The State of the European Union

One decade after the collapse of Lehman Brothers heralded the economic and financial crisis that would keep the world in suspense and provide the initial spark for a range of processes of economic restructuring, the project of European integration finds itself confronted with a variety of problems that impede the realization of policy cohesion on the European level. In this introductory chapter, the editors define a transdisciplinary framework for analysing the current crisis in its multidimensionality and present the different political, socioeconomic, and economic approaches employed therein. Combining the neo-Gramscian concept of hegemony with a heterodox economic approach, the chapter focuses on questions of policy coherence, democratic accountability and economic restructuring. The chapter provides an overview of the fault lines in European integration and retraces how areas of economic and democratic governance, financialization and militarization, the rise of the extreme right, as well as social exclusion, welfare and migration are facets of this process.

This article unfolds the theoretical concept of authoritarian competitive statism as an analytical tool to understand the current conjuncture of the European mode of integration. It presents a response to the crisis of hegemony of neoliberal integration, which followed the economic crisis within the EU. For that purpose I will—drawing particularly on the Greek-French state theorist Nicos Poulantzas—examine the tensions between democracy and capitalism and the metamorphoses of the capitalist state implied therein. In an empirical illustration of European crisis management I show that the economic dispositifs of preventing a break with neoliberalism where erected at the supranational scale, while the rearrangement of directly repressive instruments took place at the national scale because this remains the key terrain for social movements. The transnationalisation of the state is therefore key for examining and understanding its metamorphoses into a progressively authoritarian European ensemble of state apparatuses, understood as a deep entanglement and dependence of national and supranational state apparatuses.

The chapter analyses the two most fundamental processes of restructuring and transforming the European Union during the last decade from a feminist political economy perspective, namely the economic governance regime in the aftermath of the financial crisis in 2007/2008 and the reconfiguration of the (in)security regime of the EU, which has been accelerated since 2017. The chapter moreover investigates the gradual transformation in EU gender equality policies, funding and institutions. The transformations show deeply enshrined reconfigurations of gender relations and gendered power structures. Common tendencies are the closing of democratic spaces, shifts of key public functions to private spheres and increasing male dominated masculinized institutions, a revival of masculine imaginery and trends of a re-essentialization of men’s and women’s roles. These developments are complemented by dynamics of re-shifting the focus on and obliterating gender equality. The three interwoven change dynamics are paradigmatic for the changing nature of the European Union and profound changes in the gender order within the EU. Shifts in the economic, military and public-private spheres strengthen and constitutionalize stronger masculine authoritarian reconfigurations in EU economic and (in)security policies and institutions meanwhile.

Recent developments such as the lasting impact of the economic and financial crisis of 2008 and particularly the so called “refugee crisis” of 2015—as the immigration of larger groups of people from the Near East and African countries via Eastern Europe and the Southern Mediterranean region has been termed—have posed fundamental challenges to European democracies, political parties, and policy makers. In addition, the noticeability of the effects of globalization in everyday life and relating uncertainties have contributed to feelings shared by an increasing number of voters that traditional parties are no longer able to solve today’s political, economic and social problems. Thus, people tend to support populist alternatives. The chapter focuses on the example of Austria, where the center right Sebastian Kurz List—the New People’s Party has accepted the far right-wing populist Austrian Freedom Party as junior coalition partner in December 2017. The former has itself recently turned into an in-between center right party and right-wing populist movement under the leadership of the party’s chairman and until May 2019 Austrian federal chancellor Sebastian Kurz. Due to political developments in Austria throughout the last two decades which eventually culminated in the result of the 2017 general elections and the following formation of the coalition government between the People’s Party and the Freedom Party, Austria can serve as a prime example for the analysis of a changed frame of political discourse which further supports the process of normalization of right-wing populism.

This contribution analyzes the classification of extreme right wing parties in Europe based on a twelve-country comparison. With respect to terminology, the case is made for maintaining the “extreme right party family” as the category of comparison and to comprehend those extreme right-wing parties that resort to populist strategies as one variant of right-wing extremism in Europe. It is argued that instead of understanding right-wing populism in isolation the focus should be shifted to two other dimensions: the relationship of the parties to the national socialist or fascist past and tradition on the one hand, and on the other hand the concrete positioning of the parties with regard to Europe.

About a decade after the outbreak of the financial crisis, claims about the re-regulation of financial markets have not been realized by far. On the contrary, in some regards the political economic strategy of the EU has reoriented again towards pushing financial markets and financialization, which was the pathway before the financial crisis. This article seeks to explore these developments by taking stock of European financial and monetary policies and related processes of financialization. We will argue that there have been contested initiatives to stabilize the EMU, which go hand in hand with a stabilization or even resumption of financialization. To support our argument, we draw upon perspectives of critical political economy of European financial market capitalism which are useful in identifying contested policies and underlying power relations that are inscribed in the European integration process and, more specifically, in the management of the ongoing Eurozone crisis. Besides the European level, financialization continues to play an important role in the member states as well. Relevant areas are primarily the reorganization of social security provisions (above all pensions) and policies of privatization.

