By IAN DE MELLO
Staff Writer
In the small crevices of Europe, in between Austria and Switzerland, lies a country that most Americans don’t even know about. The small country of Liechtenstein. The origins of Liechtenstein can be traced back to the Holy Roman Empire when the territories of Vaduz and Schellenberg were merged to form the independent principality it is known as today. While it gains the peculiar reputation of being a micronation, among the ranks of the Vatican, San Marino, Andorra, and Monaco, it is also one of the most prosperous countries in Europe. It has one of the highest GDPs per capita in the world and enjoys a high standard of living. The situation becomes even more strange as it is essentially an absolute monarchy.
Essentially, is the key word here, as it is still, by de jure, a semi-constitutional monarchy. Starting from the beginning, Liechtenstein formally became a constitutional monarchy in 1921, however, the Prince still held a substantial amount of power. This changed in 2003 when there was a national referendum spurred on by the reigning monarch, Hans-Adam II, to give the Prince more broad powers. These included the ability to dismiss the government and to veto any laws. He threatened to sell his property and move to Austria if it failed and luckily for him, it passed in a landslide. This policy change was criticized by the European community, as they believed it to be expanding the power of the monarchy to the detriment of democracy. This referendum is what essentially turned Liechtenstein absolutist.
Hans-Adam II, Ruling Prince of Liechtenstein
It is true that Liechtenstein has both a direct and representative democracy, but it’s under a two-party system. The two big parties are the Progressive Citizens’ Party and the Fatherland Union, which both essentially run under the same platform. They are both conservative, economically liberal, and pro-monarchy and are in complete support of the Prince’s power. These two parties, in a typical election, easily account for more than 80% of the votes, meaning that Liechtenstein is perpetually stuck with the same government. Third parties have tried to gain influence with very little success. The direct democracy aspect of the government comes from referendums, which the Prince can veto for any reason he wants. One such example was in 2012, in which there was an ongoing referendum to liberalize abortion laws. Hans-Adam II reacted by boldly proclaiming that he would veto the referendum if a “yes” verdict was concluded.
These details altogether make Liechtenstein something of an anomaly, as it seems to be in complete competition with Europe’s notion of democracy. Another question that may be asked, is how is Liechtenstein so small yet so prosperous? It comes down to its incredibly low corporate tax rates, with Liechtenstein being one of the few countries that have more registered companies than citizens. This benefits the country immensely as it is essentially a win-win situation. These companies avoid hefty taxes all while bringing plenty of revenue to the country.
Liechtenstein is definitely one of the most interesting out of European nations. Its weird blend of direct democracy, representative democracy, and constitutional monarchism has essentially led to the establishment of a Prince with near absolute control. And it is actually doing incredibly well for itself with its strange, but understandable, choice of becoming the headquarters for multiple corporations and companies. In the end, the people seem to be perfectly content with a monarchical rule, which is the likely reason for the lack of change, with the country even reducing democracy. However, despite its successes or failures, Liechtenstein will still be that tiny country in the Alpines unlikely to change any time soon.