Yanis Varoufakis: Sleep-Deprived in Europe

Lambert here: Yanis raises a very interesting point. The literature shows that sleep-deprived people make very bad decisions; at Three Mile Island and Chernobyl, for example. And Yves has spoken, as Yanis does below, of how drained Paulson, Bernanke, and other key figures were during the financial meltdown that began with the collapse of Lehman. So if when the finance guys crash the economy again, let’s pay attention to the time of day the decisions come down from on high. Generally, I’m not very sympathetic to body language stories, but visibly exhausted decision makers might be an exception to that rule.

By Yanis Varoufakis, a professor of economics at the University of Athens. Cross posted from his blog

The thoughts below were inspired by a talk Arianna Huffington gave at the Headliners’ Club, Austin TX in April 2014. She spoke of sleep deprivation and the terrible decisions that it leads to. This made me recall that all the awful decisions of our European leaders (and there were so many of them) were reached at around 4.00am.

At the height of her political dominance, Mrs. Margaret Thatcher famously portrayed sleep as another form of inefficiency. Given that her political ideology turned on combating inefficiency with the same venom that the Catholic Church had previously reserved for mortal sin, her remark that “sleep is for wimps” possessed the hallmarks of a major political and cultural intervention. Indeed, it did much to establish the “hamsters-on-a-treadmill” environment in government, in the City of London, in the corporations; everywhere men and women strove to prove that they were part of her Brave New Economy and not, to coin another of Mrs. Thatcher’s expressions, “moaning minnies.” Thus, from eager interns to the heads of government departments and the CEOs, the race to prove one’s capacity for burning the midnight oil was on. Quantity came to trump quality on every turn. It would not stretch credulity too far to say that the vast pyramids of bad quality assets, which crashed and burned in 2008, had their origins, at least in some small part, in this cultural shift.

Mrs. Thatcher left her mark not only as a prodigious insomniac but also as a committed Eurosceptic. It is, in this sense, a delicious irony that her attitude to sleep seems to have been adopted and pressed into service by the European Union’s leaders during their inane handling of the inevitable Euro Crisis. Once Greece ignited the haystack (with its early 2010 insolvency), a cascading financial and economic crisis engulfed Europe like a vicious bushfire, scorching one proud nation after the other. In a bid to stem it, Europe’s great and good were forced to convene more than thirty emergency summits. These summits will undoubtedly go down in history as a comedy of errors. Indeed, for those of us who have been observing our leaders’ decision making closely, it feels a lot like watching Othello – wondering how our leaders can be so deluded. One explanation, that is intimately linked to Europe’s political economy, has to do with the time of day when they finalized their decisions: invariably in the early hours of the morning, between 4am and 5am.

Deadline effects are important to all of us. Alas, European leaders seem to have neglected consciously to set time limits for their negotiations. Instead, they allowed deliberations to last for days and nights until a de facto deadline presented itself in the form of the physical exhaustion that usually hits just before sunrise. At that point, in a fog of fatigue, desperate minds settled on the most immediately available position. Would Europe be a better place today had sleeplessness had not been a major determining factor of our leaders’ accords? While the root causes of Europe’s troubles are deep, some of Europe’s shenanigans might have been avoided.

If “sleep is for wimps,” as Mrs. Thatcher said, and a form of inefficiency, Europe should today be the land of efficiency and heroic leadership. It is, of course, neither. Powerful Europeans get less sleep than ever, as the crisis continues to fill their mind with intense worry, while a multitude of Europeans are kept awake at night fearing for their jobs, wondering what they must do to get one, agonizing on how they will succeed in putting food on the table after the sun rises.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. John

    That is an interesting observation. I worked at one of the big accounting firms and their implied work ethic was to work long hours. I can say that some decisions resulting from crises management (insomniac actions) were mediocre at best. Yes, some were almost blunders. Oops!

  2. The Dork of Cork

    What complete and utter tosh.
    The EU experiment has been crafted over more then a few generations now.
    Current events are following the programme.
    Subtraction of local purchasing power to build more concentric rings of inflation elsewhere on the planet.

  3. Skeptic

    As the velocity of money increases so too must the velocity of Humans to manage the disasters. Not prevent them but manage them.

    1. Moneta

      I am one of those losers… if I don’t get my full 8-9 hours of sleep per night over a couple of days, I get a full blown migraine. So I have known where I stand in the pecking order since high school.

      One of my most vivid conversations in university was with a bright overachiever full of grants studying day and night to complete her degree in 2.5 years. She would go to bed past midnight and wake up at 5am.

