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Income Inequality and the Rise of European Separatist Movements

Separatist movements typically flourish during times of economic or political distress. While in the recent past separatism has been associated most with emerging or failed states and linked with armed conflict and insurgencies, the West’s economic dislocation and the ‘rise of the rest’ has coincided with a surge in political movements and a desire for autonomy and independence – not only among violence-prone regions of the world, but among the strongest of emerging states, and the EU. That separatist movements are flourishing in Europe is an indication of the impact of rising income inequality, a trend which is global in nature. As a result, a rise in separatist movements may be expected globally in the medium and long-term.

Several countries within the EU-27 have political movements that have expressed support for regional or national parties seeking greater self-determination. Belgium experienced a long crisis last year, being virtually ungoverned on a national level for months. The desire by the Flanders region to acquire more autonomy had been a central issue in Belgian politics for some time.

Of the major regional movements requesting autonomy or independence, several are ironically among the wealthiest regions within their country, such as the Flanders region, Aland region of Finland, the Basque region of Spain, and Moravia in the Czech Republic. Ten European countries face similar tendencies in one or more of their regions, with Italy, Spain and the UK having the best known separatist movements.

Although separatist movements in Europe have traditionally been based on ethnicity or religion, the current trend is based more on economics, and on the increasing centralization of fiscal and monetary policies since the onset of the Great Recession. The credit crunch, debt crisis, unemployment and low growth rates have all been contributing factors.

As Europe’s economic stagnation endures, there is every reason to believe that separatist movements will grow in number. The most active include Republica Srpska in Bosnia, Serbian Krajina in Croatia, Transdniestria in Moldova, the Georgian breakaway regions of Abkhazia and South Ossetia, and of course Cyprus. The partial international recognition of the Kosovar declaration of independence has created a potentially troublesome precedent for Brussels, which may now be forced to face other political demons of Europe’s past at a time when the existence of the EU is threatened economically.

Rising income inequality within European countries has been a persistent theme for some 20 years now. A study comparing inequality between countries versus within countries in Europe between 1975 and 2005 using Generalized Entropy measures found that inequality between European countries started falling shortly after the fall of the former Soviet Union and that inequality within countries started rising at the same time – in the early 1990s.

Another study noted Gini Coefficients (used to measure inequality) and poverty rates were rising notably in some countries in Europe a decade ago, establishing a pattern that has become pronounced in the time that has passed.

A measure of the development of primary income among private households comparing 2000 with 2008 indicates that income levels have remained divided in the EU-27, with variations between regions and within individual countries. Household incomes in Scandinavia, Eastern Europe, and Spain have generally risen, while incomes in the rest of Europe have generally fallen.

The long-established pattern of rising income inequality and poverty rates within the EU generally and within specific member countries is surely a contributory factor to the rise in separatist movements throughout the continent. Given that these are long-term contributory trends, they must first be meaningfully addressed before the corresponding trends toward separatism may hope to be reduced. However, given the trajectory that Europe is on, neither is likely to be diminished in the short or even medium-term.

Brussels would be wise to acknowledge the problem and focus its legislative efforts on addressing the core issues of income inequality and rising poverty rates with haste. If not, before too long, Europe stands the risk of resembling some of the countries it conquered a century or more ago.