The recent announcement from Greece that Prime Minister Papandreou (see here and here) has proposed that the country hold a referendum on the recent deal with the EU is currently being cast as an economic story (but see here, for a report that treats it as a Greek political crisis) But in fact, it ties together a number of story lines and suggests that sovereignty, specifically questions of what it means and where it is located, are the crucial and constitutional problems of the moment.
The proposed referendum rests on a number of distinct, but related, assumptions of constitutionalism and sovereignty:
First the referendum makes the point that proposals to help Greece resolve its financial crisis are, ultimately, questions that implicate political, as well as an economic, issues. They are questions of political economy, not merely questions of the needs of the market or creditors.
Second the referendum suggests that those political questions are not merely problems that can be resolved through no confidence votes or new elections. They are questions of sovereignty--who has the authority to decide what Greece should (or must) do and bind Greece to a particular course of action. At the most obvious level, this is the problem of the scope of national sovereignty within the EU. Did the various countries of the EU retain sovereignty when they entered the union? If so, how much did they retain? Or, if they did they give up political sovereignty to enter into the union, how much did they relinquish? In the absence of a written EU constitution, these are questions of constitutional order rather than constitutional text, questions of constitutional order that are being determined by events on the ground.
Third, while practice suggests that at present the EU constitutional order assumes that member nations retain the sovereignty to try to resolve their economic problems on their own, in the first instance, the referendum engages the question of what the EU can do if a member nation fails (or is unable to resolve the problem). Does that failure create a state of exception (or something more fluid and quotidian?) that empowers the EU and/or some of its member countries to put the failing country into a type of economic and political receivership to save the rest of the union? If the answer to that question is yes, does that same principle also obligate the various countries of the EU to take action to save one or more of their members? To reframe this last question, does the state of exception that might strip Greece of sovereignty and autonomy for the good of the rest of the EU also strip Germany or other creditor nations of sovereignty and autonomy, to the extent that it gives them a duty to act to save Greece and the union, regardless of the cost to their own people?
Fourth, the referendum engages the related question: if there is some sort of state of exception that gives the EU extraordinary power over member nations, do the member nations still have to formally agree to the obligations that the EU has asked them to accept? It certainly seems that is the case. If there is an expectation that the member states will formally assent to whatever role the EU has assigned them, the final question is who has the power to bind each state by giving that consent.
The answer to that last question must, presumably, be found in each member state's constitution (see here, for example). The text of the Greek Constitution, Article I, paragraphs 2-3, provides that "popular sovereignty is the foundation of the government" and "all powers derive from the People and exist for the People and the Nation...." The argument that the Greek people have to ratify the EU plan is, then, an argument that in Greece, at least, sovereign authority ultimately lies in, and must be exercised by, the people of Greece, not the Greek govenment.
But here, too, there are more questions than answers, since it appears at the moment that that constitutional interpretation is not shared by everyone in Greece, or in the Prime Minister's party.
Update: For another, critical reaction, see here.
Further update: For two other responses, see here and here.
ERD