Tuesday, 14 June 2011

Belgium hits one year with no government

A rather embarassing anniversary was reached here in Belgium yesterday - it has been one year since an inconclusive election threw the country into a period with no government. At the time, it would have seemed obscene to suggest that there would still be no government in Belgium in a year's time. But that's where we are today, and perhaps the only thing more surprising than the length of this governmentless period is the barely noticeable effet it has had on the country.

In truth, it's hard to say whether the current governmentless period hit it's one year mark yesterday or a few months earlier. The previous government of prime minister Yves Leterme collapsed in April of last year, so in truth Belgium has not had a government for a year and three months. Either way, this is the longest period any country in modern history has ever gone without a government. In February Belgium surpassed the previous record held by the fledgling Iraqi democracy.

While the Dutch-speakers and French-speakers have spent the last year arguing over how to form a government, a 'caretaker government' has been in place. But this administration can only take care of day-to-day administrative things. It essentially can't take a 'decision' on anything, it can only take care of the administrative aspects keeping the country functioning. In the mean time Belgian King Albert II runs the show,overseeing the negotiations.

But yet the country has continued functioning. Because the country's governmance has already been so devolved at this point to the local governments of the three regions - Flanders, Wallonia and Brussels - there is little for the national government to do at this point anyway. In many ways Belgium has become a country in name only. In reality it is a federation of three autonomous countries - a bit like the cantonal system of Switzerland. But unlike in Switzerland, Belgium is not technically set up to work in this way. So you have a country that exists de jure as a unitary state but de facto as a confederation.

The big thing that the national government does take care of is taxes, and it is this power that the Flemish nationalists are insisting be devolved before they will agree to form a government. They want Flanders, the wealthiest area of Belgium by far, to collect its own taxes which it would only spend on itself. But the Francophone politicians are refusing to go along with this idea because Wallonia, with its astronomical unemployment rate and systemic development problems, would have difficulty staying afloat if it could only spend the tax money it brings in itself. The Francophone politicians also point out that such a split would be patently unfair to Brussels because so many Flemish people work in the capital but live in Flanders - which explains why on paper it looks like Brussels brings in far less tax revenue than it actually does.

Does Belgium need a government?

But while the politicians have been duking it out, everything else has carried on as normal. The country's time holding the rotating ministerial presidency of the EU last year was deemed a success, perhaps because of the fact that there was no government rather than in spite of it. The Belgian economy is growing nicely and its exports have actually gone up over the past year. The most recent economic forecast has put Belgium's growth equal to that of Germany, the Eurozone powerhouse.

So given that it now seems a near impossibility for the country's two warring sides to come together to form a national government, is there any sense in even trying? Should the constitution of Belgium be completely redrawn to make it a loose confederation rather than a unitary country? The Flemish nationalists say yes, but the Francophones say absolutely not. They fear that such a conferation is a first step toward breaking up the country, and they know that Wallonia would have difficulty surviving on its own. Were it an independent country, it would be the poorest country in Western Europe.

So the fight goes on, and there seems to be no end in sight. There is little reason to think that a government will be formed before the end of the summer, when caretaker prime minister Yves Leterme will have served as an unelected PM for longer than he served as an elected PM with a mandate. But there is a limit to how long this can go on without causing serious harm to the country. The markets are watching Belgium's massive public debt, the third highest in Europe, with considerable unease. The common wisdom is that Belgium urgently needs to make the same significant cuts in public spending that its neighbours are pursuing.

But for now, this surreal situation in Europe's most surreal country continues.


jolyonwagg1 said...

Its more than alittle ironic with Brussels being the home of the EP dream of EU harmony while Belgium is tearing itself apart?

If the French and Flemish politicians cannot agree on anything after 1 year of bickering and cultural mud slinging, what hope is there for the fantasy dream of eurozone harmony?

msouth said...

I would love to see this in the US, is there any way they can export it? :)

I like jolyonwagg1's comment--the irony is amazingly acute, given that it's the same tension tearing at the larger EU that's pulling Belgium apart. Not to mention that the EU is really a highly artificial "union", much like Belgium itself.

Anyway, I'm rambling. Thanks for a great writeup!