A Microcosm of the Changes Roiling Europe
AP Photo/Peter Dejong, File
A Microcosm of the Changes Roiling Europe
AP Photo/Peter Dejong, File
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Editor's Note: This is the second in a two-part series about an election easily overlooked outside of Northern Europe. This vote and the circumstances surrounding itprovide keen insight into the broader state of politics on a continent in transition. To read part one, click here.

The two coalition parties in power in the Netherlands are destined for crushing defeats in elections on March 18 that will determine the makeup of the new Senate. Polls show the opposition anti-Islam Freedom Party of Geert Wilders in the lead.

A big loss in the Senate could spell the end of the country's coalition government. More likely, the country's mainstream parties will take one look at the polls and decide not to call for new national elections - which could see formerly fringe parties take firm control - thus leaving an effectively delegitimized administration in charge. We take a look at the major issues in a country that is increasingly seen as a bellwether for Western European politics.

The Netherlands since World War II has been at the vanguard of social welfare reform in Europe. Social Democrats and Christian Democrats in tandem laid the foundations for a true welfare state in the late 1950s and the 1960s.

A pensions savings system, improved collective health care, basic government-financed unemployment insurance, welfare benefits, and state-financed education plans were introduced within a generation. Employers, workers, and the government all picked up part of the tab, and the discovery of huge gas fields in the north of the country removed all restraints.

From the 1970s onward, welfare schemes expanded. New benefits were designed, health care costs ballooned, and education expenditures increased. In the early 1980s, government expenditures had increased to such heights - just as the global economy pushed inflation to unsustainable levels - that the government pushed the major labor unions and trade unions to reach a national labor agreement. Unions would no longer demand outrageous raises; employers would invest in jobs.

In the mid-1980s, government expenditures accounted for more than 60 percent of Dutch gross domestic product. In those days, the Social Democrats, Christian Democrats, and Liberals were the biggest parties in parliament. They formed alternating government coalitions, with the Christian Democrats always being the centrists who pivoted to the Liberals or the Social Democrats depending on the outcome of the vote.

An age of discontent

Since the late 1980s, much has changed - especially for the Social Democrats and Christian Democrats. Both parties, formerly responsible for the creation of the welfare state, set about tempering it, cutting back on expenses. Government-owned companies were privatized, markets were liberalized, and expenditures on government programs were cut.

But while parties dealt with the outsized welfare state, many of their voters didn't follow. The year 2002 saw voters revolt. Out of nowhere one man, Pim Fortuyn, galvanized the discontent that part of the electorate had silently carried for years. Much to the surprise of many a complacent politician, it turned out that a sizeable non-voting portion of the population felt deeply disenfranchised and ignored by what Fortuyn dubbed "the establishment" or "the elite."

Many of the discontended voters had grievances that had also been largely ignored. Whereas most of the political debate in the country had for decades centered on socioeconomic issues such as health care, education, social security, unemployment, and economic growth, a great number of these people were also worried about sociocultural issues.

They felt left behind. While foreign refugees were granted houses to live in for free (or at vastly reduced rents), the disenfranchised poor had to wait years for affordable housing due to market shortages. While these voters' old, post-World War II Reconstruction neighborhoods in the cities were drastically altered by the influx of cheap foreign labor, they felt a loss of identity, and they believed that politicians didn't care about them. To protest the influx of foreign labor led more often than not to being publicly dubbed a racist by politicians.

The Netherlands at that time saw the emergence of a PEGIDA movement avant la lettre - one made of people who didn't demonstrate in the streets, but rather voiced their protest in the voting booth. Fortuyn played the identity politics fiddle so well that it was picked up by many other political parties, including the Social Democrats and the Christian Democrats. Ever since the time of Fortuyn, who was assassinated just before the national elections of 2002, sociocultural issues such as crime, integration, and immigration have sat solidly at the forefront of Dutch politics.

Fortuyn 2.0

Geert Wilders of the Freedom Party has pushed matters further than Fortuyn ever did. Where the latter singled out and took on Muslim extremists, but respected Islam as a religion, Wilders is unabashedly anti-Islam and anti-immigration, combining this with a decidedly leftist socioeconomic program that would overturn the reforms of recent decades.

Wilders is currently in the crosshairs of the country's Prosecution Office for alleged discrimination against Moroccans during an election rally. But the movement that supports him is unfazed; in polls, Wilders looks set to be the solid winner of the elections on March 18, handing him many new seats in the Senate.

Vertical divides become horizontal

Meanwhile, something else has changed. Among voters concerned with predominantly socioeconomic issues, even those on the right - voters usually associated with a strong preference for lower taxes and smaller government - are far less keen on cuts in health care, education, and even social security than they once were.

This has led the government coalition parties (left-wing Social Democrats and right-wing free-market Liberals) to turn the tables on the opposition. After ramming through hard-hitting reforms that resulted in more than €50 billion in cuts in health care and social security, the government parties now accuse the opposition of wanting more budget cuts.

Hardly a day goes by this election season without the Social Democrats accusing their opponents in the D66 party of "wanting to cause new instability" and "calling for even more cuts" in health care and social security. It appears to be working. Some recent polls indicate that D66, which had been riding high in the polls, is gradually losing support.

In the Netherlands, political truisms have been turned on their heads. With even cost-cutting, small government-type voters rejecting austerity, it seems that ideas that were once vilified as leftist tax-and-spend politics have been internalized as schemes you can now take for granted.

Once again, Dutch voters in this respect may stand at the European vanguard.

Kaj Leers (1975) is a former financial journalist, election campaign analyst, political communications strategist and spokesman. Specializing on international affairs, Leers writes for RealClearWorld on European political affairs, the European Union, campaign strategy and macro-economics. COuntries in focus: The Netherlands, Belgium, Germany, France, Spain, Portugal, the United Kingdom. Follow him on Twitter.com/kajleers (mostly Dutch, oftentimes in English).