On the new economic philosophy of crisis management in the European Union

This essay attempts to go beyond presenting the bits and pieces of - still ongoing - crisis management in the EU. Instead it attempts at finding the 'red thread' behind a series of politcally improvized decisions. Our fundamental research question asks, if basic economic lessons learned in the 1970s are still valid. Namely that crises that emanate either from structural or regulatory weaknesses can and should not be remedied by demand management. Our second research question is the following. Can a lacking internal committment and conviction in any member-state be replaced or substituted by external pressure or formalized procedures and sanctions? Under those angles we analyze the project on establishing a fiscal and banking union in the EU, as approved by the December, 2012 Council.