Revisiting the European Crisis: Whose Crisis and Who Should Pay?
Proponents of austerity have argued that the ‘fiscal profligacy’ of periphery Eurozone economies is responsible for the current crisis. This paper explores the underlying economic and political forces behind the process of European integration to provide an alternative analysis of the crisis. Using a Post-Keynesian and Political Economy framework, this paper argues that the crisis is a manifestation of the underlying conflict between labor and capital, exacerbated by the structural flaws in the design of the Eurozone. It provides evidence that German export-driven policies played a fundamental role in creating trade imbalances between the core and periphery countries, further exacerbated by fiscal and monetary policy constraints imposed on member nations. This paper concludes that the current austerity reforms do not address the fundamental problems of the Eurozone, but rather attempt to shift the burden of the crisis onto the workers. Ultimately, the outcome of this class struggle will determine how the Eurozone will emerge out of this crisis
Franklin and Marshall College Archives, Undergraduate Honors Thesis 2013
- F&M Theses Collection