Globalisation, the Global Financial Crisis and the State

Globalisation, the Global Financial Crisis and the State

Edited by John Farrar and David G. Mayes

The recent global financial crisis has challenged conventional wisdom, and our conception of globalisation has been called into question. This challenging and timely book revisits the relationship between globalisation, the crisis and the state from an interdisciplinary perspective, with law, economics and political science underpinning the analysis.

Chapter 5: The EU and the member states: Germany and supranationalism in times of financial crisis

Jürgen Bröhmer

Subjects: economics and finance, political economy, politics and public policy, international politics, international relations, political economy

Extract

The European sovereign debt crisis is bringing to the fore imminent questions on constitutionalism and democracy and the ability of international and, in this case, supranational institutions to deal with a crisis with potentially major repercussions on the national and international level. The debt crisis highlights once again what the global financial crises had already demonstrated, that is, that the management of international affairs, especially international economic affairs, has long left the realm of the nation state. The nations are still major players, but institutions such as the European Union (EU), the G-20, the International Monetary Fund (IMF) or intergovernmental specialised instruments such as the ESM (European Stability Mechanism) in the future and currently the EFSF (European Financial Stability Facility) have entered the playing field. Recently unimaginable amounts of money have been committed and guaranteed. Wide-ranging policy decisions of whole countries are heavily influenced by outside forces. The executive branches of government are at the core of all this decision-making. National parliamentary oversight is severely hampered by time and information constraints and supranational parliamentary control is also largely absent. In contrast to the international executive management of such crises stand largely domestic, national systems of democratic accountability.

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