Belgium, this Gallic village where the middle class is the only one in Europe to pay more than the share it represents in the population – Economic Policy
The magic will consist in taxing the middle class even more, the only one in Europe to pay more than the share it represents in the population.
Despite the never-ending health crisis, it is time to gradually start monitoring the economic barometer again. This one, unsurprisingly, is not looking good. Violent storms, which everything suggests are wreaking havoc mainly in the middle class, are coming.
Inflation is making a comeback. For the years 2021-2022, it is estimated at 5.1%. Or, in Europe, two countries continue to convert automatically, and entirely, the increases in labels into wage increases: Belgium and Luxembourg, the richest of the countries of the Old Continent. According to the National Bank, wage increases could go up to 4.5% in 2022, i.e. accelerations three times faster than in neighboring countries, and the most marked for 25 years.
Combined with soaring commodity prices, these automatic increases will generate new inflationary surges that will cause us to fall back into a well-known infernal spiral. If countries like France, Denmark and Italy have freed themselves from the automatic indexation regime, the Belgian unions refuse to consider the idea. For the president of the FGTB, Thierry Bodson, any modification of the system would even be “a real declaration of war”. Belgium having become competitive again, the union goes so far as to consider superfluous the law which limits the evolution of wage costs to that of the Netherlands, Germany and France. Competitive, really? Belgium actually occupies only 24th place in the world ranking of the most competitive countries, whereas it was in 18th position 10 years ago and the nations which are comparable to it hover around 15th place.
Do you know why so many orders are delivered from the Netherlands? Because in our country, the regulations in the event of night work (prohibited except for exceptions) are so restrictive and the wage costs so high (20% more than in neighboring countries) that we have globally priced the e-train Trade. Result: 65% of Belgians order in other countries of the Union, against 27% for the Dutch, affirms the 2021 E-Commerce Report. It is, moreover, all labor regulations which are among the most rigid in Europe (our country occupies 114th place in the index of hirings and dismissals) and which must therefore be the subject of urgent reform. Even France, however known for its lack of flexibility in the matter, is doing better: it is 90th.
Do you also know why Belgium still has so many unemployed people when there have never been so many vacancies? Because because of taxation on work, the most penal in Europe for two decades, working earns barely more than not working. But unemployment is only a temporary mechanism intended to support the recipient during his job search, the critical reader will point out. That’s right… except in Belgium, the only country in the world where the right to unemployment is unlimited in time.
Our dish therefore pays for everything from the Gallic village ignorant of socio-economic imperatives but unfortunately devoid of a magic potion. The magic will therefore consist in imposing even more the middle class, the only one in Europe to pay more than the share it represents in the population. If the dynamic continues to pinch, there will be no future for this State with aging demographics, a budget deficit structurally stuck at 4% and whose debt has already been higher than the gross domestic product for almost 50 years ( 112% in 2024).
Despite the never-ending health crisis, it is time to gradually start monitoring the economic barometer again. This one, unsurprisingly, is not looking good. Violent storms, which everything suggests are wreaking havoc mainly in the middle class, are coming. Inflation is making a comeback. For the years 2021-2022, it is estimated at 5.1%. Or, in Europe, two countries continue to convert automatically, and entirely, the increases in labels into wage increases: Belgium and Luxembourg, the richest of the countries of the Old Continent. According to the National Bank, wage increases could go up to 4.5% in 2022, i.e. accelerations three times faster than in neighboring countries, and the most marked for 25 years. Combined with soaring commodity prices, these automatic increases will generate new inflationary surges that will send us back into a well-known infernal spiral. If countries like France, Denmark and Italy have freed themselves from the automatic indexation regime, the Belgian unions refuse to consider the idea. For the president of the FGTB, Thierry Bodson, any modification of the system would even be “a real declaration of war”. Belgium having become competitive again, the union goes so far as to consider superfluous the law which limits the evolution of wage costs to that of the Netherlands, Germany and France. Competitive, really? Belgium actually occupies only 24th place in the world ranking of the most competitive countries, whereas it was in 18th position 10 years ago and the nations which are comparable to it hover around 15th place. Do you know why so many virtual orders are delivered from the Netherlands? Because in our country, the regulations in the event of night work (prohibited except for exceptions) are so restrictive and the wage costs so high (20% more than in neighboring countries) that we have globally priced the e-train Trade. Result: 65% of Belgians order in other countries of the Union, compared to 27% for the Dutch, affirms the E-commerce report 2021. It is all labor regulations that are among the most rigid in the world. Europe (our country ranks 114th in the Hiring and Firing Index) and therefore needs urgent reform. Even France, however known for its lack of flexibility in the matter, is doing better: it is 90th. Do you also know why Belgium still has so many unemployed people when there have never been so many vacancies? Because because of taxation on work, the most penal in Europe for two decades, working earns barely more than not working. But unemployment is only a temporary mechanism intended to support the recipient during his job search, the critical reader will point out. That’s right… except in Belgium, the only country in the world where the right to unemployment is unlimited in time. Our dish therefore pays for everything from the Gallic village ignorant of socio-economic imperatives but unfortunately devoid of magic potion. The magic will therefore consist in imposing even more the middle class, the only one in Europe to pay more than the share it represents in the population. If the dynamic continues to pinch, there will be no future for this State with aging demographics, a budget deficit structurally stuck at 4% and whose debt has already been higher than the gross domestic product for almost 50 years ( 112% in 2024).