Hostname: page-component-745bb68f8f-kw2vx Total loading time: 0 Render date: 2025-02-11T09:20:35.741Z Has data issue: false hasContentIssue false

Caroline de la Porte and Elke Heins (eds) (2016) The Sovereign Debt Crisis, the EU and Welfare State Reform, Basingstoke: Palgrave Macmillan, £89.99, pp. 229, hbk.

Published online by Cambridge University Press:  05 July 2018

NAZIMUDEEN SALEEM*
Affiliation:
Global Economic and Public Policy Institutenazimsa@gmail.com
Rights & Permissions [Opens in a new window]

Abstract

Type
Book Review
Copyright
Copyright © Cambridge University Press 2018 

This well-edited book provides a useful and thorough analysis as well as a base for further investigation of the EU policies on member countries’ welfare state reforms in the aftermath of the 2008 economic crisis. Editors de la Porte and Heins have managed to gather and put together a series of thoroughly analysed studies for those who are serious about investigating the effects of the financial crisis on the welfare state in the EU member States. Here the need for harsh responses under the institutional framework and structure of the EMU are analysed while their effects on the welfare state are also examined. The authors also have examined the influence of the EU on the welfare state reform, particularly in those member countries most affected by the economic crisis of 2008. The financial crisis which nobody could predict in advance severely affected the Western economies where over-borrowed economies of the eurozone were hit badly with sovereign debt crisis. Addressing the debt crisis by the EU required harsh responses that would demand drastic changes in the welfare policies.

Scholars in social policy research from across the union have contributed to produce this excellent book which helps the readers examine how the European Union responded to the sovereign debt crisis in the member States with some drastic measures, including intervention into domestic welfare states. The findings suggest that the EMU norms were strictly applied and enhanced measures were taken to monitor and enforce the rules of fiscal integration to achieve consolidation.

In chapter 2, de la Porte and Heins, with their own typology of EU integration, explore the development of new surveillance instruments and enforcement mechanism affecting the labour market and social policy during the crisis period. These responses the authors consider as radical alteration in EU integration. But they argue that the nature of the EU intervention into domestic welfare states has changed with a focus on fiscal consolidation while revisiting issues of social equity and social investment through other softer EU programmes. Success of such approach still remain debatable while the authors see the effective nature of the latest EU Social Investment Package launched in 2013 to respond to the post-crisis welfare needs as a welfare modernisation tool.

Jon Kvist in chapter 3 argues that the European social investment strategy developed in the aftermath of the economic crisis has essentially overlooked the gender dimension but believes it holds the promise of renewing the European Social Model. Kvist proposes a comprehensive life-course perspective on social investment in which he emphasises some key gender dimensions that need to be addressed to optimise the formation, maintenance and the use of human capital. However, some may question the practicality of such a proposal when it comes to implementing it based on a comprehensive life-course perspective.

The austerity measures demanded from some troubled EMU states against large scale financial support by the EU and IMF in the aftermath of the crisis were obviously harsh. But Fiona Dukelow argues in chapter 4 that, in Ireland, such measures did not constitute a change in social policy direction. Whether this would hold true in other affected eurozone states true or not still remains a matter for further investigation.

In chapter 5, Sotiria Theodoropoulou critically analyses the intrusive role of the EU and IMF in Greece and Portugal in the aftermath of the crisis. As detailed in the MoUs, financial assistance was provided against structural reform in both countries but the author points out that there were notable differences with radical policy intervention and extensive reforms in Greece than in Portugal. Through radical reforms, the author argues, it was intended to achieve fiscal consolidation under pervasive austerity measures leading to retrenchment of welfare states in these countries. As the title of the article implies, the author seems to claim that under the shadow of EU bailout conditionality, national social and labour market policy reforms remained the focus.

The crisis-ridden EU states of Italy and Spain come to the focus in the works of Pavolini, Leon, Guillen, and Ascoli in chapter 6. Their contribution under the title ‘From Austerity to Permanent Strain? The EU and the Welfare State Reform in Italy and Spain’ sheds light on the impact of EU intervention. The authors argue that although the countries were not needed to be bailed out, both member countries came under the ‘shadow of conditionality’. The analyses seem to suggest the Italy and Spain were pursuing different approaches before the crisis but the post-crisis pressure from the EU led to take hasty and harsh measures leading to retrenchment in the welfare states in both countries leaving a permanent strain.

Stefano Sacchi on the other hand, in chapter 7, draws our attention to the altered nature of conditionality in the case of Italy. He stresses that enforcement remained weak but policy specificity and surveillance were strong when it came to intervention. The author was convinced that the market forces were the important causal factor intervening in the enforcement of EU reform policies. It also meant informal conditionality coming from such institutions as the European Central Bank.

In chapter 8, the authors Hassenteufel and Palier seem to suggest that welfare state reform remained a key policy area in the EU even before the crisis. Using their longitudinal study in France, authors argue that reforms in the areas of healthcare, pension, and labour markets have been in progress for sometimes. The authors note that such reforms are again linked to overall fiscal consolidation and market reform.

In overall, the authors demonstrate how the intervention represents an unprecedented degree of EU involvement in domestic social and labour market policies. Readers will also discover how greater demands to attain balanced budget have been institutionalised, leading to tensions with the EU social investment strategy. This highly informative edited collection will engage students, social policy practitioners, and researchers as well as scholars of the welfare states and political science.

In the end, it is fair to say that the authors seem to question the validity of European social model which was obviously under attack from the emergence of market forces and globalisation during the last thirty or more years. The weaker economies with strong welfare state principles in the EU could not sustain in the aftermath of the financial crisis which prompted harsher measures by the EU. This book provides a timely and valuable contributions on the impact of EU policies and measures on the welfare states of the crisis-ridden member countries. Lastly, de la Porte and Heins conclude the book with the core findings of the articles and key reform policy areas of labour market and pension along with a direction for future research. One key question may still remain unanswered would be whether the financial crisis and the EU intervention has helped the EU achieve it overall policy agenda of market liberalisation and labour market reform in the affected member countries.