A number o problems with democratic quality emerge.Te sets o rules and annual targets limit democratic policy choices while economic and scal policy choices, imposedon a liberal democracy by unelected bodies, deprivenational democracies o their core business. All this ismade worse i the rules-based governance ramework doesnot deliver sound macroeconomic results. Moreover, i toodetailed and constraining rules are enshrined in secondary legislation or are constitutionalized at the national level, theability o democracies to sel-correct is weakened.As a result, some governments may choose not to respectthe rules set by “Brussels,” and justiy this on the groundso democratic legitimacy. Tis then poses another threatto the EU’s legitimacy: member states that actually abideby the rules and take nancial risks in the European rescuemechanisms are likely to judge the economic governanceset-up as illegitimate i not all parties play by the rules (asawed as they may be). Te recent elections in Italy and thethreat or the euro area that emerges rom its prospectivepolitical instability pose a threat that could even eventually threaten the survival o the European Union.echnocratic intervention is particularly important ormember states that have applied or a rescue program o the roika (comprised o the European Commission, Euro-pean Central Bank, and International Monetary Fund). Ina country like Greece, the population’s say over economicdecisions has been rendered largely nil, raising concernsthat a solution to the country’s predicament is “no longercompatible with democracy.”
Moreover, some experts nd that the EU’s economicagenda has come to rely unhealthily on “grey zone politics”or deals cut outside ormal channels, the political equiva-lent o the inormal shadow economy.
Moreover, in somemember states, the increasing demand on national govern-ments to meet specic budgetary objectives is leadingnational governments to attempt a recentralization o powers domestically in order to control regional spending.In sum, the EU’s traditional reliance on output legitimacy now rests on shakier ground, as the EU and nationalgovernments have ailed to deliver in terms o growth,
4 W. Munchau, “Greece will have to default if it wants democracy,”
(February 20, 2012).5 AUGUR project on Challenges for Europe in the World on 2030, Report from Workpackage 8, prepared by the Tiger Group of Kozminski University (2011).
employment, and social security. Te EU is increasingly seen as the problem (both by debtor and creditor coun-tries) or low growth rates, restrictions on public spending,and high unemployment, rather than as a solution. Tisis not just a temporary, crisis-linked problem. Given thegenerally weak economic outlook, global competition, anddemographic developments, this is likely be the economiccontext in which the EU operates or the oreseeable uture.In order to improve its general economic perormance anddemocratic legitimacy as much as possible, measures areneeded to improve competitiveness and recover economicdecision-making sovereignty so as to allow the euro areamembers to take legitimate and efcient policy decisions.
Crisis Management and Integration at Gun Point
the way decision-making has taken placeboth in crisis management and in governance reorm haswidened the democratic decit. At acute moments o crisis,key decisions were taken at emergency summits, discardingthe European Parliament, providing a key role to Germany and France to the detriment o medium-sized and smallermember states, and national parliaments were able only togive their consent aer the act — at such a high price ordissent that this was hardly ever a realistic option. Crisismanagement decisions were characterized by a lack o transparency and accountability and made worse by a lack o political leadership and public communication. Many necessary nancial steps to resolve the crisis could notbe taken because o the clash between what creditor and
Member states that actually abide
by the rules and take fnancial
risks in the European rescuemechanisms are likely to judgethe economic governance set-upas illegitimate if not all partiesplay by the rules.