The interests of Schiphol Amsterdam Airport and the Dutch economy are not synonymous, even though Schiphol tries to make us believe that.

It was quite conspicuous news last week, except for the fact that it wasn’t… for all those who know the situation around Schiphol Amsterdam Airport:

Due to the deployment of new European calculation rules for noise pollution, the airport was allowed to grow with a significant number of slots per annum. At least, according to an environment effects report (i.e. MER in Dutch), researched and published on behalf of the airport itself. The following article is from news broadcaster NOS:

Growth airport is demonstrably possible

Additional annual growth in flight movements is demonstrably possible for Schiphol, according to the airport itself. The calculations show, according to Schiphol, that it is possible to grow “in a sustainable and safe way”, as the airport is now well under the agreed norm of noise pollution.

The data are mentioned in the Environmental Effect Report (MER), that Schiphol had to publish,commissioned by the Dutch Ministry of Infrastructure and Environment (Ministry of I&M).

Today Schiphol presented the data to representatives of the neighbouring people, officials from the region and the airtransport industry. Based upon the conclusions in this report, these parties all hope to make agreements about the growth of Schiphol after 2020.

According to the MER, the number of houses that is dealing with excessive noise pollution has since 2015 increased to 11,000 from 10,100 (based upon the forecasted 500,000 flights per year). The agreed norm was 13,600, so the noise pollution would remain 19% below this very norm.

And according to the same calculations the number of people that suffers from serious noise pollution, caused by air transport, is 117,500. That is well below the norm of 166,500. Based upon these figures, Schiphol concluded that there is ample room for growth.

I truly hope that these data and the new EU calculation methods used in this MER report are indeed reliable and trustworthy, even though I have my doubts. Nevertheless, during the last decades, there was always one constant factor in the economic, political and legal treatment of Schiphol Amsterdam Airport:

“Schiphol shall grow. Always and eternally. It does not matter how it grows, as long as it grows. When the existing norms for safety and noise pollution hamper growth, we will use new norms or new ways of measuring pollution. Whatever. It. Takes. 

When inhabitants of the region around Schiphol complain, they will be shut up with money, beads and mirrors. Or we will make them suffer in the court of law.

If business people and non-related companies have different plans for the building ground surrounding Schiphol, we will start expropriation procedures based upon safety constraints, pollution constraints or whatever we will come up with. The Dutch government will always be Schiphol’s henchman-of-last-resort, in case the sh*t hits the fan. Schiphol will win! Period!” 

Yet, the state secretary for Infrastructure & Environment, Sharon Dijksma, was not pleased with the conclusions of the MER Report presented by Schiphol, which she declared to be premature. But not for the reason that Schiphol’s conclusions about the environmental effects or the noise pollution were wrong or fouled. 

No, she was rather worried about premature conclusions by the Dutch people regarding that other “hobby project to release Schiphol from excess travellers”, Lelystad Airport.

Lelystad Airport, which is currently developed from being a local airport for private “hobby” planes into an international airport to be opened in 2019 and mainly focussed at the handling of holiday charter planes, is meant to be an overflow valve for Schiphol. 

By taking away the “cheapskate” charter flights from Schiphol towards Lelystad, Schiphol itself will get more room for the cherished growth of the lucrative and prestigious transit flights. So they think. And the Dutch government thinks this as well.

This was the reason that State Secretary Dijksma was not amused (the following thoughts of her are written by me): 

What if the world would think that the whole Lelystad Airport was not necessary after all?! Or even worse, that it would be a “dead on arrival”, waste of money project?! Hated by the charter companies (its future clients) and hated by the people in the surrounding, rural areas, who would now suffer from excess noise pollution and exhaust pollution in their nature-laden living space.

That would be bad news, wouldn't it...?!

Het Financieele Dagblad wrote this about it:

Sharon Dijksma reacted to the boasting of Schiphol about future growth possibillities in a parliamentary debate:”Why now? It is thoughtless to do this now! This paints a picture that Schiphol can grow eternally and that Lelystad is not necessary”. She suggested in the debate that the MER was not ready yet and lacked the cohesion with other topics.

