Note: This article was originally written on 26/02/2021 and published in the April 2021 edition of De Derde Dinsdag magazine.
By Sam Volkers
The Covid-19 Pandemic has been hailed by some as the death of our current neoliberal system. It has exposed how fragile our economies and global supply-chains are. The problems during the early phase of the pandemic (when hospitals were running out of medical equipment fast) have also shown how our public services have been neglected over the past decades, and how de-industrialization and the outsourcing of the production of many essential products have made our country wholly unprepared for a crisis of these proportions. Now that these problems are exposed, and with the evermore fragile stability of both the EU and the world in general, it is clear our country needs a new economic system — a system based not only on competition, but also on unity and co-operation — that can protect our country’s economic and political sovereignty and ensure that our country endures these troublesome times.
Family, Community & Co-operation
It is important to remember that not all that has come of COVID-19 has been bad. During the pandemic people from all over the country have set up local initiatives to help those who were hit the hardest by the pandemic. It has shown how important co-operation is and how valuable our families and communities are. This is why they should become central to any new economic system. But the importance of co-operation has to go beyond local initiatives and into the workplace and public utilities. During the pandemic, labour unions saw their membership grow, especially among the younger generation, due to their efforts to help the working and unemployed with their issues. We need to stress the importance of our Poldermodel (1) and also expand this co-operation between labour unions, employers and the state into the workplace by adopting a system of co-determination. The boards of big companies/factories should not only consist of shareholders, but also the workers of the company and government representatives who represent the consumer. A system of this kind has been used successfully in Germany for years (Holmberg 2019). For public utilities we should adopt a system of “social ownership”, meaning that it will not just be the state or a private company owning the utilities and making decisions, but also the locality and employees. In this system the board of representatives should be split up between local representatives, worker’s representatives and representatives of either the state or private owners. They should all get to elect 1/3 of the representatives (Glasman 2018). These types of co-operation will enable a more fruitful relationship and will prevent conflict, because they make everyone feel like they have a voice in the matter.
Essential Workers & The Public Sector
The pandemic has also reminded us of the importance of essential workers. Our nurses, doctors, ambulance drivers, police officers, soldiers and all others who worked hard during the pandemic to keep everything running deserve more than just applause. They deserve higher wages, better working conditions and proper investments in their sectors. A higher minimum wage is also needed, with an increase to €14 being a good goal. We need to rebuild our public sector and make these services accessible to all, possibly by creating a National Health Insurance Fund (Nationaal Zorgfonds) similar to the NHS, with a focus on preventive care and lowering or getting rid of co-payments. Not only healthcare needs overhaul though. Our education system does too. We need to invest more money in our schools and teachers. Something else which should be brought back is the studiebeurs (universal scholarship grants) for students at MBO, HBO and University. We also need to invest more in these institutions and especially in improving our trade schools to create a well-trained workforce suitable for a much-needed new industrial policy.
“Buy Dutch” & Industrial Policy
Another thing that has become clear is that our reliance on foreign countries such as China for the production of basic/important goods such as medical supplies, military equipment and high-tech products has made us weaker and less secure (Boswijk and Buijs 2021). The Covid-19 pandemic has shown how important it is for nations to be able to solve issues related to national security, economic stability and health on their own. To do this, the state needs to take an active steering role and implement a (green) industrial policy (2) program (Hillen et al. 2020). This new industrial policy should focus on creating new and protecting existing domestic businesses and well-paying jobs in these strategic sectors. The government should invest more in infrastructure and local manufacturing, especially small-medium businesses (MKB). To protect these new and existing sectors the government should not be afraid to make use of practices such as nationalizations, tariffs, (temporary) tax cuts and moderate levels of deficit spending. The state should also seek to prevent foreign companies from acquiring strategic businesses and infrastructure (Boswijk and Buijs 2021). Besides stimulation from the government, there should also be stimulation from consumers. The government should start a “Buy Local” or “Buy Dutch” informational campaign to get consumers to buy domestic made goods. The same would go for our agricultural sector, in which the government should work closely with our farmers. We should protect our farmers and stimulate consumers to buy locally produced food. In the (near) future we should also look at utilizing automation and robotics to make our manufacturing processes in factories even more efficient and to make up for our (compared to other industrial countries) smaller labour force.
Housing & Social Programs
The past year we have also seen how fragile the situation of many families in our country is. People lost their houses, jobs and sometimes even family members. On top of that, the “toeslagenaffaire” showed how a very complicated bureaucracy in charge of administering welfare can do a lot of harm to families. This is why expanding and simplifying some of these welfare programs by adopting new ideas such as a Universal Basic Income (UBI) of for example a monthly 1500-2000 euro per person could prove to be worthwhile looking into. The same goes for more family-oriented forms of UBI, seen in countries such as Poland, which provide a direct monthly payment to families of a certain amount of money per child. Although these programs have had mixed results in solving problems related to an aging and declining population (which they were originally designed for) they have had positive results in providing better living standards and economic security to poorer families (Sussman 2019). Something else which has been a problem the last few years is the availability of housing. Our country is facing a large-scale housing shortage, made worse by the fact that in our current system houses have become a commodity to be traded on the financial market, instead of a basic human need. This is why we should build more affordable houses, both in our big cities and outside of them, and make owning a house a reality instead of just a dream for future generations.
Although there is much I would still like to go over that I did not get the time for (such as the financial sector or green economic ideas), these ideas serve as the basis of a possible new system that can be implemented after the Covid-19 pandemic. The pandemic has not just brought pain, it has also brought an opportunity for change. It has brought the possibility for a transition to a new, more just system. A system in which we value not only growth, but also co-operation and justice. A system that rejects the idea of putting our trust solely in either the market or the state and instead puts its trust in our society: our families, communities and country. A system in which an honest day’s work means an honest day’s pay, and an economy in which “de Nederlandse belofte” (the Dutch-promise) — that promises that all those who work hard can have a good life — will be a reality again.
1: Poldermodel: A system of economic order characterized by regular and intensive negotiation between the state and social partners (e.g. labour unions). Found and translated from: https://www.economischwoordenboek.nl/?zoek=poldermodel.
2: Industrial Policy: Industrial policy refers to organized government involvement in guiding the economy by encouraging investment in targeted industries. Such policy serves to allocate capital across manufacturing industries by a system of taxes, subsidies, and investment incentives designed to move the economy along a specific pathway. Found on: https://www.encyclopedia.com/social-sciences-and-law/economics-business-and-labor/economics-terms-and-concepts/industrial-policy.
Boswijk, D. en Buijs, M. (2021). “Van made in China naar owned by China?”,
https://christendemocraat.nl/het-chinese-paard-van-troje/. Accessed on 25/01/2021.
Glasman, M. (2018). “Re-imagining ‘public’ utilities”,
https://youtu.be/5wSt4K6vFIE. Accessed on 03/02/2021.
Hillen, H., Van der Touw, A. en Van der Veer, J. (2020). “Kabinet moet kiezen voor duidelijke
industriepolitiek”, https://fd.nl/opinie/1343380/kabinet-moet-kiezen-voor-duidelijke-industriepolitiek. Accessed on 31/01/2021.
Holmberg, S.R. (2019). “Workers on Corporate Boards? Germany’s Had Them for Decades”,
https://www.nytimes.com/2019/01/06/opinion/warren-workers-boards.html. Accessed on 02/02/2021.
Sussman, A.L. (2019). “The Poland Model — Promoting ‘Family Values’ With Cash Handouts”,
https://www.theatlantic.com/international/archive/2019/10/poland-family-values-cash-handouts/599968/. Accessed on 01/02/2021.