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Home » Focus, Netherlands

Dutch Politics Paralysed in Post-Wilders Era?

Submitted by on 12 Jul 2012 – 12:34

By Dr Henk Overbeek, Professor of International Relations, VU University, Amsterdam

 

On April 21st the Liberty Party (PVV) of Geert Wilders blew up negotiations with the Liberals (VVD) and the Christian Democrats (CDA) which had been dragging on for seven weeks, about a draft 2013 budget that would stay within the strict European 3% deficit maximum. The Netherlands, once known for its political stability, saw its sixth consecutive coalition cabinet fall prematurely this millennium, and is facing new elections on September 12th.  VVD and CDA bear a heavy responsibility for the situation in which they have manoeuvred the country.

Domestically, driven by their shared dislike of the Social Democratic Labour Party (PVDA), they have allowed Geert Wilders to hold Dutch democratic politics hostage for the past two years. In the process the leaders of VVD and CDA have compromised the principles of parliamentary democracy, with its inherent respect for the rights of minorities, in their attempt to pacify the unquenchable thirst of Wilders for ever more extreme policies. Starting with the election campaign of 2010, VVD leader Rutte has consistently refused to distance himself from the offensive and at times anti-democratic discourse of the right-wing populist. When his coalition lost its majority in the First Chamber (the Dutch Senate) in 2011, Rutte even enlisted the support of a right-wing Christian fundamentalist party that excludes women (SGP). For Rutte, apparently, the principles of liberal democracy can be exchanged for agreement to increase the maximum speed on motorways from 120 km/h to 130 km/h. Likewise, the Christian Democratic leadership forced a substantial minority in its own party into silence and submission in pursuit of continued political power after a devastating election defeat in 2010.

The influence of Wilders on Rutte’s government policies has also fundamentally affected the international position of the Netherlands. Most noteworthy, and most consequential, has been his influence on the politics of the Eurozone sovereign debt crisis. Propelled by electoral fears for its anti-European coalition partner, the Dutch minority government pushed for very strict budget discipline in Europe generally, and for unbearably stringent conditions to be imposed on Greece specifically, at times even out-flanking Angela Merkel’s German government in this respect. By doing so, Prime Minister Mark Rutte and his Minister of Finance Jan Kees de Jager have helped box the Eurozone into a corner:  the corner of deflationary, pro-cyclical austerity which is driving peripheral Europe towards the abyss. What is more, they have also narrowed the playing field for domestic debate, in fact ruling out any discussion of countercyclical pro-growth policies. In the short run, three small centrist parties have bailed out the minority government by agreeing a provisional budget for 2013 that complies with the 3% deficit rule. Here too, however, CDA and VVD may have foreclosed longer term options.

The past few weeks have made it clear that the end of traditional neoclassical austerity is fast approaching. Voters in Greece, France and even Germany have clearly indicated that they no longer accept the logic of ever deeper cuts. Opinion polls in several other countries, including the Netherlands, show that pro-austerity parties are losing their majority there as well. Statements by prominent European leaders (including Barroso and even Merkel) as well as by Christine Lagarde of the IMF, confirm that the balance is shifting. Whether this will be enough to prevent a Greek exit from the Eurozone, or whether at least the safety measures put in place will be able to prevent contagion to Spain, Portugal, or Italy, very much remains to be seen. Although the Eurozone governments, the ECB and the IMF have cooperated to install substantial financial firewalls, nothing has been done effectively to limit the ability of the financial markets to undermine the stability of Eurozone bond markets. On the contrary, the financial resources put at the disposal of the IMF and the EFSF may in fact constitute a strong incentive to the financial markets to increase pressure on Spain and Italy: after all, each successive bail-out agreement has is fact bailed out the financial markets at the expense of the European taxpayer.

From the perspective of Eurozone stability the shifting balance away from extreme austerity may thus be too little too late. However, my point here is to argue that the Christian Democrats and the Liberals may have missed this boat, thus making it unnecessarily more difficult to form a stable government after the September elections. The five parties supporting the 2013 budget (who accepted the 3% deficit rule as inescapable) do not currently have a majority in the polls; Geert Wilders is now excluded by everyone as a potential coalition partner; and the Labour Party (indispensable for a majority if predictions come true) has been manoeuvred (and has manoeuvred itself) into a position that will make it impossible to accept the proposed 2013 budget. With the consent and complicity of VVD and CDA, Wilders has thus successfully paralysed Dutch politics; a long period without a majority government with a credible programme of reform and growth might well be the result.  In this sense the Christian Democrats and the Liberals have fallen into their own sword.