Time and again, critical voices have highlighted that the EU’s political system suffers from a democratic deficit: EU policy tends to rank low on salience for European citizens while elections to the European Parliament are largely fought out in the shadow of national politics. These assessments would suggest that the European public’s preferences play a negligible role in determining the course of EU policy. Nonetheless, recent studies provide evidence that despite the EU’s democratic deficiencies, its policy output is often remarkably congruent with citizens’ priorities. In his article “Democratically deficient, yet responsive? How politicization facilitates responsiveness in the European Union” published in the Journal of European Public Policy, Iskander De Bruycker addresses this puzzle and shows that the politicization of EU policy processes facilitates EU decision-makers’ responsiveness to demands for new policy initiatives voiced by European citizens. Drawing on evidence from Eurobarometer surveys on 15 policy issues between 2010 and 2016 as well as a content analysis of almost 6,000 media statements by political elites, Iskander shows that civil society groups’ mobilization in the media coupled with citizens’ demands for new initiatives are important determinants of EU decision-making. Iskander concludes that his findings point to a ‘politicization paradox’: “On the one hand, further politicization may derail deeper integration and induce policy deadlock”, yet “[o]n the other hand, politicization is a necessary condition for democratic deliberation and control for the EU to develop into a responsive and democratically mature political system.”
Committee chairs are a coveted prize among Members of the European Parliament (MEPs): MEPs serving as chairs exercise discretion over their respective committee’s agenda, they have a say on who gets invited to committee hearings and they get a seat at the table of inter-institutional negotiations on new policy initiatives, the so-called trilogues. Although committee chairs in the European Parliament undoubtedly play an influential role in the EU’s policy-making process, Mihail Chiru notes that “we know virtually nothing about how committee chairs are selected”. In his article “Loyal soldiers or seasoned leaders? The selection of committee chairs in the European Parliament” published in the Journal of European Public Policy, Mihail draws on evidence from the European Parliament’s first seven terms between 1979 and 2014 to identify the drivers of committee chair allocations. His findings suggest that MEPs with prior experience as committee chairs stand a better chance of securing (re-)appointment than their less-experienced colleagues. In contrast, MEPs’ voting records and loyalty to their European party groups (EPGs) appears irrelevant for the allocation of committee chairs. In light of this evidence, Mihail concludes that the office allocation of committee chairs “mainly serves the informational needs of the EPGs and a premium is put on experience in the role, acquired in the EP and less so on pure policy expertise.”
The European Union’s regulatory agencies enjoy a comprehensive portfolio of competences and play a critical role at several stages of the EU’s policy-making process. They supply the European Commission with independent expertise, set standards in specific policy areas and monitor the implementation of EU rules. This broad set of powers comes with a catch, however: EU agencies need to cultivate their organisational reputation among external audiences to foster their autonomy from political actors, yet due to their various roles tend to face conflicting expectations from these audiences. In their article “Meeting expectations in the EU regulatory state? Regulatory communications amid conflicting institutional demands” published in the Journal of European Public Policy, Madalina Busuioc and Dovilė Rimkutė explore how EU regulatory agencies respond to the expectations of multiple audiences. Madalina and Dovilė develop a novel dictionary to analyse the text of every annual report published by the EU’s regulatory agencies and identify which aspects of their reputation agencies emphasise, how these vary over time, and why. Results of their analysis suggest that EU regulatory agencies become more strategic over time in their communication and diversify their reputational repertoire: “[r]ather than boldly venturing into ‘moral’ legitimation grounds, their communication efforts have expanded into performative aspects, consistent with the EU’s regulatory state output legitimation criteria for its regulators.”
A multitude of actors at the national and supranational level typically have a stake in the EU’s relationship with third countries. Governmental and non-governmental actors seek to frame debates over the EU’s external relations in ways that suit their own interests. In their article “Legal framing and the EU’s external relations: how NGOs shaped the negotiations for an Israel-Europol cooperation agreement” published in the Journal of European Public Policy, Patrick Müller and Peter Slominski highlight that a recourse to legal arguments can give actors with limited power resources the upper hand in shaping the EU’s foreign policy. Patrick and Peter argue that strategies of legal framing, encompassing intimate knowledge of and an ability to align arguments with the laws regulating conduct in a legal community, allow non-governmental organizations to leave their mark on the EU’s external relations. Their analysis of the negotiations on the Israel-Europol agreement shows that an EU-registered civil society organization, the MATTIN Group, employed various strategies of legal framing, highlighting that a draft text of the agreement would have been inconsistent with the EU’s legal position, and ultimately convincing EU officials to include additional conditions in their negotiations with their Israeli counterparts. The evidence presented by Patrick and Peter illustrates that by connecting its legal reasoning with a stable understanding of the law within the EU, the MATTIN Group managed “to develop a powerful legal frame, which finally prevailed in the intra-EU debate despite a strong political interest to reach an agreement.”
