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Dutch and Germans Give European Union Some Breathing Room Dutch and Germans Give European Union Reasons to Cheer
(about 1 hour later)
PARIS — There was a general sigh of relief in the European Union this week. The cause was not better performance in the troubled and highly indebted southern countries of the euro zone, but crucial decisions made in the rich northern nations with perfect credit ratings, where skepticism about the common currency is running high.PARIS — There was a general sigh of relief in the European Union this week. The cause was not better performance in the troubled and highly indebted southern countries of the euro zone, but crucial decisions made in the rich northern nations with perfect credit ratings, where skepticism about the common currency is running high.
On Wednesday, the German Constitutional Court found a way to declare that the permanent bailout fund, the European Stability Mechanism, is legal, clearing the way to use it in time to recapitalize troubled banks as well as governments. And the Dutch voted for mainstream parties in a parliamentary election, choosing not to be enticed by parties wanting to leave the euro.On Wednesday, the German Constitutional Court found a way to declare that the permanent bailout fund, the European Stability Mechanism, is legal, clearing the way to use it in time to recapitalize troubled banks as well as governments. And the Dutch voted for mainstream parties in a parliamentary election, choosing not to be enticed by parties wanting to leave the euro.
Combined with the European Central Bank’s decision to restart its bond-buying program in return for more budget discipline, immediately lowering interest rates on Italian and Spanish bonds, European leaders could begin to feel that perhaps the worst is over in the euro crisis, at least for now.Combined with the European Central Bank’s decision to restart its bond-buying program in return for more budget discipline, immediately lowering interest rates on Italian and Spanish bonds, European leaders could begin to feel that perhaps the worst is over in the euro crisis, at least for now.
“With the Dutch shying away from anti-European parties the same day the German Constitutional Court rules in favor of the E.S.M., Sept. 12 seems to have been a good day for the euro,” Dimitry Fleming of ING Groep NV said in an analysis via e-mail.“With the Dutch shying away from anti-European parties the same day the German Constitutional Court rules in favor of the E.S.M., Sept. 12 seems to have been a good day for the euro,” Dimitry Fleming of ING Groep NV said in an analysis via e-mail.
Not all is well, of course. Greece remains a mess, and will probably need even more money. A decision keeps being postponed about when, and whether, to grant Athens another big portion of loan money it needs to stay afloat.Not all is well, of course. Greece remains a mess, and will probably need even more money. A decision keeps being postponed about when, and whether, to grant Athens another big portion of loan money it needs to stay afloat.
The Germans remain deeply anxious about the Central Bank’s effectively printing money and building up larger stocks of shaky bonds. And there is reluctance among some nations, especially Germany, over the mechanism and scale of a Europe-wide banking regulator to try to prevent another crisis, particularly in Spain.The Germans remain deeply anxious about the Central Bank’s effectively printing money and building up larger stocks of shaky bonds. And there is reluctance among some nations, especially Germany, over the mechanism and scale of a Europe-wide banking regulator to try to prevent another crisis, particularly in Spain.
Then there is significant division over just how far to take the idea of European fiscal and political integration, let alone union. In a speech on Wednesday, the European Commission’s president, José Manuel Barroso, pushed for “pooled sovereignty” and a European Union “federation of nation states that can tackle our common problems, through the sharing of sovereignty in a way that each country and each citizen are better equipped to control their own destiny.”Then there is significant division over just how far to take the idea of European fiscal and political integration, let alone union. In a speech on Wednesday, the European Commission’s president, José Manuel Barroso, pushed for “pooled sovereignty” and a European Union “federation of nation states that can tackle our common problems, through the sharing of sovereignty in a way that each country and each citizen are better equipped to control their own destiny.”
Any major changes would require another treaty, which would mean some difficult parliamentary votes or referendums. Germany has spoken of a treaty change to be ratified by referendum, but France, even under its Socialist president, François Hollande, is dubious about sacrificing too much sovereignty — let alone engaging in a vote.Any major changes would require another treaty, which would mean some difficult parliamentary votes or referendums. Germany has spoken of a treaty change to be ratified by referendum, but France, even under its Socialist president, François Hollande, is dubious about sacrificing too much sovereignty — let alone engaging in a vote.
In 2005, the French Socialists split over a new treaty for a European constitution; Mr. Hollande supported it, but Laurent Fabius, the current foreign minister, did not. And the proposal lost badly in a referendum, dooming the constitution. So there is considerable wariness in Paris about too explicit an integration.In 2005, the French Socialists split over a new treaty for a European constitution; Mr. Hollande supported it, but Laurent Fabius, the current foreign minister, did not. And the proposal lost badly in a referendum, dooming the constitution. So there is considerable wariness in Paris about too explicit an integration.
That will be true in the Netherlands, too. Prime Minister Mark Rutte, one of the few European leaders to win re-election during this crisis, is hardly a fan of European integration. He has opposed any further loss of Dutch sovereignty, and he mocked the European flag during the campaign in a successful effort to take votes away from the far-right party led by Geert Wilders, who had been an ally in the previous government. More important, Mr. Rutte has vowed to refuse Greece any more loans.That will be true in the Netherlands, too. Prime Minister Mark Rutte, one of the few European leaders to win re-election during this crisis, is hardly a fan of European integration. He has opposed any further loss of Dutch sovereignty, and he mocked the European flag during the campaign in a successful effort to take votes away from the far-right party led by Geert Wilders, who had been an ally in the previous government. More important, Mr. Rutte has vowed to refuse Greece any more loans.
