No Government, No Problem: The Curious Case of Belgium

[IndyPragmatist]

http://blogs.wsj.com/source/2011/08/18/belgium-thrives-despite-lack-of-government/">Belgium Thrives, Despite Lack of Government
By FRANCES ROBINSON
AUGUST 18, 2011, 9:43 AM GMT
Belgium is the home of surrealism; think of paintings by Magritte, or the attractions in Bruparck, where a a mini-Europe lovingly renders the continent’s greatest monuments in 1:25 scale.

Politics are no exception. There’s been no federal government for more than a year, but the country is continuing to grow and outperform the single currency bloc as a whole. Belgian gross domestic product expanded 0.7% in the second quarter, compared to a euro zone average of just 0.2% according to EU statistics published yesterday.

Last month, caretaker Prime Minister Yves Leterme cut the forecast for budget deficit to around 3.3% of GDP instead of 3.6%, well ahead of the deficit reduction path it agreed with the European Union, which targets a deficit of 4.1% this year.

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http://duncanseconomicblog.wordpress.com/2011/08/17/when-having-no-government-is-helpful-%E2%80%93-the-strange-case-of-belgian-growth/">When having no government is helpful ? the strange case of Belgian growth
By DUNCAN WELDON
August 17, 2011
Belgium is the home of surrealism; think of paintings by Magritte, or the attractions in Bruparck, where a a mini-Europe lovingly renders the continent’s greatest monuments in 1:25 scale.

Politics are no exception. There’s been no federal government for more than a year, but the country is continuing to grow and outperform the single currency bloc as a whole. Belgian gross domestic product expanded 0.7% in the second quarter, compared to a euro zone average of just 0.2% according to EU statistics published yesterday.

Last month, caretaker Prime Minister Yves Leterme cut the forecast for budget deficit to around 3.3% of GDP instead of 3.6%, well ahead of the deficit reduction path it agreed with the European Union, which targets a deficit of 4.1% this year.

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This is such an interesting topic. The Belgians seem to be very content with the current state of affairs. Their government is so fragmented, this has allowed them to transfer power to local governments, where the ideologies are much more homogeneous. I know, this is only one incident, so I won't act like a Keynesian and make countless assumptions based on it. However, it may help prove Angela Merkel correct; "This approach has failed, utterly failed."

The most successful and happy societies are those without a huge amount of ideological diversity. Most believe the main reason why nations such as Sweden and Denmark are willing to give such gracious social welfare to their citizens is that they are all similar. Ethnicity is very similar and the spectrum of political views isn't as wide as other nations. Many are expecting Belgium to split into 2 (possibly 3) sovereign nations within a decade. Each region seems to have a very strong political ideology that differs from the other regions (sound familiar), and many there now believe that the best solution is to let these regions do what their citizens want. The SW region may be annexed to France in the future as they align much more with the French political system than they do with the traditional Belgian government or the views of the North of Belgium.

[IndyPragmatist]

1. They "keynesian" jab was an inside joke, sorry

I just copied and pasted this from my post on another forum. We have a joke about a guy who will attempt to explain everything in the world from a single statistic.

[CJCRANE]

2. They still have a government but it's a caretaker government not an elected one. nt

[IndyPragmatist]

3. Yes, just to continue basic services, there is no policymaking

np

[CJCRANE]

4. "To clarify: most European countries are seeing a contraction

because of government austerity packages in the wake of the euro zone debt crisis. Belgium, lacking a government with a full mandate hasn’t been able to do this."

So in a way, the countries with elected governments have less government because of the austerity measures.

:crazy:

[IndyPragmatist]

5. Haha, I guess you could look at it that way

I really do think that power being closer to home is providing a bit of confidence in their economy. I've always been a federalist (which is not very popular around here) because I think it allows people to feel as if they are better represented. Confidence is a silly thing in our economy; you could make all the right moves, but if the people think its the wrong move, things will stall. Likewise, poor policies can be overcome a bit by people believing that they will help.

[d_r]

6. the have two things going for them

beer and chocolate.

[xchrom]

7. Recommend