Abstract
This chapter discusses the political economy of the austerity programmes currently being applied throughout Europe and in many other countries worldwide. It examines the economic context of austerity, including its relations to the global financial crisis of 2008 and support for banks, its impact on economic growth, and links to long-term concerns of the IMF and the EU over public spending. Furthermore, the chapter looks at the roles of the IMF and EU, including the legal and economic bases of their interventions, the policy objectives being pursued, and the relationship between both bodies and national laws and political processes. It concludes that tensions between these institutional mechanisms and democratic processes are likely to continue and grow, in the absence of significant economic growth.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
Eichengreen 2007.
- 2.
R. Kuttner, Debtors’ Prison: The Politics of Austerity Versus Possibility. Knopf, New York. http://knopfdoubleday.com/book/219148/debtors-prison/. Accessed 15 December 2014.
- 3.
I. Ortiz and M. Cummins, The Age of Austerity: A Review of Public Expenditures and Adjustment Measures in 181 Countries. http://policydialogue.org/files/publications/Age_of_Austerity_Ortiz_and_Cummins.pdf. March 2013. Accessed 15 December 2014.
- 4.
Stuckler and Basu, How Austerity kills. New York Times, 12 May 2013.
- 5.
Cavero and Poinasamy 2013.
- 6.
Verbist et al. 2012.
- 7.
IMF, Successful Austerity in the United States, Europe and Japan, IMF WP12/190. http://www.imf.org/external/pubs/ft/wp/2012/wp12190.pdf. Accessed 15 December 2014.
- 8.
- 9.
IMF, World Economic Outlook, October 2012. http://www.imf.org/external/pubs/ft/weo/2012/02/pdf/text.pdf. Accessed 15 December 2014.
- 10.
IMF, Fiscal Adjustment in IMF-Supported Programs. www.ieo-imf.org/ieo/files/completedevaluations/09092003main.pdf. Accessed 15 December 2014.
- 11.
UNCTAD, Trade and Development Report: Post-crisis policy challenges in the world economy, UN Publication, New York, Geneva, 2011, p. 65.
- 12.
European Commission, Report on Public Finances in EMU 2012, European economy series 4/2012 http://ec.europa.eu/economy_finance/publications/european_economy/2012/pdf/ee-2012-4.pdf. Accessed 15 December 2014.
- 13.
EC 2012, p. 160.
- 14.
IMF, The Economic Crisis: Did Financial Supervision Matter? Masciandaro D, Vega Pansini R, Quinty M, IMF WP 11/261. http://www.imf.org/external/pubs/ft/wp/2011/wp11261.pdf. Accessed 15 December 2014.
- 15.
IMF, The Economic Crisis: Did Financial Supervision Matter? Masciandaro D, Vega Pansini R, Quinty M, IMF WP 11/261. http://www.imf.org/external/pubs/ft/wp/2011/wp11261.pdf. Accessed 15 December 2014; D. Giannone, M. Lenza and L. Reichlin, Market freedom and the global recession OECD. http://www.oecd.org/economy/productivityandlongtermgrowth/46418753.pdf. Accessed 15 December 2014.
- 16.
P. De Grauwe and Y. Ji, Panic-driven austerity in the Eurozone and its implications. http://www.voxeu.org/article/panic-driven-austerity-eurozone-and-its-implications. 21 February 2013. Accessed 15 December 2014.
- 17.
P. De Grauwe and Y. Ji, Panic-driven austerity in the Eurozone and its implications. http://www.voxeu.org/article/panic-driven-austerity-eurozone-and-its-implications. 21 February 2013. Accessed 15 December 2014.
- 18.
K. McMorrow and W. Roeger, The economic consequences of ageing populations. (European Economy) Economic Papers 138, November 1999. http://ec.europa.eu/economy_finance/publications/publication11151_en.pdf, p. 16. Accessed 15 December 2014.
- 19.
IMF, From Stimulus to Consolidation: Revenue and Expenditure Policies in Advanced and Emerging Economies, 30 April 2010. www.imf.org/external/np/pp/eng/2010/043010a.pdf. Accessed 15 December 2014.
- 20.
OECD/EU 2012.
- 21.
Thorstensen et al. 2013.
- 22.
