EU-imposed austerity in European Monetary Union’s peripheral economies prompted some to question whether the “troika” has introduced “politics without choice” to Southern Europe. Papers in this panel examine how domestic politics in Southern Europe (Spain, Italy and Portugal most notably) precipitated their exposure to the Euro-crisis, and evolved under the economic strain that the crisis (and austerity) delivered. The first paper (Royo) details how Portugal’s political legacies, tied to its transition to democracy, influenced its pre-crisis economic performance and subsequent need for a fiscal bail-out. The second paper (Field, Hamann and Johnston), examine whether organized labor in Spain still has the capacity to penalize their main left party ally (PSOE) when it pursues pro-market and austerity-based welfare policies. They find that despite organized labor’s organizational decline in Spain, unions have proven better able to turn public opinion against PSOE executives than PP executives before and during the crisis. The third paper (Vidal and Sánchez-Vítores) detail how the crisis has transformed the Spanish party system. The authors explain how the Great Recession caused the rhetoric of economic and political crisis to interact in a way that only new political parties (Podemos) were able to take electoral advantage of. The final paper (Dubin and Hopkin) examines how ideas have shaped labor market reform in Spain and Italy before and during the crisis. The authors argue that the ideational power of neoliberalism remains prominent even during the crisis due to the absence of alternative reform strategies from those that oppose it.