Is Belgium too big?

Belgium is nice and compact, the iPod of countries.  When I visited in 1990 I noticed that most Belgian cities were about 30 minutes from Brussels by train.  When I need an example of a small country to use in my economics class, I often pick Belgium.  But today I’d like to argue that Belgium is just too big.

In earlier posts like this one I argued that there are severe diseconomies of scale in governance.  In olden times large countries benefited from having a big internal market and a large military to deter invaders.  The unfortunate Belgians was frequently overrun by the Germans or French.  But in the modern world this is no longer a problem.  Belgium is protected by NATO and can export freely throughout the EU.  I got to thinking about this issue when I read this article:

BRUSSELS (AP) – Belgium’s 6.5 million Dutch and 4 million French-speakers are locked in an unhappy, quarrelsome union, and voters in a general election Sunday might well favor the prospect of a political divorce down the road.

A mainstream Flemish party that is expected to do well is invoking the concept of irreconcilable differences to seek a separation and, in time, take the country’s Dutch-speaking Flanders region into the European Union as a separate country.

This is a nightmare scenario for the poorer Wallonia, Belgium’s Francophone south, which greatly depends on Flemish funds.

.   .   .

The divide goes beyond language.

Flanders tends to be conservative and free-trade minded. Wallonia’s long-dominant Socialists have a record of corruption and poor governance. Flanders has half the unemployment of Wallonia and a 25 percent higher per-capita income, and Dutch-speakers have long complained that they are subsidizing their Francophone neighbors.

But those in Wallonia don’t want to join France and France has never expressed any interest in absorbing the region because of its high unemployment and other costs. France also does not to encourage separatism so regions like the French island of Corsica don’t get their own separatist ideas.

If you are a right-winger this pushes all your buttons.  Wallonia is too socialist.  They rely on handouts from the more conservative and productive Flemish.  They speak French.  But they are so poor even France won’t take them.  You’re instincts tell you that the virtuous Flemish would be better off without those deadbeats.

But I am a utilitarian, and am thus supposed to be above all that petty bigotry.  So I’ll try to make a principled argument that both sides would be better off with an amicable divorce.  The advantages to Flanders are obvious.  A population of 6.5 million is a bit more than Denmark and and a bit less than Switzerland and Austria, all three of which are highly successful countries that also border Germany.  And all three are richer than Germany.  A small country can be nimble, and set public policies that are well-suited to attracting international business.  And in a small country it’s harder for rent-seeking special interest groups to rip-off the broader public, without attracting attention.  Win-win policy coordination is easier to get in Flanders than in a country like America, where the Democrats and Republicans are barely on speaking terms.

But how would the Walloons gain?  Here the argument is a bit tougher, but I’ll try to make it using the analogy of Czechoslovakia.  Before the split-up, the Slovaks represented the smaller and less prosperous part of Czechoslovakia.  Being further east, their instincts were probably more statist.  After the breakup they did flounder around for a few years, but then got their act together and instituted some important neoliberal reforms.  And I think it is fair to say that the reforms were successful.  Obviously Slovakia still has lots of problems, but their business-friendly tax regime did attract lots of investment from multinational car companies.  So tough love can work.

I am a pragmatist, so I don’t want to argue that separation is the answer to every problem.  The Swiss have shown that decentralization can work well, and up until 1929 it was highly successful in America as well.  I suppose there is the risk that a region that strikes it rich with oil could decide that it doesn’t want to share its undeserved riches with the rest of the country.  Or Beverly Hills might want to declare independence to avoid high income taxes.  (Indeed Monaco is essentially in this position vis-a-vis France.)  But where you have two regions that are relatively equal in natural resources, but have trouble getting along due to cultural/language differences, then why not split in two?  When it comes to governance, small is beautiful.

PS.  I suppose there is the tricky issue of what to do with Brussels.  How about making it an independent city-state?  Call it Brussels D.E., meaning Brussels, District of Europa.

