Highlighting the EU's structural contradictions: Crisis in the Eurozone reviewed on Marx and Philosophy.


In his rigorous review of Crisis in the Eurozone, written by Costas Lapavitsas and his colleagues from the Research on Money and Finance group, Alex Cistelecan bounces the book’s arguments off Jürgen Habermas’s The Crisis of the European Union.

What comes out of this skillful comparison is the depth of Lapavitsas’s arguments about the nature of the problems that the European Union is facing at the moment. Unlike Habermas, whose focus is mainly on the moral dimension of a problem not even dubbed a “crisis”, the kernel of Lapavitsas’s analysis is to emphasize “the profound and structural nature of these problems, and of the underlying contradiction built into the European legal and institutional construction.”

The first moment of the argument is to acknowledge the external imbalance between the core and the periphery of the union. Since the beginning of European integration, the gap has “fixed and institutionalized the German advantage deriving from its permanent trade surpluses.” The institutions and structures of the European Union have actually widened the gap rather than bridged it.

“Instead of closing this continental gap between the core and the periphery, the institutional framework of the EU (more exactly, its monetary integration, unsupported by a similar fiscal integration) in practice leads to its widening, by financializing this imbalance under the form of loans from the continental core to the periphery.”

But Lapavitsas does not only stress the external nature of the European crisis. He also pays close attention to the class-related level of analysis, bringing to the foreground national class-power relations.

“This continental structural imbalance between core and periphery is, after all, sustained – or nourished – by the internal class imbalances or contradictions: the systematic squeezing of workers’ wages and curtailment of their political power through repeated waves of flexibilization, privatization and – when nothing else works – austerity, in the name of more and more productivity and competitiveness.”

In the eyes of Lapavitsas, the solution to this “race to the bottom” cannot be the official austerity cuts that are being implemented throughout Europe and which “consist in an acceleration of the exactly same things that brought the crisis.” The only solution is a radical one: “progressive exit” or “debtor led default.” On this point, Cistelecan acknowledges that Lapavitsas’s solution, although not everyone might agree with it, is much more realistic and politically sound than Habermas’s mild communication-based liberal model.

“While for Habermas the European problem is moral and the solution is superstructural (or vice-versa), for Lapavitsas the problem is both political and economic (structural imbalances and class domination constitutionally fixed and institutionalized as European Union), and the solution should be at the same level.” 

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