New reporting shows that the video is apparently real. The article has been updated.

If a government is running out of cash, watching depositors pull hundreds of millions of euros from local banks, and scrambling to meet deadlines for the $212 billion it owes other governments, a video purporting to show its finance minister giving the finger to its biggest creditor doesn't help.

The supposedly just-discovered footage of Greece's now-Finance Minister Yanis Varoufakis flipping off Germany at a conference two years ago has sparked a controversy, which the German tabloid Bild quickly dubbed "Fingergate." Shortly after the video was aired by German broadcaster ZDF, the host of a satirical German TV show, Jan Böhmermann, claimed he had doctored the footage. Now, The New York Times has reported that the video is real—Martin Beros, who edited the original footage in Croatia, says it “is the original, undoctored, unmanipulated video that I edited.” This tale of the "Stinkefinger," as the Germans call it, is an apt symbol of the tensions between Greece and Germany over the former's debt crisis.

When the clip was recorded in 2013, Varoufakis was, in his own words, "quietly writing obscure academic texts." At the time, he told an audience in Croatia that in 2010, when Greece was negotiating a deal to accept onerous conditions if other countries—notably Germany—would help pay its debts, the country should have just announced it would default and "stick the finger to Germany."

That's the root of an argument over Greek debt that's still taking place two years later. The Greek economy was hammered by the global financial crisis, with its national income shrinking by nearly a quarter between 2008 and 2013; unemployment rates in the country are still around 25 percent. The IMF, the European Central Bank, and the European Commission have provided massive bailouts to keep Greece afloat—and to stop it from leaving the bloc of 19 countries that use the euro.

But the conditions that came with the bailouts, not least severe cuts in public spending, helped the left-wing Syriza party win Greek elections in January on the strength of a promise to renegotiate the debt deal. “We will finish with orders from abroad,” Syriza leader Alexis Tsipras vowed right before being elected.

While now-Prime Minister Tsipras recently agreed to continue economic reform when he negotiated an extension of Greece's bailout package, he has also promised to fight back against the imposition of budget cuts—just Wednesday he pushed through an expensive bill providing more food stamps and subsidized electricity.*

German Chancellor Angel Merkel's position has been that Greece must stick to the terms of the bailout extension. She will not allow Syriza to write off a significant portion of Greek debt nor countenance a moratorium repayments. "There's no arguing with us about this, and what's more we are difficult to blackmail," German Finance Minister Wolfgang Schäuble told the BBC.

In this tense environment, then, a "Stinkefinger" didn't seem all that out of place. Schäuble has been accused of calling Varoufakis "foolishly naive;" a majority of Germans are now in favor of Greece leaving the euro. There were also questions about how badly Greece could be hurting after Varoufakis and his wife posed for a glossy photomagazine shoot in their beautiful home at the foot of the Acropolis.

Then before parliament last week, Tsipras claimed that Germany owed Greece 162 billion euros, nearly half the value of Greece's total debt, as reparations for a forced loan the Nazis extracted during occupation of the country in World War II. The initial conflict over bond issues and debt tranches appears to be becoming an issue of national pride.

Böhmermann, the TV host who falsely claimed to have doctored the offending finger, had some sharp words for German journalists who got involved in the controversy.

Dear Editorial Staff of Günther Jauck [a famous German political talk-show host]. Yanis Varoufakis is wrong, you did not falsify the footage. You simply took it out of context and gave him the runaround, so that the average German could be angered. “Foreigner, out of Europe you go! He’s poor and takes our money. That’s just not possible! We are the bosses in here.” That’s what you did. The rest is our effort.

Varoufakis took to Twitter to offer support, appearing to go along with Böhmermann's claim that the video was fake, even though it is apparently real.

Although it might have provided satirists with a lot of material, the "Stinkefinger" exchange hasn't helped fix the cash crunch in Greece—the country's central bank has even asked for donations on its website. This morning in Brussels, European leaders affirmed that Greece must propose the promised structural reforms in order to receive more bailout funds. In any case, Varoufakis says he will "squeeze blood out of a stone" to meet repayment deadlines.

For that, presumably, he'll need all his fingers.

* Correction, March 21: This article originally referred to Greece's prime minister, Alexis Tsipras, as the country's president. We regret the error.