Sunday, 19 September 2010

An exercise in political fiction: and what if Belgium would split?

For forty months now the federal government of Belgium has been immobilised by the central dispute of institutional reform. Yes, in between, the banking crisis was managed, and the budget deficit was even held slightly better under control than in the neighbouring countries. But every bit of fundamental reforms, so much needed because of the greying of the population, the migration questions, the badly functioning labour market and the worsening investment climate, has been delayed because of the deep differences between Flemish and French-speaking parties.

The logical conclusion after more than three years should be that Belgium does not work any more, that another political framework is needed to get the normal machinery of government to function again. But this conclusion has not yet been drawn by those trying to make a new government in Belgium. The reason – and everyone agrees on that – is that there is no alternative. Or that this alternative, the scenario of breaking up Belgium, is at least so unknown that nobody knows a way to begin with it.

Some media and academics have nevertheless already tried to imagine what the consequences would be of abolishing Belgium after 180 years of existence. One can indeed imagine a quite rational scenario, of which the main flaw is inevitably that it is rational. The creation and disappearance of states usually is not a rational process, but one with heavy emotions, that can easily get out of control.

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But let us at least try. At some points in the present government negotiations the two main parties, NVA on the Flemish side and PS on the French-speaking side, decide that a divorce is inevitable, like in a married couple where the initial bond of honest and outright love had already melted away some time ago. It would probably be enough that these two big parties agree on it, like the two main parties did in Czechoslovakia in 1992. The smaller ones may not like this, but they are in no way able to create an alternative.

So the French-speaking and Flemish parties start to discuss the divorce. Two big headaches disappear immediately: there will no longer be any need to wrangle about a new Finance Law that distributes the tax revenues over different authorities, nor about the devolution of competences. Two other headaches however remain and become much, much bigger: where are the boundaries to be drawn between the new would-be independent states and what happens with the minorities inside? And how will the jobs, the infrastructure, the money and above all the debt of the federal state – and with it the whole of the social security, in money twice as large as the federal budget – be split up among the heirs of the late Belgium?

Can the Flemish and French-speaking politicians agree on this, where they have failed to do so inside Belgium? Or will they readily abandon this discussion to international mediation, with the risk of losing the driver’s seat, but with the gain of being no longer held responsible for the concessions that will inevitably follow. The latter is the more probable scenario, with the European Union stepping in, and the neighbouring countries – who except for Luxemburg were already very much present at the creation of Belgium in 1830 – following close: France, Germany, the Netherlands and Britain.

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Things seem quite simple for Flanders. That region of slightly less than 6 million inhabitants is geographically defined and stable, with more citizens than at least ten member states of the EU, and economically still strong, although rapidly declining. But it might be obliged to start new negotiations of entry into the EU. Inside the Union the applause for secessionists will indeed be minimal, and countries such as Spain, Britain, Italy – to name but these – are likely to raise the threshold as high as possible for those who would wish to follow the example.

As a new country the former region of Flanders is vulnerable about its treatment of the French-speaking minority on its territory, about the solidarity it wants to take up as the richest of the former Belgian regions in paying the debt of the defunct nation, and above all about its wish to keep a foothold inside Brussels for the 80000 people living there and still more or less claiming  to be Flemish.

One of the Flemish aims today is to continue to have a crucial say in the running of the Brussels region. But in a splitting process Brussels, with its huge majority of French-speaking people and politicians, is unlikely to go along with Flanders. It will, on the contrary, try to obtain more money from Flanders, if that country wants to maintain a more or less privileged position for the shrinking Flemish minority in the capital region. Brussels is in dire need of cash, mainly due to its inefficient administration and government structures, and an immigration policy that for electoral reasons was made so generous (even compared with other big cities with large immigration in Western Europe), that the average income in the larger central part of city has dramatically declined in the last decade.

Brussels will need new incomes and at least one sponsor before it reaches the status of a self-supporting city-state. It will try to make Flanders pay some cash, to forge an alliance with Wallonia, and of course look to Europe too. The EU will then have to study how Washington handles this, with the federal government and the District of Columbia, and see if some of this can be applied in what is more and more the only capital of Europe. As the neighbours of Belgium are involved too, there might even be openings for a grander scheme, where Luxemburg and Strasburg are gradually abandoned (with some sweets to compensate) and the money thus spared could go to Brussels.

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But that is already daring fiction. Brussels and Wallonia will, after the secession of Flanders, be tempted emotionally to go together in a rump-Belgium with a stronger claim on the inheritance of the defunct nation and with the French language and culture as binding agent. But the problem of the debt will drive them apart.

