Austerity and Law in Europe: An Introduction
| Author | Markos Karavias,Marija Bartl |
| Published date | 01 March 2017 |
| DOI | http://doi.org/10.1111/jols.12011 |
| Date | 01 March 2017 |
JOURNAL OF LAW AND SOCIETY
VOLUME 44, NUMBER 1, MARCH 2017
ISSN: 0263-323X, pp. 1±9
Austerity and Law in Europe: An Introduction
Marija Bartl* and Markos Karavias*
I.
It is close to a decade since the peak of the global financial crisis in 2008,
which heralded a recession unlike anything the world had witnessed since
the Great Depression of the 1930s. The impact of the 2008 crisis is still being
felt across the world, as even today a number of states, predominantly in
Europe, are struggling to recover. Nonetheless, the policy responses to these
two seismic events could not have been more markedly different. Whereas
the post-Depression era ushered in Keynesian thinking and `New Deal'
approaches, the European response to the 2008 crisis has been dominated by
the politics of austerity.
Austerity has been defined as:
a form of voluntary deflation in which the economy adjusts through the
reduction of wages, prices and public spending to restore competitiveness,
which is (supposedly) best achieved by cutting the state's budget, debts, and
deficits.
1
Austerity is a commonsensical cure of, and minimizes the risk of, contagion
associated with a `sovereign debt crisis'. States cannot make their way out of
public debt by piling up more debt. Thus, they need to tighten their belts and
balance sheets, in order to send signals to private investors which boost the
latter's confidence in the state's commitment to pursue economic
development. The abandonment of fiscal stimulus strategies and the move
towards `fiscal consolidation' was aptly summarized by Jean-Claude Trichet
who, in his capacity as the President of the European Central Bank, opined in
2010:
1
*University of Amsterdam, Oudemanhuispoort 4±6, 1012 CN, Amsterdam,
The Netherlands
M.Bartl@uva.nl M.Karavias@uva.nl
1 M. Blyth, Austerity: The History of a Dangerous Idea (2013) 2.
ß2017 The Author. Journal of Law and Society ß2017 Cardiff University Law School
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