The role of the State in (and after) the financial crisis: new challenges for administrative law

The chapter explores the extent to which the 2008–09 financial crisis may ‘resurrect’ the idea of regulation and in so doing radically change existing administrative law systems. It further considers whether these changes are likely to result in either progressive convergence or even rising divergence across countries. As a matter of fact, in the face of a worsening financial and economic crisis, many States have passed acts and statutes designed to stabilize financial institutions and restore trust in the market. The most important effort arose in the United States, where Congress adopted legislation both at the end of Bush administration and at the beginning of Obama administration. In the meantime, European countries also adopted a variety of plans and laws to confront the economic and financial crisis. This chapter will detail how, throughout the world, the legislation emerging out of the financial crisis arguably marks the end of a long period of confidence in the market’s capacity to regulate itself. It also will turn more specifically to how this legislation enables public bodies to adopt a number of measures aimed at addressing the crisis, focusing in particular on bailout measures, stimulus packages and regulatory reform. Moreover, the chapter will take a broader perspective, arguing that the crisis legislation has the potential to create a complex political and institutional infrastructure geared toward guaranteeing the legitimacy and accountability of the State in the economic emergency. Finally, it will then detail how all these transformations challenge existing systems of administrative law both in national and in global perspective.