Economic governance in a post-crisis era: A conceptual appraisal

EU economic governance, as organized in the Treaties and implemented during the first years of the Economic and Monetary Union (EMU), strongly echoed the philosophy of “new governance” theories, and closely resembled the general patterns of the Open Method of Coordination (OMC). This Article seeks to determine whether this still holds true after the Eurozone crisis, and the subsequent fundamental revamping of the EMU’s economic pillar. It is argued that the Eurocrisis set in motion a dual process of expansion and intensification of EU intervention in economic policy, and brought about a new economic governance model. This new model relies on a certain understanding of policy coordination – supranationally driven, increasingly substantive and designed to harmonize – which sharply contrasts with that at the heart of new governance and the OMC. On that basis, the Article further argues that in the post-crisis era, EU economic governance radically departs from the OMC pattern and its main constitutive features (horizontality, experimentation, diversity accommodation), so much so that it has lost most of its relevance as a conceptual framework to characterize EU economic policy. Finally, the Article highlights the fundamentally paradoxical nature of the post-crisis EU economic governance framework, and the disparities that exist, on the one hand between the reality of post-crisis economic coordination and the relevant institutional discourse, and on the other hand, between the extensive powers the EU now enjoys under that governance framework, and the weak constitutional settlement that supports it.