Policy Briefs

P. Bofinger, J.-P. Fitoussi, E. Giovannini, J.Stiglitz: THE EXISTENTIAL DILEMMA OF EUROPE

Europe seemingly is facing an existential dilemma: the rules of the EU and the Eurozone were established by democratic governments. But now, as new democratic governments get elected, those very rules mean that the views of the electorate are frustrated. Those who see the economic policies of austerity as a disaster and have replaced governments who pursued those policies with new governments promising a new course quickly observe the new governments pursuing essentially the same policies, with minor variants. The governments would like to change course, but their hands are tied: their room for maneuver is constrained. Citizens are rightly beginning to ask: what is the meaning of democracy if elections make so little difference to the things they care most about, the economy, their future, their society? The very legitimacy of democracy is being put into question.

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