Campaign to Break up Belgium Gathers Pace: Secession In Our Midst

Large countries can emulate free markets within their borders because, within a single nation, barriers to trade are few and transaction costs are low. Regional protectionism has few supporters, particularly in the U.S.–No one in California, for instance, raises much sand about jobs getting out-sourced to Nevada, even though it happens every day. Or at the very least, no one argues against interstate competition with the same vehemence as they might over trade between nations.

The greater the extent of the market, the greater the wealth created. So you might expect a country to maximize its wealth by increasing its size, but the great trade-off in the size of nations fractures and flags that impetus, because the greater the size, the greater the diversity in values. Things fall apart. The center cannot hold. Some micro-cultures cannot be homogenized. In their book on the optimal size of nations, Alberto Alesina and Enrico Spolaore present a thorough analysis of the trade-off and it seems that Belgium is playing out this dramatic dilemma in its current election. I know little about Belgian politics, even less about the tensions between the Flemish in the north and the socialist French-speakers to the south, but I dare say the future of Belgium waffles.

From today’s NYTimes:

A stunning electoral success for Bart de Wever’s Flemish nationalist party, which won the most parliamentary seats, is a significant new challenge to the fragile unity of a federal country where tensions between French and Dutch speakers run deep, and where voters in one region cannot vote for parties in the other. It has also injected a new element of uncertainty into Europe at an especially difficult time for the European Union, struggling with serious problems over its finances and currency. Belgium is due to assume the rotating presidency of the European Union in less than three weeks. But it is likely to take months to negotiate a new coalition, raising the prospect that Belgium will be struggling to assemble its own government at precisely the time it is supposed to be steering Europe out of a deep crisis.