The chapter analyses the increasing role of financialization on European housing markets and its immediate impact on prices and social asymmetries in the Austrian and Irish case. Financial structures of housing show a disperse picture throughout the European Union, while countries which experienced a boost in financialization such as Ireland were more strongly exposed to house price boom and bust cycles. When comparing institutional settings of economies with diverging experiences with regard to house prices in the past, it turns out that those promoting free market solutions in housing—in combination with the high vulnerability of private households to financial market developments—account for house price bubbles. The authors take into account Schwartz’s and Seabrooke’s analysis of the residential housing market and argue that the role of the state and its form of housing provision and/or subsidy schemes is not integrated into their analysis satisfactorily. The chapter thus widens their residential capitalism approach by analysing the institutional setting of housing provision and the structure of national financial systems.

The policy of the European Union should officially be guided by the principle of policy coherence. The promotion of stability, peace and development within and beyond the EU are central goals but these goals may conflict with one another. The dominant opinion assumes that liberal market-oriented economic policy contributes to economic and social progress and therefore to political stability and peace. This paper however questions this assumption by showing that this interpretation is based on a neoclassical understanding of the economy which fails to adequately address the dynamics of economic development and crises. Therefore, it will be argued that alternative perspectives such as critical international political economy are needed. The strength of this approach is illustrated with an analysis of external relations of the European Union and its member countries, the(de-)stabilising effects of these policy strategies in general, as well as the EU’s increasing militarisation efforts and in particular its role in global rivalries.

This chapter outlines a socioeconomic framework that builds on conceptions of hegemony and authoritarian neoliberalism in order to analyse and to link the various intertwined processes marking the authoritarian policy shift in the EU. While economic necessity serves as the overarching mantra, the disciplining of households and member states’ budgets through austerity policy measures intensified in the aftermath of battling the 2008 crisis and eventually led to an overemphasis of authoritarian elements in policy-making as well as on the level of negotiating social consensus. On the societal level, austerity and the amplification of authoritarian policies and discourses have led to increasing levels of radicalization due to an increasing lack of prospects, the widespread diffusion of economistic imperatives, and the subsequent formation of new societal groups within an environment of constant economic insecurity.

Since the onset of the global financial crisis a decade ago, social policy reforms have become increasingly prominent in EU governance and policy debate. The severe decline in annual growth rates of social expenditures in EU-28 indicates a clear retrenchment bias in implementing respective reforms after 2008. Whereas the increasing salience of the seemingly necessity of austerity policies and structural reforms is widely acknowledged, the causes and consequences of these developments remain fiercely contested. While some see the EU as a catalyzer of the debasing of national welfare states, mainly driven by the imperative of fiscal discipline, others stress the broad scope of action left to national decision makers. Many member states have undertaken more or less far-reaching social and employment policy reforms, which they have often sought to justify by reference to EU requirements and recommendations. The article seeks to identify and to discuss specific trajectories and causalities explaining the retrenchment and deregulation bias, which goes along with the post-crisis architecture of fiscal and macroeconomic policy coordination, including Economic Adjustment Programs and Memoranda of Understandings (MoUs) imposed on fiscally distressed countries. Therefore, an econometric analysis provides an examination of the impact of financial assistance programs (ESM/EFSF) and/or of the Excessive Deficit Procedure (EDP) on countries’ social expenditure rates for the period 2008 to 2013. In addition, the correlation between the ideological base of parties in government and the social expenditure ratios is tested.

This chapter takes a long-term perspective on the term ‘crisis’ and EU asylum policy. It starts by looking at how the financial and economic crisis that the EU has faced post-2008 has affected decision-making processes and outcomes in the asylum field. It then moves on to the EU’s response to the recent ‘refugee crisis’. The chapter argues that the EU has sought to safeguard the key pillars of its asylum policy—notably the Dublin system—by providing EU member states that face high migratory pressures and/or financial constraints with additional support. While the southern and northern members had most political disagreements pre-2015, this has changed since the refugee crisis. The Commission’s idea to install a permanent and legally binding relocation mechanism has met staunch opposition in the Visegrád group, an alliance of four Eastern European countries. The current struggles point to a dilemma for the EU: can the EU further deepen the integration process in a field such as asylum policy in view of populists and Eurosceptic governments? The risk of a fragmentation of the EU due to the migration issue is still real.