Portal de Periódicos da CAPES

Editorial

2024; Volume: 22; Issue: 1 Linguagem: Inglês

10.1163/16456432-20040018

1645-6432

NULL AUTHOR_ID,

Global Financial Regulation and Crises

In 2008, a deep global financial crisis spread from and through the United States financial system to the rest of the world, contaminating the world economy by means of the global reach and integration of financial institutions.The crisis hit continental Europe a few weeks later, and by the beginning of the 2010s, most European economies were forced to reconsider their global position, while central states were using tax revenues to bail out banks and investment funds.In this bailing out campaign, economies that were the most exposed to American financial institutions or had been the most dependent on global capital markets for economic growth found themselves in dire straits, as they were the economies where the resilience of state revenues was the least stable because of the scope of the economy as a whole and/or the state's capacity to extract and retain revenue was low.Southern European countries, with particular emphasis on Greece, Italy, Portugal and Spain bore the brunt of this crisis, with a quick increase of public debt.To avoid state bankruptcy, Southern European countries had to borrow from European central banking institutions and from the IMF, in a general bailout that was then perceived and publicly presented as the strongest, morally sound economies of Northern Europe paying for the less proficient and corrupt states of the South, where private and state debt were to be expected because of weak institutions and doubtful moral standards by citizens and states.This reasoning was often portrayed internationally, but also nationally by centre-right wing parties, as a historical phenomenon and thus to be expected.At a moment when European solidarity had been key to steering the EU economy towards an upward trend, politicians and bureaucrats in Northern Europe and Brussels remained adamant in their moral judgement of Southern European economies.The culmination of public bashing arose in the early spring of 2017 when the Chair of the Eurogroup, former Minister of Finance of the Netherlands, Jeroen Dijsselbloem, gave an interview to the Frankfurter Allgemeine Zeitung where he stated, "I cannot spend all my money on booze