Public officials often count on the technical expertise of organised interests when designing policy and employ them as intermediaries to facilitate subsequent implementation. And since organised interests tend to depend on government’s financial support, we can observe that rules attached to government’s provision of funding shapes the advocacy behaviour of organised interests. While this relationship has been well-documented in national contexts, we know surprisingly little about the drivers of organised interests’ advocacy behaviour when they face funders at different levels of the EU’s multi-layered political system. In their article “Writing blank checks? How government funding affects interest organisations’ advocacy behaviour in a multi-layered context” published in the Journal of European Public Policy, Frederik Heylen and Evelien Willems draw on a survey of 727 Belgian interest organisations as well as an analysis of relevant legislation and expert interviews to show that organised interests’ reliance on sub- and supranational funding induces fewer interactions with government officials at the national level. In contrast, organised interests depending on support of funders at the national level show no tendency to cut their ties with subnational governments. Frederik and Evelien argue that the specific funding rules employed at different levels of government account for this pattern: “Whilst national funding is used to incentivise cooperation across regions, subnational rules on funding are not conducive for multi-level advocacy behaviour”, often coming with stringent territoriality requirements.
In an attempt to shake off the secrecy surrounding the EU’s trade negotiations, the European Commission is obliged, since 2009, to immediately and fully inform members of the European Parliament of its deliberations with third parties. Some may say unsurprisingly, the transparency-enhancing role of the European Parliament has come in hand with an informalisation of communication between Commission and Parliament: As transparency threatens confidentiality and quick decision-making, Commission officials turned to an informalisation of communication to preserve the efficiency of their trade negotiations, yet arguably eroded the transparency gains achieved through the 2009 reform. In her article “Opening up by closing off: How increased transparency triggers informalisation in EU decision-making” published in the Journal of European Public Policy, Evelyn Coremans challenges the common perception that informalisation conflicts with the goals of transparency reforms. Focusing on the case of the EU-US negotiations over the Transatlantic Trade and Investment Partnership (TTIP), Evelyn develops a causal mechanism linking the increased transparency of TTIP negotiations to the informalisation of interactions between the Commission and the European Parliament. Evidence from her case study supports Evelyn’s expectation that the Commission’s informalisation of communication improved the quantity and quality of information exchange with members of the European Parliament, much in line with the goals of the transparency reform. Evelyn concludes that the “informalisation of Parliament-Commission communication for TTIP is an improvement to a system where secrecy and confidentiality between Council and Commission reigned supreme only a few years before.”
As new policy initiatives shuttle through the EU’s institutions, we expect policy-makers to chisel away at the language contained in these proposals to make sure that policies’ anticipated effects match policy-makers’ preferences before they are formally adopted. Yet, even once a policy successfully exits the legislative arena, its actual impact may be subject to change. In their article “Many faces of dismantling: hiding policy change in non-legislative acts in EU environmental policy” published in the Journal of European Public Policy, Jan Pollex and Andrea Lenschow argue that the EU’s regulatory legislation typically provides the European Commission with opportunities to shape the actual effects of policies after their adoption by designing specific implementation measures. In light of the Commission’s prioritisation of fostering economic growth in response to the economic crisis, Jan and Andrea provide case studies of the EU’s ecolabel and ecodesign policies and show that the Commission had used its powers of specifying implementing measures to ease the regulatory pressure in the EU’s environmental policy. Jan and Andrea’s analysis highlights that in order to evaluate the EU’s environmental policy it is necessary to pay close attention to the actual implementation of policy, as “we might see policy dismantling in disguise, effectively softening environmental regulatory pressure on producers within rather stable regulatory structures.”
