Cardiff, 2013


63rd Political Studies Association Annual International Conference
The Party’s Over?
25 – 27 March 2013
City Hall Cardiff

Joint Panel of the German Politics and Greek Politics Specialist Groups
The Eurozone crisis between Germany, Greece and Italy: Characteristics and implications of Germany’s economic leadership in Europe

Session 12 (Wednesday 27 March 2013, 16.00 – 17.30)

Chair: Dan Greenwood, University of Westminster
Moderator: Graham Timmins, University of Birmingham

Panel Abstract

The Eurozone crisis prompted demands for German economic leadership in Europe, but Germany’s proposed solutions have encountered hostility from different quarters. They have profound implications for individual EU member states, for the future of the Eurozone, for the future shape of the EU, and for member state sovereignty more generally.  This panel  explores the characterisation of Germany as a new economic hegemon, ‘reluctant’ (Paterson, 2011) or otherwise.  It evaluates the ‘battle of ideas’ between neo-liberal and neo-Keynesian approaches to German economic policy in the context of the current Eurozone crisis. It explores the impact of Germany’s attempts to find immediate and longer term solutions to the crisis on its relationship with its European neighbours.  In particular, it examines the implications of the proposed fiscal treaty for the future shape of the Eurozone and the institutional relationships within the EU.  Evidence from Greece and Italy, the member states arguably the most radically affected by Germany’s solutions for the crisis, tests the impact of recent developments in relation to public and partisan support for the EU.  Current solutions to persistent economic crisis challenge member-state national sovereignty and may promote the fracture of the EU into a core zone with multiple peripheries.

[Lothar Funk (University of Applied Sciences Duesseldorf): ‘The Debate on German economic hegemony: misleading or enlightening?’

German economic behaviour has been described as “hegemonic” recently due to the country’s regained economic strength and its relative size compared to other European countries. The academic debate is controversial on the issue. It appears misleading to argue – as usually – that the macroeconomic controversies regarding the diagnosis and therapy of the current problems in the euro area are foremost among “the German view” and the “Anglo-Saxon / Anglo-American view”. This hypothesis holds true even if leading actors on the one side are based mainly in Germany as well as some other Nordic countries, while others are, above all, living in the English-speaking world.  Rather the real underlying issue is the battle among rule-based versus discretionary economic policies which originates in the debates of the 1960s (with earlier German origins). Thus the basic issue is about a “neo-liberal” economic policy assignment (Friedman) versus a Keynesian economic policy assignment (Samuelson): The issue is whether a clear division of labour among policy actors (neo-liberalism) and the hypothesis of a prior coordination of different actors (neo-Keynesianism) will lead to better results in practice and empirically. Overall, therefore, this “battle of economic ideas” is enlightening because the current conflicts will contribute to beneficial mutual learning.

Christian Schweiger (Durham University), ‘What about sovereignty? The political implications of the Eurozone fiscal compact’

The intergovernmental fiscal compact signed by 25 EU member states in March 2012 marks a profound watershed in the development of the EU and particularly in the future shape of the Eurozone. If ratified, the fiscal treaty – which heralds the implementation of strict limits for national budgets and the potential for sanctions in the case of non-compliance – may prove to be the first stage towards full political and economic union in the Eurozone and beyond.  The main test of the treaty will be the challenge it poses to member state fiscal sovereignty.  How will member states react to a new policy regime where the initiation of an excessive deficit procedure lies exclusively with the Commission and can only be overturned under strict conditions through a process of ‘reverse’ QMV?  This paper outlines how the fiscal compact is supposed to function in practice and what the long-term impact on national sovereign economic policy-making is likely to be. The paper asks two fundamental questions:  what will be the future of national sovereignty in the EU under conditions of persistent crisis; and is the division of the Single Market into a core vs. multiple peripheries inevitable?

Ben Clements (University of Leicester), Kyriaki Nanou (University of Oxford), Susannah Verney (University of Athens), ‘The Eurozone crisis and public attitudes towards the European Union in Greece’

This paper analyses public support towards the EU in Greece, which has been severely affected by the recent financial and debt crises. There has been recurrent speculation about Greece leaving the Eurozone. The crisis has caused much political controversy, electoral volatility and civil strife, affecting political parties, voting behaviour and the institutions of governance. However, there has been little analysis of how Greek public opinion may have changed in response to the crisis. For a country traditionally seen as strongly pro-European, has public opinion changed during the crisis, becoming more Eurosceptic? Which social and political groups have changed their views and in which direction? Has there been an increase in ‘hard’ or ‘soft’ Euroscepticism? The paper analyses public opinion in three areas: (i) ‘utilitarian’ support for the EU; (ii) ‘affective’ support for the integration process; (ii) and support for flagship EU policies, including the Single Currency. The paper uses data from Eurobarometer surveys conducted before and during the current crisis. It is informed by the leading theoretical approaches used to explain support and opposition to the EU. The analysis contributes to the wider literature on public opinion towards the EU and research into Euroscepticism in Southern European member states.

Andrea Giuricin (University of Milan Bicocca), ‘The European Government of Mario Monti and the euroscepticism of Italy’

Monti’s Government is certainly pro-European. The new first Minister is sustained by a big coalition of center-right and center-left wings of Parliament strongly supported by the European Union. This wasn’t the first time that a “technical” Government took power in Italy. When there is an economic “emergency”, parties leave to technicians responsibility for reforms.  After one year of Monti’s Government it is possible to observe that the economic measures of increase of taxation and spending cuts have boosted the new extreme political movements. Exit polls indicate that these new “parties” will gain more than 20 per cent of parliamentary seats. These parties are strongly against the Euro and German economic leadership.  Parliament has repeatedly halted proposed government reforms relating to the labour market or the liberalization of economy and this paper addresses the impact of this immobility from an economic point of view.  It analyses the way in which the declining confidence of Italians in the traditional parties is directly affecting the European Union, with an increase in Euroscepticism. The secondary effect is the shift of traditional parties towards Euroscepticism to try to ensure that they do not lose votes at the next elections in March or April 2013.

