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Abstract
This book argues for the importance of situating our contextually influenced thinking about European states and debt within a commitment to historically informed and critical analysis. It teases out certain broad historical patterns. The book also examines the inescapably difficult and contentious judgements about ‘bad’ and ‘good’ debt; about what constitutes sustainable debt; and about distributive justice at times of sovereign debt crisis. These judgements offer insight into the nature of power and the contingent nature of sovereign creditworthiness. Three themes weave through the book: the significance of creditor-debtor state relations in defining asymmetry of power; the context-specific and constructed character of debt, above all in relation to war; and the limitations of formal economic reasoning in the face of radical uncertainty. Part I examines case studies from Ancient Greece to the modern euro area and brings together a wealth of historical data that cast fresh light on how sovereign debt problems are debated and addressed. Part II looks at the conditioning and constraining framework of law, culture, and ideology and their relationship to the use of policy instruments. Part III shows how the problems of matching the assumption of liability with the exercise of control are rooted in external trade and financial imbalances and external debt; in financial markets and vulnerability to banking crisis; in the character of the ‘private governance of public debt’; in who has power over indicators of sustainability; in domestic institutional and political arrangements; and in sub-national fiscal governance. Part IV looks at how the problems of mismatch between liability and control take on an acute form within the historical context of European monetary union, above all in euro area debt crises.
Table of Contents
Prologue
1 Contextualizing Debt
2 The Nature of Sovereign Creditworthiness
3 Moralizing Credit
Part I Debt and Political Rule in European History
4 The Evolution of Public Debt
5 Financial Repression, Debasement, and the Historic Arc of Default
6 Theological Traces and Social Contexts
7 The Dynamics of Public Debt in Historical Perspective
Part II Law, Culture, and Statecraft
8 Law, Public Debt, and the Paradoxes of Power
9 Economic Cultures, Ideologies of Debt, and State Virtue
10 Space, Time, and Statecraft
Part III State Liability and Territorial Control
11 States and Financial Markets
12 Professional Consensus, Political Silence, and Sovereign Creditworthiness
13 The Dynamics of External Imbalances and Debt
14 Which Truth? The Power of Numeric Indicators and Probabilistic Reasoning about Public Debt
15 Public Debt Dynamics
16 Public Debt and Multilevel Statehood
Part IV Sovereign Creditworthiness and European Integration
17 Still the ‘Old’ Europe? Historical Legacies and Long-Term Political Challenges
18 The Achilles Heel of Post-War European Integration
Epilogue
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