Expansive Collapse?: The EU’s Regulatory Expansion as Symptom of Political and Juridical Decay

Legal and regulatory development in the throws of the Eurozone crisis presents a contradictory and paradoxical developmental dynamic.  The crisis stems all too predictably from the foundational economic, monetary, and political flaws of the Euro and Eurozone governance.  Yet, the prevailing responses at the EU level has ignored these flaws in favor of a dramatic expansion of centralized regulatory authority, coupled with destructive ad hoc crisis management, austerity policies, monetary interventions to prop up debt markets, and increasingly intractable conflicts over the powers and competencies of the EU and its institutional organs, including the ECB.  Politics and policy under conditions of a perpetual, crisis-driven “state of exception” form the problematic foundations of an emergent EU regulatory super-state.  The resulting regulatory superstructure rests and relies upon a political and constitutional base that is becoming increasingly hollowed out, technocratic rather than democratic, and marked by a pronounced mismatch between emergent EU capacities in financial regulation and the necessity of addressing fundamental problems in managing economic tensions and allocating adjustment costs imposed by the Eurozone’s structural deficiencies.  As a consequence, the expanding EU regulatory state is erected on an increasingly unstable and dysfunctional political foundation of parlous legitimacy.  This attempted means of strengthening the “ever closer union” threatens both further political and constitutional disintegration, and a degeneration of the rule of law more broadly as law and regulatory institutions prove inadequate to the political and economic tasks assigned them and consistent formal enforcement of legal rules becomes impracticable.  In short, regulatory expansion and overreach arguably reflects the dialectical political and juridical decay of the Eurozone and the EU as a whole.