Jürgen Habermas: Democracy, Solidarity and the European Crisis

The Economic and Monetary Union took shape during the 1990s in accordance with the ordoliberal ideas of the Stability and Growth Pact. The Monetary Union was conceived as a supporting pillar of an economic constitution that stimulates free competition among market players across national borders, and it is organized in accordance with general rules binding on all member states.[3] Even without the instrument of devaluing national currencies that is not available in a monetary union, the differences in levels of competitiveness among the national economies were supposed to even out of their own accord. But the assumption that permitting unrestrained competition in accordance with fair rules would lead to similar unit labor costs and equal levels of prosperity, thereby obviating the need for joint decision-making on financial, economic and social policies, has proved to be false. Because the optimal conditions for a single currency in the euro zone are not satisfied, the structural imbalances between the national economies that existed from the start have become more acute; and they will become even more acute as long as the European policy pattern  does not break with the principle that each member state makes sovereign decisions within the relevant policy fields without taking other member states into consideration, in other words, exclusively from its own national perspective.[4] In spite of some concessions, however, until now the German Federal Government has clung steadfastly to this dogma.

It is to the credit of the Commission and the Presidency of the Council that they have addressed the actual cause of the crisis —namely, the faulty design of a monetary union that nevertheless holds fast to the political self-understanding of an alliance of sovereign states (as the “Herren der Verträge”). According to the aforementioned reform proposal, the so-called Blueprint, three essential, though vaguely defined, objectives are to be realized at the end of a path projected to last five years: First, joint political decision-making at the EU level on “integrated guidelines” for coordinating the fiscal, budget, and economic policies of the individual states.[5] This would call for an agreement that prevents the economic policy of one member state from having negative external effects on the economy of another member state. Furthermore, an EU budget based on the right to levy taxes with a European financial administration is envisaged for the purpose of country-specific stimulus programs. This would generate scope for selectively focused public investments through which the structural imbalances within the Monetary Union can be combated. Finally, euro bonds and a debt repayment fund are supposed to make possible a partial collectivization of state debts. This would relieve the European Central Bank of the task of preventing speculation against individual states in the euro zone that it has currently assumed on an informal basis.

These objectives could be realized only if cross-border transfer payments with the corresponding transnational redistribution effects were to be accepted. From the perspective of the constitutionally required legitimation, therefore, the Monetary Union would have to be expanded into a real Political Union. The report of the Commission naturally proposes the European Parliament for this purpose and correctly states that closer “inter-parliamentary cooperation as such does not … ensure democratic legitimacy for EU decisions.”[6] On the other hand, the Commission takes into consideration the reservations of the heads of state and adheres so radically to the principle of exhausting the present legal basis of the Lisbon Treaty that it conceives of the transfer of competences from the national to the European level occuring only in a rather gradual and inconspicuous way.[7]

The obvious aim is to postpone a revision of the treaties to the very end. The Commission accords the expansion of steering capacities priority in the short and the medium term over a  corresponding enlargement of the basis of legitimation. Thus the ultimate democratization is presented as a promise like a light at the end of the tunnel. Supranational democracy remains the declared long term goal on paper. But postponing democracy is a rather dangerous move. If the economic constraints by the markets happily meet the flexibility of a free-floating European technocracy, there arise the immediate risk that the gradual unification process which is plannedfor, but not by the people will grind to a halt before the proclaimed goal of rebalancing the executive and the parliamentary branches is reached. Uncoupled from democratically enacted law and without feedback from the pressing dynamics of a mobilized political public sphere and civil society, political management lacks the impulse and the strength  to contain and redirect the profit-oriented imperatives of investment capital into socially compatible channels. As we can observe already to-day, the authorities would more and more yield to the neoliberal pattern of politics. A technocracy without democratic roots would not have the motivation to accord sufficient weight to the demands of the electorate for a just distribution of income and property, for status security, public services, and collective goods when these conflicted with the systemic demands for competitiveness and economic growth.[8]