The long-awaited reports, all twenty of them, from the committees set up to explore all possibilities for cutting back on the ballooning Dutch budget deficit and the national debt finally hit the press last Thursday, nicely just before Easter to give everyone a grim feeling over the long weekend.

Established around 6 months ago, the committees were deliberately set up to allow them to look at every and any possibility. No political taboes in the way. No sections of the government escaping. Everywhere a 20% cut. The figures are disputed, but that the axe is going to fall is not doubted, its a question of when not if. The Central Plan Bureau has estimated an annual deficit of 29 billion per year on current trends. A civil servant financial study group came up with advise that the next cabinet must improve the fiscal position by 15 to 18 billion a year.

And thats the first issue about these reports. There is no fully functioning government right now, only a ‘demissionair’ cabinet that keeps things ticking over until a new formation emerges out of the elections in June. So these reports have landed in the middle of an already tight electioneering battle. Nice timing. They don’t point the way for a ruling cabinet, but offer instead a backdrop for all the parties to profile themselves against. There are big differences of opinion. The Christian Democrats aim for 18 billion, the GreenLeft 12 billion, the Socialists 10, and so on, each party choosing its favourite target. We will all be paying more ‘own risk’ fees for health care. We may even lose our tax relief on mortgages (eventually). A whole section of local government – the provinces – could be swept away, bringing 1.8 billion savings. The Netherlands has made itself into a massive experiment.

Two things about this whole process don’t feel so good.

The first is the fact that much of the hole in the state finances came among other things from pouring billions into several banks over the past 18 months: Fortis, ABN, ING. Yes we need the banks, without banks an economy can’t move. But it feels pretty sad if the largest share of the costs accrued from this (ongoing) rescue operation are merrily passed on to the ordinary citizen. Ah, but unemployment, projected to hit 10% in the Netherlands, remains stubbornly between 5 and 6. So the Keynesian rule that you don’t cut back during a downturn can apparently be ignored. The state, having taken on the debt of the banks, passes it on to the people without being able to ensure that the banks won’t carry on pre-2008. Meanwhile the bonuses continue to flow. A golden opportunity for effective reforms was therefore missed.

 The second is that the relative position of the Netherlands internationally is not so bad at all. True, the national debt has risen from just above 50% of GDP in 2007 to around 75% now, and will continue to rise. But that still places it below Germany, the rule-maker when it comes to setting budget targets in Europe, never mind France, which is now around 100%, or Italy, around 130%. From the major economies in the EU only Spain comes out better. Recent figures also suggest that the Dutch industrial sector is starting to see an increase in orders. Its current account balance actually improved slightly from 2008 to 2009. Is this the right time to start undermining the chance of recovery for the sake of fiscal purity and abstract economic theory? No its not.

True, the reports are purely advisory, not policy. But they are proof of how nervous the Dutch state gets when figures start diving into the red. With this exercise the Netherlands is way ahead of everyone else in terms of seriously assessing what has to be cut to balance the books. Way ahead. No other nation has so far attempted to get a grip on everything like this. The UK has a far worse position but coming elections have exactly swept any serious discussion from the table (ironic really, when you think about it) as both Labour and Conservatives look to protect their interests. Obama has now also created a bipartisan to look at options, but in doing so he effectively removed the problem (temporarily) from his agenda. In big contrast, a strong hint of ‘best student in the class’ is once again emanating from the Hague.

Will cuts hit every corner of government? Yes they will. Even the intelligence and security service, the AIVD, since 9/11 a massively expanding operation, will take its share. Recent figures from the Ministry of Home Affairs indicate a budget of 176 million Euro for the AIVD this year, but this will decline to around 171 million by 2014. However, in 2000 its budget stood at around half that amount. So the cuts are likely to be minimal in comparison with other areas of government. The security of the nation must come above everything else, after all (I wonder for instance if this round of cuts will have any impact on major defence projects like the Joint Strike Fighter). And compared to the US, its cheap. Recent figures indicate a total budget for all 16 institutions in the US intelligence community of around $75 billion a year, and that is the public figure – there is plenty more invested via the ‘black budget’.