English

Monetary Disunion: The Domestic Politics of Euroland

Veröffentlicht von

With Lea Elsässer, Journal of European Public Policy, 2015

Abstract: Regional disparities within the European Union have always been perceived as an impediment to monetary integration. Discussions on a joint currency were linked to compensatory payments in the form of regional policy. Structural assistance increased sharply at the end of the 1980s. Later, however, it had to be shared with the new member states in the East. Moreover, the low-interest credit that Southern European Monetary Union members enjoyed as a result of interest rate convergence is no longer available. We predict that considerable amounts of financial aid will have to be provided in the future by rich to poor member countries, if only to prevent a further increase in economic disparities. We also expect ongoing distributional conflict between payer and recipient countries far beyond current rescue packages. We illustrate the dimension of the conflict by comparing income gaps and relative population size between the centre and periphery in Europe and in two nation-states with high regional disparities, Germany and Italy.

Download [PDF]

(Previously published as Discussion Paper 14/17, Max Planck Institute for the Study of Societies, October 2014 Download [PDF])

Brutish, nasty – and not even short: the ominous future of the eurozone

Veröffentlicht von

Appeared in The Guardian, August 17, 2015

Now the dust has temporarily settled over the ruins of Greece’s economy, it is worth asking if there wasn’t a brief moment when the actors had found a way to cut the eurozone crisis’s Gordian knot. At some point in July German finance minister, Wolfgang Schäuble, appeared to have realised that his dream of a “core Europe” with a Franco-German avant-garde would vanish into thin air if Greece was allowed to remain in the economic and monetary union. Rewriting the rules of the union to accommodate the Greeks, Schäuble realised, would pull the euro southwards, and France, Italy and Spain with it – forever breaking up the European core. (Continue)

Griechenlandkrise: Gefangen in der Eurozone

Veröffentlicht von

Debattenbeitrag für Spiegel Online, 8. Juli 2015. English translation published on Verso Books Blog.

Es gibt noch Fortschritt in Europa. Als der damalige griechische Ministerpräsident Georgios Papandreou 2011 ein Referendum über die Austeritätswünsche seiner europäischen Kollegen abhalten wollte, wurde er von diesen kurzerhand abgesetzt.

Als Nachfolger entsandten Brüssel und Berlin einen gewissen Loukas Papademos, Vertrauensmann der internationalen Finanzindustrie, der Anfang der Nullerjahre als griechischer Zentralbankchef mithalf, sein Land mit Hilfe von Goldman Sachs Euro-würdig zu rechnen. So etwas ging diesmal nicht – dank eben jener Restbestände nationaler Demokratie, die die deutschen Europhilen zugunsten einer zukünftigen „europäischen Demokratie“ suspendieren wollen. Weiterlesen →

The strikes sweeping Germany are here to stay

Veröffentlicht von

Appeared in The Guardian, May 22, 2015

German strikes once seemed like German jokes: a contradiction in terms. But no more: this year, Europe’s largest economy is on course to set a new record for industrial action, with everyone from train drivers, kindergarten and nursery teachers and post office workers staging walkouts recently. The strike wave is more than a conjunctural blip: it is another facet of the inexorable disintegration of what used to be the “German model”. Weiterlesen →

German Hegemony: Unintended and Unwanted

Veröffentlicht von

Appeared, in an abbreviated version, in Le Monde diplomatique, May 2015. Italian translation appeared in il Mulino 4/2015 (PDF here).

Germany’s new European hegemony is a product of European Monetary Union in combination with the crisis of 2008. It was not Germany, however, which had wanted the Euro. Its export industries had since the 1970s lived comfortably with repeated devaluations of the currencies of Germany’s European trading partners, in response to which much of German manufacturing moved out of price-sensitive into quality-competitive markets. It was above all France which sought a common European currency, to end the felt humiliation of having to devalue the Franc against the Mark and, after 1989, to bind united Germany firmly into a, hopefully French-led, united Europe. Weiterlesen →

„Barely disguised oligarchies“

Veröffentlicht von

Appeared, in Italian, in L’Eco di Bergamo, May 15, 2015

How do you interpret the current economic-financial crisis in part of the western world?

It is a return to the normal condition of capitalism: instability, uncertainty, unpredictability, a permanent conflict between social justice and the justice of the market. The return began in the 1970s with the breakdown of the postwar order. The three decades after the war were an exceptional period. Since then, a crisis sequence has begun brought inflation, public debt, private debt, secular stagnation and anarchic money production. The financial crisis of 2008 was the high point up now. More such high points are coming. Weiterlesen →

Piketty, the Global Tax on Capital, and the Fiscal Crisis of the State

Veröffentlicht von

To appear in Labor History, 2015

There has hardly been a book recently whose strengths and weaknesses have been as extensively discussed as Thomas Piketty’s „Capital in the Twenty-First Century“ (2014).[1] I have little to add to the Marxist critique that Piketty’s concept of capital is somehow underdeveloped, or to Piketty’s quite reasonable response to it. Nor will I repeat that Piketty may be underestimating the role of trade unions and collective bargaining in the era of the Great Compression between the First World War and the mid-1970s, when unions and the institutions that sustained them began to be rolled back. Instead I begin by reminding readers of some of the book’s unquestionable merits: the fact that it focusses on the commonalities rather than the differences between the countries of advanced capitalism; its emphasis on the basically unearned nature of great wealth; the attention it rightly pays to the impact of the two world wars (with, among other things, the great upswing in trade union organization and trade union rights in the two „postwar settlements“); its rejection of the „convergence thesis“, according to which capitalism will on its own even out social and economic inequality through, among other things, competition (in fact, Piketty impressively proves the presence in capitalism of what Robert K. Merton has once called the „Matthew effect;“[2] Merton 1968); and the observation that large wealth can expect to draw a better rate of return than small savings, due to its access to more sophisticated financial advice. Weiterlesen →

Heller, Schmitt and the Euro

Veröffentlicht von

European Law Journal, Vol. 21, No. 3, May 2015, Special Section: Hermann Heller’s Authoritarian Liberalism, pp. 285-383, here: 361-370

Abstract: Heller understood that Schmitt’s ‘authoritarian state’ was in fact the liberal state in its pure form, weak in relation to the capitalist economy but strong in fending off democratic interventions in its operation. Had he lived, Heller would not have been surprised by the close affinities between Schmittian economic authoritarianism and postwar German ordoliberalism, as mediated by a figure like Alexander Rüstow. Neoliberalism as today we know it drew heavily on ordoliberal doctrine, in particular through Friedrich von Hayek who managed to merge it with Austrian economics into a powerful ideological force to replace Keynesianism after the 1970s. Today the European Union, especially in its incorporation as monetary union, closely follows the liberal-authoritarian template as devised by Schmitt and others in the final years of the Weimar Republic. The paper shows this with reference to the five European-level institutions that today govern the European free market while protecting it from democratic interference: the Parliament, the Council, the Commission, the European Court of Justice and the European Central Bank.

Download [PDF]