Mr. Rutte firmly backs Chancellor Angela Merkel of Germany in her push for more fiscal discipline and budgetary oversight in the euro zone. But as the leader of a much smaller country, he appears to be far more reluctant than she is to contemplate more shared sovereignty or to give more power to Mr. Barroso and the bureaucrats in Brussels.Mr. Rutte firmly backs Chancellor Angela Merkel of Germany in her push for more fiscal discipline and budgetary oversight in the euro zone. But as the leader of a much smaller country, he appears to be far more reluctant than she is to contemplate more shared sovereignty or to give more power to Mr. Barroso and the bureaucrats in Brussels.
The Dutch expressed considerable worry during the campaign about their money and how it would be used, and there is a widespread sense of fatigue and annoyance with the problems in Greece and other southern countries, which the richer north has repeatedly been asked to help.The Dutch expressed considerable worry during the campaign about their money and how it would be used, and there is a widespread sense of fatigue and annoyance with the problems in Greece and other southern countries, which the richer north has repeatedly been asked to help.
In vote totals that were nearly final on Thursday, Mr. Rutte’s center-right Liberal Party had won 41 out of 150 seats, 10 more than in 2010. The center-left Labor Party, led by Diederik Samsom, a nuclear physicist and former Greenpeace activist, came in second with 39 seats, an increase of nine. Mr. Wilders’s Freedom Party and the Socialist Party, both playing on skepticism about the euro, tied for third with 15 seats each.In vote totals that were nearly final on Thursday, Mr. Rutte’s center-right Liberal Party had won 41 out of 150 seats, 10 more than in 2010. The center-left Labor Party, led by Diederik Samsom, a nuclear physicist and former Greenpeace activist, came in second with 39 seats, an increase of nine. Mr. Wilders’s Freedom Party and the Socialist Party, both playing on skepticism about the euro, tied for third with 15 seats each.
That was a loss of nine seats for Mr. Wilders, who was punished by voters for what many considered his irresponsible behavior in April, when he brought down the previous government because he refused to accept spending cuts to meet deficit targets. Mr. Wilders called for the Dutch to leave the European Union, not just to abandon the euro, and that appeared to be too extreme for many of his supporters, who turned to Mr. Rutte’s Liberals.That was a loss of nine seats for Mr. Wilders, who was punished by voters for what many considered his irresponsible behavior in April, when he brought down the previous government because he refused to accept spending cuts to meet deficit targets. Mr. Wilders called for the Dutch to leave the European Union, not just to abandon the euro, and that appeared to be too extreme for many of his supporters, who turned to Mr. Rutte’s Liberals.
“In Brussels they are having a party,” Mr. Wilders told his disappointed supporters. “That’s a pity.” He vowed to continue the fight against immigration, Islam and Brussels.“In Brussels they are having a party,” Mr. Wilders told his disappointed supporters. “That’s a pity.” He vowed to continue the fight against immigration, Islam and Brussels.
The Christian Democrats, once the governing party, fell again, down to 8 seats from 13, and the pro-European centrist party, D66, won two more seats, for a total of 12.The Christian Democrats, once the governing party, fell again, down to 8 seats from 13, and the pro-European centrist party, D66, won two more seats, for a total of 12.
The German foreign minister, Guido Westerwelle, said the election outcome “strengthens Europe and weakens populists and ‘re-nationalists.’ ” He added that “after the important decisions of the last few days, we must now use the momentum to develop Europe further and make it fit for the future in times of globalization.”The German foreign minister, Guido Westerwelle, said the election outcome “strengthens Europe and weakens populists and ‘re-nationalists.’ ” He added that “after the important decisions of the last few days, we must now use the momentum to develop Europe further and make it fit for the future in times of globalization.”
Mr. Rutte and Mr. Samsom are expected to form the heart of a new coalition, but negotiations could be lengthy. “There are two clear winners who are substantially different from each other,” Jozias van Aartsen, the mayor of The Hague, told Dutch radio.Mr. Rutte and Mr. Samsom are expected to form the heart of a new coalition, but negotiations could be lengthy. “There are two clear winners who are substantially different from each other,” Jozias van Aartsen, the mayor of The Hague, told Dutch radio.
Because the two parties together do not control a majority in the upper house, analysts expect that a final coalition could include both D66 on the left and the Christian Democrats on the right.Because the two parties together do not control a majority in the upper house, analysts expect that a final coalition could include both D66 on the left and the Christian Democrats on the right.
The parties are fundamentally in favor of the Netherlands, which depends on trade, remaining in the euro zone and the European Union, which absorbs 75 percent of its exports. And with the Netherlands being one of the few AAA-rated countries remaining in the euro zone, the European Union needs the Dutch, too.The parties are fundamentally in favor of the Netherlands, which depends on trade, remaining in the euro zone and the European Union, which absorbs 75 percent of its exports. And with the Netherlands being one of the few AAA-rated countries remaining in the euro zone, the European Union needs the Dutch, too.