As the European crisis deepens, you don't see many people demanding more democracy from EU institutions. To the contrary, the seemingly endless stream of elections, referendums and treaty ratifications seems like it exacerbates the crisis more than it solves anything. So not surprisingly, there is growing sentiment that the continent's experts need to take charge of the situation, and that Europe's bureaucrats should exercise the power they've been given to stabilize the financial system.
It's an attractive argument. Democracy is messy and time consuming. And passionate (but empty) rhetoric usually gets the upper hand over facts. Nobody, after all, really wants to spend their day talking to their neighbors about bank recapitalizations and economic restructuring.
But in reality, the financial crisis has shown that technocratic governance has two important limitations. First, even if you install technocrats as heads of state, with broad mandates for change, they still have to navigate national on-the-ground political minefields to implement adjustment policies. This is harder said than done. In both Italy and Greece, unelected technocrats (both former EU officials) have taken the helm of their respective governments with little to show for their new found power. From Prime Minister Mario Monti's inability to institute meaningful reforms in Italy, to Prime Minister Papademos's failure to sustain support for austerity, technocrats more accustomed to leading armies of civil servants have found themselves unable to achieve and maintain the social consensus necessary for delivering meaningful economic reforms in their native countries.
Second, even where technocrats have unbridled power in their particular sector, most of Europe's problems are so broad-based that even unprecedented steps taken by bureaucracies in their relevant spheres of influence will be insufficient to solve larger underlying economic problems. Consider the European Central Bank. In theory, the ECB has a virtually unlimited power to lower interest rates and lend money. As a result, ECB President Mario Draghi is asked every week to throw a lifeline to insolvent governments on the European periphery. But the response by the ECB has been muted, and for good reason. Although it can ramp up the printing press to lend out money or purchase bonds, the ECB knows that any resources it puts forth will essentially be wasted and of temporary benefit without any long-term structural reform by insolvent governments.
Collectively, these inconvenient truths point to the fact that spurring on the technocrats may help, but eventually the politics of Europe itself have to change. And here technocrats can only provide incentives to politicians and EU citizens to embark upon reform. EU officials can, as in Ireland's referendum with the fiscal treaty, give stern warnings about the repercussions about voting no and imperiling their own access to EU funds. Or they can promise generous resources in the event that countries take on economic adjustment to ease the pain of social dislocation. But ultimately EU citizens have to decide for themselves if the money offered (or denied) by the continent's technocrati is worth the paper it's printed on.