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In 2012, Draghi put an end to rising euro area sovereign bond yield spreads by resolving to do 'whatever it takes'. The crisis rhetoric and institutional practices of unlimited liquidity have since become commonplace, as countermeasures to recent market turmoil show. This article sets out to explain how and why 'unlimited liquidity' ideas moved to the ECB's center of economic analysis during the euro crisis. Previous work fails to decipher that the ideational shift was highly anomalous when viewed against German ordoliberalism or scholarly support for 'expansionary austerity'. Addressing this relative neglect in other accounts, we draw on qualitative text analysis and expert interviews to argue that this shift was due to norm entrepreneurs who capitalized on the uncertainty of the crisis. We employ constructivist arguments to identify four scoping conditions that account for the ascendance of 'unlimited liquidity': an indicative reference, credibility, institutional positioning and—as an extension to the literature—intellectual sensitivity. Our analysis suggests that the euro crisis changed economic ideas, and fundamentally remodels the constructivist framework for studying monetary policy in crisis times. [ABSTRACT FROM AUTHOR]

In light of the German government’s long-held preference against EU-wide fiscal burden-sharing, a hallmark of the Euro crisis, its support for an EU-wide debt-instrument during the COVID-19 pandemic constitutes a dramatic policy U-turn. To make sense of the ‘Berlin puzzle’, we develop a theoretical mechanism that explores why an initially reluctant German government heeded to the call for transnational fiscal solidarity: First, to avoid a ‘common bad’ of a large-scale economic contraction, proposals for an EU-wide fiscal response became a political imperative. Second, the successful framing of the crisis as ‘nobody’s fault’ rendered the call for European solidarity as the dominant standard of legitimacy to which all governments subscribed. Third, governments whose preferences were not aligned with this standard faced mounting normative pressure and isolation. As a result, governments changed their positions, but not their preferences. We probe this mechanism by carrying out a process-tracing analysis of the German government’s fiscal policy U-turn in the crucial months preceding the adoption of the Next Generation EU (NGEU) recovery plan in July 2020. The paper contributes to the growing literature on fiscal burdensharing in the EU by demonstrating when and how member states can change their stance on transnational fiscal burden-sharing. [ABSTRACT FROM AUTHOR]

Following the pandemic, the EU has responded to the threat of a euro crisis flare-up by deactivating its fiscal framework and establishing the Recovery and Resilience Facility, drawing on joint European bonds to finance national investments. This paper seeks to explain these modifications to fiscal governance and asks whether they are an indication of European austerity making way for an alternative fiscal paradigm. Based on a neo-Gramscian approach, it discusses the policies as parts of competing political projects that are promoted or hindered by certain framework conditions. The paper undertakes a structured comparison of these framework conditions during the euro crisis and the current crisis. It finds that geoeconomic competition increases the demand for a more active fiscal policy, while political preferences and structural relations remained remarkably stable. As the current crisis is marked by high inflation, economic conditions are adverse to a fiscally expansive agenda. The findings do not suggest a lasting reorientation of European fiscal governance. Instead, the measures taken during the pandemic are interpreted as expressions of 'passive revolution' in which the EMU adapts elements of a fiscal integrative agenda to provide necessary fixes to its economic order while keeping its underlying fiscally restrictive features intact. [ABSTRACT FROM AUTHOR]

By focusing on ECB's economic policy thinking and its internal politics of ideas, this research aims to provide two contributions to knowledge. Firstly, it seeks to enhance scholarly understanding of ideational change inside international organisations (IOs). To do so, it asks (a) how ECB's economic policy thinking has evolved since the outbreak of the euro crisis, and (b) what drives change in ECB's ideas on the best way to deepen Europe's Economic and Monetary Union (EMU) in its fiscal and economic realms. To answer these questions, fiscal policy, structural reforms and convergence towards resilient economic structures are used as case studies. The article argues that the interplay between changes in ECB's leadership and internal policy discussions promoted by ideational entrepreneurs played a pivotal role in enabling new ideas to emerge inside the Bank. Secondly, by interrogating ECB's ideas on the way to complete EMU, this research reflects on the future of the euro. It shares the view that the construction of cognitive authority within IOs is an ongoing political struggle over the ideas underpinning the everyday practice of global governance. By looking at the politics of ideas within the ECB, this article aims to contribute to the international political economy of EMU deepening. [ABSTRACT FROM AUTHOR]

