Polder model

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The polder model (Dutch : poldermodel) is consensus decision-making, based on the acclaimed Dutch version of consensus-based economic and social policy making in the 1980s and 1990s. [1] [2]

Dutch language West Germanic language

Dutch(Nederlands ) is a West Germanic language spoken by around 23 million people as a first language and 5 million people as a second language, constituting the majority of people in the Netherlands and Belgium. It is the third most widely spoken Germanic language, after its close relatives English and German.

Consensus decision-making

Consensus decision-making is a group decision-making process in which group members develop, and agree to support a decision in the best interest of the whole group or common goal. Consensus may be defined professionally as an acceptable resolution, one that can be supported, even if not the "favourite" of each individual. It has its origin in the Latin word cōnsēnsus (agreement), which is from cōnsentiō meaning literally feel together. It is used to describe both the decision and the process of reaching a decision. Consensus decision-making is thus concerned with the process of deliberating and finalizing a decision, and the social, economic, legal, environmental and political effects of applying this process.

Netherlands Constituent country of the Kingdom of the Netherlands in Europe

The Netherlands is a country located mainly in Northwestern Europe. The European portion of the Netherlands consists of twelve separate provinces that border Germany to the east, Belgium to the south, and the North Sea to the northwest, with maritime borders in the North Sea with Belgium, Germany and the United Kingdom. Together with three island territories in the Caribbean Sea—Bonaire, Sint Eustatius and Saba— it forms a constituent country of the Kingdom of the Netherlands. The official language is Dutch, but a secondary official language in the province of Friesland is West Frisian.

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The polder model has been described as "a pragmatic recognition of pluriformity" and "cooperation despite differences". It is thought that the Dutch politician Ina Brouwer was the first to use the term poldermodel, in her 1990 article "Het socialisme als poldermodel?" (Socialism as polder model?), although it is uncertain whether she coined the term or simply seems to have been the first to write it down. [1] [3]

Ina Brouwer Dutch politician

Ina Brouwer is a retired Dutch politician of the Communist Party of the Netherlands (CPN) and later co-founder of the GreenLeft (GL) party and lawyer.

Socioeconomic polder model

Wim Kok, a former Prime Minister of Netherlands, supported the Polder Model. Wim Kok 1994.jpg
Wim Kok, a former Prime Minister of Netherlands, supported the Polder Model.

The Dutch polder model is characterised by the tri-partite cooperation between employers' organisations such as VNO-NCW, labour unions such as the Federation Dutch Labour Movement, and the government. These talks are embodied in the Social-Economic Council (Dutch : Sociaal-Economische Raad, SER). The SER serves as the central forum to discuss labour issues and has a long tradition of consensus, often defusing labour conflicts and avoiding strikes. Similar models are in use in Finland, namely Comprehensive Income Policy Agreement and universal validity of collective labour agreements.

Tripartism is economic corporatism based on tripartite contracts between employers' organizations, trade unions, and the government of a country. Each is to act as a social partner to create economic policy through cooperation, consultation, negotiation, and compromise. Tripartism is a common form of and favored by neo-corporatism.

VNO-NCW is a Dutch employers' federation founded in 1996 as a merger of the Christian-democratic Nederlands Christelijk Werkgeversverbond (NCW), which was founded as fusion of the Protestant PCW and the Catholic NKW, and the liberal Verbond van Nederlandse Ondernemingen (VNO). Both organizations had strong ties with the Protestant and liberal pillar, respectively.

Federatie Nederlandse Vakbeweging trade union

The Federatie Nederlandse Vakbeweging is a federation of trade unions of the Netherlands.

The current Dutch polder model is said to have begun with the Wassenaar Accords of 1982, when unions, employers, and government decided on a comprehensive plan to revitalise the economy involving shorter working times and less pay on the one hand, and more employment on the other. This polder model, combined with a neoliberal economic policy of privatisation and budget cuts has been held to be responsible for the Dutch economic miracle of the late 1990s. [4]

The Wassenaar Agreement was an agreement reached in 1982 between employers' organisations and labour unions in the Netherlands to restrain wage growth in return for the adoption of policies to combat unemployment and inflation, such as reductions in working hours and the expansion of part-time employment. The agreement has been credited with ending the wage-price spiral of the 1970s, greatly reducing unemployment and producing strong growth in output and employment. The International Labour Organization describes the Wassenaar as "a groundbreaking agreement, setting the tone for later social pacts in many European countries".

Neoliberalism political philosophy that supports economic liberalization

Neoliberalism or neo-liberalism is the 20th-century resurgence of 19th-century ideas associated with laissez-faire economic liberalism and free market capitalism. While it is most often associated with such ideas, the defining features of neoliberalism in both thought and practice has been the subject of substantial scholarly discourse. These ideas include economic liberalization policies such as privatization, austerity, deregulation, free trade and reductions in government spending in order to increase the role of the private sector in the economy and society. These market-based ideas and the policies they inspired constitute a paradigm shift away from the post-war Keynesian consensus which lasted from 1945 to 1980.

Privatization can mean different things including moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when a heavily regulated private company or industry becomes less regulated. Government functions and services may also be privatized; in this case, private entities are tasked with the implementation of government programs or performance of government services that had previously been the purview of state-run agencies. Some examples include revenue collection, law enforcement, and prison management.

