EU Socio-Economic Governance since the Crisis

The European Semester in Theory and Practice

Jonathan Zeitlin, Amy Verdun, Amy C Verdun

• Publisher: Routledge
• Year: 2018
• Print ISBN: 9781138494718
• eBook ISBN: 9781351025607
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

This book is the first to be dedicated entirely to the European Semester -- a new framework for policy coordination across European Union (EU) member states. The Semester represents a major advancement in EU governance. Created in 2010 in the wake of the financial and sovereign debt crises and revamped in 2015, it was intended to provide a new socio-economic governance architecture to coordinate national policies without transferring legal sovereignty to EU level. The papers in this collection are written by authors who have already contributed to this literature and have conducted original research for their studies. The book offers an empirical and theoretical assessment of the European Semester, examining its implications along three critical axes, running respectively between the economic and the social, the supranational and the intergovernmental, and the technocratic and democratic poles of EU governance. The book concludes that the European Semester challenges established theoretical understandings of EU governance, as it is a prime example of the complexity that supersedes simple polar oppositions.

The chapters were originally published in a special issue of the Journal of European Public Policy.

OPEN ACCESS

Socializing the European Semester: EU social and economic policy co-ordination in crisis and beyond

Jonathan Zeitlin and Bart Vanhercke

ABSTRACT

This contribution analyses how EU social objectives and policy co-ordination have been integrated into the Union’s post-crisis governance architecture. It argues that between 2011 and 2016, there was a partial but progressive ‘socialization’ of the ‘European Semester’ of policy co-ordination, in terms of increasing emphasis on social objectives in its priorities and key messages, including the Country-Specific Recommendations; intensified social monitoring and review of national reforms; and an enhanced decision-making role for EU social and employment actors. In explaining these developments, the contribution highlights the contribution of strategic agency, reflexive learning and creative adaptation by social and employment actors to the new institutional conditions of the Semester, building on recent theoretical work on ‘actor-centred constructivism’ and the ‘usages of Europe’.

Introduction

Since the onset of the euro crisis, the European Union (EU) has introduced a series of far-reaching changes in its socio-economic governance architecture (see the introduction to this collection). At its core is the ‘European Semester’ of policy co-ordination, through which the Commission, the Council and the European Council set priorities for the Union; review national performance and reform programs; and issue Country-Specific Recommendations (CSRs) to member states, backed up in some cases by possible financial sanctions. The European Semester (henceforth ‘Semester’) brings together within a single annual policy co-ordination cycle a wide range of EU governance instruments with different legal bases and sanctioning authority. This process has given the EU institutions a more prominent role than ever before in scrutinizing and guiding national economic, fiscal and social policies, especially within the euro area.

The advent of the Semester has raised a set of contested questions about the relationship between social and economic policy co-ordination within the EU’s new post-crisis governance architecture. Has the integration of EU social policy co-ordination, as developed through the Open Method of Coordination on Social Protection and Social Inclusion (‘Social OMC’), into the Europe 2020 Strategy and the Semester resulted in its subordination to fiscal discipline and budgetary austerity objectives imposed by the main economic policy actors?¹ Or has such integration instead offered new opportunities for social and employment policy actors² to defend and mainstream EU social objectives, such as the adequacy and accessibility of pensions and health care or the fight against poverty and social exclusion, throughout the Semester process?

Critiques of the Semester’s social dimension have revolved around three interrelated empirical claims. The first concerns the subordination of social objectives to higher-order economic goals within the EU’s post-crisis governance architecture. Thus Crespy and Menz (2015a: 762) contend that ‘the slippage of Europe 2020 into the European Semester … has meant the further absorption of social policy into macroeconomic policy’. Hence, in their view, EU ‘social policy is becoming increasingly … subsumed to economic objectives focused on competitiveness, narrowly defined as low labour costs … and stringent fiscal discipline’ (Crespy and Menz 2015b: 199–200). For Degryse et al. (2014: 70), similarly, ‘the CSRs reflect a particular concept of the European economic model … focused on growth and competitiveness, while neglecting … the principal role of social policies …’. More strongly still, Copeland and Daly (2015: 150) assert that ‘the European Semester has served as a focal point to organize a form of economic governance in which national budgetary discipline and the correction of macroeconomic imbalances … have been made the principles on which all other policy objectives are dependent’.

The second claim advanced by the Semester’s critics concerns the dominance of EU economic policy actors over their social and employment policy counterparts within its decision-making procedures. Thus as de la Porte and Heins (2014: 169–70) contend, ‘Europe 2020 is dominated by DG ECFIN and the ECOFIN Council with a very marginal role for the European social policy actors’ (cf. also Degryse et al. 2014). Such power imbalances within the Semester, they argue, reflect the fact that the economic actors ‘operate in areas where the EU has strong jurisdiction’, unlike their social counterparts, who are responsible for fields ‘where the EU has only weak legislative competence’ (de la Porte and Heins 2015: 12). For Copeland and Daly (2015: 150, 153), likewise, the structure of the Semester privileges economic policy actors and ‘formalizes the historically disadvantaged position within the EU’s political hierarchy of social actors’.