J. Klein, The Battle for Rule of Law in Thailand, The Constitutional Court of Thailand, The Provisions and the Working of the Court, pp. 34–90. http://www.cdi.anu.edu.au/CDIwebsite_1998-2004/thailand/thailand_downloads/ThaiUpdate_Klien_ConCourt%20Apr03.pdf. Accessed 15 December 2014.
- 23.
Preliminary Conclusions of the Mission to Libya, 28 October 2010, http://www.imf.org/external/np/ms/2010/102810.htm; ‘Egypt’s Orderly transition? International Aid and the Rush to Structural Adjustment‘ Jadaliyya, 29 May 2011; Bond 2011.
- 24.
S. Drazen A, Conditionality and Ownership in IMF Lending: A Political Economy Approach, IMF Staff Papers, 2002. http://econweb.umd.edu/~drazen/ConditionalityIMFStaff.pdf. Accessed 15 December 2014.
- 25.
W. Streeck, The Politics of Public Debt, MPIfG Discussion Paper 13/7, 2013. Max-Planck-Institut für Gesellschaftsforschung, Köln. http://www.mpifg.de/pu/mpifg_dp/dp13-7.pdf. Accessed 15 December 2014.
- 26.
Beck 2005.
- 27.
J.P. Morgan, The Euro Area Adjustment: About Halfway There. https://11740092596917189242.googlegroups.com/attach/243626285e18f68b/JPM-the-euro-area-adjustment--about-halfway-there.pdf?part=7&vt=ANaJVrG2WGC_YZQfaQXY7PeR28q3XCWQFXiOlyP7FtL81IFFYTx9nRhv8FLQAMwGy9B4_Nq5ZCR738qsPF1-LI6OccRFEfijGnIQpBHSSNJv1SHRZ_0paUI; see also http://blogs.euobserver.com/phillips/2013/06/07/jp-morgan-to-eurozone-periphery-get-rid-of-your-pinko-anti-fascist-constitutions/. Accessed 15 December 2014.
- 28.
S. Nissan, Guest Post: Brics without Mortar, Financial Times. http://blogs.ft.com/beyond-brics/2013/09/05/guest-post-brics-without-water/. Accessed 15 December 2014; Bretton Woods Project, The Future of Global Economic Governance and the IMF: Challenges and Opportunities for Europe, Emerging Economies and Developing Countries. http://www.brettonwoodsproject.org/wp-content/uploads/2014/03/Future-of-global-economic-governance-and-the-IMF.pdf. March 2014. Accessed 15 December 2014.
- 29.
Bugaric 2013.
- 30.
- 31.
EU, State Aid Scoreboard 2013, Aid in the context of the financial and economic crisis. http://ec.europa.eu/competition/state_aid/scoreboard/financial_economic_crisis_aid_en.html. Accessed 15 December 2014.
- 32.
Article 346 TFEU.
- 33.
De Grauwe 2012, p. 138.
- 34.
R. Thillaye, L. Kouba and A. Sachs, Reforming EU Economic Governance: Is “more” any better? http://www.foreurope.eu/fileadmin/documents/pdf/Workingpapers/WWWforEurope_WPS_no057_MS84.pdf. March 2014. Accessed 15 December 2014.
- 35.
Spiegel, The coming EU summit clash: Merkel vows 'no euro bonds as long as I live. http://www.spiegel.de/international/europe/chancellor-merkel-vows-no-euro-bonds-as-long-as-she-lives-a-841163.html. 27 June 2012. Accessed 15 December 2014; EIB, The Europe 2020 Project Bond Initiative—Innovative infrastructure financing. http://www.eib.europa.eu/products/project-bonds/index.htm. Accessed 15 December 2014.
- 36.
EU, The EU's economic governance explained MEMO/13/979 12/11/2013. http://europa.eu/rapid/press-release_MEMO-13-979_en.htm. Accessed 15 December 2014; Regulation (EU) No 1175/2011; A, Kocharov, Another Legal Monster? An EUI debate on the fiscal compact treaty, EUI Working Papers LAW 2012/09.
- 37.
European Commission, Commission concludes in-depth reviews to identify macroeconomic imbalances and assesses progress in fiscal consolidation, Press Release, IP/14/216, 5 March 2014.
