The Achilles Heel of Post-War European Integration

Kenneth Dyson

in States, Debt, and Power

Published in print June 2014 | ISBN: 9780198714071
Published online August 2014 | e-ISBN: 9780191782558 | DOI:
The Achilles Heel of Post-War European Integration

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This chapter examines the formalization of creditor-debtor state relations in post-1945 Europe within the early framework of the Bretton Woods system. It looks in depth at the European Payments Union; the first decade of the EEC; the process and the substance of EMU, particularly from the Werner Group to the Delors Committee and the Maastricht Treaty. The chapter considers the post-2007 economic and financial crisis; its strategic management within a shrinking ‘hard core’ of creditor states; the rise and eclipse of the ‘stand-alone’ model of European monetary union and the process of beginning to build banking and fiscal union in Europe. It examines the Franco-German relationship, the European Council, the European Commission, and the ECB. The chapter concludes by considering the boundaries of creditor-state power and the unresolved tension between endogenous preference formation, in particular learning by doing, and conditional cooperation, in which ‘red lines’ continue to be drawn.

Keywords: creditor-state power; European Payments Union; monetary union; banking union; fiscal union; European Council; Franco-German relations; ECB; European Commission; endogenous preference formation

Chapter.  23317 words. 

Subjects: European Union

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