The third claim underpinning the social critique of the Semester concerns its coercive and prescriptive character. Many commentators have seen the process as a centralized mechanism for imposing structural reforms on member states, including in areas of primary national competence such as social and employment policy, through CSRs underpinned by the threat of sanctions under the Stability and Growth Pact (SGP) and Macroeconomic Imbalance Procedure (MIP). Dawson (2015: 984), for example, asserts that the new ‘post-crisis economic governance in many ways entails a return to “command-and-control” regulation’, whereby ‘national diversity … is often placed within strict limits with high levels of supra-national policy prescription’. While Dawson (2015: 984–6) and Degryse et al. (2014: 72, 76) highlight the uniform ‘one-size-fits-all’ message embodied in the CSRs, other critics such as Scharpf (2013: 137–8) decry instead their discretionary application, involving ‘a radical extension of hierarchical European controls over national policy choices’. Either way, however, de la Porte and Heins (2014: 170) contend that ‘the European Semester and the instruments designed to re-enforce it are highly intrusive along the dimensions of policy interference, surveillance, as well as coercion’. Within the Semester, they conclude, fiscal and budgetary governance instruments ‘have become more precise in terms of objectives, and stricter in terms of surveillance and enforcement’, while social and labour market policy instruments remain weaker on these dimensions and thus in their ‘potential impact’ (de la Porte and Heins 2015: 10).

By contrast, a second body of recent research has drawn attention to the gradual evolution of the Semester in a more socially balanced direction in relation to each of the preceding empirical claims. Thus Bekker has analysed the changing content of the CSRs, finding not only an increasing emphasis on social and employment issues, but also that even recommendations issued under the SGP and the MIP sometimes promote EU social objectives such as accessibility of health care and the fight against poverty and social exclusion (Bekker 2015; Bekker and Klosse 2013). Coding the policy measures contained in the CSRs between those promoting ‘social investment’ as opposed to austerity or ‘social retrenchment’, Crespy and Vanheuverzwijn (2016: 77–8, 85–6) estimate that the proportion of the former has increased from 50 per cent to 64 per cent between 2011 and 2016.³ Focusing on poverty and social inclusion, Jessoula (2015: 496) observes that the growing number of CSRs on this issue was ‘the result of the process whereby DG EMPL learnt how to defend and support the Europe 2020 social dimension in inter-DGs bargaining at the various stages of the Semester’. Finally, Bekker has examined the CSRs and National Reform Programs (NRPs) of France, Germany, Poland and Spain between 2009 and 2014, concluding that while the degree of flexibility varies across countries and over time, ‘the European Semester, including the SGP, allows for developing alternative socio-economic policies’ (Bekker 2016: 62).

Building on this latter body of work, along with two earlier research reports of our own (Zeitlin and Vanhercke 2014; Vanhercke et al., 2015), this contribution analyses the evolution and dynamics of the Semester from its inception in 2010 through the 2016 cycle, bringing new evidence to bear on the main disputed questions about the relationship between social and economic policy co-ordination in the EU’s post-crisis governance architecture. The contribution makes two major contributions to this debate. The first is empirical: drawing on 76 interviews with key policy players as well as a systematic analysis of EU documents, we demonstrate that over this period there was a partial but progressive ‘socialization’ of the Semester, both in terms of its substantive content and its governance procedures. This socialization, as we define it, comprises: 1) a growing emphasis on social objectives in the Semester’s policy orientations and messages, embodied in the AGS and especially the CSRs; (2) intensified monitoring, surveillance, and review of national reforms by EU social and employment policy actors and (3) an enhanced role for these actors relative to their economic policy counterparts in drafting, reviewing and amending the CSRs. Finally, regarding the Semester’s prescriptive and coercive character, the contribution shows that a concerted pushback by the Employment, Social Policy, Health and Consumer Affairs (EPSCO) Council and its advisory committees against the Commission’s perceived efforts to impose uniform, over-detailed recommendations on social and employment issues resulted in significant revisions to the Semester’s decision-making arrangements, including the CSRs themselves, which have made them less hierarchical and more interactive. The second major contribution is explanatory and theoretical. In accounting for the empirical developments traced in the contribution, we highlight the contribution of strategic agency, reflexive learning and creative adaptation to the new institutional conditions of the European Semester by the key actors, especially on the social and employment side.

The remainder of the contribution is organized as follows. Section 2 presents the theoretical approach, building on ‘actor-centred constructivism’ and the ‘usages of Europe’, along with the data and methods supporting the empirical analysis. Section 3 examines the relationship between social and economic policy co-ordination from the Lisbon Strategy to Europe 2020 and the inception of the Semester. Section 4 analyses the socialization of the Semester under the Barroso Commission (2012–2014), in terms both of policy orientations and governance procedures. Section 5 shows how this socialization was further institutionalized under the Juncker Commission. The final section summarizes the empirical evidence and revisits our contribution to the ongoing academic debate.