The theory of international regime complexity that frames this study specifies expectations for international cooperation stemming from different combinations of hierarchy and differentiation among institutions in regime complexes. This paper compares relationships between regional financial arrangements and the International Monetary Fund in the regional complexes for crisis finance in East Asia, Latin America, and the euro area during 2000-2019 and tests these expectations. Creditor states that sit at the nexus between global and regional institutions are particularly influential in the choice of architecture (the combination of hierarchy and differentiation) for these complexes but are constrained by arrangements inherited from previous decades. Once chosen, the complex's architecture in turn shapes policy adjustment in borrowing countries and influences whether states pursue regime shifting or competitive regime creation when dissatisfied with institutions. These findings generally coincide with expectations, but exceed the degree of policy adjustment that the core theory expected for the euro area. Interinstitutional collaboration, the dynamics of which are elaborated, fills this explanatory gap. The paper concludes that relations among institutions are essential for understanding the outcomes and evolution of regime complexes and underpin a more complete explanation than provided by singular institutionalism, the power-gap hypothesis and other alternative approaches. [ABSTRACT FROM AUTHOR]

In Europe's Crisis of Legitimacy: Governing by Rules and Ruling by Numbers in the Eurozone, Vivien Schmidt authoritatively charts how the European Union weathered the crisis of its single currency in the 2010s, gradually moving from fiscal austerity and structural reform to a more systemic solution and flexible interpretation of the euro's governing rules. Using a discursive institutionalist approach in combination with a "systems theory" understanding of democratic decision making, Schmidt persuasively argues that we need to look at the euro problem as a fundamentally political problem that lacked democratic legitimacy as long as technocrats were in charge of policy solutions. Schmidt argues that the euro crisis needs to be broached from the point of view of the E.U.'s split-level legitimacy as well as the growing politicization of E.U. governance in an era of increasing populism and rising Euroskepticism. Schmidt's application of discursive institutionalism allows readers to judge for themselves whose and which ideas mattered, why and in what way they were implemented, and how they gradually evolved over time. [ABSTRACT FROM AUTHOR]

The rise of populist parties is a defining feature of political change in the advanced capitalist countries. Whereas a large body of research explores populist parties in domestic politics, we know little about how populist parties of right and left have responded to the transformation of the transnational Eurozone regime. In this paper, we show how the diverse exposure to the costs and benefits of EMU can explain their EU-level economic policy positions and thereby create opportunities for populist alliances across the left-right divide. In the debtor countries of Southern Europe, populist parties of both right and left have resisted demands for neoliberal reform during the Euro crisis while supporting fiscal risk-sharing arrangements during the COVID-19 pandemic, making populist left-right coalitions possible. In the creditor countries of Northern Europe, by contrast, populist right and left parties have been fundamentally divided throughout. Based on case study analyses of Germany and Italy, the most prominent creditor and debtor countries, our findings suggest that populist parties may only find common ground when ‘Brussels’ interferes in domestic policy-making autonomy by imposing neoliberal reform. [ABSTRACT FROM AUTHOR]

This article aims to discuss the impact of the energy crisis exacerbated by the Russo-Ukrainian war on the general macroeconomic performance and income distribution of the Eurozone. We consider the restrictive monetary policies induced by the return of inflation, their declared and implicit objectives, and the contradictory consequences for the economic system. We analyse the impact of Western sanctions on the Russian economy, and discuss the long-term consequences of sanctions and political strategies on the de-dollarisation of global markets.

Ordoliberalism is often recognized as a powerful ideational source during the Euro crisis; however, there is no pure ordoliberal vision of European integration, and ordoliberal ideas have been used to support both Eurosceptical and Europeanist positions during the crisis. This article reconstructs the ordoliberal theoretical and political debate on European integration and argues that there exist two ordoliberal paradigms of European integration: one bottom-up, whereby the commitment to liberal economic policies at the national level is the precondition for a liberal international order; the other top-down, whereby a liberal international order can help the establishment of a liberal order at the national level. The article compares two ordoliberal visions of the international order: Wilhelm Röpke's 'liberalism from below' (which follows the bottom-up logic) and Viktor Vanberg's 'competitive federalism' (which follows the top-down logic). Then, it explores the ordoliberal political debate on two episodes of the European integration process – the Maastricht Treaty and the Euro crisis – to argue that the bottom-up and the top-down logics underpinned, respectively, Eurosceptical and Europeanist arguments. [ABSTRACT FROM AUTHOR]

