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The Dutch face austerity


The Dutch face austerity

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The economic and financial crisis has overthrown governments all-over Europe. In the Netherlands, the political parties have clashed over austerity measures. And while the outgoing government increases the retirement age and VAT, the Dutch are becoming ever more disillusioned…

Danny, a construction worker from Rotterdam is the latest victim of the economic crisis after he was recently laid off. With a family to support and austerity measures looming on the horizon, the future is looking distinctly gloomy.

His friend, Folkert, was in the same situation four years ago, when the first ripples of the worldwide financial crisis were being felt. Rather than let his situation get the better of him, Folkert decided to work for himself.

Now he revels in the freedom of being self-employed. He can take holidays when he wants, negotiate his own pay and answers only to himself -the only downside is actually finding the work.

Folkert de Hoop explains: “It is very difficult to find work in Holland now. I come from the north and for me it’s about 150 miles to get here.”

Danny Blankespoor adds: “My situation is that I was fired so I still have six weeks of work left but after that I’m unemployed.”

Folkert de Hoop: “I don’t like it: the age that we have to stop working (for retirement) is 67 and in Greece it is 55.”

Danny Blankespoor: “Something has to be done about everything it can not go on like this. Going back to the guilder would sound great.”

Folkert de Hoop: “Maybe it would be good for the euro-zone to separate the poor countries from the richer countries to get better value from it because now the rich countries are little by little going down and that is not good.”

It is little wonder construction is suffering when you take into account that 15 per cent of all office buildings in the country are empty. In some areas, 50 per cent stand vacant.

Tax incentives on mortgages initially lured families onto the real estate market. House prices rose year on year but then the bubble burst and property values plummeted.

Private debt in the Netherlands breaks all European records and in spring, many feared the budget deficit could get out of control.

The centre-right wing government has reacted by implementing severe budget cuts. An unpopular move met with some resistance but a job well done for others.

Jan Kees de Jager, Dutch Finance Minister, talks to euronews about what he hopes to achieve:

“We have put through the austerity measures, we are making all the necessary measures to show the whole world, all parts of the world, that the Netherlands is still an austere country.”

In Rotterdam Harbour, we meet John, a jobless skipper, and his daughter Stephanie. She should have her mate’s licence next year, keeping up the sailing tradition which has been in her family for four generations.

The Netherlands is facing the gusts of an anti-Euro storm as the tone of the far right and the far left is decidedly eurosceptic.

John and Stephanie are members of the Dutch ‘Socialist Party’ and they believe the euro is to blame for their lives going off course.

John de Waard says: “The reason for the crisis is obviously the introduction of the euro. Today, the Netherlands is helping all these other countries, amongst them is Greece and obviously we’re paying quite a lot for them. That’s really bad for our country and that’s why we are in this crisis.”

John lives on 722 euros a month while Stephanie gets around 695 euros. A relatively low amount when you consider the high cost of living in Rotterdam and the government’s austerity package means even choppier waters are afoot.

Stephanie still lives at home, which means the calculations for their social security allocations will change meaning less money for both of them.

John’s home is surrounded by paintings of ‘his ships’ and at a time when VAT, the pension age; utility bills and medical care are all on the rise, it’s easy to understand his nostalgia for ‘the good old days’.

John de Waard continues: “Individual contributions – for medical care and such will increase in a dramatic way: Today I have to pay 246 euros a month, which will go up to 400 euros and as a result, food banks; where you get free food, are becoming increasingly popular. We’ll all will end up there.”

Stephanie de Waard, John’s daughter, believes things have changed as a result of the euro: “I think since the European currency, since the euro, everything has become a lot more expensive. All the prices have doubled, or worse.”

John de Waard, Unemployed: “At the time when I started sailing, a sailor tattoo cost me 5 euros, now it costs 150 euros!”

Stephanie de Waard, John’s daughter: “Today people work until their 65. The government wants to increase the retirement age to 67 or even 68 … I think by then, when I’m 67, I’ll have to work till I’m 80! “

John de Waard, Unemployed: “Young people can’t get any more money from the banks. So it’s going to kill small entrepreneurs with their small boats and we’ll end up only having big, expensive boats. We used to have the opportunity to start our own business’, but now it’s out of the question, you can’t even get credit for a house … “

In Utrecht, a debate is planned for those for and against the euro to put their points across.

Arjo Klamer, a left wing professor has a rather ominous nickname, “Europe’s Mister Doom” for him, the implosion of the eurozone would be no great surprise.

In front of the Utrecht cathedral he clashes with his intellectual and political counterpart; the liberal economist Jaap Koelewijn, an ardent defender of the euro.

Arjo Klamer, Eurosceptic economist says: “The euro is bad for Europe. The euro is bad for the Netherlands, it’s especially bad because it is a stimulus for politicians to kill the Welfare State.”

Jaap Koelewijn, Pro-euro economist disagrees:
“Basically the euro is a good idea. It is good for more European integration and it will make more competitive economies.”

Arjo Klamer, Eurosceptic economist: “I look forward to a European economy using multiple currencies. In the end that will be much better: it will make us more resistant to shocks and makes us less vulnerable to what is happening now.”

Jaap Koelewijn, Pro-euro economist: “I think unbundling the euro and disintegrating the euro would cost us five to ten per cent of GDP. Getting back the guilder (former Dutch currency before the introduction of the euro) unfortunately, would result in a dramatic loss of competitive power for the Dutch economy, as the guilder will appreciate vis-a-vis the southern European economies. So the cost of unbundling the euro would be much higher than the cost of maintaining the euro but maybe we should do without Greece.”

The Old Mint in Utrecht is secured like Fort Knox and there is good reason. Its research department holds a stunning collection of half a million gold and silver coins, as well as other numismatic treasures and only a small number of them are on public display at the Utrecht Money Museum.

However even with the historic wealth here, austerity has still managed to creep in and the museum’s curator has just lost his job.

Marcel van der Beek, Former curator, Utrecht Money Museum says:

“In history, there had been a lot of monetary unions. A good example is the Dutch Republic in the so-called ‘golden age’, in the 17th century. The Netherlands were not one country but a federation of provinces and they agreed to have a common coin, a common currency for trading purposes. It was a very stable coin, its worth remained the same for more then two centuries.”

Cees Maas is one of the founding fathers of the European Monetary Union. While he was the Dutch Treasurer-General, he negotiated the euro set-up, trying in vain to convince his European counterparts to agree on tougher rules. The euro, is his life’s work.

Hans von der Brelie, Reporter, euronews asks:
“What went wrong with the euro? Why we are in the situation we have today?”

Cees Maas, Former Treasurer-General, Netherlands answers: “The crisis we have in Europe is not on our currency, not on our banknotes, not on our coins. It is a problem with our governments. The governments’ deficits are too high.
Every country should know – and knows – that when you allow your debt to continue to accumulate and any family, any household knows that; you can not accumulate your debt all the time, then nobody finances it any more, at the end of the day.”

So is there still hope to keep the Dutch in the Eurozone? Or, will the whirlwind of anti-euro populism from the left and the right, blow up the euro from inside? The upcoming September elections in the Netherlands will no doubt be looked upon as a political barometer for the Eurozone as a whole.


Interview Bonus with :

Jan Kees de Jager, Dutch Finance Minister

Cees Maas, former Dutch Treasurer-General

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