Chaos Brexit

The situation concerning Brexit is as confused as ever. Mike Berry, on openDemocracy, is worried about the referendum since the British citizens are dangerously ill-informed about the choice, and blames a biased and partisan press for it. The Economist agrees that there is a sincere risk that the UK referendum would result in a Brexit, and tries to clarify the issue: Cameron is in a bind, since the small changes he could get in his deal with the EU would not convince any Brexit supporter. However, at the same time, this very negotiation does not allow him to argue that Europe is fine as it is. Thus, the glaring contradictions in the Eurosceptic case for leaving need to be exposed. If the UK wants to retain entry into the single market, it needs to maintain almost all the same regulations, and even keep paying into the EU budget, but without having a say in new regulations or in managing the budget. Even the free movement of people could not be restricted without loosing access to the single market. The cases of Switzerland and Norway prove all those points. Sara Hagemann, on EUROPP, suggests that, rather than proposing grand reforms, the House of Commons and the House of Lords should be granted more extensive powers regarding the input into, and scrutiny of, UK representatives’ policy work in Brussels, like many other continental parliaments have. On the other hand, Thomas Prouza, on Euobserver, links the debate on Brexit with the topic of Social Europe. He claims that any EU-UK deal must preserve social rights. However, there is not much room to manoeuvre. A compromise must be sought between UK’s request to revise the system (necessary for its staying in the EU), the needs of other states, and EU core values.

Social and economic effects of the crisis

Giulia Dotti Sani and Beatrice Magistro, on openDemocracy, have investigated whether, as a result of the crisis, trust has declined equally across European countries, and whether the decline varies among individuals with different socioeconomic backgrounds. The empirical analysis they produced indicates that trust steeply declined in those countries worst hit by the crisis. In particular, in these countries, subjects from the lower social strata lost more trust than citizens at the higher end of the social ladder. Maria João Rodrigues, on Politico, claims that we are now feeling the full effects of conservative policy responses to the Eurozone crisis. To maintain European cooperation, it is necessary to have more division of labour between the Eurozone periphery – which must keep prices down and budgets tighter according to the rules – and high-surplus countries in the core that should provide a demand boost. Without both of these policies, stagnation would be ensured for a long time. André Sapir, on Bruegel, delves more technically into the possible routes to recover from the crises. He argues that differences in national wage formation and bargaining systems, especially between core and periphery states is an important factor behind misalignments of real exchange rates, which are a symptom of asymmetric shocks. If all members had institutions to ensure wage developments in line with productivity developments, an important source of asymmetric behaviour would be eliminated.

Evolution of the European Commission

The Eurozone crisis has also impacted on the institutional role of the Commission. Michael W. Bauer and Stefan Becker, on EUROPP, claim that the Commission was the unexpected institutional winner of the economic crises. While the Commission’s agenda setting powers have been curtailed, it has been considerably strengthened in managerial terms. Contrary to this interpretation, Eugénia da Conceição-Heldt, on EUROPP, argues that the European Commission experienced a “subtle disempowerment” since the Eurozone crisis. By creating the European Stability Mechanism (ESM), Member States deliberately decided to strengthen inter-governmentalism at the expense of the Commission. The “Troika” of the Commission, the International Monetary Fund (IMF) and the ECB, has largely overtaken the Commission’s role to oversee the implementation of economic and financial policies at the national level. Moreover, the Commission has become extensively scrutinised and held accountable to Member States. More generally, Sergio Fabbrini, on Il Sole 24 Ore, argues that this institution has become more political, insofar as its leader is the spitzenkandidat of the bigger party. Juncker is a “political operator”, not a neutral civil servant anymore. Unfortunately, this politicization does not come with the constitutional constraints of parliamentary control. Thus, this loss of technical neutrality has not been followed by an increase in legitimacy.

This Ideas Monitor is by Giulia Bistagnino and Carlo Burelli

Photo Credits CC: Kevin Dooley


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