Do integration crises reinforce legal differentiation in European integration? Are differentiated EU policies under stress prone to cascading opt-outs? We argue that integration crises as such are unlikely to cause further fragmentation in already differentiated EU regimes. If the EU decides to adopt new treaties and laws in response to the crises, however, these are likely to reproduce and extend pre-existing patterns of differentiation. Empirically, this study offers within-case counterfactual analyses of differentiation in the Euro and the migration crises. Whereas the Euro crisis triggered a major institutional change in the Eurozone, the member states could not agree on a thorough reform of the asylum system. Correspondingly, we observe excess differentiation in the Euro crisis but stable differentiation in the migration crisis. [ABSTRACT FROM AUTHOR]

This research investigates links between the Euro Crisis and populism and asks whether there are patterns of populism in different election campaigns, namely is there country-specific populist rhetoric or similar anti-elite criticisms? Through content analysis, we examine the mainstream media coverage of populist and non-populist actors in the countries that were most affected by the Euro Crisis (Greece, Ireland, Portugal, Spain) and in Poland, a country that, despite not being part of the Euro, has been experiencing a significant rise of populism recently. These are also countries underrepresented in systematic empirical political communication research and that represent different levels of success of populism. Our findings show that although mainstream news media tends to be negative towards populist candidates, there are important cross-country differences with potential impact on the electoral success and failure of populist actors. [ABSTRACT FROM AUTHOR]

How should history judge the euro crisis and the way it was handled? Does it qualify as a policy fiasco in the sense that it was avoidable? Or could the crisis at least have been handled in a manner which substantially reduced its destructive impact on the economic and social welfare and politics of Europe? These questions necessitate counter-factual analysis. Nevertheless, they deserve attention. How history is interpreted impacts decisions about today and tomorrow. The article explores three discourses on economic governance: on financial stability, fiscal policy and on growth. Each discourse came with pathologies: they did not sensitize decision-makers to crucial negative consequences of the policy choices they privileged at decisive points in the sequence of boom, bust and (policy engineered) painfully slow recovery. The ECB has quietly changed its ways, but unwillingness to confront the crisis head-on as a policy fiasco can obstruct learning opportunities that are important for the EU and the Eurozone going forward. [ABSTRACT FROM AUTHOR]

(Series Information) European Papers - A Journal on Law and Integration, 2021 6(3), 1397-1414 | Article | (Table of Contents) I. Introduction. - II. Four main categories of CJEU cases. - II.1. EMU and the euro and debt crisis in general. - II.2. Problems of multilevel decision-making. - II.3. Questions of liability and responsibility. - II.4. Issues relating to the Banking Union. - III. Concluding observations. | (Abstract) The main objective of this Article is to map and categorize the CJEU's case law relating to EMU. Although in purely quantitative terms, this is not a huge task, there are already enough relevant court rulings, up to 31 December 2020, to enable the establishment of a taxonomy distinguishing between four different categories of EMU-related case law. The first and foremost category will comprise cases dealing with the fundamentals of EMU, including clarifying the distinction between monetary policy and economic and other policies. This category includes a number of well-known cases of great political importance, such as Pringle ECLI:EU:C:2012:756, Gauweiler ECLI:EU:C:2015:400, Weiss ECLI:EU:C:2018:1000, Kotnik ECLI:EU:C:2016:570 and Florescu ECLI:EU:C:2017:448. A second category relates to the nature of the EU as a system of multilevel governance and the need to determine whether the competence to act is at national or Union level or a mix of the two. Cases in point include UK v ECB (security clearing) ECLI:EU:T:2015:133, Berlusconi ECLI:EU:C:2018:1023 and Rimšēvičs ECLI:EU:C:2019:139. A third group of cases relates to issues of responsibility and liability, including questions of the liability of "abnormal" EU bodies or settings such as the Troika or the Euro Group. Fourth, especially the Banking Union has triggered cases relating to prudential supervision and other more technical issues. This analysis will be completed by some concluding remarks, including the question of the intensity of judicial control (standard of review), viewing the EMU case law in a broader context.