- 38.
EU, Treaty on stability, coordination and governance. http://european-council.europa.eu/media/639235/st00tscg26_en12.pdf. Accessed 15 December 2014; EU, Specifications on the implementation of the Stability and Growth Pact, 3 September 2012. http://ec.europa.eu/economy_finance/economic_governance/sgp/pdf/coc/code_of_conduct_en.pdf. Accessed 15 December 2014.
- 39.
EU, Treaty establishing the European Stability Mechanism (ESM) 2012. http://www.european-council.europa.eu/media/582311/05-tesm2.en12.pdf. Accessed 15 December 2014.
- 40.
Guardian, Germany to set the terms for saving the euro 31 January 2012. http://www.theguardian.com/business/2012/jan/30/eu-summit-eurozone-treaty-deal. Accessed 15 December 2014.
- 41.
Bugaric 2013.
- 42.
Fabbrini 2013.
- 43.
- 44.
Fabbrini 2013.
References
Beck U (2005) Power in the global age. Polity Press, Cambridge
Benczes I (2013) Fiscal rules and national ownership: a critical evaluation of past and current fiscal rules in the EU. In: Jensen J, Miszlivetz F (eds) Global challenges—European answers the rise of globality in Europe. Savaria University Press, Szombathely, pp 79–100
Bond P (2011) Neoliberal threats to North Africa. Rev Afr Polit Econ 38(129):481–495
Bugaric B (2013) Europe against the Left? On Legal Limits to Progressive Politics, LSE LEQS Paper No. 61/2013
Cavero T, Poinasamy K (2013) A cautionary tale: the true cost of austerity and inequality in Europe, Oxfam GB policy & practice. http://policy-practice.oxfam.org.uk/publications/a-cautionary-tale-the-true-cost-of-austerity-and-inequality-in-europe-301384. Accessed 15 Dec 2014
Crespy A (2013) Deliberative democracy and the legitimacy of the European Union: a reappraisal of conflict. Polit Stud 62(Supp. 1):81–98
Crespy A (2014) The vanishing promise of a more social Europe: public services before and after the eurocrisis, prepared for the conference of the Council for European Studies, Washington DC
De Grauwe P (2012) Economics of monetary union, 9th edn. Oxford University Press, Oxford
Eichengreen B (2007) Europe’s post-war recovery. Cambridge University Press, Cambridge
Fabbrini F (2013) The fiscal compact, the “Golden Rule”, and the paradox of European federalism. Boston Coll Int Comp Law Rev 36(1):1–38
Scheppele K (2006) Democracy by judiciary. In: Czarnota A, Krygier M, Sadurski W (eds) Rethinking the rule of law after communism. Central European University Press, Budapest, pp 25–60
Thorstensen V, Ramos D, Muller C (2013) The “Missing Link” between the WTO and the IMF. J Int Econ Law 16(2):353–381
Verbist G, Förster M, Vaalavuo M (2012) The impact of publicly provided services on the distribution of resources: review of new results and methods, OECD social, employment and migration working papers No. 130, 2012. OECD Publishing
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Annex: The EU Semester
Annex: The EU Semester
The European Semester—Coordination Throughout the Year
Glossary: AGS Annual Growth Survey, AMR Alert Mechanism Report, CSR Country-specific recommendations, EDP Excess Deficit Procedure, IDR In-depth Review
Source http://ec.europa.eu/economy_finance/economic_governance/the_european_semester/index_en.htm
Rights and permissions
Copyright information
© 2015 T.M.C. Asser Press and the authors
About this chapter
Cite this chapter
Hall, D. (2015). Services of General Interest Under Regimes of Fiscal Austerity. In: Krajewski, M. (eds) Services of General Interest Beyond the Single Market. Legal Issues of Services of General Interest. T.M.C. Asser Press, The Hague. https://doi.org/10.1007/978-94-6265-063-3_7
Download citation
DOI: https://doi.org/10.1007/978-94-6265-063-3_7
Published:
Publisher Name: T.M.C. Asser Press, The Hague
Print ISBN: 978-94-6265-062-6
Online ISBN: 978-94-6265-063-3
eBook Packages: Humanities, Social Sciences and LawLaw and Criminology (R0)
