Sometimes my wishes are fulfilled more quickly than I dared to hope myself. Last week I wrote in the article The Netherlands: Closed for the holidays… until further notice the following snips:
In spite of pictures with exuberant displays of friendliness and cosiness between especially the PVV and VVD and the obligatory chitchat of the ever-laughing and smiling PM Rutte, there is a hardfought battle going on between three parties that cannot afford to blow up the cabinet, but don’t want to give eachother another inch of leeway.
The PVV understands that the current silent partnership is as close to having government power as it will ever get, but doesn’t want to lose votes from its ever dissatisfied grassroots.
The CDA is already very sorry that it ever stepped in the current government with PVV, but understands that it will be blown away if the cabinet stumbles and falls.
The VVD suffers from a lack of longterm goals and ideology, but is extremely proud to deliver the first PM since the beginning of last century.
My take: the current lame duck-government with its impossible conformation has wasted two valuable years without really fighting the credit crisis at home and abroad, while alienating everybody and their sister. The sooner it resigns, the better.
And resigning the cabinet did. After another session in Het Catshuis, Geert Wilders of the PVV (Party for Freedom) decided on Saturday, April 21st to pack his bags and leave the rest behind. Although his exact reasons are still unclear, it could have had to do with the fact that he didn’t want to lose votes from his grassroots. Sticking around with the cabinet would force him eventually to accept nasty austerity measures, targeting his most loyal voters: elderly Dutch citizens with small pensions and lower-educated people in awkward positions at the labor market, whose jobs are under fire of workers from South and East-Europe.
Another reason that is mentioned in the newspapers, is that Wilders wants to opt for a position at an American conservative thinktank, like the American Enterprise Institute. There he could live and work in relative comfort, peace and quiet, away from the necessary 24h protection by bodyguards that is surrounding him every day in The Netherlands. His battle might be fought now after eight difficult years as a maverick leader in the Second Chamber
Whatever his reasons were, Wilders couldn’t have picked a worse time for his fellow-parties in the cabinet:
The Christian-Democrat CDA is still in a period of rebuilding and finding back its confidence, after the enormous blows that the party received during the last series of elections in The Netherlands. To make things worse, the current polls are even more devastating than the outcome of the last elections for the Dutch senate: 12 seats vs 22 seats (number converted to Second Chamber seats) in March, 2011.
In comparison: in the past the party in the center of the Dutch political landscape won easily more than 45 seats during parliamentary elections.
However, there is one glimmer of hope: currently, the CDA seems to change slowly from a spineless ‘wherever I lay my hat, that’s my home’-party without any visible principles whatsoever, into a party that says ‘yes’ where it can, but ‘no’ where it must do so to remain credible. That is a big relief.
The VVD, blinded by the success of the unexpected victory of their leader Mark Rutte at the last parliamentory elections, is currently still the biggest party. However, during the 1.5 years of its reign with the CDA (and PVV), the party introduced a new policy, best described with the sentence ‘the unbearable lightness of being’. Main feats of arms: increasing the maximum speed at highways to 130 km/h and trying to make life for illegal aliens and asylum seekers as miserable as possible, in order to drivel with the electorate of the PVV.
Concerning the indispensable reforms that should be applied to the labor market, the housing market and the pensions, the policy of the VVD/CDA/PVV cabinet during the last one-and-a-half year could be easily summarized as: ‘kicking every can as far down the road as possible’. The result of this cabinet was an enduring political and economical stalemate in The Netherlands, turning the country from a leader in Europe into a trailer.
Icing on the cake of this cabinet was the bunch of political bunglers that were collected as ministers:
- Jan Kees de Jager, the bigmouthed Finance Minister who was constantly bullying the PIIGS-countries and who was urging the EU to maintain the European Stability and Growth (SGP) Pact “To a T”, until the moment that The Netherlands itself couldn’t follow the SGP anymore. Since then, he is hoping and praying that the EU will give him absolution for missing the SGP targets, which it won’t;
- Hans Hillen, the clumsy defense minister, who
was haunted by scandals during his short period and who planned
a small invasion on Somalian turf;
- Foreign Affairs Minister Uri Rosenthal, who lost
a helicopter in Libya and alienated all his fellow EU Foreign Affairs ministers
with his torpedoing of a united European policy towards the Middle-East,
because it was too harsh on Israel;
- Gerd Leers, the Minister for Immigration and Asylum policy, whose policy as a minister was 180 degrees different from his stance as mayor from Maastricht, under influence of the PVV. Seldom a minister has been more incredible than Gerd Leers during his period;
Except for perhaps Henk Kamp, the relatively honest and straightforward Minister of Social Affairs, this cabinet has been a total failure.
Even the sworn friends of Mark Rutte and his cabinet, the Dutch entrepreneurs and employers, rewarded his cabinet Mark Rutte I with a poor 5.4 (out of 10) last Friday.
Although you can’t blame all ministerial blunders, weak policy and rude rethoric of the PVV on Mark Rutte, he IS the person who was responsible during the last 1.5 years. As a sign on the desk of the American President says: ‘the buck stops here’.
Concerning the PVV, PM Mark Rutte has too often assumed the ostrich position and that will be held against him now. Just like the often rude Dutch policy of Rutte and De Jager towards other Eurozone members, especially the ones from the peripheral countries.
It was no surprise that even in The Netherlands you could hear the scornful laughter last weekend, coming from Madrid, Lisbon, Rome, Athens AND Brussels, if you listened well. ‘Now it’s our turn’, was probably the thought most common among the European peripheral leaders and EU representatives.
What happens next?
Mark Rutte has resigned at Queen Beatrix today. This means that his cabinet is demissionary and new elections will be held later this year. The One Million Dollar-question is now: when will these elections be held?
A qualified majority of the Second Chamber is in favor of elections in the middle of June, 2012, but the CDA and some very small parties are very much opposed against this plan as it leaves them too little time to reorganize themselves. A later possible date is Mid-October, 2012.
The former date leaves the parties very little time to prepare for the elections, while the latter means that the current unstable political situation will last for another nine months at least. In this time of economic hardship, this is an undesirable situation.
One thing is for certain: Mark Rutte has an EU deadline ending at April 30, for producing a new budget that reduces the initial 4.6% budget deficit in 2013, as forecasted by the Dutch Central Planning Bureau, to a 3.0% deficit.
Today, in ‘the corridors’ the EU tried to apply all possible pressure on The Netherlands, stating that there would be no exception for the country, as it was above all the cabinet of Mark Rutte that advocated the tough preservation of the SGP budget deficit threshold of 3%.
Also the financial markets showed very little patience with The Netherlands today: the spreads between Dutch 10y sovereigns and German Bunds rose to 82 basis points, the highest level since 2009, according to Het Financieel Dagblad. This spread might even increase further tomorrow, when 2y and 25y bonds to the amount of €2.5 bln are auctioned. The success of this auction might decide the immediate financial future of The Netherlands
Finally, there are the rating agencies Fitch, Moody’s and Standard and Poor’s, who had The Netherlands already in their crosshairs during the last months. S&P put The Netherlands on a negative outlook in January 2012, while Fitch fired a warning shot last Friday, through their expert on The Netherlands, Chris Pryce.
Whatever will happen in the coming months, the Cabinet of PM Mark Rutte caused The Netherlands much harm with their mixture of lacking stability and credibility and rude politics at many occasions. It will be a helluva job for the next government to repair the damage done.