PPS.  I tried to find a YouTube of the old Monty Python skit about Belgians, but (perhaps fortunately) could not locate that tasteless performance.



15 Responses to “Is Belgium too big?”

  1. Gravatar of Simon Simon
    13. June 2010 at 12:52

    Dear Scott,

    I’m Flemish, and it’s wonderful to read your perspective on our Belgian situation.

    Funny you mention Brussels. Today the leader of the Flemish National party said:
    “I don’t want a secession, because it would entail that Flanders loses Brussels.”

    To my knowledge, nobody in Flanders has a feasible solution for Brussels, when it would come to a separation.

    To be simplistic: an isolated Brussels is a poor city, it cannot stand on its own. A lot of people work in Brussels, but they pay taxes in Flanders or Wallonia.

    By the way: we’ve had 3 years of political crisis, but it’s over now. By the end of the summer there will be an agreement on the new structure of the Belgian state.
    (At least, that’s the impression I have.)

  2. Gravatar of Thorfinn Thorfinn
    13. June 2010 at 13:01

    Is Flanders unification with the Netherlands not being considered? Historically, they have been joined politically on and off.

    How do you feel about Yugoslav separation?

  3. Gravatar of Morgan Warstler Morgan Warstler
    13. June 2010 at 13:54

  4. Gravatar of Simon Simon
    13. June 2010 at 14:19


    – No.
    – Interesting suggestion. But maybe this is not the time. Germany wants us to cut deficits first.

  5. Gravatar of scott sumner scott sumner
    13. June 2010 at 14:24

    Simon, Thanks for that info. And sorry to hear that you guys won’t be splitting up. Seriously, I am not surprised. As with Canada, there has been lots of talk over the years, but no action.

    BTW, who would get that giant atom sculpture?

    If I have any Walloon readers, I apologize for the post. It was meant to be half-joking. I’m sure Wallonia is a great place.

    Thorfinn. I was thinking about that issue. One reason we know that countries are too big is that mergers rarely happen, even between similar cultures. Moldova doesn’t want to merge with Romania. Kosovo doesn’t want to merge with Albania. France wouldn’t want Wallonia. Small is beautiful.

    I believe in peace even more than decentralization. Slovenia did fine, but the other bits should have waited until Yugoslavia had become more westernized, and a civil divorce could have been enacted. Of course the Serb government whipped up nationalist hysteria to stay to in power after communism started collapsing all around them.

    Morgan, Thanks. I guess my taste has changed a bit in 35 years. When I was twenty I thought those skits were a riot. It still is funny, but now it seems a bit too obvious. I’m becoming like those older snobs that I used to hate.

  6. Gravatar of MikeDC MikeDC
    13. June 2010 at 17:29

    My impression is that Brussels is a problem because it is wealthy, not because it’s poor. That is, if you consider the metro area rather than the city proper. To an outside observer, the reasonable thing would be to allow the local suburbs to go with it, since the folks who live their generally (but not always, of course) see themselves as living in Brussels rather than Flanders or Wallonia.

    That is, there’s a perfectly reasonable way to divide things up around Brussels, but it would involve giving up a lucrative tax paying population and not just those costly Wallonians. This, of course, has been exacerbated by everyone antagonizing the hell out of each other at the local political level and trying to strong-arm the other languages out of various neighborhoods. I guess it’d still be an amicable divorce, but they’re getting close to crossing some nasty lines.

  7. Gravatar of Jim Glass Jim Glass
    13. June 2010 at 19:31

    I tried to find a YouTube of the old Monty Python skit about Belgians…

    From a
    recent Doctor Who
    : “If we don’t stop this reaction it will blow a hole in the space-time continuum the size of … [looks at instruments] … Belgium. Well, that’s a bit undramatic.”

    No respect from the Brits.

  8. Gravatar of Simon Simon
    14. June 2010 at 00:53


    Perhaps you’re right. But I have a question.

