The Politics of the Eurozone Crisis in Southern Europe : A Comparative Reappraisal

This book provides an in-depth account of the politics of the Eurozone crisis in Italy, Spain, Greece, Portugal, Cyprus and Malta, mapping the positions expressed by the governments of Southern EU countries during the Eurozone crisis negotiations, including Greece's bailout deal, the so-called "Six Pack" and the "Fiscal Compact" and exploring the process of domestic preference formation. The book relies on original data resulting from fieldwork conducted in the context of the EU Commission- funded Horizon 2020 project "The Choice for Europe since Maastricht". Leonardo Morlino is Emeritus Professor of Political Science at LUISS, Rome, Italy. He was President of the International Political Science Association (IPSA) (2009-2012). He is a specialist in comparative politics with expertise on Southern and Eastern Europe, Latin America and a focus on processes of democratization. He is the author of more than 30 books and 200 journal essays and book chapters published in 9 languages. Cecilia Emma Sottilotta is Assistant Professor of International Relations and Global Politics at the American University of Rome (AUR), Italy. Her research interests focus on political risk for foreign investors, South European and Latin American politics. She is the author of Political Risk: Concepts, Theories, Challenges Contents 5 Notes on Contributors 7 List of Figures 9 List of Tables 10 1 Introduction 11 1 Setting the Stage 11 2 The Eurozone Crisis: Negotiated Responses and Contested Issues 15 References 18 2 How Member States Cope with the Eurozone Crisis 22 1 Introduction 22 2 Crisis Perceptions, Ideological Cleavages and Compromise 25 3 Crisis Actions, Power and Bargaining Success 27 4 Future Perspectives: What Are the Chances for EMU Reform? 29 5 Conclusions 31 References 32 3 Institutional Inertia, Ignorance and Short-Circuit: Cyprus 35 1 Introduction 35 2 The Importance (and the Consequences) of Being Unimportant 38 3 The Context to Cyprus’ Perception of the EU 40 4 The Nature of the Crisis in Cyprus and Its Impact 42 4.1 The March 2013 Bail-In as a Game-Changer 46 5 Contested Issues, Actors’ Preferences and Influences 48 6 National Preference Formation and Decision Making: Ignorance, Inertia and the Downgrading of Parliamentary Discussions 51 6.1 De-ideologisation and a Consensual Negotiating Strategy 54 6.2 A Distorting Variable: The Local Banking System 55 6.3 Symbolic Protest and Mobilisation 57 7 Conclusions 59 References 61 4 In the Eye of the Hurricane: Greece 65 1 Introduction 65 1.1 The Meanders of EU-Greece Relations Before the Crisis 67 1.2 Domestic Actors and Their Positions Towards the EU 69 2 The Causes and Evolution of the Crisis in Greece 71 2.1 Collusion of Interests 72 2.2 The Party System and State Administration 73 2.3 Interest Articulation and Representation 74 2.4 Political Culture 75 3 Greece and the EU During the Economic Crisis 76 4 The Evolution of the Greek Crisis and Crisis Management 79 5 The Crisis Within the Crisis and the Political Consequences of the Crisis 82 5.1 The Implosion of Greece’s Party System 82 5.2 The Rise of the Radical Left and the Far Right 83 6 Conclusions 85 References 88 5 Vincolo esterno or Muddling Through? Italy 92 1 Introduction 92 2 Italy and the Eurozone Crisis: The Background 96 3 Contested Issues and the Role of the Parliament 101 4 Explaining National Preference Formation 104 5 Conclusions 107 References 109 6 Dissecting the Exceptional Case: Malta 115 1 Introduction 115 2 Liberal Intergovernmentalism and Small EU States 117 3 Small States and Economic Openness 120 4 Political Consensus on the Euro 121 5 Strong Economic Fundamentals 122 6 The Dual Personality of the Banking System 126 7 Maltese Stands in the Council and Euro-Group 128 8 Conclusions 132 References 135 7 Unstable Preferences and Policy Changes: Spain 139 1 Introduction 139 2 A Brief Political History of the Crisis 143 2.1 The (Desired) Virtuous Circle: Stimulating Consumption 144 2.2 Changing Perceptions and Policies: From Keynes to Austerity 146 2.3 Decisions 150 3 Main Contextual Actors Influencing Decisions 151 3.1 The Role of Europe and European Actors 152 3.2 Parliament 153 3.3 Mass Media 155 3.4 National Economic and Social Actors 155 4 Unanimous Support for Greece 157 5 The European Stability Mechanism 161 6 The Debt Brake and Constitutional Reform 165 7 Conclusions 171 References 173 8 Challenges and Opportunities Under Conditionality: Portugal 178 1 Introduction 178 2 Portugal and the Global Crisis: The Background 181 3 Before the Bailout: Portugal Is Not Greece (or Is It?) 186 4 The Bailout Period: More German Than the Germans? 192 5 Conclusions 202 References 204 Appendix: Eurozone Crisis-Related Events in Southern Europe—A Chronology (2010–2015) 207 Index 218 Front Matter ....Pages i-xi Introduction (Cecilia Emma Sottilotta, Leonardo Morlino)....Pages 1-11 How Member States Cope with the Eurozone Crisis (Sonja Puntscher Riekmann, Fabio Wasserfallen)....Pages 13-25 Institutional Inertia, Ignorance and Short-Circuit: Cyprus (Yiannos Katsourides)....Pages 27-56 In the Eye of the Hurricane: Greece (Dimitri A. Sotiropoulos)....Pages 57-83 Vincolo esterno or Muddling Through? Italy (Cecilia Emma Sottilotta)....Pages 85-107 Dissecting the Exceptional Case: Malta (Roderick Pace)....Pages 109-132 Unstable Preferences and Policy Changes: Spain (Xavier Coller, Fernando Ramírez de Luis)....Pages 133-171 Challenges and Opportunities Under Conditionality: Portugal (Marco Lisi, Vera Ramalhete)....Pages 173-201 Back Matter ....Pages 203-218 "This book provides an in-depth account of the politics of the Eurozone crisis in Italy, Spain, Greece, Portugal, Cyprus and Malta, mapping the positions expressed by the governments of Southern EU countries during the Eurozone crisis negotiations, including Greece's bailout deal, the so-called 'Six Pack' and the 'Fiscal Compact' and exploring the process of domestic preference formation. The book relies on original data resulting from fieldwork conducted in the context of the EU Commission- funded Horizon 2020 project 'The Choice for Europe since Maastricht'."-- Back cover