Theoretical approach, data and methods

In explaining the partial but progressive socialization of the European Semester between 2010 and 2016, this contribution focuses on the strategic agency and creative adaptation to changing institutional conditions of the key actors concerned. Here we draw on and extend recent theoretical work on ‘sociological approaches’ to European integration and policy-making, notably ‘actor-centred constructivism’ (Saurugger 2009, 2016) and the ‘usages of Europe’ (Jacquot and Woll 2003; Woll and Jacquot 2010). These approaches provide valuable conceptual resources for understanding how apparently weaker players, such as the EU social and employment policy actors, can advance their substantive goals and decision-making influence in complex multi-level governance processes like the European Semester, despite the institutional asymmetries and structural power imbalances emphasized by the critical literature discussed in the previous section.

As presented by Saurugger, ‘actor-centred constructivist’ approaches to the EU diverge from standard rationalist and historical institutionalist analyses that overstate the weight of structural constraints and path dependence on actors’ choices, while underestimating the ‘possibilities for actors to modify the rules and institutions in which they act’. Such actor-centred approaches, in her formulation, likewise differ from classic constructivist and sociological institutionalist accounts that emphasize how dominant cognitive frames and taken-for-granted norms shape actors’ behaviour, thereby downplaying their ‘room for manoeuvre in power struggles and social conflicts’. In this view, too, actors’ capacities for action are not ‘entirely predefined’ either by their resource endowments or by the structure of the field in which they operate; instead actors ‘are able to adapt and to change their environment’ (Saurugger 2016: 73–5).

Work on the ‘usages of Europe’ gives concrete form to actor-centred constructivism as defined above by analysing how different types of actors identify and strategically exploit opportunities within EU multi-level governance processes to advance their own preferences and objectives. The concept of usages ‘highlights how actors engage with, interpret, appropriate or ignore the dynamics of European integration’. This means that actors can fail to seize opportunities for action identified by external observers, either because they do not perceive them as such or because they are more concerned with the possible risks than the potential benefits involved. Moreover, while actors intentionally make use of the opportunities and resources they find in EU institutions and policies to pursue their own goals, the outcome may not be identical to the original objective, since ‘the effects of an action are often not entirely predictable or controllable’. Finally, ‘as strategic as usages may be initially’, in the longer term, as Woll and Jacquot (2010: 115–6) observe, they ‘entail cognitive and/or normative adaptation by actors and their political environment, which in turn affects their subsequent behaviour and positioning’. Just as there is ‘no impact of Europe without usage’ by the actors (Jacquot and Woll 2003: 5–6), so too as another scholar working within this approach remarks, there are ‘no usages of Europe without impact’ (Sanchez Salgado 2014: 203).

Although the usages of Europe, like actor-centred constructivism, has been conceived as a general conceptual approach to European integration and policy-making, it has mainly been applied to the strategic identification and ‘creative appropriation’ of opportunities arising from EU governance processes (including both the OMC and the Lisbon Strategy) by national-level actors to advance their own domestic objectives and agendas (Barcevičius et al. 2014; Graziano et. 2011; Jacquot and Woll 2003; Woll and Jacquot 2010). But as their proponents explicitly envisage, these approaches can also be used to illuminate the evolution and dynamics of EU governance processes themselves. Thus, for example, the ‘usages of Europe’ approach draws attention to how actors situated at the intersection between national and supranational policy-making (such as EU committees of member-state officials) may strategically exploit the ambiguities of European concepts, rules and procedures in order to reframe policy issues, build political coalitions, enhance their institutional influence, and justify decisions taken at the EU as well as the domestic level (Woll and Jacquot 2010: 116–7).

In this contribution, we extend the insights of these agency-focused and possibility-orientated approaches by tracing how reflexive learning from past experience by key actors, especially on the social and employment side, together with creative adaptation of their own organization and practices to the new institutional conditions of the EU’s post-crisis governance architecture, has contributed to the partial but progressive socialization of the Semester. Here we focus on how EU social and employment policy actors have deliberately revised their working methods and styles of argument to gain traction in ‘evidence-based’ deliberation with their economic policy counterparts. At the same time, we analyse how the arguments and demands advanced by the social players through the Semester process have h...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Contents
• Citation Information
• Notes on Contributors
• Introduction: the European Semester as a new architecture of EUsocioeconomic governance in theory and practice
• 1 Socializing the European Semester: EU social and economic policy co-ordination in crisis and beyond
• 2 Flexicurity in the European Semester: still a relevant policy concept?
• 3 Deciding on the European Semester: the European Council, the Council and the enduring asymmetry between economic and social policy issues
• 4 Enforcing the European Semester: the politics of asymmetric information in the excessive deficit and macroeconomic imbalance procedures
• 5 Cherry-picking external constraints: Latvia and EU economic governance, 2008–2014
• 6 Explaining the evolving role of national parliaments under the European Semester
• 7 Parliamentary accountability in multilevel governance: what role for parliaments in post-crisis EU economic governance?
• Index