Beyond Crisis ANNA TSIFTSOGLOU NBG POST-DOCTORAL FELLOW MARCH 7, 2017, LONDON SCHOOL OF ECONOMICS

Beyond Crisis ANNA TSIFTSOGLOU NBG POST-DOCTORAL FELLOW MARCH 7, 2017, LONDON SCHOOL OF ECONOMICS

OUTLINE 1. The Idea of Constitutional Change 2. Drivers of Constitutional Change in Crisis-hit Greece A. The Parliament v Troika (parliamentary distortions) B. The Courts (judicial distortions & asymmetries) C. The People (the 2015 plebiscite & Grexit v Brexit ) 3. Which Way Forward - What Democracy after the Crisis?

1. The idea of Constitutional Change

CONSTITUTIONAL CHANGE What is a Constitution? How can Constitutions Change? Who drives Constitutional Change? Can Crises bring Constitutional Change?

WHAT IS A CONSTITUTION? The supreme law of a country a document Encompasses a set of principles according to which every state should be governed (eg separation of powers) May usually contain a bill of rights too May be written / codified or not (eg UK) May be short (eg USA) or long (eg India) Interpreted through the political process (parliament/ executive) and particularly by the courts through case-law Judicial review of constitutionality: may be centralized (eg Germany, Italy, Portugal) or not (eg Greece, USA)

THE AMERICAN CONSTITUTION Since 1789 (after Philadelphia Convention) amended 27 times to date

THE HELLENIC CONSTITUTION Since 1975 (after fall of military dictatorship) amended 3 times (1986, 2001, 2008)

HOW CONSTITUTIONS CHANGE Formal v Informal Constitutional Change Formal (de jure) through Revision / Amendments Rigidity v Flexibility Long & difficult process Requires political consent Qualified Majorities and time limits Informal (de facto) through (Political) Practice Everyday practice of state / external institutions Tends to happen in states with rigid constitutions Normalization The permanence of the temporary?

CONSTITUTIONAL REVISION IN GREECE Article 110 2. The need for revision of the Constitution shall be ascertained by a resolution of Parliament adopted, on the proposal of not less than fifty Members of Parliament, by a three-fifths majority of the total number of its members in two ballots, held at least one month apart. This resolution shall define specifically the provisions to be revised. 3. Upon a resolution by Parliament on the revision of the Constitution, the next Parliament shall, in the course of its opening session, decide on the provisions to be revised by an absolute majority of the total number of its members. 4. Should a proposal for revision of the Constitution receive the majority of the votes of the total number of members but not the threefifths majority specified in paragraph 2, the next Parliament may, in its opening session, decide on the provisions to be revised by a threefifths majority of the total number of its members. 6. Revision of the Constitution is not permitted before the lapse of five years from the completion of a previous revision.

WHO DRIVES CONSTITUTIONAL CHANGE? INTERNAL PLAYERS The Parliament (laws) The Executive (acts) The Courts (case-law) The People (referenda) EXTERNAL PLAYERS Supranational Institutions (EU) Other ad-hoc Institutions (Troika)

FINANCIAL CRISES AND CONSTITUTIONS Financial Crises as Constitutional Moments? (Ackerman) Shared Sovereignty Era The New Institutional Mix The Crisis Narrative The New Constitutional Ethos The Greek Case Institutional Crisis predated Debt Crisis

2. Constitutional Change in Crisis-Hit Greece

2a. THE PARLIAMENT v THE TROIKA (Andreas Petroulakis, Kathimerini, 24.2.2015)

INSTITUTIONAL ROLES Article 26 1. The legislative powers shall be exercised by the Parliament and the President of the Republic. 2. The executive powers shall be exercised by the President of the Republic and the Government. 3. The judicial powers shall be exercised by courts of law, the decisions of which shall be executed in the name of the Greek People.

THE MEMORANDA OF UNDERSTANDING (MoUs) Political Agreements signed between Greece and its Creditors ( Troika : EU / ECB / IMF and recently ESM) Bailout MoUs aimed to restore fiscal balance + growth Three MoUs over almost seven years (2010, 2012, 2015) in exchange for loans total over 300 billion Rumours of a fourth MoU/bailout that may be agreed in 2017 (negotiations with institutions still under way) MoUs signed by three different (coalition) governments, from all sides of the political spectrum (PASOK: 2010; PASOK/ND/LAOS:2012; SYRIZA/ANEL: 2015) Lack of political consensus on the bailouts

THE MEMORANDA OF UNDERSTANDING (MoUs) Drafted by the creditors agreed by governments Imposed conditionality (loan conditions reforms) Legality and justiciability of MoUs disputed Soft Law non-legally binding instruments Not International Treaties (28.2Σ) easier ratification Implemented through austerity package laws Imposed Fast-track Fiscal Adjustment Often set unrealistic targets that Greece failed to deliver in such little time frames // weak institutions

LEGISLATIVE PROCEDURE Article 73 1. The right to introduce Bills belongs to the Parliament and the Government. Article 74 5. A Bill or law proposal containing provisions not related to its main subject matter shall not be introduced for debate. No addition or amendment shall be introduced for debate if it is not related to the main subject matter of the Bill or law proposal.

