Netherlands (Encyclopedia Americana Annual '77)

On balance, 1976 was a year most Dutchmen would just as well like to forget. Their problems were largely domestic: the economy basically stagnated; the House of Orange was wracked by the worst scandal in its 140-year-old reign; and the center-left coalition government, its cracks widening, almost collapsed during bitter disputes over such issues as abortion — which is technically illegal, but tacitly condoned — and whether or not to supply parts for the building of a South African nuclear power station. (It was done.)

Economy. An upturn in world trade stimulated a partial recovery by the ailing Dutch economy. The gross national product (GNP), having dropped in 1975, increased by 3.5%, while the rate of inflation remained at a tolerable 8.5%.

Nevertheless, it was a gloomy year. The number of unemployed reached 230,000-7% of the labor force, a postwar high. Rising taxes and labor costs helped induce a marked decline in both foreign and domestic investments. Worried about the deterioration in the country’s business climate, the chairmen of nine of the largest Dutch firms sent an open letter of protest to the government in February. They complained about high labor costs — including the employers’ large social security contributions–and bemoaned the leftist government’s apparent indifference to business.

The Hague responded by publishing a four-year plan for returning the country to prosperity by such devices as limiting the rise in public spending to I% of the GNP per year and curtailing family allowances to households with more than average incomes. The plan was well received; nevertheless, Prime Minister Joop den Uyl’s poor economic record is sure to be a major issue when he and his cabinet members stand for reelection in May, 1977.

Lockheed Scandal. Overshadowing the economic troubles was the controversy over Prince Bernhard’s intimate relationship with the American aircraft industry. The prince’s troubles began on February 6, when a former official of the Lockheed Aircraft Corporation told U. S. Senate investigators that in the early 1960′s he paid a $1.1-million bribe to a “high official” of the Dutch government to secure the latter’s aid in the sale to the Netherlands of numerous Lockheed F-14 jetcraft. Clearly, the anonymous “official” was Prince Bernhard, who, as inspector general of the Dutch armed forces, had considerable influence over the nation’s weapons procurement policy.
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Still, it was hard to believe that long-accepted Bernhard could have had anything to do with the alleged pay-offs. A blue-ribbon commission was appointed by the prime minister to investigate the matter. On August 26, the commission’s findings were finally issued. Although there was no hard proof that the wily prince actually accepted Lockheed’s bribe, he was found to be “open to dishonorable requests and offers,” and capable of “completely unacceptable initiatives.”

The chagrined Bernhard was forced to resign virtually all of his business and military posts, including that of inspector general. The government, fearing a constitutional crisis, decided not to prosecute the matter. But the cloud over the House of Orange was not easily dispelled. As the year ended, Queen Juliana, smarting from her husband’s disgrace, was said to be contemplating abdication.

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