Published in the Bank of Greece Working Papers Series, January 2019.
Proposals for Eurozone reform aim to complete its institutional architecture by
securing stability without creating moral hazard. Such policy arguments inevitably
rely, however, on implicit assumptions about justice, or on what is owed to whom. A
common assumption is that member states are solely responsible for what happens
to them. This paper, written from the point of view of public law and legal theory,
asks if this assumption is correct.
The relevant idea is often considered to be that of
solidarity. Yet, solidarity is a puzzling concept. Although it is mentioned in the EU
treaties, it does not appear to create any clear duties of mutual assistance. Many
prominent legal theorists argue that solidarity will only become relevant in the
future, when new European institutions bring citizens together under a single
Europe-wide political community. This paper argues, however, that these arguments
They are at least incomplete in that they miss the key role played by
corrective justice. Unlike distributive justice, which applies within states but not
among states, corrective justice applies to cooperative arrangements creating
interdependence. Corrective justice creates a principle of redress, which requires
that those who are unfairly burdened by an agreement should be compensated by
those who caused the unfairness.
Any state that was unfairly burdened by the
Eurozone’s flawed architecture, may thus have a claim of redress for the losses it
incurred as a result of the unfairness. It follows that the programmes of financial
assistance were not merely actions of self-preservation or prudence by the
Eurozone. They were also manifestations of an existing European principle of
solidarity based on corrective justice.