By a sheer coincidence, no doubt (though some have called it Goebbelian, which is a little hard) that was the day in which it was made public that back in the days of the country entering the economic and monetary union, the guilder was deliberately devalued by 5 to 10 per cent.
In other words, the Dutch people had 5 to 10 per cent of their salaries, pensions and savings written off. And for why?
According to former Finance Minister Zalm, getting a higher price for the guilder was “a politically unreachable goal”. People’s salaries and savings? Pooh, who cares about that?
Mr Zalm had also assured people that prices would not rise and inflation would not, in any circumstances, follow the adoption of the euro. It seems that he was not entirely accurate, or so the Director of the Dutch Central Bank says now.
“We could ascertain that the Guilder was 5 to 10 percent undervalued against the D-Mark. It is always difficult to establish a balanced exchange rate, but one can say without doubt that the Guilder was undervalued.News like that is best released on a holiday, when people might not pay attention to it. Unfortunately, this did not precisely work, as, with the referendum approaching, even holidays do not interfere with interest in the way politicians manipulate information, particularly when it has to do with European integration.
With the exchange rate fixed and unable to adapt itself, the prices adapted themselves. This was later followed by a multiplying effect; our competitive position strongly weakened because of extreme salary increases.”
Meanwhile, in the other part of the Low Countries, Belgium, things are not looking too bright. They are not due to have a referendum and, indeed, if Prime Minister Guy Verhofstadt has anything to do with it, they may well do away with democracy altogether.
The Flemings are becoming more and more disgruntled by what they see as their hard work being squandered by the Walloons, who seem to be natural recipients of government funds in one way or another.
On top of which, the latest figures on economics make sad reading. This is what the Economist City Guide to Brussels says:
“Belgian workers are the most expensive in the world, according to a recent survey by Mercer Human Resource Consulting. Belgian employers spend an average of €53,577 (£36,480) a year on each worker—more than Britain (€46,451, £31,628)or America (€33,195, £22,602), and marginally ahead of both Sweden and Germany.But take-home pay is much lower than the headline figure. The reason that Belgian workers are so costly is the very high payroll taxes the country needs to fund its health and social security systems. One trade-off for such good services is an unemployment level that is now close to 13%.”
The figures do not show where the highest level of unemployment is. None of this is good advertisement of the eurozone or the whole concept of further European integration, unless, of course, we use the old socialist argument: if socialism does not work, it is because there is not enough of it.
So far, European integration has not produced the economic growth and political stability it keeps promising. I expect, we need more of it to achieve what it has not delivered so far.