LEGISLATIVE PROCEDURE Article 76 1. Every Bill and every law proposal shall be debated and voted on once in principle, by article and as a whole, with the exception of the cases provided under paragraph 4 of article 72. 2. Voted Bills or law proposals that are sent back to Parliament pursuant to article 42 shall be debated and voted on by the Plenum of Parliament twice and in two distinct sittings, at least two days apart, in principle and by article during the first debate, and by article and as a whole during the second. 4. A Bill or law proposal designated by the Government as very urgent shall be introduced for voting after a limited debate in one sitting, by the Plenum or by the Section of article 71 as provided by the Standing Orders of Parliament. 5. The Government may request that a Bill or law proposal of an urgent nature be debated in a specific number of sittings, as specified by the Standing Orders of Parliament.

PARLIAMENTARY DISTORTIONS How the Parliament actually works Steady rise & abuse of an exceptional provision (76.4Σ) Often no satisfaction of very urgent nature Parliament works to satisfy troika deadlines Normalization of Emergency Legislation Severe impact on the quality of legislation No time for deliberation (huge laws voted in one sitting- often by MPs acknowledging they had no idea what they voted for ) Governments have steadily promoted law proposals/ amendments containing provisions unrelated to the main subject matter of the proposal (74.5Σ) (eg former Justice Minister Paraskevopoulos: we should be rather lax when applying the constitution 28/1/2016) Amendments may often surpass the total provisions of a draft law

LEGISLATIVE DECREES (PNPs) Article 44 1. Under extraordinary circumstances of an urgent and unforeseeable need, the President of the Republic may, upon the proposal of the Cabinet, issue acts of legislative content. Such acts shall be submitted to Parliament for ratification, as specified in the provisions of article 72 paragraph 1, within forty days of their issuance or within forty days from the convocation of a parliamentary session. Should such acts not be submitted to Parliament within the above time-limits or if they should not be ratified by Parliament within three months of their submission, they will henceforth cease to be in force.

PARLIAMENTARY DISTORTIONS Legislative Decrees (Πράξεις Νομοθετικού Περιεχομένου - PNPs) Steady rise & abuse of an exceptional provision (44.1Σ) A Way for Government to Bypass the parliament Often no satisfaction of extraordinary circumstances No judicial review of this condition considered political question that cannot be reviewed by courts Hampers separation of powers Parliament merely ratifies the decrees Such practice leaves the executive unbound Legal theory promotes judicial review of this condition

LEGISLATIVE DECREES (PAST 15 YEARS) Source: D.Sotiropoulos, L.Christopoulos Polynomia, Kakonomia kai Grafeiokratia stin Ellada, Dianeosis Report, July 2016

LEGISLATIVE DECREES IN TIMES OF CRISIS Source: Panagiotis Karkatsoulis, To Vima, March 6, 2016

OLDER PERCEPTIONS OF PNPS BY THE PRESENT GOVERNMENT ( A distortion of our polity ) ( The disgrace of PNPs does not exist in any other country ) ( PNPs are junta-inspired )

2b. THE COURTS (Andreas Petroulakis, Kathimerini, 10.2.2017)

JUDICIAL GUARANTEES Article 87 1. Justice shall be administered by courts composed of regular judges who shall enjoy functional and personal independence. Article 88 2. The remuneration of magistrates shall be commensurate with their office. Matters concerning their rank, remuneration and their general status shall be regulated by special statutes. 5. Retirement from the service of the magistrates shall be compulsory upon attainment of the age of sixty five years for all magistrates up to and including the rank of Court of Appeal judge or Deputy Prosecutor of the Court of Appeals, or a rank corresponding thereto. In the case of magistrates of a rank higher than the one stated, or of a corresponding rank, retirement shall be compulsory upon attainment of the age of sixty seven years. In the application of this provision, the 30th of June of the year of retirement shall in all cases be taken as the date of attainment of the above age limit. ***THUS: Greek Constitution does NOT provide specific salary levels for judges BUT provides compulsory retirement age for all judges (not altered contra legem) ***