Strike a conversation with a stranger about the EU these days and you are (rather) unlikely to end up chatting about the EU’s Cohesion Policy. But why not actually? After all, development projects funded in the context of the Cohesion Policy account for roughly a third of the EU’s annual budget and the policy is the bloc’s key tool to address social and economic disparities both across and within its Member States. In their article “The EU as a savior and a saint? Corruption and public support for redistribution” published in the Journal of European Public Policy, Monika Bauhr and Nicholas Charron address the gap in our knowledge on European citizens’ support for the EU’s cross-border redistribution of resources. Drawing on original survey data tailored to capture public opinion on the EU’s Cohesion Policy in 15 Member States, Monika and Nicholas conclude that citizens generally express some sense of support for redistribution within the EU. However, their analysis shows that this support is shaped by citizens’ perceptions of domestic corruption. Monika and Nicholas find that those who perceive domestic institutions as performing poorly “are more likely to perceive the EU as both a potential ‘savior and saint’, that will ultimately ensure better public service delivery and governance systems less plagued by corruption and mismanagement of public funds.”
When the European Commission began pushing for the liberalisation of the telecommunications sector in the mid-1980s, EU Member States lacking the means and capacity to fuel an effective industrial policy faced an economic worry: Will their policies be enough to help key domestic telecommunications players survive the mergers and foreign acquisitions expected to unfold in the wake of European integration? In his article “The state strikes back: industrial policy, regulatory power and the divergent performance of Telefonica and Telecom Italia” published in the Journal of European Public Policy, Fabio Bulfone compares the fortunes of industrial policies implemented by the Italian and Spanish governments to aid the internationalisation of their main domestic telecommunications firms, Telecom Italia and Telefonica. Fabio explains why despite the similar styles of industrial policies pursued by Italy and Spain, Telefonica managed to transition from a monopolist focused on the Spanish market into a ‘European champion’, while Telecom Italia did not to follow the same trajectory. His analysis shows that the Italian government failed to convince key domestic investors of becoming the main shareholders of Telecom Italia during its liberalisation process. In Spain, on the other hand, the government was able to draw on the support of Spanish investors and “the strong hardcore of domestic banks created after privatisation gave Telefonica the ownership and managerial stability necessary to successfully expand abroad.”
By Tobias Wiß
Financialisation – the increasing reliance of society, the economy and politics on financial market solutions – has become a key feature of post-industrial economies. Pension reforms in recent decades reduced benefit levels of public pensions and expanded non-state – occupational and personal – pre-funded pensions, resulting not only in a process of privatisation but ultimately in the financialisation of pensions. As the result, pension policy is not only a social policy that affects retirement income, but also a financial one that impacts savings rates, corporate finance and, indirectly, corporate behaviour.
The first JEPP special issue in 2019 on “The political economy of pension financialisation: public policy responses to the crisis” edited by Anke Hassel and Tobias Wiß addresses how and why pension reforms came to rely more on financial markets and how public policy reacted to the financial crisis.
The collection of articles sheds light on pre-funded private pensions as one key component of financialisation, as they turn savings into investment via financial services providers. Public pension systems face financial pressures, resulting from ageing and rising public debt, while financial services are keen to move into the market of private pension provision. The financial crisis has triggered policy responses including shifts in investment strategies and also a re-assessment of the role of pre-funded private pensions as a complementary, rather than a superior, source of old-age income.
The special issue focusses on three main issues: The emergence of pension financialisation, reactions to financial crises and regulatory variation.
Politics and reform packages have mattered for the introduction of private pensions and especially minimum benefits in Germany. The overview of the historical development of pension financialisation in Denmark, the Netherlands and Sweden lays down how the social partners (trade unions and employer associations) managed to organise pre-funded pensions collectively allowing that financialised pensions serve social interests.
With regard to responses to financial crises, Germany, the Netherlands and the UK show processes of reinforcement instead of a weakening of pension financialisation.
A further set of articles looks more detailed at regulatory variation: The role of organised interests including adaptions of their strategies in times of financialisation, the influence of investment professionals promoting liability driven investment and the independent role of the state in shaping regulatory decisions. Apart from nation-states, the European Union does not promote a coherent pension financialisation agenda as one might expect. Instead, the EU’s pension strategy is rather accidental and multi-faceted, consisting of a mix of market creation, emulation and correction. In sum, it seems that pension financialisation and the broader financialisation of the economy are here to stay, despite negative developments during and after the financial crisis. Governments are quite aware that pre-funded pensions play a role for corporate finance, economic growth and financial markets in general.