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Shelton investigates the conditionality regime directed at 'transforming societies' inside EU candidate states. He offers a new understanding of conditionality that incorporates the social and subjective dimensions of the 'European project', locating the ambitions and limits of conditionality in the ideas of political economy.



Introduction: Conditionality in Crisis?

1. Introduction: Conditionality in Crisis?

As late as 2013, Europe was said to be in crisis. The future of the euro was in doubt, threatened by bank bailouts and sovereign debt. Recession rocked the continent, helped along by austerity measures that generated social unrest, and newspapers declared the future of the European Union (EU) itself to be imperiled. Coverage of such disorder in European affairs suggested that the period since late 2009 — when the Greek government first announced the state had been grossly under-reporting its budget deficit — had been something of an aberration; a formerly harmonious Europe had been ripped asunder by bad assets, overleveraged banks, public bailouts, and profligate spending. Yet from another vantage point, crisis — and anxious anticipation of the next crisis — has been the very stuff of European Union. Crisis re-made the idea of ‘Europe’, and it is fear of crisis — particularly anxieties about the political, economic, and social cohesion of the continent following the collapse of communist states in the east — that has rationalized the functional and geographic expansion of the Union. Crisis propels the ‘European project’ haphazardly forward. Disharmony is an invitation to governance.

Joel T. Shelton

Political Economy and Conditionality


2. The Limits of International Political Economy

Political economy has been a contested terrain since its emergence as a field of knowledge and practice concerned with securing material abundance through the proper ordering of the emerging commercial societies of late seventeenth-century Europe. Political economy concerned itself with understanding both the production of wealth and the social and political order that sustained the workings of an increasingly complex market system; early capitalism promised to overcome scarcity but at the price of destabilizing the old order. In the context of these uncertainties, political economy emerged as a field of knowledge concerned with understanding the conditions of possibility for order and abundance and driven to investigate the extent to which the disharmonies of the emerging order could be managed or redirected, at least for a time. Disputes and exclusions emerged early on: According to the founding lore of the discipline, Adam Smith dealt a ‘mortal blow’ to Sir James Steuart, Smith’s well-known and better-traveled contemporary, when he failed to cite his fellow Scotsman’s An Inquiry into the Principles of Political Oeconomy (1767) in The Wealth of Nations (1776) — ‘even in places where his arguments directly confronted those of Steuart’ (Blaug 1991: x). Lest we assume the slight is accidental, a 1772 letter from Smith to William Pulteney suggests otherwise: ‘I have the same opinion of Sir James Steuart’s book that you have. Without once mentioning it, I flatter myself that any false principle in it will meet with a clear and distinct refutation in mine’ (as cited in Rae 1895: 253).

Joel T. Shelton

3. The Anxieties of Classical Political Economy

Equilibrium is the article of faith of a political economy defined in terms of harmony. No matter the temporary impediments to order and abundance in political-economic life, the actions of self-interested states, firms, and individuals will in time adjust to new conditions and deliver a new set of prices, a new level of output, and a stable institutional order reflecting a new balance of political interests. Where irrationalities erupt, they can be attributed to the operation of ‘norms’ and subsumed as an exception that proves the rule. States, firms, and individuals calculate, markets clear, and institutions adjust. From this vantage point, political economy appears as a ‘great and harmonious machine’ (Blaney and Inayatullah 2010a: 58). Existing theorizations of European Union enlargement are heavily indebted to this account of political-economic life, explaining the function of EU membership conditionality in terms of bargaining outcomes, legislative alignment, and rule/norm adoption that work to harmonize interests, law, and institutions.

Joel T. Shelton

4. Political Economy and the Problem of Conduct

Karl Marx insists that nineteenth-century political economy is too enamored of Adam Smith’s invisible hand — not only does the ‘free trader vulgaris’ (1981: 280) build on this turn-of-phrase a substantial ideological apparatus that conceals the real forces that shape political-economic life, he also hides from view the disharmonious character of these forces. For Marx, harmony in exchange is not the result of approbative sociality or the management of circumstance, but is an appearance — merely the ideological surface of an inherently disharmonious set of social relations that fuel the production of commodities and the accumulation of wealth. In Volume I of Capital (1867), Marx (1981: 280) argues that the views, concepts, and standards of political economy are derived from only its most visible dimension — ‘the sphere of circulation or commodity exchange’. From the surface of exchange, political economy appears harmonious — a realm of freedom in which buyers and sellers come together to exchange commodities (including labor-power) by their own free will, equal before the law, and looking only to their own advantage. Within the sphere of circulation, ‘either in accordance with the pre-established harmony of things, or under the auspices of an omniscient providence, they all work together to their mutual advantage, for the common weal, and in the common interest’ (1981: 280). To the harmonizer, the domain of political economy is ‘the exclusive realm of Freedom, Equality, Property and Bentham’ (1981: 280).

Joel T. Shelton

Conditionality as Technique of Governance


5. Assembling Conditionality in the Republic of Macedonia

For EU policymakers currently insisting on the moral economy of austerity in response to the banking and subsequent sovereign debt crisis in Southern Europe, the case of Greece suggests a particular lesson: Inadequate conditionality in social and subjective dimensions of political- economic life prior to membership (i.e. the alleged inefficiency of the Greek worker, corruption of the Greek official, and profligacy of the Greek consumer) breeds social disorder and economic contagion. That other explanations for the crisis are possible — in particular, that the introduction of the euro encouraged unsustainable lending practices and wage inflation in Southern Europe as Germany’s export markets surged (Krugman 2012) — is of little importance. The specter of an unconditionalized Greece seemingly makes the work of conditionality in the Republic of Macedonia and other candidate states in ‘the Balkans’ (a region long understood to be potentially dangerous) all the more vital.

Joel T. Shelton

6. Ambitions Interrupted: Conditionalizing Human Resources Development

As the reach of the ‘European project’ extends south and east, conditionality takes on a number of ambitions that were unthinkable in the earliest rounds of enlargement. Far from being concerned only with the bargaining of high politics, institutional rules, regulatory standards, and legal harmonization, conditionality has opened up fields of interventions in Southeastern Europe through prioritization, programming, and evaluation that now encompass projects to transform the ‘human resources’ of candidate states prior to enlargement; the overriding logic of conditionality in ‘human resources development’ has been the vision of state, society, and person articulated in neoliberal accounts of political-economic life.

Joel T. Shelton

7. Conditionality and the Future of ‘Europe’

The fragility of conditionality as a technique of governance emerges in part from the ‘technical’ limits of its instruments: ill-defined fields of intervention, imprecise objects, insufficient financial support, inadequate implementation infrastructure, and agents sometimes working at cross-purposes — in short, a relay that can short-circuit at various points. European Commission officials have continually worked to overcome these limits: fields of intervention have been reimagined, financial assistance has been restructured, and the instruments of conditionality have been adjusted, refined, and expanded over time. The conditionality that has emerged from this ad hoc configuration is neither a centralized set of practices dictated from Brussels nor a strategic game between a unitary European Union and candidate state counterparts acting as more or less rational persons, but a bundle of diverse activities coordinated through the operation of several instruments and conducted by a range of agents who are differentially positioned across space and time, working within and across spaces of governance usually designated as international, national, and local.

Joel T. Shelton


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