Commentators, such as Timothy Garton Ash in The Guardian , accuse Polish and Hungarian leaders of attempting to selfishly block funding for Southern Europe to protect their right to spend that money as they wish and without limits. He is of course referring to the dispute over the rule of law conditionality mechanism. It’s part of the stereotype of generous net payers from the West being faced with ungrateful net beneficiaries from the East failing to understand that he who pays the piper calls the tune.
However, to argue that the Netherlands is chomping at the bit to transfer funds to the East is absurd. In reality, it was the “frugal four” (Netherlands, Austria, Sweden and Denmark) who fought tooth and nail to stop transfers from taking the form of grants.
The “frugal four” wanted loans to be conditional on Southern Europeans pursuing austerity and internal reforms. Mark Rutte, the Dutch PM, had a mandate from his parliament to actually veto any such notion of a “give-away.” He did not have to use that veto, as a rule of law mechanism was instituted as leverage to be used against the beneficiary countries — a convenient instrument that could first be used against Poland and Hungary for political reasons before being used to discipline the South of Europe for economic reasons. The real division in the Europe of today is not between East and West, but between North and South. The real division in the Europe of today is not between East and West, but between North and South. The rule of law was just a pretext to show voters that solidarity has a price. The transfers are to be made, but the frugal states will gain some control over who gets the money and how it is spent.
Back in the summer, the Dutch PM will no doubt have recalled how the Greek crisis nearly toppled his government when he agreed to aid packages for Greece, despite parliamentary opposition. He did not want a repeat of such scenes just three months ahead of a general election in March. The Dutch political scene has plenty of Eurosceptics who want the Netherlands to take Britain’s place in the EU as the country that stops excessive social spending from being tolerated by the Franco-German tandem that runs the EU.
The Dutch Government is a liberal one, which believes that market-oriented policies account for their country’s prosperity and is thus irritated that Italians and Greeks do not want to follow suit.
The Dutch are missing Britain inside the EU. Like the British, they see the EU as an economic project, a common market that should benefit them. In other words, they are behaving exactly the same way they accuse the Poles and Hungarians of treating the Union: as a source of funds. They want trade and prosperity rather than solidarity. They are fighting for their own interests and not for the rule of law or democracy. And they are trying hard to resist mutual debt, which is needed to make the Eurozone workable.
Had Hungary vetoed the EU budget and recovery fund, the Dutch would have been pleased to have saved money. But they are also happy with a rule of law mechanism that could in the future be used to stop funding Greece and Italy. Any such attempts, however, would likely put pressure on a Union already being torn apart by the protectionist behavior of Western Europe, such as the posted workers directive and mobility pact, currently targeted to stop competition from Central and Eastern Europe. The rule of law mechanism is another attempt by liberals to regain control over a scenario that was to be “the end of history,” with the new member states becoming carbon copies of their Western partners.
The mechanism is part of a change in the rules of engagement inside the EU. It is going to be increasingly difficult to build consensus and compromise. It will not help the wealthy North, the poor South or our own Eastern peripheries.
Title image: Dutch Prime Minister Mark Rutte arrives for an EU summit at the European Council building in Brussels, Thursday, Dec. 10, 2020, AP.