During recent years, central banks have increased the levels of their international reserves at an unprecedented pace. In this paper, we introduce new country-specific reserve data and examine determinants of the composition of international reserves. Using a dataset of 36 countries (and the euro area) for the years from 1996 to 2016, we identify currency pegs and trade patterns as determinants of currency compositions. Our results emphasize the importance of transaction motives for the composition of currency reserves. The euro crisis appears to have been a setback for the euro, which temporarily seemed to challenge the US dollar as the most important international reserve currency and potentially impacted the determination of international reserve compositions. [ABSTRACT FROM AUTHOR]

The architecture of European labour policy has changed in the past years of the euro crisis and its management. While in the pre-crisis phase EU labour policy still had a mainly symbolic character, the EU crisis management gave it a much more binding character. The article analyses the continuities and shifts in European labour policy against the background of austerity and crisis policy arguing that a new labour policy complex was able to emerge at the European level. While institutional shifts were considerable, the market-liberal orientation of labour policy remained in place. However, it was radicalized with the resilience approach. The article therefore provides an overview of the continuity and change of European labour policy in the euro crisis on the basis of institutional and discursive shifts. [ABSTRACT FROM AUTHOR]

Since the global financial crisis, the relationships between gender and political economy have received renewed attention, emphasising change as well as continuities. Similarly, a recent return of attention to the interrelation between masculinity and neoliberalism has stressed historicity and specificity in the nature of these relationships. However, the question how articulations of gender and the economy are socially and politically made within a contested field of economic governance has not yet received attention. This paper seeks to contribute to the literature with the concept of gendered performative agency, which can be used to specify the link between masculinities and political economy, and inform a gendered analysis of important politico-economic events. Empirically, it contributes a study of the making of the monetary policy principles of the European Monetary Union (EMU), analysing the gendered performative agency of the governors of the German Bundesbank in their public discourse from 1988 to 1998. It argues that by mobilising metaphors of disciplinary masculinity in their discourse of monetary policy and in their performances of identity, the governors fostered legitimacy for their policy positions. Thus, the performance of masculinity contributed to performing monetary policy and to shaping the EMU. [ABSTRACT FROM AUTHOR]

This article analyses the development of financial assistance in the Eurozone since 2010. It argues that reforms to instruments and bodies, notably the European Financial Stability Facility, the European Stability Mechanism, and the current Covid-19 recovery fund, are best explained by a re-occurring pattern of negotiations between potential creditors and debtors based on common Eurozone interests and national cost-benefit considerations. Building on a liberal intergovernmentalist approach, this article shows how this pattern influenced the step-by-step reform of financial assistance in the Eurozone. The threat to Eurozone stability served as a constant factor encouraging member states to expand and deepen the assistance formula. Creditors’ cost-benefit considerations were key for retaining disincentives, a limited liability for common debt, and intermediary borrowing and lending within the financing design. However, on the back of common Eurozone interests, debtors were able to push for an increase in assistance, an expansion of assistance into areas of banking sector support, and a softening of moral hazard elements in the more recent Covid-19 pandemic. Due to creditors’ continuous insistence on safeguards and limited burden-sharing, reform outcomes were repeatedly unable to resolve the difficulties at hand.

Scholars regularly mobilise the concept of policy paradigm to characterise successive periods in which certain ideas appear to structure policymaking. While this concept proved useful to establish that ideas matter, it is time to start thinking about ideas in ways that better resonate with actors' practices. This article introduces and empirically illustrates two conceptual alternatives. First, it looks at international monetary relations from 1944 through the early 1970s. Instead of simply labelling this period as 'Keynesian,' it shows that the enduring centrality of gold was a pivotal practice among policy makers. Second, it considers the governance of the Eurozone in the run-up to the crisis of the 2010s. Rather than viewing this period as 'neoliberal,' it highlights a new discursive repertoire of governance that produced both austerity and unconventional policies. In sum, practices and repertoires help to make sense of elements of continuity, ambiguity and contestation that are often obscured by ideational analysis. [ABSTRACT FROM AUTHOR]

Conventional wisdom about the European sovereign debt crisis and its handling defends that fiscal austerity is unpopular and that external conditionality and/or imposition on national democracies generates backlash. However, not enough research has addressed this question: How willing are citizens to accept unpopular policies imposed on their national governments by European institutions? Would they object to unpopular policies less if these were coming from their national representatives? In this article, we propose a survey experiment, complemented by four focus groups, to test whether citizens' willingness to accept economic policies varies depending on whether the decision originates in the national parliament or in EU institutions. The experiment was conducted in Spain in 2017. Our results show that agreement with a particular policy does not depend on the policy-making actor but on the policy's content. The bitter pill of austerity is no less bitter because elected politicians decide it at home. Similarly, EU 'diktat' does not make a popular policy less popular. Our conclusion is that Spanish citizens during the Euro crisis objected to the policy of austerity due in large part to its content and not to the EU intervention in favour of implementing it. [ABSTRACT FROM AUTHOR]

