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Puccio, Laura --- "The Pressures Inflicted by the Financial Crisis on the Euro Area: De Facto Creating an EU ‘Economic Government’ Despite the Status Quo Maintained in the Lisbon Treaty?" [2012] ELECD 514; in Trybus, Martin; Rubini, Luca (eds), "The Treaty of Lisbon and the Future of European Law and Policy" (Edward Elgar Publishing, 2012)

Book Title: The Treaty of Lisbon and the Future of European Law and Policy

Editor(s): Trybus, Martin; Rubini, Luca

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9780857932556

Section: Chapter 4

Section Title: The Pressures Inflicted by the Financial Crisis on the Euro Area: De Facto Creating an EU ‘Economic Government’ Despite the Status Quo Maintained in the Lisbon Treaty?

Author(s): Puccio, Laura

Number of pages: 23

Extract:

4. The pressures inflicted by the
financial crisis on the euro area:
de facto creating an EU `economic
government' despite the status quo
maintained in the Lisbon Treaty?
Laura Puccio

1. INTRODUCTION

The European Economic and Monetary Union (EMU) is representative of
a multi-speed policy1 and asymmetric degrees of integration. Member
States, having adopted the Euro, are indeed part of a monetary union;
however, they have left competences for other economic policies at the
national level, introducing only some coordination at the European level in
order to ensure the effectiveness of the unified monetary policy. This
division of competences has been codified within the new Lisbon Treaty,
keeping the EMU's original balance between soft law instruments and
hard-core fiscal rules and the same division of power between Commission
and Council.
The financial crisis, the general rise of public debt, the increasingly
diverging competitiveness ratios in the euro area, and the following sover-
eign debt crisis in Greece with its spillover effects ­ first on Ireland,
Portugal, and later Spain and Italy ­ revealed the fallacies and incomplete-
ness of European economic governance. The inevitable violation of the
no-bail-out clauses to save the Euro from collapsing questioned both the
ability of Euro countries in coping with asymmetric crises through their


1
Different obligations and statuses of Member States within the EMU: coun-
tries participating in the Euro, countries with derogations (like the UK or Den-
mark), Sweden, and the new Member States who will adopt the Euro at ...