Beyond the Crisis: The Governance of Europe's Economic, Political and Legal Transformation (Hertie Governance Report)

In The Wake Of The Euro Crisis, The European Union Has Been Transformed In Many Ways. Is It Now On The Right Track? The Euro Crisis, The Steps Taken To Manage It, And The Resulting Transformations Have Triggered A Necessary Process Of Reconsidering Economic Governance In The European Union. This Volume- The Third In A Series Of Annual Editions Tackling Different Aspects Of Governance- Examines The Long List Of Open Political, Legal, And Economic Questions Related To The Functioning And Fundamental Structure Of The Union As A Whole And The Economic And Monetary Union In Particular. Organised In Three Main Sections, The Contributions To This Collection Bring The Perspectives Of Different Academic Disciplines To Bear On The Functional Aspects Of Economic Governance, The Institutional Transformations That Have Taken Place, And Their Implications For The Union's Legitimacy. A Separate Chapter Looks At Inequalities In Perceptions Of Economic Conditions And Well-being Within The European Union To Identify Trends Particularly During The Eurozone Crisis. In Doing So, The Chapters In This Volume Take Stock Of The Current Situation, Shed Light On The Dilemmas And Challenges That Must Be Recognised And Addressed, And Explore Various Options For The Way Ahead. The Collection's Ultimate Goal Is To Assess Whether The Recent Transformations Lead Eu Governance In The Right Direction Or Require Further Adjustment.--dust Jacket. Introduction : The Governance Of The Transformation Of Europe’s Economic, Political, And Constitutional Constellation Since The Euro Crisis / Mark Dawson, Henrik Enderlein, & Christian Joerges – Towards An Ever Closer Economic And Monetary Union? The Politics And Economics Of Exploratory Governance / Henrik Enderlein – Making The Euro Thrive For The Next 100 Years : What Is Needed, And What Is Missing? / Marcel Fratzscher – Rebalancing And Completing The European Monetary Union / Loukas Tsoukalis – Rebalancing The Governance Of The Euro Area / Jean Pisani-ferry – Opening Pandora’s Box? The Crisis And The Eu Institutions / Mark Dawson – Emerging From The Euro Erisis : The Institutional Dilemmas Of A Political Union / Sergio Fabbrini – The Role Of Courts In The Wake Of The Eurozone Crisis / Alicia Hinarejos – Banking On Union : Eu Governance Between Risk And Uncertainty / Michelle Everson – Europe’s Legitimacy In The Crisis / Christian Joerges – The Inter-democratic Deficit Of The European Union / Daniel Innerarity – Political Legitimacy, Credible Commitment, And Euro Governance / Albert Weale – Paradoxical Europe : The Eurozone Crisis And The Unanticipated Consequences Of Integration / Maurizio Bach – Constitutionalism And The Law Of The European Economy / Christian Joerges – Inequality In Economic Perceptions Within And Between Eu Member Countries / Liam F. Mcgrath. Edited By Mark Dawson, Henrik Enderlein, And Christian Joerges. Includes Bibliographical References And Index. Cover 1 Beyond the Crisis: The Governance of Europe’s Economic, Political, and Legal Transformation 4 Copyright 5 Preface 6 Table of Contents 10 List of Tables and Figures 12 List of Abbreviations 14 About the Contributors 16 1: Introduction: The Governance of the Transformation of Europe’s Economic, Political, and Constitutional Constellation since the Euro Crisis 20 The missing blueprint 22 Exploratory governance 23 An interdisciplinary perspective 25 Conclusion 26 References 28 Part I: Economic Governance 30 2: Towards an Ever Closer Economic and Monetary Union? The Politics and Economics of Exploratory Governance 32 Introduction 32 Contrasting views on how to make the EMU work 33 Exploratory governance 35 EMU as a functionally motivated step in the process of European integration 37 Solving the collective action problems in fiscal policy 38 Which next steps in the ‘exploratory governance’ of EMU? 40 Conclusion 41 References 41 3: Making the Euro Thrive for the Next 100 Years: What Is Needed, and What Is Missing? 