Montesquieu Institute: from science to society

Building consensual bridges to combat the euro crisis

Thursday, November 29 2012, 13:35

THE HAGUE (PDC) – ‘Although co-operation between governments and social partners stabilises economies, it might not be a solution to overcome the current euro crisis,’ stated Corina Hendriks, editor of the political-scientific journal Idee of the Hans van Mierlo Stichting, during the fourth lecture of the MI lecture series. She pointed out that involving social partners into policy-making, as in Dutch corporatism, could lead to economic stability. However, corporatism might not be able to contribute to a good solution to the present euro crisis since it does not solve sovereign and bank debts.

Furthermore, Hendriks explained her vision on consensual politics referring to Dutch consensual politics – also called ‘Polder Model’. It gained its fame by the Agreement of Wassenaar in 1982: Dutch social partners and the Dutch government signed an agreement to enhance employment in times of economic misery. ‘Been there, done that,’ Corina Hendriks said. However, this euro crisis is more than just unemployment. It is about sovereign debts and bank debts in EU member states. Nevertheless, it has been proven that corporatism, which is a form of governance including social stakeholders in the policy-making process- seems to have better employment rates, a larger GDP growth and lower inflation levels. On a more negative note, she also stated that this crisis is a crisis that started because of problems in the financial system, not in the economic system. It is therefore not the employers’ associations and unions as such that can solve this problem.

With reference to the Dutch who made social pacts three times as a solution in order to combat economic misery, Corina Hendriks questioned whether it would be a potential solution to combat the euro crisis on supranational level with corporatist consensual politics. In addition, she took into account that making social pacts in Dutch policy-making were ambiguous, inevitable and convenient choices of the Dutch government. Instead of coming up with a definitive conclusion herself, she gave the floor to the audience to discuss if there is room for social pacts to tackle the current crisis.

Three conclusions were drawn in a group discussion. At first, consensual politics will always be there in terms of representing employees in labour unions and social partnerships. Secondly, consensual politics on a supranational level to combat the euro crisis is unlikely due to the variety of political systems throughout the member states. Last but not least, political hard choices do not always need to involve social partners especially with regards to economic misery.

All in all, Corina Hendriks highlighted another perspective on combating the euro crisis. Moreover, the audience asked some essential questions, given the fact that the consensual political system of the Dutch corporatism is quite difficult to understand.