State secretary Dijksma reacts here like a small child of which a favorite toy is taken away by its parents:

• Not a word by State Secretary Dijksma about the fact that the increased noise and air pollution of continued growth for Schiphol is bad for the people, living in North and South Holland. Or the people living in the take off and landing zone of Lelystad Airport, as a matter of fact.
• Not a word about the enhanced safety risks that Schiphol’s growth has to offer for the region and the airport itself. Or that Lelystad Airport poses.
• No, everything she states is about the risk that her hobby project “Lelystad Airport” would turn into a (financial) disaster. A monstrosity that nobody really likes, but that is built anyway [which it very well might be after all – EL]. 

This proves the eternal shortsightedness of the Dutch government, in case of Schiphol and its growth figures.

The fact that Schiphol has already some serious issues with the current influx of flights and passengers, is not incorporated in the overly optimistic growth plans for the following ten years. Nevertheless, the writing is already on the wall, according to Het FD:

Overloaded parkings, endless queues and dozens of passengers missing their flights. The start of the May holiday was chaotically at Schiphol. And it stays crowded: the coming months the airport expects about 100 peak days with 200,000 passengers each.

This snippet is symptomatic for the situation at Schiphol, where the passenger, security and safety infrastructure can’t keep up with the excessive ambitions of the management.

At this moment the airport is seemingly experiencing “peak load”, which makes it nearly impossible to reach further growth without taking some drastical countermeasures to reduce overcrowdedness.

And there is more: The Netherlands is one of the most densely crowded countries in the world and already has a vast airtraffic network. The addition of Lelystad Airport and the tens of thousands of flight movements this will cause eventually, is already a conundrum for the Air Traffic Control. 

Addition of roughly 20,000 extra flights per year on Schiphol itself, on top of that, will make this conundrum extremely hard to solve and will inevitably lead to enhanced safety risks and more ‘near misses’ in the air, not even to think about worse incidents with casualties.

That Schiphol and The Netherlands have only experienced a few flight disasters with more than 10 casualties (f.i. the Bijlmer disaster in 1992 or the Turkish Airlines accident in 2008) is probably rather a question of sheer luck than of strategic insights and appropriate counter measures.

Airplane accidents tend to follow statistics in the end. The higher the number of flight movements is, the higher is the risk for fatal accidents. And fatal accidents in densely populated areas carry more risk for elevated levels of casualties than in scarsely populated areas. There is no bargaining with such basic statistical rules.

Nevertheless, Schiphol is – together with Rotterdam World Port – targeted as mainport in The Netherlands by the Dutch government. 

That means that Schiphol is considered a strategic asset, with respect to labour supply, international political and business relations and economic growth. In the past, government officials have decided that Schiphol should be a pivot point for international air traffic (transit flights) and (as such) one of the largest and most importants airports in Europe.

That the competition with the airports of Dubai and Istanbul for transit flights is almost impossible to beat (due to vast state subsidies in their host countries) and that The Netherlands is probably not fit for hosting such a crowded airport, does not matter.

Schiphol is paramount for the Dutch economy – so they say – and its growth should not be hampered at all, or else… 

This is an almost religious belief among goverment officials, lobby groups and Schiphol itself. And Lelystad Airport, which will partially destroy a few of the most beautiful nature areas in The Netherlands with its strongly increased air and noise pollution, is part of this scheme.

Exactly this makes it nearly impossible to have a fair discussion about the pros and cons of such dense air traffic in The Netherlands, as it always falls on deaf ears with the government and the lobby groups. That is… until another catastrophic air accident with dozens of casualties occurs. Let us hope that does not happen.

Until such a dramatic event occurs in reality, it is time to reconsider the desirability of such heavy airtraffic in such a densely populated country, as someone has to do that and draw his conclusions. 

Schiphol’s interests are not synonymous to the interests of the Dutch population, even though Schiphol is trying to make us believe that.

But that person will probably not be part of the Dutch government. Slim chance… 

The diabolical dilemma of e-commerce: losing money on your business or losing your whole business

People who follow me more closely and visited my LinkedIn page in the recent past, know that I work for a large chain of supermarkets in The Netherlands. 

