Kevin Featherstone

The JCMS Annual Lecture: The Greek Sovereign Debt Crisis and EMU: A Failing State in a Skewed Regime*

The Greek sovereign debt crisis of 2010 exposed the weaknesses of governance of both the ‘euro area’ and of Greece. Successive governments in Athens had failed to overcome endemic problems of low competitiveness, trade and investment imbalances, and fiscal mismanagement placing the economy in a vulnerable international position. Once the market crisis erupted, the European Union’s Council of Ministers and the European Central Bank failed to provide a timely and effective response. The implications are threefold: the constraints on domestic reform proved immutable to EU stimuli; the ‘euro’ is more vulnerable to crisis than previously acknowledged; and the early discussion on ‘euro’ governance reform suggests that its underlying philosophy has not shifted significantly towards more effective ‘economic governance’. This article explores the antecedents and management of the crisis and assesses the outcome. At the EU level, a paradox was evident in the denial of agency and resources that might limit the obligation of states to rescue an errant peer. Domestically, within Greece, the unprecedented external monitoring and policing of its economy – though matched by some initial successes – raises in the longer term sensitive issues of legitimacy and governability, with uncertain prospects for avoiding further crises.

Introduction: ‘Modernisation’ and the Structural Constraints of Greek Politics

Contemporary Greek politics are marked by tensions between pressures for reform and the structural constraints to their realisation. The pressures combine those emanating from processes of Europeanisation (European Union agendas on economic reform, for example) and the domestic demand for ‘modernisation’ (the agenda of former Premier Simitis). The two have been seen as synonymous in Greece. The resultant tensions have created a fundamental issue of governability: in a number of areas, Greece is une société bloqué. There are systemic weaknesses deriving from the institutional capacity of the state, the regime of ‘disjointed corporatism’, and cultural practices of clientelism and ‘rent-seeking’. These constrain agency and leadership strategies. The analysis places the recent Simitis project in an historical context and attempts to delineate patterns of change and continuity. The reform process has been asymmetrical and uncertain in character. The problem of governance remains and, in turn, it questions the nature of Greeces convergence with the EU.

‘Europeanization’ and the Centre Periphery: The Case of Greece in the 1990s

Abstract This article discusses the notion of ‘Europeanization’ as it might apply to the position of Greece in the European Union. It advances three basic propositions: (i) that the domestic impact of EU integration can be differentiated along various dimensions; (ii) of particular relevance is differentiation between the centre and periphery; and (iii) that the impact of the EU in Greece can be gauged in terms of a series of inter-connected features: a Gramscian hegemony, external penetration of the state administration, dependence on EU aid, fragmentation, and a ‘core executive’ empowerment.

‘Soft’ co-ordination meets ‘hard’ politics: the European Union and pension reform in Greece

Abstract The paper examines the process of pension reform in Greece in the context of the ‘soft’ policy constraint (on structural reform) emanating from the European Union. It argues that the EU stimulus to reform complemented a set of domestic pressures. However, the domestic system of interest mediation has largely thwarted reform. The reform process is marked by a strong configuration of institutional conditions undermining the will and capability to adapt. Negotiation reflects a game of ‘non-cooperation’, with those currently privileged fearing zero-sum outcomes and constituting powerful veto-players. Strategies of concertation have proved unsustainable, whilst unilateral approaches by government have failed to build coalitions and offer sufficient incentives. An acute problem of governance prevails, threatening Greek interests in the EU and the Unions ability to co-ordinate economic reform across an increasingly diverse membership.

The ‘party‐state’ in Greece and the fall of Papandreou

Revelations of corruption and of maladministration have forced a re‐examination of some of the basic characteristics of the Greek party‐state and party system. The purpose of this article is to examine how the controversies ‐ ‘scandals’ ‐ arose, and to assess their consequences for political development in Greece in the light of the June 1989 national elections. The elections may prove critical for the evolution of the State and the party system.

The Limits of External Empowerment: EMU, Technocracy and Reform of the Greek Pension System

This paper seeks to explain an aborted attempt at reform of the Greek pension system, following a series of previous failures. It applies the framework of rational choice institutionalism in order to examine the strategy and setting of the relevant actors. The pension system had become a huge fiscal burden on the state, threatening Greeces position in the European Union. Moreover, its gross inequalities of provision and bureaucratic inefficiency were symptoms of the embedded clientelism and ‘disjointed corporatism’ that stood in the way of the governments self-proclaimed ‘modernization’ programme. In the event, though EMU entry requirements empowered the reform momentum, a combination of the strategic weakness of key actors and the entrenched opposition of sectoral interests dissipated the initiative. The failure suggests the relevance of the wider social setting to reform: in particular, the weakness of the technocratic community and the relative absence of a supportive ‘advocacy coalition’, beyond the dominance of the ‘party state’. Faced with criticism, the political leadership sought to protect their electoral position and postponed pressing decisions. The case study raises important questions about the scope for such reform in Greece and the future stability of the ‘Euro-zone’.

Strapped to the mast: EC central bankers between global financial markets and regional integration1

Abstract Paradoxically, though the Treaty on European Union underlines the power of EC central bankers, they have been neglected in the literature on European integration. Central bank independence provides the key connection between changes in global financial markets and the new Treaty provisions on economic and monetary union (EMU). In recent years EC central bankers have been subjected to ever more volatile and competitive markets and new political pressures related to EMU. Central bank independence has offered a means of reconciling these twin changes. This article seeks to explain why central bank independence has strengthened its grip in Europe and the nature of the role of central bankers in European integration. The adequacy of existing theories of central bank behaviour is examined ‐ public interest, personality, public choice and bargaining theories. Emphasis is given to explanations that focus on external factors: the structural power of the ‘anchor’ currency in the exchange rate mechanism (ER...

External conditionality and the debt crisis: the 'Troika' and public administration reform in Greece

ABSTRACT Levering domestic reform via external conditionality has become crucial to the rescues of European Union member states in the context of the eurozone crisis. This article examines a critical case – Greece – and a problematic sector – reform of the central state administration – to assess the applicability of three hypotheses advanced by Schimmelfennig and Sedelmeier. New data on the trends in reform activity before and during Greeces debt crisis are assessed, as well as their content and paradigmatic frames, to assess the extent of a break with the inherited domestic model. They highlight the contrast between aggregate activity and the substance of reform in sensitive areas. They attribute reform failures to the crafting of the conditionality strategy and to conflicting interests, administrative traditions and cultural norms. The case highlights key challenges for the EU in its handling of the diversity of administrative systems across the eurozone, an agenda neglected at Maastricht.

Introduction: Southern Europe and the Process of ‘Europeanization’

Abstract This article introduces the theme of ‘Europeanization’ in the context of the focus on contemporary southern and Mediterranean Europe. In applying the term ‘periphery’ to the region, it argues that the major contrasts that exist between it and the ‘core’ EU states serve to highlight in stark terms the challenges endemic within the Europeanization process. It explores the different meanings of ‘Europeanization’ and argues that it necessitates a broad focus and a complex ontology. The case studies that follow are placed within the perspective of domestic institutional adaptation, albeit in multi-tiered, core-periphery setting. The southern experience highlights the dynamism, asymmetry and fragmentation of the Europeanization process. These attributes are of increasing significance both to an understanding of the patterns of change underway in the region and to the future stability and cohesion of the EU itself.

Political Change in Greece before and after the Colonels

This book provides historical background explaining the eventful changes in regimes which have occured in Greece since the Second World War.