JUDICIAL DISTORTIONS Article 88.2 Σ: - Special Court ( Μισθοδικείο ) instituted for all issues re: judges compensation and pensions - Composition by lottery changes every year - Court composed by 3 judges, 3 law professors, 3 lawyers - Lawyers and law professors tend to side with judges - Judges practically end up deciding their own salaries (!) - Cases 88/2013 and 127/2016 (ruled salary cuts - including retroactive ones- were unconstitutional and demanded return to former standards court substituted legislator!) - Strong law professor dissents in both cases

JUDICIAL ASYMMETRIES Growing asymmetries in crisis case-law: Between the Courts involved On the Timing of the cases Parties (payrolls) at issue Expenditures v Revenues

JUDICIAL ASYMMETRIES Examples of austerity case-law Salary & Pension Cuts in the public sector Asymmetry in between different payrolls Armed forces professors judges Other Social Rights Litigation Privatizations, property tax Courts back or challenge austerity measures Techniques used to limit public expenditure

JUDICIAL ASYMMETRIES Examples of austerity case-law Council of State - 668/ 2012 (on the 1 st MoU) - 1116/2014 (on bond holders) - 2192-6/2014 (on armed forces) - 4741/2014 (on university professors) - 734/2016 (on retirement bonuses) Court of Audit - 4327/2014 (on judges pensions) - 4707/2015 (on armed forces) - 1506/2016 (on university professors)

THE EUROPEAN FACTOR Austerity measures also challenged abroad unsuccessfully During crises, courts tend to defer to the executive European Court of Human Rights Koufaki & ADEDY v Greece, App.No.57665/12 (2013) (salary cuts not deemed disproportional restriction to property) Mamatas et al v Greece, App.No. 63066/14 (2016) (on greek bond holders that suffered damage from PSI) Court of Justice of the EU T-541/10 & T-215/11, ADEDY v Commission & Council (both applications dismissed on procedural grounds) CJEU in general declined to rule on preliminary references concerning austerity measures (Portugal, Romania)

THE EUROPEAN FACTOR Foreign Courts in other crisis-hit states (examples) Cyprus (High Court) Christodoulou v. Central Bank of Cyprus, Case No 551/13, Judgment of June 7, 2013 (on bail-in damages) Fylaktou v. Democracy of Cyprus, Case No 397/12, Judgment of June 14, 2013 (on judges salaries) Portugal (Constitutional Court) Cases 353/2012, 187/2013, 862/2013, 413/2014 Strong judicial activism on social rights during crisis Several austerity measures deemed unconstitutional

2c. THE PEOPLE Former Speaker of the Parliament endorsing the No Vote on the Eve of the 2015 Referendum (Source: I Efimerida, 5.7.2015)

ARTICLE 44.2 ON REFERENDA 2. The President of the Republic shall by decree proclaim a referendum on crucial national matters following a resolution voted by an absolute majority of the total number of Members of Parliament, taken upon proposal of the Cabinet. A referendum on Bills passed by Parliament regulating important social matters, with the exception of the fiscal ones shall be proclaimed by decree by the President of the Republic, if this is decided by three-fifths of the total number of its members, following a proposal of two-fifths of the total number of its members, and as the Standing Orders and the law for the application of the present paragraph provide. No more than two proposals to hold a referendum on a Bill can be introduced in the same parliamentary term. Should a Bill be voted, the time-limit stated in article 42 paragraph I begins the day the referendum is held.

THE 2015 PLEBISCITE No referenda culture in Greece in the metapolitefsi era (1974-date) 2011 idea of referendum shocked Eurozone and led to former PM s G.Papandreou s resignation 2015 plebiscite constitutional issues: Subject was erroneous and misleading Question was vague and confusing Contrary to CoE standards No time for deliberation Political manipulation tool Had shocking repercussions

GREXIT v BREXIT REFERENDUM GREXIT (2015) BREXIT (2016)

GREXIT v BREXIT REFERENDUM GREXIT (2015) -vague & misleading question -no time for discussion (1 week) -Grexit was not officially pronounced -Government defied popular mandate BREXIT (2016) -very clear & precise question -ample time for discussion (1 year) -Brexit was officially pronounced -Government respected mandate

3. Which Way Forward?

WHAT DEMOCRACY AFTER THE CRISIS? Normalization of the Exception Restoring checks & balances Constitutional Resilience Revisiting Sovereignty Populistic Threats

50 YEARS OF CHANGE ANDREAS PAPANDREOU It is only fair to ask our friends some understanding on our effort to make Greece an equal member of the European Economic Community, a Greece that will prosper, will advance, will be free and liberal ( A New Financial Policy for Greece, Lecture given at Bonne, January 29, 1965) ALEXIS TSIPRAS Austerity is not part of the European treaties; democracy and the principle of popular sovereignty are ( End Austerity before Fear Kills Greek Democracy, Financial Times, January 20, 2015)