And of course this supermarket chain is involved in e-commerce (i.e. online sales of groceries). As a matter of fact, I work in the team that is responsible for maintaining and improving the omnichannel webshop, including the normal webshop, the mobile webshop and the web apps for Android and iPhone.

It is a safe conclusion to state that omnichannel e-commerce as a prominent sales channel is booming. My company presented double digit growth on its online channel sales last year and this year promises to be even better than last year.

So everything is cool, right?! Well, that depends...

E-commerce is more and more turning into an arms' race between competitors in the same line of business. It is not enough for a large online store to just have a stable and reliable webshop with a proper, state-of-the-art e-commerce CMS (i.e. Content Management System) behind it, that offers a nicely looking and smoothly operating frontend webshop.

The website should be established and maintained with usage of the latest trends and insights in neuro-marketing, SEO (i.e. Search Engine Optimization), customer-tracking and behaviourial prediction, as well as continuous performance improvement for an optimal shopping experience. On top of that it should be optimized for conversion, conversion and conversion alone, in order to make it pay itself back. Everything else is ballast and loses your store money.

Letting your customer wait for 1 minute on your website or app means angry or disappointed customers; letting them wait for 3 minutes means a new customer for one of your competitors. Customer gone = customer gone forever... or at least until the moment that all your competitors scr*w up themselves and you are back in business again!

And with respect to the shipping and delivery of the ordered goods and products to the home of the customer, it aren’t delivery days anymore, but delivery hours(!) nowadays.

Being too slow in any shape or form means that you can be out of business very soon, as your competitors never sleep and are always behind you to raise the knife against you and your online store: even if these competitors come from a totally different line of business (hence: Amazon and their innovations with respect to supermarket services).

And the biggest question regarding e-commerce is: does it earn you any money?! Where that seems a straight-forward and very simple question, the answer is quite complicated in fact!

Supermarkets and large department stores are wonders of efficiency and effectivity. 

Concepts like optimal store design and optimized shelf layout, just-in-time replenishment logistics, as well as cash registers connected to automated stock control and order services and enterprise resource planning tools (ERP) have been developed to an exceptionally high level of effectivity and efficiency in most modern supermarkets and store chains. 

The choices between A-brands versus house brands for various food and non-food products and the usage of direct mail / leaflets as effective marketing tools are thought over time and time again, making the supermarket as a ‘living organism’ extremely efficient, effective and customer-guided. Also in modern department stores, logistics and just-in-time stock replenishment is a path well-trodden and optimized to a T.

Everything in a modern supermarket and department store is set up to deliver an optimal shopping experience to the customer and welcome him back every time.

Yet, e-commerce – in any which way you do it – is a whole different ball game. 

The customer does not need to visit a supermarket or department store anymore in order to know what he wants to buy. He uses the website for that. Consequently he doesn’t come over to collect his groceries or purchased products, but leaves that for the supermarket or online store to do, as quickly and accurately as possible.

This means that either (wo)men or robots must do this collection job: men and women that need to be paid an hourly fee or robots that need to be programmed and operated at quite high operational expenses. A very efficient in-store shopper might collect 4 to 5 shopping carts per hour and a shopping robot in a “dark store” (i.e. a small warehouse or distribution centre acting as a specialized collection supermarket for robots) might collect 8 to 10 shopping carts per hour. This means that the hourly fee of the human shopper or the total operational costs per hour of the robot shopper must be divided among 5 to 10 shopping carts, meaning an additional cost of €2 - €3 per shopping cart.

And then is there the delivery of goods to the home of the customer, ideally within 2 – 3 hours after the electronic purchase. About the maximum amount that the customer will pay for this delivery to his home alone is roughly €5 - €6. Otherwise the delivery is becoming too expensive for the customer from a psychological point of view, forcing him to collect his groceries himself after working hours. 

Or...  the customer may order his groceries at the supermarket’s direct competitors when they charge lower delivery costs. There are also supermarkets and online stores that do this delivery for free occasionally or even structurally, when the customer exceeds a minimal shopping amount of f.i. €25. So being too expensive is not an option for an online store or supermarket.

Ideally a store courier for an online supermarket can deliver 8 to 10 shopping carts with groceries per hour in an average city or village, but 3 to 5 is probably no exception. This depends on the distance that needs to be driven between two customers. 

