Government is fiddling the books – Netherlands’ economy scores average for Europe

8 March 2015

Government is fiddling the books – Netherlands’ economy scores average for Europe

During this week’s televised election debate, everyone could see that right wing Prime Minster Mark Rutte and his Labour Party deputy Diederik Samsom would have us believe that we are the finest students in the European Union, that our economy is booming and that we’re doing a lot better than other member states. But if you examine the precise statistics, little survives of this scenario. Our performance is no better than average, and there seems to be a direct link between this average performance and the Rutte government’s e obsession with austerity. Time to get rid of the coalition.

Foto: SP

On 5th March, the Central Planning Bureau (CPB) published the economic prospects for the year. In February the European Commission did the same for the whole of the EU. If we put these data alongside each other the following picture emerges.

Economic growth for 2015 in the Netherlands is estimated by the CPB at 1.7%, the exact average for the EU, according to the Commission. Consumer spending in the Netherlands should grow by 1.5%, but the Commission says that the figure for the entire EU will grow by 1.9%.State investments 0.2% for the Netherlands, 0.6% EU-wide. At 7.2%, unemployment is indeed rather lower in our country than the average for the EU, which stands at 9.8%, but the EU figure includes countries such as Greece and Spain where joblessness stands at record highs. If we concentrate on countries more comparable to the Netherlands, then 7.2% is pretty poor: in Germany it’s ‘only’ 4.9% and in Austria 5.2%.

Unfortunately such collections of statistics never include estimates for poverty. We hear about that only after the event, in the case of the Commission at least two years after. It wouldn’t surprise me, however, if the Netherlands totally fails on this count, because everyone now knows that the gap between rich and poor here is growing.

It can be a sign of intelligent economic policy if you present stats in a rather more optimistic fashion than the facts justify. By doing so, you can for instance, you can attempt to offer encouragement to consumers and firms in the hope that they will start once again to spend more on consumption and investment. In the case of this election campaign, however, there is no question of this. It suits the two governing parties, the right wing VVD and the centre-left PvdA (Labour Party), only because we will all then believe that their policies have worked and that the economy, thanks to the government, is once again doing well.

In reality it turns out from these same figures that the government has destroyed a great many things and thus prevented a speedy recovery. Unemployment will fall hardly at all in the coming year and we all know that the long-term unemployed are finding it difficult to return to work. That is a ticking time-bomb. Consumer spending remains in addition well behind that in other member states. People are being attacked by the government’s measures in such a way that they are unlikely to be spending more money. Moreover, many people are in a position where they will first have to reduce their mortgage and other debts before they can think of buying more stuff. Even a statistic which is easy for the government to influence, the level of state investments, lags behind the rest of Europe. But of course, the right has only one ideology now, and that is to draw back the state. And so the first priority is to refrain from investing in public services and public works.

A comparison with the EU as a whole can lead to only one conclusion: the Dutch economy has profited from a low oil price and poor euro exchange rate, which together have enabled soaring exports, but when it comes to the domestic economy, the government has done a great deal to ensure that our country will exit the crisis in poor condition. It’s time that Rutte and Samsom did their sums again - and this time they should refrain from cooking the books. Time we got rid of them.

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