Dutch Politics Complicates Euro Rescue

Dutch Premier Defends Austerity, Says No to More Greek Aid – Bloomberg.

Pundits like to discuss the possibility of a Grexit, but history shows that a small, rich country is likely to leave a currency union first. Greece is poor and requires foreign aid, so it is unlikely to leave on its own accord. The Netherlands is a small, rich country with a history of neutrality up until the aftermath of WWII, so it is an exit candidate.

Mark Rutte has so far been a staunch supporter of Merkel and her handling of the crisis, but he wishes to be reelected. There is a rising swell of support for ending the Greek bailouts with one-third of the Dutch electorate either backing the Socialist party, which wishes to end EU expansion into the Netherlands, or the Freedom party, which wishes to withdraw from the Eurozone and revert back to the guilder.

Rutte will have to piece together a coalition if he wishes to remain as prime minister and must take these views into consideration. It is notable that he has moved into the anti-bailout camp, and Merkel can no longer count on him to support a third bailout for Greece.

 

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