43 The origins and benefits of the euro 44 What went wrong? The European crisis and the role of the euro 46 The first ten years of the euro 47 Europe’s crisis is not a euro crisis 49 What future for the euro? 50 The eurozone as an optimum currency area 50 The euro and rebalancing 51 The role of the central bank for a stable currency 53 Four threats to central bank independence 56 Institutional reforms 58 Conclusion 60 References 61 4: Rebalancing and Completing the European Monetary Union 63 Lessons from history 63 The price of rescuing the euro 68 A more sustainable euro system 72 And the politics of it 75 References 78 5: Rebalancing the Governance of the Euro Area 81 Introduction 81 Economic governance: what has been done 83 Shortcomings of the reformed policy system 85 Complexity and lack of ownership 86 Procyclicality and under-provision of stabilisation 87 Fiscal dominance 88 OHIO syndrome 89 Weak institutions 90 The way forward: choices 91 A practical agenda 95 Fiscal institutions 95 Economic institutions 96 Solidarity 97 Fiscal capacity 98 Governance institutions 98 Legitimacy 99 Acknowledgments 99 References 100 Part II: Institutional Transformation through the Euro Crisis 102 6: Opening Pandora’s Box? The Crisis and the EU Institutions 104 Beyond constitutional compromise 105 The crisis and the courts 106 Governance by technocracy 109 Opening Pandora’s box? 111 References 112 7: Emerging from the Euro Crisis: The Institutional Dilemmas of a Political Union 113 Introduction 113 Maastricht and the ambiguities of the political union 114 The union emerging from the euro crisis 118 A parliamentary alternative to intergovernmentalism 121 Towards a euro-based political union 124 Conclusion 128 References 128 8: The Role of Courts in the Wake of the Eurozone Crisis 131 Introduction 131 The Court of Justice of the EU and the crisis 131 First category: the legality of general reforms 132 PRINGLE AND THE LEGALITY OF THE ESM TREATY 133 THE PROBLEMATIC OF PRINGLE 135 THE FUTURE: OMT BEFORE THE COURT OF JUSTICE 136 Second category: preliminary references concerning MoUs 138 Interim reflections 142 ADJUDICATING THE ECONOMIC 142 ADDITIONAL CHALLENGES 144 The national courts 144 First category: protecting social rights against MoUs 145 Second category: protecting the state against excessive centralisation 147 Final reflections 149 Acknowledgments 152 References 152 9: Banking on Union: EU Governance between Risk and Uncertainty 156 The technocratic mastery of markets 156 Squaring the circle with sound money 159 The risks of revolutionary futurisation 160 Governing futurisation 163 Systemic risk, macroprudential oversight, and the post-financial crisis EU response 164 ESFS AND THE HARDENING AND DEEPENING OF EU COMPETENCE 165 BANKING UNION AND THE GOVERNANCE OF SOUND MONEY 167 Squaring the circle within democratised technocracy 171 Democratised administration 172 Deliberative dissonance and a fractured rule of law 173 Uncertainty, or render unto the market . . . 177 References 180 Part III: Legitimacy Problems and Normative Perspectives 184 10: Europe’s Legitimacy in the Crisis 186 References 190 11: The Inter-Democratic Deficit of the European Union 192 Democratic continuum 193 The inter-democratic deficit of member states 196 Democratising interdependence 199 References 201 12: Political Legitimacy, Credible Commitment, and Euro Governance 204 Introduction 204 The contractarian logic of monetary union 206 Legitimacy by rules alone? 208 Depoliticisation? 209 Denationalisation? 211 The fixed constraints 213 Monetary union is here to stay; money will not be renationalised 213 A full denationalisation of money is not possible 214 The European social model is an essential element of both empirical and normative political legitimacy within the member states, so that any viable system of euro governance must be compatible with the continuation of the European social model 214 Economic and monetary union puts some policy strategies out of reach of national governments 215 The reform agenda 216 A role for national parliaments 216 The implications of solidarity 217 The art of governance 218 Acknowledgments 219 References 219 13: Paradoxical Europe: The Eurozone Crisis and the Unanticipated Consequences of Integration 222 An atypical crisis 222 Vicious circles of the European crisis 224 Structural dynamics of the European conflict regime 229 Conclusion 232 References 233 14: Constitutionalism and the Lawof the European Economy 235 Introduction 235 European ‘economic constitutionalism’ 236 The project of integration through law and economic constitutionalism 236 Foundational flaws 238 Failings of economic constitutionalism 238 The judicial fiction of a ‘stability community’ 239 The Maastricht compromise as ‘diagonal conflict’ 241 Emergency Europe and the crisis of law 242 Conflict ‘resolution’ through authoritarian managerialism 243 Normalisation v. political contestation 245 References 247 Part IV: Governance Indicators 252 15: Inequality in Economic Perceptions within and between EU Member Countries 254 Introduction 254 The statistical model and data 256 Prior distributions 258 Inequality measures 258 Results 260 Discrimination parameters 260 Trends in average perceptions within EU countries 260 Inequalities in perceptions within EU countries 262 Economic perceptions in Greece during the eurozone crisis 265 Variation between EU countries in economic perceptions 267 Conclusion 269 References 270 Index 272