The article systematically reviews EMU governance reforms implemented, policy instruments introduced and further institutional reforms currently under discussion with a view of how far they have addressed the institutional shortcomings of the euro-area architecture, which have led to the euro crisis of 2010ff. It further explores how far these reforms have helped to prevent a replay of that crisis when the COVID-19 pandemic hit the euro area. To this end, the article first reviews the academic debate about the causes of the euro crisis that started with the Greek sovereign debt crisis in 2010. In a second step, it evaluates the reforms implemented since the onset of the euro crisis and during the COVID-19 crisis with regard in how far these reforms have addressed or could address the causes of the crisis and gives an outlook on potential forthcoming problems. [ABSTRACT FROM AUTHOR]

Over the past two decades, real GDP per capita in Portugal has nearly stagnated. The conventional account attributes this to the mismanagement of public finances and the lack of structural reforms in labor and product markets prior to the "adjustment program" agreed with the troika in the early 2010s. In the same vein, the neoclassical-inspired interpretation explains the subsequent recovery based on supply-side and fiscal reforms implemented during the troika years, which would account for the reduced fiscal deficits, external equilibrium and employment growth registered in the pre-COVID-19 period. In this article, we challenge this optimistic view, identifying structural weaknesses of the Portuguese economy that would have soon become apparent even if the pandemic had not happened. Addressing these weaknesses requires changes that go beyond the EU and national responses to the pandemic crisis. [ABSTRACT FROM AUTHOR]

Financial markets understood the Euro crisis as a two-level game. They monitored national politics as a source of both national and European policy. The incentives to conform to the market's preference were weaker for creditor countries than for debtor countries because debtors were providers of their own macroeconomic policy, but each creditor was one of several contributing to bailouts. Worries about default caused investors to sell the bonds of debtors and thereby constrained debtors by raising interest rates. By contrast, if creditor behaviour reduced the probability of a bailout of debtors, the response again would be to sell assets linked to the debtor. The implication is that market responses to creditor elections should have been larger and more turbulent than reactions to debtor elections. We test this theory by analyzing credit default swaps of eleven countries around fifteen elections and conducting a content analysis of 3,126 reports from Bloomberg terminals. [ABSTRACT FROM AUTHOR]

Is the European Union a technocracy? Observers and practitioners of EU politics have debated this deceptively simple question for decades, without arriving at a clear answer. To a large extent, this is due to the elusive nature of technocracy itself, a phenomenon that is hard to define with precision, and even harder to measure empirically. To tackle this problem, the article presents a novel approach to technocracy in the EU based on the study of bargaining settings, in which political and technical actors interact horizontally and simultaneously—as opposed to sequentially—thus allowing for a better appraisal of the power of experts. Using data gathered by the 'EMU Choices' project, we apply this alternative framework to the analysis of negotiations on the reform of the Economic and Monetary Union over the period 2010–15, focusing on the role of two institutional actors: the European Central Bank and the European Commission. While we find some evidence for technocracy in EMU negotiations, this has been mostly at the hands of the hybrid Commission rather than the quintessentially technical ECB. This suggests both caution in dismissing the EU as hopelessly technocratic, and the need for further research on the nature of the Commission. [ABSTRACT FROM AUTHOR]

In the German parliament, the Bundestag, floor time is a scarce resource and is allocated to MPs by leaders of their respective parliamentary party groups. Previous research indicates that highly salient plenary debates tend to be dominated by party leaders and other loyal frontbenchers. Plenary speeches can therefore offer only limited insights into party unity. Any MP can give a so-called ‘explanation of vote’ (EoVs) to justify their voting decision and/or express their point of view. These written statements provide a more accurate depiction of the range of viewpoints present within legislative parties. In order to assess the effect of party control on observed party unity and parliamentary contestation, discourse network analysis has been employed in this study to compare legislative speech with EoVs in debates on the Greek crisis between 2010 and 2015. Discourse network analysis combines content analysis with an actor-centred approach, and this is the first time this method has been used to study party control and (dis)unity. Bundestag debates on the Greek crisis present an interesting case study, as the issue became increasingly controversial over time, both in the public and the legislature. While this became evident in declining voting unity and individual-level mobilisation through EoVs, the extent to which gatekeeping impedes contestation on the plenary floor needs to be assessed. In terms of representation, it is important that European Union issues not only make it to the plenary agenda but that these debates also reflect the different viewpoints of MPs.