    “To an outside observer, the reasonable thing would be to allow the local suburbs to go with it, since the folks who live their generally (but not always, of course) see themselves as living in Brussels rather than Flanders or Wallonia.”

    Maybe this is true. But do you think they are also volunteering to pay taxes in Brussels and heavily subsidize its poor population?

  9. Gravatar of Tracy W Tracy W
    14. June 2010 at 02:57

    The merging of the Australian states strikes me as an example of countries wanting to get together.
    Although on the other hand I have heard that the main security worry of the Australian military is that Indonesia will collapse into a expansionary military dictatorship that will then occupy a third of Australia before any Aussie notices that they’re being invaded. There’s a lot of very empty space in Australia. So maybe the unification was driven by security concerns.

  10. Gravatar of MikeDC MikeDC
    14. June 2010 at 03:27

    I suppose it’s a matter of just how much of a tax advantage they could expect from joining Flanders. However, I think only about 15% of the capital region actually speaks Dutch, and of those that do many actually speak pretty good French and don’t mind doing so for cultural identification purposes.

    So I’d guess the average person might pay a premium to join Brussels than Flanders. Especially given that the Flemmish haven’t been all that nice to non-Flemmish speakers. Given that last point, they might also imagine that, since they’re a non-favored group, if they get stuck as part of Flanders, the Flemmish government might use them as a cash cow and tax them at a higher rate to subsidize the rest of Flanders. A skeptic might be concerned there would be no tax benefit to being in Flanders for those particular folks.

    Finally, I suspect an independent Brussels might be able to generate a lot of revenue from the many international sources there if it really tried. With SHAPE and the EU, they could probably tax all the foreigners a bit harder and come out about equal.

    For that matter, having spent a fair amount of time there, nothing about the city itself strikes me as especially poor compared with other Belgian cities I’ve been to. The yuckiest places I’ve seen in Belgium have been in Antwerp, complete with housing projects and industrial stuff that reminded me of growing up in Chicago.

  11. Gravatar of Brian Moore Brian Moore
    14. June 2010 at 06:11

    Whatever result is chosen, so long as the export of Belgian beer, waffles and chocolate is maintained, I will be content.

  12. Gravatar of scott sumner scott sumner
    14. June 2010 at 06:21

    MikeDC, You make Brussels sound like Jerusalem. Thanks for the info.

    Jim Glass. Thanks for that item.

    Tracy, And that merger occurred before the modern clubs like the EU and NATO, which reduced the benefits of being large.

    Brian, And they invented french fries.

  13. Gravatar of Simon Simon
    14. June 2010 at 08:30


    very interesting perspective.
    You’re right that I should have been more nuanced about Brussels. (I study in Brussels, by the way.)

    What’s your perspective on the argument that independent social security systems in Flanders and Wallonia would be a nightmare for the enormous labour market in Brussels?

  14. Gravatar of Matthew Yglesias » Does The World Need Belgium? Matthew Yglesias » Does The World Need Belgium?
    15. June 2010 at 08:16

    […] vote for the NVA. This seems like a terrible deal for them with no real upside. Scott Sumner tries to make the case that even the Walloons would be better off: Here the argument is a bit tougher, but I’ll try to […]

  15. Gravatar of Joop Joop
    24. November 2012 at 04:38

    I’m Dutch, and every time I visit Antwerpen I can’t help but notice how utterly similar it is to Dutch cities and Dutch culture.

    They have “uitsmijter” ( on the menu, they have the “intocht van Sinterklaas ( and and they have shops like de Hema, Blokker and Albert Heijn, which are all very typically Dutch.

    The local accent is really easy to understand for Dutch people. In fact, I’ve been to some places in The Netherlands where the accent was much more difficult to understand (I’m from the Amsterdam region).

    Really, if it ever came to a merger between The Netherlands and Flanders, those guys would fit right in 😉

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