Greek Politics Specialist Group Panel
Multidisciplinary approaches to the Greek crisis

Session 6 (Tuesday 26 March 2013, 11:00 – 12:30)

Chair: Dr Dimitris Tsarouhas (Bilkent University)
Discussant: Dr Theofanis Exadaktylos (University of Surrey)

Panel Abstract

This panel will bring together emerging interpretations of the Greek economic, political and social crisis. The four papers track the origins and implications of the crisis from four different but related points of view, looking at the role of institutions, leaders, political economy and media. It is hoped that this approach will encourage a multidisciplinary dialogue on the root causes of, and possible solutions to, the crisis in Greece.

Zeki Sarigil and Dimitris Tsarouhas (Bilkent University), ‘Political Diffusion at Critical Junctures: Comparing Political Economy Trajectories in Greece and Turkey’

Critical junctures are usually associated with path breaking outcomes or developments. However, a critical juncture may lead to various outcomes, such as no change (path continuity/ path maintenance); gradual change (path modification) or major, abrupt change (path breaking/ path punctuation). If so, then, how can we explain this variation? When is a critical juncture more likely to lead to one form of change rather than another, and which factors account for variance in institutional outcomes?
This study deals with this puzzle by examining Greek and Turkish political economies through time. Although both countries went through a critical juncture in the late 1970s and early 1980s, these junctures led to diverse policy outcomes. While Turkey’s previous path was transformed towards a fully liberalized political economy regime, the previous statist path persisted in Greece. Even more interestingly, in the 2000s, both countries again experienced critical junctures. These junctures led to a weakening of statism in Greece, while in Turkey path continuity was observed. Therefore, this study asks what the relative weight of a) ideas, b) interests, c) power and d) discourse is in explaining this variance. Moreover, what are the implications for the broader theoretical debate for politics at critical junctures?

Aris Trantidis (King’s College, London), ‘The beginning of the storm: Mitsotakis’ reform agenda and the political ascendancy of informal veto-players’

The Mitsotakis period was Greece’s first encounter with a bold and extensive programme of privatisation and market liberalisation. Following a simmering macroeconomic crisis, the Mitsotakis programme was a departure from the political equilibrium that commanded continuous fiscal expansion and state ownership in order to nurture a clientelistic political system.
The paper reviews the impact of the reform on Greek party politics in a comparative light. PASOK’s austerity package of 1985-1987 relied on rising taxes and incomes policy that diffused the cost of adjustment horizontally. It left clientelist relations unscathed and minimized reaction from stakeholders. By contrast, Mitsotakis’ programme undermined the cohesion of the government party while strengthening PASOK’s party base that re-united following the dramatic year of 1989 and attracted the support of the organised groups reacting to Mitsotakis’ reforms.
The fall in popularity and ultimate collapse of the Mitsotakis government confirms empirically that a bold and thorough reform agenda faces a collective mobilisation problem (Olson, 1965): Privatisation sparks the reaction of groups that expect significant losses, whereas prospective fiscal and economic benefits are too dispersed and uncertain to mobilise enough support that could counteract the social backlash. Organised groups rally around the main opposition party, strengthening its electoral mobilisation capacity, while the party implementing reforms is experiencing centrifugal tendencies, factionalism and defections. Reaction to New Democracy’s unsettling policies marks the rise of ‘informal veto players’ (Featherstone and Papadimitriou 2008) that vociferously resisted proposed and implemented changes to the status quo throughout the period that followed.

Emmanuel Heretakis (University of Athens), ‘The mass media, fair play and other obsessions’

The direct consequences of chaos theory seem to have been already embedded into the daily lives of the citizens, with serious after-effects, but rather not into the minds of European politicians.
The exegesis of what is happening in front of our eyes inevitably requires, usually, a wider outlook, and not a compartmentalization or a trivialization of the whole picture, having happened at least for many decades in the West. Tectonic shifts have taken place, resulting in further changes of a quite unpredictable form and character. The arrogance of predictability based on pseudo-mathematical models has proven its absolute failure, already starting from what has already taken place in the global financial sector since 2000.
In Greece, there is a quite evident total lack of understanding by the majority of the population of even a part of the total picture, due to the platitudinous effect both of the educational system and the end consequences of the great majority of the mainstream mass media. This is very good news for the mechanisms of enforcement.
At the same time, having a knowledge of the wider picture is decisive, in contradistinction to the partial knowledge of informational instances supplied  regularly by the mainstream mass media, that cannot be critically examined in any meaningful way, being steadily offered for “consumption” to the “consumers” of those media instances.
The role of the wide majority of mass media voicing the diktats of the establishment is entirely crucial within this context. They have grown to be propaganda mouthpieces for the successive recent Greek governments, promoting a mixture of propaganda in its purest form, coupled with a ceaseless flow of continuous entertainment. While, simultaneously, they promote a mixture of fairy tales, instead of the concept of fair play, which is so much idealized in Western societies (e.g. the Assange case!). In reality, they systematically shrink from any sense of even the slightest regulation.
This leads us into the various uses of alienated language and the spurious range of meanings of pivotal words, e.g. democracy, citizenship etc. This course points to the direction of forwarding and practicing of communicative capitalism, a useful pre-condition for the deconstruction of democracy proper as we know or rather knew it, alias post-politics.