Analysis

Farm Crisis Divides Dutch Government

Christian Democrats break from goal to cut emissions in half by 2030.

Mark Rutte
Prime Minister Mark Rutte answers questions from Dutch lawmakers in The Hague, September 17, 2020 (Tweede Kamer)

Farm protests in the Netherlands have divided Prime Minister Mark Rutte’s four-party coalition.

Foreign minister and deputy prime minister Wopke Hoekstra, who leads the junior Christian Democratic party, told the AD newspaper last week that the government’s ambition to halve nitrogen emissions by 2030 wasn’t “sacrosanct”.

Christianne van der Wal, the minister who designed the targets, and a member of Rutte’s liberal party (of which I am a member too), publicly described Hoekstra’s seeming capitulation to demonstrating farmers as “unpleasant”. Het Parool, the newspaper of Amsterdam, reports she privately called it a “stab in the back.”

Sigrid Kaag, the finance minister and leader of the left-liberal D66, accused Hoekstra of undermining “trust” between the ruling parties.

Rutte downplayed the split on Tuesday in parliament, arguing Hoekstra had a right to speak his mind as party leader, even if, as a member of the cabinet, he is supposed to represent the government’s point of view.

Nitrogen cuts are controversial

Hoekstra is the highest-profile dissident so far, but provincial deputies of both his Christian Democratic and Rutte’s liberal party have questioned Van der Wal’s plan, which could force one in three Dutch livestock farmers to quit. At a party congress in June, 51 percent of liberal party members voted to relax the emissions targets. Farmers have protested by blocking motorways and food distribution centers.

Reductions are needed, as I explained here when the policy was announced, because the Netherlands has an outsized farming sector that produces the highest emissions of ammonia (a type of nitrogen) per hectare in the EU. Emissions pollute the soil and groundwater, and are lethal to local plant- and wildlife. The Netherlands has lost 70 percent of its insect population since the EU introduced standards for nature conservation in the 1990s. The Netherlands has never met those standards. The current government is compelled to by a supreme court decision from 2019.

Provinces would decide which farms can stay

Farms are responsible for 40 percent of nitrogen pollution and would have to reduce emissions by 40 percent in eight years. Other reductions would come from cars and industries that burn fossil fuels, which releases nitrogen oxide.

The government is making €32 billion, including €25 billion in new spending, available to buy out an estimated 11,000 livestock farmers and subsidize another 17,000, who would need to downsize in order to cut emissions 12 to 58 percent, depending on their proximity to conservation areas.

Provincial councils would have to decide farm-by-farm which need to downsize, which need to relocate and which need to quit. Hence the resistance from provincial politicians, who are not seldom farmers themselves.

Ruling parties have lost support

Voters are due to elect new provincial councils in March, who in turn elect a new Senate in May.

Polls show the Christian Democrats, traditionally the party of farmers, have lost half their support since the general election in 2021.

The liberals have also gone down, from 22 to 16-18 percent.

So have D66, from 15 to 9-11 percent.

Only the Christian Union, the smallest party in the coalition, is stable, at 3 percent.

The fact that even D66 — which never had strong support in the countryside — is down shows Rutte is caught between a rock and a hard place. The farm policy is costing him and Hoekstra support to more right-wing parties, which oppose cuts. But to the extent that they have met farmers halfway, with €32 billion in subsidies and lower livestock reduction targets than D66 had hoped for, it disappoints the left. D66 competes with the Green and Labor parties.

Asylum is also divisive

Nitrogen pollution is not the only issue dividing the coalition, and Rutte’s party.

Attempts to resettle asylum seekers are also unpopular. The Netherlands received some 25,000 asylum requests in the first half of 2022, 10,000 from Syrians. If the numbers don’t go down, the asylum record from 2015 — 45,000 — would be surpassed this year.

There aren’t enough beds in refugee centers. Municipalities have furnished emergency shelters, but still not enough. Asylum seekers have been sleeping outside the application center in Ter Apel in tents.

Asylum minister Eric van der Burg, a member of Rutte’s party, has invoked emergency powers to force local governments to make more beds available. That has led to demonstrations in one town and opposition from local liberal party politicians nationwide.

What to do about inflation

A third question on which there isn’t agreement (yet) is what to do about inflation.

Energy prices have tripled in the last year. Grocery prices are up 18.5 percent. Inflation, at 10.3 percent, is the highest since 1975.

The government spent €6.5 billion in the first half of the year to reduce energy and fuel taxes. Low-income households received a one-time subsidy of €1,300. Still 2.5 million, or one in three, households struggle to pay their bills.

Options under consideration include:

  • Permanently reducing energy and fuel tax, although D66 and the left-wing parties Rutte needs for a majority in the Senate would prefer measures that don’t also benefit high incomes;
  • Tying an energy subsidy to health-care subsidies received by the 4.7 million poorest households;
  • Raising the minimum wage from €1,750 per month, although liberals are sympathetic to the argument of employers that they’ve already raised wages by 3.2 percent this year, and that 60 percent of companies haven’t passed on their rising costs to consumers;
  • Reducing the lowest income-tax bracket or raising the personal allowance, currently €36,650.

There is consensus for shifting the tax burden from labor to capital, however, the liberals split if “capital” also means homes. Many liberal party voters are homeowners. Currently only second homes are taxed as capital. Primary residences are taxed by municipalities, not the national government.

Conservatives never warmed to Rutte

Worryingly for Rutte, the opposition to closing farms, resettling asylum seekers and taxing capital go hand in hand.

The Netherlands’ multiparty democracy — sixteen parties and six independents fill the 150 seats in parliament — usually prevents divisions from hardening into two camps, but now the dividing line is running down the middle of Rutte’s party.

The liberal right never warmed to Rutte. He won the leadership with 51 percent of the votes in 2006 against a more conservative candidate. His first cabinet, which was supported by the nationalist Freedom Party, was arguably the most right-wing in Dutch history, but he has since governed with center and left-wing parties. Right-wing voters had to swallow higher energy taxes, higher green-energy subsidies, an amnesty for the children of illegal immigrants, three Greek bailouts, a phaseout of the home mortgage interest deduction and stricter rules for the self-employed. For reactionaries, the cuts to farming are one concession too many.

Hans Wiegel, a former liberal party leader, has called on Rutte to resign and make way for new elections.

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