An important role in this process was played by the Dutch Central Planning Bureau (CPB), founded by Jan Tinbergen. The CPB's policy advice since 1976, in particular with the Den Hartog and Tjan model, in favour of wage restraint, was an important argument, supportive for government and employers, that the unions could not easily counter.

Jan Tinbergen Dutch economist

Jan Tinbergen was an important Dutch economist. He was awarded the first Nobel Memorial Prize in Economic Sciences in 1969, which he shared with Ragnar Frisch for having developed and applied dynamic models for the analysis of economic processes. He is widely considered to be one of the most influential economists of the 20th century and one of the founding fathers of econometrics. It has been argued that the development of the first macroeconometric models, the solution of the identification problem, and the understanding of dynamic models are his three most important legacies to econometrics. Tinbergen was a founding trustee of Economists for Peace and Security. In 1945, he founded the Bureau for Economic Policy Analysis (CPB) and was the agency's first director.

Incomes policies in economics are economy-wide wage and price controls, most commonly instituted as a response to inflation, and usually seeking to establish wages and prices below free market level.

Many authors and researchers, however, have argued that the Wassenaar Agreement has been largely overrated. [5] [6] [7] [8] Most of these writers have argued that considerable continuity can be seen from the 1950s on. The young historian Stijn Kuipers, however, draws the line even further. In an article which is much indebted to the work of Coen Helderman, [9] Kuipers argues that the modern socioeconomic polder model already manifested itself in 1920 with the Dutch High Council of Labour. It would follow that the polder model is much older and therefore could have had a larger influence on Dutch society and economy than has generally been thought up to now. [8]

Other uses

The term polder model and especially the verb polderen (to polder) has been used pejoratively by some politicians to describe the slow decision-making process where all parties have to be heard. The model flourished under the "Purple" governments of Dutch prime minister Wim Kok, a coalition including the traditional rivals the Labour Party (a social-democratic party, whose colour is red) and the People's Party for Freedom and Democracy (right-wing liberals, whose colour is blue). In the declining economic climate of the early 21st century the model came under fierce attack particularly from right-wing politicians and Pim Fortuyn in his book entitled De puinhopen van acht jaar Paars ("The wreckage of eight years Purple").

Historical background

There is no consensus about the exact historical background of the polder model. In general there are three views on this subject.

One explanation points to the rebuilding of the Netherlands after World War II. Corporatism was an important feature of Christian Democratic, and particularly Catholic, political thought. During the postwar period, the Catholic, Protestant, Christian, social-democratic, and liberal parties decided to work together to reconstruct the Netherlands, as did unions and employers' organizations. Important institutions of the polder model, like the SER, were founded in this period. No single political party has ever had anything approaching an overall majority in parliament, so coalition government is inevitable. This makes parties extremely cautious, since today's enemy may be tomorrow's ally, all the more so in present times when the "death of ideology" has made it possible for almost all the parties to work together.

Another explanation points to the dependency of the Netherlands on the international economy. The Dutch cannot afford protectionism against the unpredictable tides of the international economy, because the Netherlands is not an autarkic economy. Therefore, to cushion against the international economy, they set up a tri-partite council which oversaw an extensive welfare state.

A third explanation refers to a unique aspect of the Netherlands, that it consists in large part of polders, land reclaimed from the sea, which requires constant pumping and maintenance of the dykes. So ever since the Middle Ages, when the process of land reclamation began, different societies living in the same polder have been forced to cooperate because without unanimous agreement on shared responsibility for maintenance of the dykes and pumping stations, the polders would have flooded and everyone would have suffered. Crucially, even when different cities in the same polder were at war, they still had to cooperate in this respect. This is thought to have taught the Dutch to set aside differences for a greater purpose.

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References

  1. 1 2 Ewoud Sanders, Woorden met een verhaal (Amsterdam / Rotterdam, 2004), 104–06.
  2. Stijn Kuipers, Het begin van het moderne Nederlandse poldermodel; De Hoge Raad van Arbeid van 1920 als eerste manifestatie van het Nederlandse tripartiete sociaaleconomische overlegmodel? (Nijmegen, 2015), 3.
  3. Ewoud Sanders, "Poldermodel", NRC Handelsblad , 22 April 2002.
  4. Elke van Riel, "Akkoord van Wassenaar keerpunt in relatie regering en sociale partners", SER Magazine, 2010 (versie 9) (archived 15 April 2015).
  5. Agnes Akkerman, "Zo historisch was het Akkoord van Wassenaar niet" Archived 2015-09-24 at the Wayback Machine ., Radboud University Nijmegen, 2007 (retrieved 25 February 2015).
  6. Jaap Woldendorp, The Polder Model: From Disease to Miracle? Dutch Neo-corporatism 1965–2000 (Amsterdam, 2005), 267–69.
  7. Piet de Rooy, Republiek van rivaliteiten; Nederland sinds 1813 (2nd printing Amsterdam, 2005), 216–17.
  8. 1 2 Stijn Kuipers, "Het begin van het moderne Nederlandse poldermodel; De Hoge Raad van Arbeid van 1920 als eerste manifestatie van het Nederlandse tripartiete sociaaleconomische overlegmodel?", Radboud University Nijmegen, 2015.
  9. Coen Helderman, "De Hoge Raad van Arbeid, 1919-1940(-1950)", Tijdschrift voor Sociale en Economische Geschiedenis I:2 (2004).

Further reading