Federal Dynamics in Times of Economic and Financial Crisis

The global economic and financial crisis is a challenge for all governments, but particularly for federal states because divided and/or shared territorial powers make federations susceptible to coordination problems in fiscal policy making. This article explores the effects of the ongoing crisis on federal relations. Three kinds of problems that may become the cause of federal tensions and conflicts are evoked: opportunism of subgovernments, centralisation and erosion of solidarity among members of the federation. Our analysis of fiscal policies and federal conflicts of 11 federations between 2007 and the present reveals three kinds of coordination problems: shirking in the use of federal government grants, rent-seeking in equalisation payments, and over-borrowing and over-spending. Our results show that shirking remained limited to few cases and occurred only in the first part of the crisis. However, rent-seeking and over-borrowing and over-spending led to a reduction of solidarity among subgovernments and to increased regulation of the fiscal discretion of the members of the federation. Subsequently, tensions in federal relations increased - although only in one case did this challenged the federal order.

Religion in Times of Crisis

Religion is alive and well all over the world, especially in times of personal, political, and social crisis. Even in Europe, long regarded the most "secular" continent, religion has taken centre stage in how people respond to the crises associated with modernity, or how they interact with the nation-state. In this book, scholars working in and on Europe offer fresh perspectives on how religion provides answers to existential crisis, how crisis increases the salience of religious identities and cultural polarization, and how religion is contributing to changes in the modern world in Europe and beyond. Cases from Poland to Pakistan and from Ireland to Zimbabwe, among others, demonstrate the complexity and ambivalence of religion's role in the contemporary world.

How Party Linkages Shape Austerity Politics: Clientelism and Fiscal Adjustment in Greece and Portugal during the Eurozone Crisis

Drawing on an analysis of austerity reforms in Greece and Portugal during the sovereign debt crisis from 2009 onwards, we show how the nature of the linkages between parties and citizens shapes party strategies of fiscal retrenchment. We argue that parties which rely to a greater extent on the selective distribution of state resources to mobilize electoral support (clientelistic linkages) are more reluctant to agree to fiscal retrenchment because their own electoral survival depends on their ability to control state budgets to reward clients. In Greece, where parties relied extensively on these clientelistic linkages, austerity reforms have been characterized by recurring conflicts and disagreements between the main parties, as well as a fundamental transformation of the party system. By contrast, in Portugal, where parties relied less on clientelistic strategies, austerity reforms have been more consensual because fiscal retrenchment challenged to a lesser extent the electoral base of the mainstream parties.

Managing the crises : how did local governments react to the financial crisis in 2008 and what explains the differences ? The case of Swiss municipalities

Swiss municipalities are, to a large extent, responsible for their financial resources. Since these resources primarily depend on income and property taxes from individuals and enterprises, municipality budgets are likely to be directly affected by the current crisis in the financial sector and the economy. This article investigates how municipalities perceived this threat and how they reacted to it. In a nationwide survey conducted at the end of 2009 in all 2596 Swiss municipalities, we asked local secretaries which measures had been launched in order to cope with expected losses in tax income and a possible increase in welfare spending. Did the municipalities rely on Keynesian measures increasing public spending and accepting greater deficits, or did they try to avoid further deficits by using austerity measures and a withdrawal of planned investments? Our results show that only a few municipalities - mainly the bigger ones - expected to be greatly affected by the crisis. Their reactions, however, did not reveal any clear patterns that theory would lead one to expect. Preferences for austerity measures and deficit spending become visible but many municipalities took measures from both theories. The strongest explanatory factors for determining how/why municipalities react are: the municipality's level of affectedness followed by whether or not the municipality belongs to the French-speaking part of the country. Size also has an impact, whereas the strength of the Social Democrat party is negligible. Explaining what kind of measures municipalities are likely to take is more difficult. However, the more a municipality is affected, the more likely it is to stick to austerity measures.