Dutch Parties’ Plans Scored for Economic Impact

The liberals would boost employment and growth; left-wing parties would protect pensioners and welfare.

Dutch prime minister Mark Rutte confers with his Latvian counterpart, Valdis Dombrovskis, during a meeting of the European Council in Brussels, May 22, 2013
Dutch prime minister Mark Rutte confers with his Latvian counterpart, Valdis Dombrovskis, during a meeting of the European Council in Brussels, May 22, 2013 (Valsts Kanceleja/Thierry Monasse)

The Dutch economy would grow faster if the manifesto of Prime Minister Mark Rutte’s liberal party were implemented while pensioners and those on welfare would be better off under a left-wing government.

Those are some of the findings of the Netherlands Bureau for Economic Policy Analysis, which calculated the effect proposals from the country’s eleven largest political parties would have on incomes, jobs and growth.

Few of the findings are surprising. Rutte’s liberals are pro-business, so it makes sense their policies would generate higher growth. The Labor Party and the far-left Socialists are unwilling to weaken workers’ rights for the sake of boosting employment. The Green are willing to sacrifice some growth for eco-friendly energy and tax policies.

What stands out is the difference between the liberals and Socialists in terms of job growth. The parties are polar opposites on economic and trade policy and it shows: Whereas structural unemployment would fall 3.5 percent under the liberal plan, it is projected to rise 4.6 percent under a Socialist administration.

Signals

No single party is expected to win a majority in the election next month, so no single program would be implemented.

But the findings do signal to voters which parties look out for their interests.

Rutte’s willingness to cut benefits in order to finance a middle-class tax break may help him win over right-wing voters from the Christian Democrats and nativist Freedom Party.

Labor’s determination to control deficit spending would be reassuring to middle-income voters who worry that the left is sometimes too profligate.

By protecting benefits and pensions, the Socialists could attract left-wing voters who think Labor is too compromising.

Notably, all major parties are willing to slow fiscal consolidation in the next parliament and all their plans would add to baseline growth.

Exception

Parties normally submit their manifestos for analysis several months before the election.

The Freedom Party, which is polling in first place, refused to this year. Its entire program consists of a single page with eleven bullet points.

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