Democratic Politics in Times of Austerity: The Limits of Forced Reform in Greece

ew people have been shielded from the recentfinancial crisis and fewer still have suffered morethan the Greeks. With unemployment rates above27 percent, youth unemployment just below 60 percent,25percentshrinkingoftheGDPsince2009,highertaxes,lowerwagesandpensions,andonlymodestpricedeflationin the market, it is hard to be optimistic about a quickeconomic recovery. From Stagnation to Forced Adjustmentprovides a thorough discussion of the chronic pathologiesthat rendered Greece the weakest link during theEurozone crisis. The book’s contributors considera range of explanations for “reform stagnation” inGreece despite the presence of seemingly favorableinstitutional conditions since the transition to democ-racy in 1974—aunitarystatewithstableone-partygovernments, cohesive parties, and few veto players.The theme of the volume is that lack of reform iscausally related to the intensefinancial crisis that led tothe sovereign debt crisis in Greece. The authors suggestthat the crisis occured because of contextual factors thatdid not allow reforms to function properly or in somecases to be implemented at all. By setting the currentcrisis in a broader historical and political context, thebookmakespossibleadeeperunderstandingofthedevelop-mentssurroundingit.Andareviewofthisbookprovidesanopportunity to also consider the broader meaning of theGreekcrisis,whichposesimportantquestionsforthefutureof democracy in the Eurozone.Thevolumeisdividedintothreesections.Thefirstpart includes various theoretical accounts that attemptto explain the paradox of reform stagnation in Greece.The second part offers specialized treatments of the mostimporant sectors: market reforms, pension system, publichealth, education, administrative system, and foreignpolicy. The third section of the book focuses on the onsetof the crisis and provides an account of the forced reformsthat were imposed as a result of the Memorandumof Understanding signed between the EuropeanUnion-European Cental Bank-IMF (a.k.a ‘troika’)and the Greek government.In the theoretical section, Dimitris Sotiropoulossuggestsdifferent ways that a reform can fail and then exploresthe causes of reform failure in Greece in particular.He primarily focuses on failure following the adoption ofa reform and concludes that while common explanationsfocus on political cost, financial constraints, or party com-petition alone, we need also to take into account historicallegacies that constrain reform. Such legacies include:placing reform priorities in defense rather than othermore dynamic sectors; polarized party competition;biased state intervention in society in favor of powerfulinterest groups; and weak capacity in Greek publicadministration.Kevin Featherstone and Dimitris Papadimitriou surveythe literatures on neo-corporatism, varieties of capitalism,welfare regimes, and Europeanization, and attempt asynthesis that would best describe the Greek or SouthernEuropean variety more generally. They maintain that“the path to the Greek sovereign debt crisis was clearlymarked by the domestic impediments to reform” (46).VassilisMonastiriotisandAndreasAntoniadesgobeyonddominant grand narratives just cited that have been usedto account for reform failure in Greece. Instead theyfocus on theconception and designstage of policy formu-lationandarguethat“inmanyinstancesofreformfailureHarris Mylonas is Assistant Professor of Political Science andInternational Affairs at George Washington University’sElliott School of International Affairs (mylonas@gwu.edu).He is the author of The Politics of Nation-Building: MakingCo-Nationals, Refugees, and Minorities (Cambridge Uni-versityPress,2013).Heiscurrentlyworkingonabookproject– tentatively entitled Varieties of Diaspora Management –analyzing why some states develop policies to cultivate linkswithand/ortoattractbacksomeoftheirco-ethnicsabroadbutnot others.