One can imagine that all the debt of the Belgian authorities – today about 100 % of gdp – after a split will be put in a common fund that the heirs of the defunct state have to administer and pay. As most of this debt is in the hand of citizens and enterprises of today’s Belgium, these heir-states will for their own sake be obliged to achieve its continuity. And although there is an interesting study to be made about how much owners of the debt are situated in each of the regions, it is more likely that the obligations of the follow-up states will be laid down through international mediation on the basis of objective criteria like number of citizens, surface of the territory, gross regional product and economic growth.

Regardless of the mix used in such a scenario, Flanders should be deemed capable of repaying this debt. Given its slowing economy and the fact that from all the Belgian regions it faces the biggest greying of the population, this might become more difficult after a few years. Independence will not be the great deliverance many Flemish nationalists dream of. It will on the contrary finally confront the region with its failures of the last decades, among which the worsening of the investment climate through bureaucracy, high taxes and a disastrous mobility policy is the most urgent to tackle.

Wallonia on the contrary seems to be the most promising economy of present-day Belgium in the years to come, as it is recovering from half a century of decline and stagnation, and is rapidly becoming the more interesting place to build a home an to invest. But for the moment,  it will almost certainly not be capable of paying its due part in the national debt without the kind of measures Greece has taken to stay in the eurozone. The same is true of course for Brussels that might in ten years eventually profit from its young migration population – provided it ever succeeds in offering them a decent education system and an efficient labour market, both blatantly absent these days – but lacks today the capacity to take up its part of the debt.

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That is the point were the Belgian question will become an international question. Walloon politicians of course will prefer to keep the perks of an independent state, but the logic of debt repayment and after a while maybe also the sentiment of more and more Walloons point towards an incorporation into France. La République will thus be enlarged with five new départements (four of the five provinces of Wallonia were already départements during the French revolution). 
The French right of president Sarkozy might not like the addition 3 million people who in a large majority vote for parties of the left. But they might also speculate that some of this left-leaning is generated by the nationalistic reflex to gather around the Parti Socialiste as a counterweight against Flemish aspirations.  And it could be tempting to try to lure the voters for the presidential elections of 2012 with a greater France, enlarged with a region with good economic perspectives. As for the debt of Wallonia, inside the greater France it would disappear in a far greater amount, to be paid by almost twenty times as much citizens.

Germany will not resist to this, as the French did not really obstruct German unification twenty years ago. Berlin will ask for its compensation in another area of EU-policy, as François Mitterrand did towards Helmut Kohl. Britain will probably do the same, as the old premises for which London accepted the creation of Belgium in 1830 – the fear that France would come too close to the Rhine-delta – no longer count.

Still new problems might arise. The small German community of 75000 citizens in the east of Belgium, still half a part of the Walloon region, will lose its status of best protected minority of Europe. In that case it might prefer Germany over France. Even the Walloon province of Luxemburg – mainly rural and mostly covered by the Ardennes – might according to some prefer to enlarge the Grand-Duchy nearby than to become part of France. But then again it is not clear if the people of the Grand-Duchy would like this: there is an obvious risk that French would push the national Letzeburg language into a minority position.

Last but not least will both the Germans and the British, and surely also the Dutch, obstruct as long as possible the thought that Brussels becomes a part of France while staying at the same time the capital of the EU. It is then that the DC-solution – Brussels as a European district and city-state – will come up again. Not for the cheap of course: someone will have to put up the cash to help this new nation through its early years.

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So the map of Europe might be redrawn, with the most likely outcome being that two new states – Flanders and Brussels – will replace the former Belgium. France will become larger, Germany slightly, maybe also Luxemburg. The Dutch may hope to find in Flanders a better ally in European discussions, and Britain a less Euro-enthusiast nation than the late Belgium.

The process might take a few years to come through. All regions of present-day Belgium are likely to lose – or will at least have to face up a lot of reforms they have up to now been pushing aside because of the nationalistic dispute. Flanders will have to change its language laws, and accept a French minority. Maybe even Germany should, in its new acquired piecelet of territory. Do not expect a clear winner of the affair.

The best hope is that a split will be for the most a rational matter, like it was – almost miraculously – in Czechoslovakia twenty years ago. Emotions will be present, inevitably, but if they remain more or less under control, the unstable situation of a country disappearing and a few new ones coming into live, should not make too much havoc. Of course nobody can guarantee that it will be that limited on the day the divorce starts. From then on it will be, as ever, wait and see what happens next...

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