Editorial Board
Dutch Cabinet Collapse Shows Folly of Merkel Fiscal Pact
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Alarm over Europe’s financial predicament is surging again. The immediate cause is the European Union’s fiscal pact. Germany insisted on this plan to cut public borrowing sharply and immediately, and euro-area governments hoped it would restore stability. It’s doing the opposite.
The pact is proving so unpopular that it’s undermining governments, and not just in the peripheral countries most obviously at risk. The stresses caused by the EU’s strategy influenced presidential elections on Sunday in France and forced a crucial partner in German Chancellor Angela Merkel’s austerity drive, Dutch Prime Minister Mark Rutte, to offer his cabinet’s resignation on Monday.