      Meanwhile, I worked 20 hours per week and slept 8-9 hours. That gave her an extra 40-50 hours per week of study time over me. I knew that I would need to be very strategic if I wanted to get ahead in this society we live in!

      1. Moneta

        I instinctively pick areas where slow and steady wins the race.

        But I must say that it’s sad that it must be a race…

          1. F. Beard

            Competition? If only! Instead, those with sufficient equity can leverage it immensely with government-subsidized credit creation.

            Yes, it’s a competition but not one that the winners should have much pride in since they essentially stole from the poor.

  4. Hugh

    This presupposes that decisions made at 4 AM would have been different from those made at 4 PM. The only difference I can see is in the theatrics. A 4 AM decision can more easily be sold, is almost by definition, a crisis decision. Think of it as a variation on the shock doctrine. You manufacture a crisis atmosphere, and then exploit it.

    No matter how much sleep any of them got, Paulson was always going to let Lehman crash and burn, and Bernanke and Geithner with their ad hoc approach and lack of vision were never going to oppose him on it. The same could be said of Europe. Southern Europe and its 99%s were always going to be squeezed into a backdoor bailout of the Northern banks and the rich who controlled them. Time of day and/or lack of sleep were irrelevant to this, except for the atmospherics they provided.

    1. allcoppedout

      Mostly right Hugh – we might quibble on the blood sugar biology. Ever seen these creepies in “action”. They look like centipedes on beta-blockers.

    2. Moneta

      While I agree that Paulson had his mind made up no matter what, burning the midnight oil was proof that no one slept on it before going ahead.

      Also, this incites other sectors to use the same tactics to prove their workers’ stamina… such as doctors.

    3. craazyman

      so true. So true. The last two posts by Professor V have not been, let us say, “stellar”. Maybe he needs a good night’s sleep. Take a day off from banging out the words and check out Youtube, but stay away from global macro lecture videos. Adele is always good. “Someone Like You” for example, and then “Rolling in the Deep”.

  5. allcoppedout

    The neurotic often think they are working hard while achieving nothing. Planks at the back of the EU boat are being ripped up to replace rot at the front. The heads of the poor have been shoved in holes left by rich tar-thieves. What ‘resources’ are left – cut the air time of the poor and their rations.

  6. Andrea

    Here a curious – and rather alarming study – of the effect of breaks (lunch) on judge’s decisions.

    from the abstract: “We record the judges’ two daily food breaks, which result in segmenting the deliberations of the day into three distinct “decision sessions.” We find that the percentage of favorable rulings drops gradually from ≈65% to nearly zero within each decision session and returns abruptly to ≈65% after a break.” … !!!


  7. Banger

    This is really a more serious issue than it appears to be. Sleep and other natural human animal functions are hated by people like Thatcher because they are natural. Their agenda for humanity is to destroy nature not just in terms of trees, fish, fowl, animals, insects, and the Earth system itself but as an ideology. The goal is complete control of ourselves and others. Technology itself has become nearly a religion because it personified the part of the human psyche that solves technical problems. We are now headed towards what many techno-worshipers believe is “the singularity” when machines become more intelligent than humans, or as some believe, we will all join the machines in a predictable and a perfectly engineered life.

    Human beings are more than technicians but we’re beginning to forget that so we hate our bodies’ tendency to be human–we want to drive our bodies into some ideological notion of perfection whether through yoga or running or dieting or cosmetic surgery. Taking the time to stare at the leaves blowing in the wind is time we could spend training our brain or learning a language or studying so we can build more walls between ourselves and others. We put the world in a spreadsheet and are driven by bitterness and the need for control, control, control. We have wish lists of all kinds to drive us to success–meanwhile the world is burning because we have lost our hearts to the God of Control.

    1. Garrett Pace

      The current paradigm of technotopia is reaching a splitting point – either we force the squishy and inefficient organic units (us) into the machine, or remove ourselves from the system entirely.

  8. allcoppedout

    Leaves? Thatcher infected all our trees with the like of Dutch Elm disease, probably as a false flag to justify annexing Holland in retaliation for the Second Anglo-Dutch War.

  9. Podargus

    I have worked over 30 years in jobs which require 24 hour / day labour. Most of that 30 years has been in an emergency service.
    So I know very well what it is like to be sleep deprived with a chronic sleep deficit problem.
    Adequate sleep is necessary for the proper functioning of the human mind and body.This is a proven fact and has been known for a long time.Decisions made when sleep deprived are less likely to be based on sensible thinking.

    Fortunately I’ve been retired for several years and,boy,do I ever enjoy getting my need slumber at the proper time,night in,night out.

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