George Pagoulatos

The Politics of Privatisation: Redrawing the Public–Private Boundary

Privatisation in Greece represented a reversal of the entire post-war and post-authoritarian interventionist policy paradigm. The privatisation decision resulted from pressures associated with the EC/EU and globalisation in general. The Simitis governments reactivated a privatisation programme comparable to that of ND in the early 1990s, but distinctly pragmatic in its reasoning, gradualist in its pace, and non-conflictual though unilateralist in its policy implementation. A central feature of the ‘Simitis privatisations’ was the flotation of successive minority stakes in public enterprises leading to retention of public control even though the government kept only a minority stake in the privatised enterprises. Privatisation was most far-reaching in the banking sector, with important broader implications for the entire economy. Despite the remarkably more favourable overall conditions under which the Simitis governments implemented privatisation as compared to the ND government in the early 1990s, privatisation policies continued to provide ad hoc opportunities for considerable socio-political opposition.

The Return of the Greek Patient: Greece and the 2008 Global Financial Crisis

The 2008 financial crisis found the Greek economy in a position of fiscal vulnerability, given the large public debt, and structural weaknesses, demonstrated in a huge current account deficit. The banking system was relatively robust, but exposed to imported risks from the emerging Southeast European markets. The government adopted a ‘financial crisis reaction plan’. Its reaction affirmed long-lasting features of Greeces ‘credit-based’, partly state-controlled financial system. Sectors most visibly affected by the crisis are housing construction, tourism, shipping and the small–medium enterprise sector. Paradoxically, some facets of relative underdevelopment of the Greek model of capitalism are serving to mitigate the intensity of the crisis.

The Limits of EMU Conditionality: Fiscal Adjustment in Southern Europe

The EMU fiscal adjustment paths of the four Southern Europe members (Italy, Spain, Greece, and Portugal – SE-4) vary along two dimensions: (a) cross-temporal pre- and post-EMU accession and (b) cross-country. We account for the cross-temporal variation by distinguishing between the ‘hard’ and ‘soft’ EMU conditionality of the pre- and post-accession stage. External constraints in the form of the Maastricht eligibility criteria constituted a significant common ‘push’ factor in the fiscal stabilization process of EMU candidate countries throughout the 1990s. However, their power does not necessarily lead to fiscal sustainability as demonstrated by the post-accession budgetary outlook of the SE-4. We account for the cross-country variation by introducing additional ‘pull’ factors related to the reform content, context and capability, such as unemployment, the level of social concertation, and government effectiveness. Only in cases where such factors were at work did governments engage in structural reforms to consolidate public finances instead of the less controversial path of macroeconomic policy reform.

Believing in national exceptionalism: ideas and economic divergence in Southern Europe

Economic adjustment in Spain, Portugal and Greece prior to the EMU nominal convergence programme is examined in an effort to explain divergence from policy orthodoxy. A notion of national exceptionalism is proposed as an ideational framework through which government policy makers perceive their countrys position in the European and global sphere. Three levels of national exceptionalism are distinguished, in ascending order of explanatory importance: a level at which national exceptionalism is rooted in cultural predispositions; a level at which it appears to be empirically and logically plausible; and a level at which it offers a politically beneficial ideological strategy. When all three levels concur, national exceptionalism carries notable ancillary explanatory power. That is the case with post-authoritarian Greece through the 1980s, but not with Spain or Portugal.

A President for the European Union: A New Actor in Town?*

In the post-Constitution EU, the rotating Presidency would be replaced by a hybrid system combining a rotating component with the establishment of a permanent President for the European Council. Using a principal-agent framework, we look at the supply and demand for formal leadership in the new system, accounting for the substantial institutional change in the format of the Presidency. We then examine the Presidents effectiveness and efficiency and discuss whether the President, as a new institutional actor, has the potential to evolve into an autonomous political actor in the EU. Our analysis suggests a discernible though by no means unconditional strengthening of the Presidents potential for an autonomous political role in the new EU institutional architecture.

‘Enlargement Waves’ and Interest Group Participation in the EU Policy-Making System: Establishing a Framework of Analysis

How does enlargement affect the EU system of interest group intermediation? We introduce an analytical framework to conceptualise the impact of enlargement. ‘Enlargement waves’ do not only result in a ‘top-down’ process of Europeanisation of national interest intermediation systems, but also have a ‘bottom-up’ effect. This comprises uploading national organisational features and a broader scope of activities onto the EU system of interest representation. The enlargement impact can be seen on the structural properties (organisational features and resources) and the agenda content (scope of associational agenda, policy direction, inter-group balance) of EU-wide interest associations (‘Eurogroups’). The magnitude and scope of impact are conditioned by two groups of parameters linked with the source and target of the impact. The first group refers to the particular features of each ‘enlargement wave’ (e.g. which and how many countries are involved, national system of interest intermediation) and the second to Eurogroup attributes (e.g. willingness to broaden membership base, organisational and decision-making structures).

Economic Adjustment and Financial Reform: Greece's Europeanization and the Emergence of a Stabilization State

Abstract In a brief part of the 1980s and throughout the 1990s, Europeanization, more in the nominal-macroeconomic than in the structural sense, was the most pronounced economic objective of Greek governments. This objective was pursued mainly through extensive reliance on monetary austerity predicated upon financial liberalization, and through the transformation of the growth state into a stabilization state. Macroeconomic policies were aimed at triggering the disciplinary mechanisms that would facilitate structural adjustment by eroding domestic sociopolitical resistance. A principal strategy employed for transforming a growth state into a stabilization state was one of surrendering government control over finance to the regulatory authorities of an increasingly autonomous central bank and to the allocative functions of a rapidly internationalizing market.

The Enemy Within: Intragovernmental Politics and Organizational Failure in Greek Privatization

Mainstream approaches explain privatization policy failure by taking account of the surrounding sociopolitical and economic context. This article examines the unsuccessful Greek privatization over the first half of the 1990s by following an alternative approach. It looks at the obstacles originating from intragovernmental politics and the state organizational structures and resources. Contrary to what the British or French experience would suggest, the adoption of a statist, impositional policy-making strategy in the Greek case failed to achieve policy effectiveness. Indeed, it probably ended up accelerating policy failure. The employment of statism as a policy-making strategy was undermined by the structural weaknesses of the state.

European banking: Five modes of governance

Banking policy is a strong case for the rise of the regulatory model in Europe. However, regulation is not the single observable governance mode. Overall five competing and mutually complementary modes of governance define European banking policy and policy making: governance by state control; governance by the market; governance by regulation; governance by sectoral co‐ordination; and governance by supranational interdependence. Each of these modes raises its own distinct claim to legitimacy. Moreover, a pattern of leapfrogging characterises regulatory policy making at the supranational level.

The Comparative Politics of Industrial Privatization: Spain, Portugal and Greece in a European Perspective

Privatization has been on the policy agenda of almost every country in the world, whatever the nature of its regime or its political hue.2 The purpose of this chapter is to place the industrial privatization programmes of Spain, Portugal and Greece in a European context in order to underline and explain their common as well as their distinctive characteristics.3 What ties these programmes together is that they have been geared towards a common objective of ‘catching up’ with the ongoing economic transformation inside the EC/EU. This transformation is driven by convergent pressures exercised more or less upon all West European economies over the 1980s and 1990s. Evidently, the differentiating factor of Southern European economies (SEEs) from the rest of EC/EU economies, and their own shared predicament, is that the distance to be covered is larger. ‘Catch-up’ in their case encompasses a double challenge: modernize to the point of being able to compete from an equal ground with the rest of Western Europe, and then successfully persevere the competition.