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The Limits of Law (and Democracy) in the Euro Crisis: An Approach from Systems Theory

Published online by Cambridge University Press:  06 March 2019

Lars Viellechner

Abstract

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The Article attempts to explore the fate of law and democracy in the euro crisis from the sociological perspective of systems theory. It consecutively ascertains the performance, the relevance, and the function of the law with regard to the current practice of restructuring sovereign debt in the euro area. While novel forms of regulation such as the European Stability Mechanism attest a remarkable assertiveness of the law, they cannot effectively command economic recovery and must cede to economic imperatives for their part. Under such circumstances, the law can no longer adequately fulfill its function to counterfactually secure normative expectations. Nevertheless, the regulatory experiments in the euro crisis may not be regarded as undemocratic. Rather, the heterarchical processes of mutual observation, recognition, and contestation among the various constituencies involved, including representatives of governments, institutions of the European Union, central banks, national parliaments and peoples via referenda, as well as European and national courts, provide some substitute for the lack of elections and parliamentary decision-making at the European level.

Type
Research Article
Information
German Law Journal , Volume 17 , Issue 5: Special Issue Democracy and Financial Order , 01 October 2016 , pp. 747 - 762
Copyright
Copyright © 2016 by German Law Journal, Inc. 

References

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