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Published on September 20th, 2012 | by Katharina Obermeier
Image © [caption id="" align="alignnone" width="566"] © By Alina Zienowicz; Via commons.wikimedia.org; Image taken: 16 July 2007[/caption]   It is a sign of both the gravity of the eurozone crisis and the peculiarity of the EU’s political structure that the results of the Dutch national election on September 12 were reported in the media all over the world. Journalists described the election as a “litmus test” for public willingness to support the euro and wondered whether the results were part of a “turning point” in the crisis. What made this news from a  small European country so special? To answer this question, we have to go back to last spring, when the Dutch governing coalition collapsed and Prime Minister Mark Rutte resigned from his position. The reason for the break-down was the budget-cutting measures proposed by the government in order to keep the national deficit in line with targets set by the European Union. The attempt to implement austerity measures caused Geert Wilders, the virulent head of the far-right anti-EU Freedom Party, to withdraw his support from the coalition, thus triggering a political crisis in the Netherlands and the need for new elections. The collapse of the government was very much tied to the eurozone crisis and   it generated debate on the effectiveness of austerity measures, the sustainability of the euro and the legitimacy of the EU’s restrictions on national budget deficits. At the time, the crumbling of the Dutch coalition government was viewed by sceptics of the single currency and the European project as proof that national governments – and their electorates – as unwilling to pay the price of keeping the euro alive. The important role played by Wilders and his anti-EU rhetoric highlighted the deep backlash to the single currency which the crisis created among European politicians and citizens. Now, however, the overwhelming winners of the election are parties which are in favour the euro and the EU. However, this is not merely a symbolic victory for the single currency, demonstrating support for it among at least one group of European citizens. Decision-making in the EU is still heavily dependent on individual national governments, represented at European level by the Council of the European Union. Through this institution, national governments can block any legislative proposals, and each member state’s vote is important. In fact, the distribution of votes in the Council favours the less populous countries in the EU, giving a country like the Netherlands more clout. On sensitive issues, such as many of the measures proposed to help solve the eurozone crisis, unanimity is required among EU member states. This can lead to a situation like the one in October 2011, when the Slovak Parliament threatened to unilaterally derail an expansion of the European Financial Stability Fund (EFSF), used to bail out troubled eurozone countries and banks. The crisis was only averted when the Slovak Prime Minister at the time, Iveta Radičová, sacrificed her own position in order to make a deal with the opposition party which saved the EFSF expansion. Considered in this context, the results of the Dutch election are important and encouraging for the eurozone. In the past, Dutch politicians have been amongst the toughest critics of proposals such as eurobonds which would increase interdependence and debt-sharing in the eurozone. A different election result could have significantly raised the risk of one EU member state jeopardising any compromise agreement between the 26 other countries, perhaps purely because of internal politics. Of course, uncertainties remain, the various centrist Dutch parties will have to determine how to form a coalition, and the result could be a government that is not stable enough to lead the country through the crisis. More importantly, there is no guarantee that the eurozone crisis management won’t be hijacked by another member state. In the end, despite the popular perception of a Brussels “diktat”, the big decisions in the EU can still be affected by the smallest member.

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The Dutch Election Result: A New Hope for the Eurozone?

© By Alina Zienowicz; Via commons.wikimedia.org; Image taken: 16 July 2007

 

It is a sign of both the gravity of the eurozone crisis and the peculiarity of the EU’s political structure that the results of the Dutch national election on September 12 were reported in the media all over the world. Journalists described the election as a “litmus test” for public willingness to support the euro and wondered whether the results were part of a “turning point” in the crisis. What made this news from a  small European country so special?

To answer this question, we have to go back to last spring, when the Dutch governing coalition collapsed and Prime Minister Mark Rutte resigned from his position. The reason for the break-down was the budget-cutting measures proposed by the government in order to keep the national deficit in line with targets set by the European Union. The attempt to implement austerity measures caused Geert Wilders, the virulent head of the far-right anti-EU Freedom Party, to withdraw his support from the coalition, thus triggering a political crisis in the Netherlands and the need for new elections. The collapse of the government was very much tied to the eurozone crisis and   it generated debate on the effectiveness of austerity measures, the sustainability of the euro and the legitimacy of the EU’s restrictions on national budget deficits. At the time, the crumbling of the Dutch coalition government was viewed by sceptics of the single currency and the European project as proof that national governments – and their electorates – as unwilling to pay the price of keeping the euro alive. The important role played by Wilders and his anti-EU rhetoric highlighted the deep backlash to the single currency which the crisis created among European politicians and citizens.

Now, however, the overwhelming winners of the election are parties which are in favour the euro and the EU. However, this is not merely a symbolic victory for the single currency, demonstrating support for it among at least one group of European citizens. Decision-making in the EU is still heavily dependent on individual national governments, represented at European level by the Council of the European Union. Through this institution, national governments can block any legislative proposals, and each member state’s vote is important. In fact, the distribution of votes in the Council favours the less populous countries in the EU, giving a country like the Netherlands more clout. On sensitive issues, such as many of the measures proposed to help solve the eurozone crisis, unanimity is required among EU member states. This can lead to a situation like the one in October 2011, when the Slovak Parliament threatened to unilaterally derail an expansion of the European Financial Stability Fund (EFSF), used to bail out troubled eurozone countries and banks. The crisis was only averted when the Slovak Prime Minister at the time, Iveta Radičová, sacrificed her own position in order to make a deal with the opposition party which saved the EFSF expansion.

Considered in this context, the results of the Dutch election are important and encouraging for the eurozone. In the past, Dutch politicians have been amongst the toughest critics of proposals such as eurobonds which would increase interdependence and debt-sharing in the eurozone. A different election result could have significantly raised the risk of one EU member state jeopardising any compromise agreement between the 26 other countries, perhaps purely because of internal politics. Of course, uncertainties remain, the various centrist Dutch parties will have to determine how to form a coalition, and the result could be a government that is not stable enough to lead the country through the crisis. More importantly, there is no guarantee that the eurozone crisis management won’t be hijacked by another member state. In the end, despite the popular perception of a Brussels “diktat”, the big decisions in the EU can still be affected by the smallest member.

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About the Author

Katharina Obermeier

Katharina considers herself a German-Canadian hybrid. She grew up in Germany and completed her BA in International Relations at the University of British Columbia in Vancouver, Canada. Politics, especially in relation to concepts of nationality, have always fascinated her, and she is particularly interested in international political economy. During her studies, she was an avid participant at Model United Nations conferences, and helped welcome international exchange students to her university. She is currently completing an internship at a Brussels-based trade association and hopes to work in European affairs in the future. In her political writing, Katharina marries social democratic principles with a keen interest in the European Union and its implications for European politics and identity. She writes to counteract simplistic ideas about politics and economics, continuously attempting to expose the nuances and complexities involved in these subjects.



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