Greece's newly elected prime minister, Alexis Tsipras, has named a finance minister who gamers should recognize. The Wall Street Journal reports that Yanis Varoufakis has been tapped to help turn the Greek economy around, but fans of virtual economies will remember him as Valve Software's former economist-in-residence.
"Before the Euro Crisis erupted in 2009 I was just another economics professor, minding my own little theoretical endeavours," Varoufakis wrote in that first blog post at Valve in 2012. "Writing obscure papers and esoteric books that only a few hundred nutcases around the world (like myself) would ever read, terribly satisfied in my very own academic cocoon."
The leading expert on virtual hats has been named the finance minister of Greece
But he came down from the ivory tower to slum it with the digital generation, and went on to become fascinated with the virtual economies he found there — an estuary of curious and ephemeral economic issues. In his blog, he mused over the nature of an online bartering economy and how buying low and selling high was to be achieved when trading hats in Team Fortress 2.
Varoufakis also lent Polygon his expertise in our journey to find Satoshi Nakamoto, the mysterious figure behind Bitcoin, where he argued that the end result of the virtual currency boom would inevitably be deflation.
In Greek and Roman times, change was made by literally cutting coins in half. Bitcoins can be subdivided as well, down to the 1/100,000,000, a denomination dubbed the "Satoshi." But Varoufakis says that when the last Bitcoin is mined there will be no more to go around, causing deflation. As the Bitcoin economy continues to grow, there will be the same amount of money shared in the system, and no amount of chopping it up will help it spread far enough.
In joining the Greek cabinet, Varoufakis has a lot of trouble ahead of him. Greece is locked in a serious depression, brought on by the European economic crises of 2009. The bailouts needed to prop the country up lead it dangerously close to default, and the austerity measures mandated by the European banking system have ground the Greek economy down. Varoufakis has routinely described the austerity measures as "fiscal waterboarding."
Statistics show that today more than one in four Greeks are unemployed. Youth workers, defined as those aged 15-24 who want a job, fare even worse with unemployment rates over 55 percent.
More than half of Greek workers under 24 are unemployed
The Wall Street Journal says that the self-described "libertarian Marxist" will be sworn in later today. Just how he'll use the financial levers available to him to help the Greek economy is unknown.
"The ancient Greek word for money, for currency, is 'nomisma.' It comes from the verb 'to imagine,'" Varoufakis told Polygon in 2013. "Money has value to the extent that we imagine that it has value, according to the ancient Greeks. They knew that more than 2,000 years ago, and we kind of forget that simple, important notion at times."