A new Dutch government with a taste for Europe

ohRDINARILY, WHEN the EU promotes a flood of collective spending, the Dutch are putting their finger in the collective dyke. In 2020, the Netherlands rallied a group of small rich countries (the “frugal four”) to oppose the EUthe covid recovery fund. They finally gave in, but not before Wopke Hoekstra, then finance minister, insulted southern Europeans for lack of fiscal discipline. This week a new Dutch government took office. It includes the same parties as the previous one, but its position on the EU is much more relaxed.

Mark Rutte, the Liberal Prime Minister, is back for a fourth term, but has turned to Europe. Equally important is the new finance minister, center-left Sigrid Kaag, proEU D66 part. Finance is the most powerful ministry and has largely ruled the Netherlands EU policy since the euro crisis of 2010-12. Mr Hoekstra, a Christian Democrat, was sent back to the Foreign Office. It might sound strange, but Mr Hoekstra embodies an old adage about the country’s diplomacy: ‘I’m Dutch, so I can be blunt. “

Finance ministers are often popular in the Netherlands. Obtaining the position is a testament to Ms.Kaag’s negotiating skills, honed as a UN diplomat in the Middle East. The coalition negotiations lasted nine atrocious months. Closing a deal forced the parties to trade favors, which led to rather non-Dutch plans for big spending. They include a climate fund of 35 billion euros ($ 40 billion) until 2030 and reimbursing 95% of childcare costs up to the age of 12. Public debt will increase beyond EUthe notional limit of 60% of GDP.

Dutch flexibility would be welcome in Brussels, where France and Italy want to permanently relax fiscal rules. The new government could agree, subject to conditions. He also supports letting the EU further increase its own taxes, including a carbon tariff on imports. Instead of clubbing with small thrifty states, it will work with the EU, France and Germany.

The tone of the Netherlands has changed, but not its interests. As a very trading country with a large financial sector, it felt closer to Britain than to France until Brexit. He remains less statist than most EU members. “We will continue to be a liberal outpost in Europe,” says Hans Vijlbrief, a D66 minister who worked at the Ministry of Finance and in Brussels. But they can be less direct about it.

This article appeared in the Europe section of the print edition under the title “Unclogging Europe”

Mary I. Bruner