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From Taboo to Reality: The Strategic Construction of European Bonds in a Long Decade of Crises (2010-2021)

par Massart, Tom
Président du jury Foret, François
Promoteur Crespy, Amandine
Publication Non publié, 2025-02-17

Thèse de doctorat

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Résumé :

The Covid-19 pandemic triggered unexpected changes within European socio-economic governance, contrasting with the European Union’s (EU) approach during the financial crisis. Instead of strengthening fiscal rules and implementing austerity policies, member states agreed to create a Recovery Plan based on common debt. Joint borrowing within the framework of EU institutions is not new and mostly occurred before the creation of the Economic and Monetary Union (EMU). Since the creation of the European Economic Community in 1957, European institutions have issued common bonds at various times, particularly to help countries with a deteriorating balance of payments. Nevertheless, after the establishment of EMU in the Nineties, no permanent mechanism for mitigating economic shocks was established among member states for fear of moral hazard as well as burden-sharing concerns. A Eurozone budget and common bond issuance were discarded in favour of economic coordination based on a set of rules, known as the Stability and Growth Pact (SGP). At the height of the financial crisis (2010-2013), political leaders refused to create a common debt under the EU umbrella to stabilise countries in difficulty. Yet, in 2020, the Covid-19 pandemic brought about an unexpected shift: the issuance of European and Green Bonds under the NextGenerationEU (NGEU) program, aimed at stabilising the economy while supporting digital and green transitions. The agreement to jointly issue bonds marks a temporary departure from the longstanding refusal to establish common debt. This doctoral dissertation focuses on the emergence of the unexpected by investigating the political conditions that led to the NextGenerationEU agreement and the breaking the EU bond taboo. Existing research examines the creation of the NGEU agreement from four analytical perspectives: first, through a naturalist lens, which focuses on the diagnosis of the crisis as an endogenous disaster; second, from supranationalist and intergovernmentalist views, analysing the roles of political actors involved in the Recovery Plan’s design and implementation; third, through historical institutionalism, which explores the temporal processes and institutional shifts leading to NGEU; and finally, from a constructivist perspective, emphasising the ideas mobilised by actors that shaped the Recovery Agreement. While each explanation contributes to the understanding of the return of common debt at the EU level, they are limited by an overemphasis on specific variables, challenges in operationalising theoretical assertions, or deterministic tendencies. Furthermore, a piece of the puzzle is still missing in the literature. How can we explain the fact that common debt issuance, which had occurred in the past, became a taboo that was ultimately broken during the pandemic? In particular, no research provided a convincing analysis of how ideas were strategically reconfigured in a process leading to the emergence of common debt whereas other instruments could have been chosen instead. The answer presented in this doctoral dissertation is grounded in strategic constructivism, providing insights into the political strategies employed by institutional and governmental actors to build consensus amid diverging—and at times opposing—interests and policy preferences. Strategic constructivism allows to analyse the politics of European bonds, where ideas are mobilised strategically and contingently by national and EU actors. In this research, strategic constructivist insights are adapted to include contingency and discourse, away from rationalist assumptions. Concretely, political actors express, legitimise and reconfigure their ideas through discourse contingently. These ideas shape their view about their interests and political preferences. Understanding the political strategy of EU leaders offers a way to grasp how they strategically conceive a phenomenon or a policy in accordance with their interests and policy preferences. In the case of European bonds, the different understandings (polysemy) of the concept enabled EU leaders to forge a consensus, even if they attributed different meanings to common debt because of their divergent interests. Specifically, this doctoral thesis analyses EU leaders’ discourse to make sense of European bonds politics. Through a frame analysis complemented by a study of metaphors, I show that the various understandings of EU bonds evolved during the last decade (2010-2021), following actor’s contingent reconfiguration of their interests and preferences. The country cases selected for this research are the Spanish and Dutch governments, representing opposing interests and preferences along the creditor-debtor cleavage. This focus complements existing research on the influential role of the Franco-German tandem in shaping the Recovery Plan. Additionally, two institutional actors were chosen as case studies: the President of the European Council (EUCO), who formally serves as a consensus-builder, and the Commission’s political leadership, central to European socio-economic governance.Overall, the Spanish and Dutch governments alongside the Commission acted as discursive entrepreneurs during the decade, by forging a consensus on EU bonds close to their respective interests through discourse. Over the decade, the EUCO President aligned at different times with the interests of either low-indebted or high-indebted member states. The reason lies in the fact that the three EUCO Presidents interpreted their mandate differently, viewing themselves either as ‘political’ or ‘diplomatic chairmen’. The Commission’s main interest during the decade was related to the avoidance of policy failure. The institution's discourse demonstrated a desire to legitimise and defend its common debt proposals. For example, the institution tried to reconfigure the meaning of common debt away from fiscal integration. The Commission also attempted to depoliticise EU bond issuance and frame EU bonds as providing financial resources in the form of investment. The Spanish government initially conceived common debt as a tool to accommodate low-indebted countries' interests, while providing southern countries financial support and a deepening of fiscal integration. The Spanish government tried to reshape the prevailing view of the common debt burden by highlighting the contributions of southern debtor countries as well as the collective responsibility of the EU. This reframing was a core part of Spain’s political strategy to foster consensus among member states, alongside an attempt to put pressure on low-indebted member states. The Dutch government acted as a discursive entrepreneur by first opposing joint borrowing and then reluctantly agreeing to it. The Dutch U-turn was part of a political strategy that attempted to tie the financial resources coming from the Recovery Plan with an obligation for countries to implement structural reforms. Following a stable interest in fiscal discipline, the government was able to shift the burden of EU obligations onto highly indebted countries by forcing them to implement long-term reforms in exchange for EU funding. This doctoral thesis extends existing knowledge on the breaking of the common debt taboo, by analysing the political strategy of the opposing countries and institutional actors. This research considers political actors as ‘beings in action’ whose interests and preferences are not a ‘given’ but are relentlessly reconfigured, and so is their political strategy. Strategic constructivism provides a way to bridge the gap between the study of ideas, institutions and actors. In this perspective, further research is needed to shed light on the political strategy of France and Germany and to what extent NGEU’s debt was the result of discursive entrepreneurship from these countries. The mechanisms shaping EUCO Presidents’ view and political strategy also need to be further investigated. In addition, a study of interests and preferences within the European Commission would be interesting to understand the establishment of the institution's political strategy. Finally, this research provides a macro-level forward-looking analysis of the vision regarding public debt and power and the way it feeds into actors’ political strategy. A disconnection exists between the vision of sovereign debt and European bonds, which requires more in-depth knowledge. From this perspective, the NGEU agreement could mark the emergence of a new ‘ontological’ vision, particularly about joint borrowing, considered as a means of protecting the ‘European way of life’.