Since the beginning of the sovereign debt crisis, Europe has been forced into a rather unfamiliar territory: the provision of financial assistance to crisis-stricken member countries. Initially provided to countries with balance of payment problems in Central and Eastern Europe, financial assistance has ultimately been provided to Euro area countries too. Central to this activity has been the creation of the Troika or ‘bailout monitors’ – that is to say, the arrangement that brings together the European Commission, the ECB and the IMF for the design and monitoring of the adjustment programs. The Troika has often been criticized for the pernicious effects that its economic recommendations have on the social fabric of debtor countries. The focus on debtor countries, however, has often obscured other, important effects that take place on the creditors’ side. The purpose of this paper is exactly that of exploring how the politics of financial adjustment have interfered with the democratic set up of the European Union. In particular, the paper sheds light on two distortive effects that have materialized since the start of the crisis. The first is the fragmentation of the principle that the EU is a union of countries that are equal, with some member countries becoming more important than others because of the veto power assigned to them for the adoption of the adjustment programs. The second is the transformation of the European Commission, which has often been forced to choose between two competing roles, i.e. be the guardian of the Treaty or the agent of the Euro group.