This paper1 scrutinizes the transformation of the European economic governance. This is a framework conceived by European Union decision-makers to establish institutions and processes – coordination and harmonisation of economic policies – in order to achieve economic and social development for the European Union and its citizens. Prior to the global financial crisis, the European economic governance was incomplete, poorly coordinated and in certain macroeconomic areas insufficient. The international financial crisis and the “Euro crisis” compelled a much deeper and more comprehensive governance structure from the decision-makers of the European Union. Despite the rapid emergence of Community-level crisis management mechanisms, ad hoc responses and processes prevailed till the turning point of the “Euro crisis” in 2012. Since then, the transformation the European economic governance continued in a heavily institutionalized and coordinated form, providing a long-term vision for the European Union and the Eurozone. European economic governance has been substantially expanded, institutional arrangements cover fiscal policy, monetary policy, the supervision of the financial system, policies related to structural and competitiveness issues. Moreover, comprehensive and coordinated reform strategies were launched, based on the European Commission’s priorities. In this paper, we carry out a simple analysis to detect whether the new European economic governance has corrected the pre-crisis country-specific risks and institutional flaws.

After an initial phase of firefighting against the euro crisis that began in 2010, one that was characterized by policies that focused on strict austerity, from 2014 onwards the European Commission gradually began to ease its recommendations about fiscal consolidation. Between 2015 and 2016, this policy turn was reflected in series of procedural changes in the European Semester. These gave the Commission a certain degree of discretion in applying the rules and interpreting the benchmarks of the post-crisis EU economic governance arrangements. This article investigates if this double shift in fiscal policy and governance that was initiated in 2014 has been consolidated in 2019, and, if so, what has driven that consolidation. By building on the literatures on EU politicization and policy learning, it asks whether the character of this intra-paradigm policy shift has been more Bayesian or sociological. Based on interviews and on a small-scale survey conducted with key civil servants working at the European Commission, we find evidence to support the putative explanation that, through a political process of policy learning, European Semester officials have acquired a more politicized and flexible practice of fiscal governance and a more social vision of the European Semester. [ABSTRACT FROM AUTHOR]

The euro crisis has shaken up the euro zone. It pushed the boundaries of political conflict, it triggered the most intensive period of decision-making so far and ultimately led to a set of institutional reforms, which define new domains of euro zone decision-making, such as in the case of financial assistance, and assign new roles to different political actors. At last, the crisis became the focal point of scholarly debate and new research activity, some of which has been finalised only more recently. This warrants new debate. In this debate section a group of scholars from political science and legal studies, who have contributed to the study of euro crisis decisionmaking and euro zone development in the context of recent collaborative research projects, discuss who leads the euro zone. Most importantly, they debate what we can learn from crisis decision-making and euro zone politics in recent years more broadly for the question of who leads the euro zone today and who may determine its future policy decisions and institutional reform trajectory. [ABSTRACT FROM AUTHOR]

Euro zone economic governance is determined by governments, as member states resist ultimate transfers of authority to traditional supranational institutions. Neither crisis-driven institutional change nor later reform initiatives have altered this predominant role of domestic executives. The Commission cannot exercise ultimate decision-making powers in the domain of economic governance unilaterally. Instead it is co-opted to what could be called a collective euro zone executive of member state governments. The latter act by consensus or not at all. The democratic pathologies of European politics imply that governments remain reluctant to vacate their seats in euro zone governance. So far, governments have consistently opted for making collective decisions and have chosen to circumvent domestic actors when the euro was at risk. However, governments shy away from forward-looking reforms, which have redistributive implications and are beyond their future control, as they remain uncertain of their own legitimacy when deciding on the euro's future. [ABSTRACT FROM AUTHOR]

Employing a multidimensional conception of power shows how interaction between EU institutional actors is structured by different kinds of power – coercive, institutional and ideational – and that none of these are sufficient on their own for actors to successfully drive the reform process. We ask not just who leads the euro zone, but how interactions between actors enable the polity to achieve (or not) its goals. This requires thinking of power in terms of both zero-sum and positive-sum outcomes, which reveals the weakness of the polity as a whole, whatever the power of different institutional actors. In this view, key for the long-term sustainability of the euro zone is an economic and political rebalancing among its members borne out at the level of common ideas and institutions and the leadership of the most resourceful member states. Despite significant reforms in wake of the crisis, such rebalancing seems far beyond the horizon. [ABSTRACT FROM AUTHOR]