This means that for supermarkets the whole delivery process from store to home takes at least two staff members (groceries collector + courier) and one (shared) delivery van per shopping cart against hourly delivery fees of (at most) €60 per hour, but often much less.

Most online department and specialty stores can negotiate special contracts with large couriers like PostNL or DHL, but small online stores mostly pay the normally pending fees for packages and mail.

Needless to say that in most cases the charged delivery fee is hardly covering expenses for supermarkets and online stores. This means that already the delivery part of the e-commerce shopping transaction is eating away the margin of the supermarket on the purchased goods...

And to a certain degree, online supermarkets have it still relatively easy in comparison with online department or specialty stores for a simple reason: unless their customers discover a flaw in their delivered groceries – damaged goods or spoilt fruit, vegetables or meat – they wil never return their goods. This makes the issue of returned goods a relatively small risk for the online supermarket operator.

However, for online department stores or specialty shops (f.i. shoe and fashion stores), the issue of returned goods is a serious extra expense for the store management. The EU obliges the online store to pay the full shipping expenses for the customer in case of returned goods. Some customers abuse this obligation by sometimes ordering 3 pairs of shoes or 3 different dresses, only to keep the best fitting ones and subsequently return the non-fitting items to the store, at the expense of the storeowner.

This is the nightmare of every online store and it is nearly impossible to prevent themselves from such unwanted customer behaviour. The largest online stores might operate their own returned goods fleet in order to save a few bucks, but most stores toothgrindingly pay the mounting shipping expenses of PostNL or DHL. 

Consequently, such extra shipping expenses for returned goods are large margin eaters: especially for shoe and fashion stores, like Zalando, that suffer from loads of returned, non-fitting goods.

And then there is of course the issue of the e-commerce infrastructure itself: a good, efficient and well-maintained omnichannel e-commerce platform (i.e. suitable for all desktop and mobile devices) with a proven, high conversion rate costs somewhere north of € 3 – 5 million per year for a store or store chain with approximately  €100 - €200 million in online sales.

This amount includes scalable hardware or cloud services, software, web design, consultancy (Search Engine Optimization(!)) and dedicated personnel. 

This means that an additional 2% to 4% margin on the sold goods is eaten away by the e-commerce infrastructure alone. Not one year, but every year...

Nowhere the expression “stagnation is decline” is more true than in case of omnichannel e-commerce platforms:

If you neglect the response times of your web services and especially your customers’ forced waiting times – impatiently looking at sandglasses and spinning wheels on their monitor – you might be out of business without you even knowing what hit you in the first place. Customer loyalty in case of brick & mortar stores is a thousandfold of online shopping loyalty. One or two bad shopping experiences and your customers skip your online store for months, years or for eternity.

All this puts high pressure on your performance, your Search Engine Optimization (“if your SEO is not optimal, you simply won’t be found on Google”), your webshop design, your product presentation and shopping cart handling, as well as on your discount calculation and weekly promotions. 

And last, but not least, on the scalability of your online store, for the days of the year that are decisive for your annual success: Sinterklaas (i.e. Dutch children holiday), Thanksgiving (in the US), Christmas and Eastern.

Summarizing, there is so many that can go wrong with one’s e-commerce platform and the expenses of keeping it up to speed and on topic are so high, eating away a large share of one’s margin, that one could wonder why he should operate an e-commerce platform in the first place and not simply stick to the old-fashioned brick & mortar store.

To be frank, when one would look at the continuity, cost-efficiency and sheer profitability of omnichannel e-commerce alone, the crystal clear message would be: don’t do it! It costs you a whole lot of money every year and yet offers a lot of uncertainty regarding the continuity of your online shop and whole business.

But 1 + 1 isn’t always 2 in the commercial services and retail industry... 

Especially in case of (not) offering e-commerce possibilities to one’s customers, the answer to this question is not a question of black and white.

This is for the simple reason that offering an up-to-date e-commerce platform costs a lot of money per annum, but not offering an e-commerce platform could put a store chain or supermarket out of business, due to being obsolete, out of fashion and not in connection with its (future) customers anymore.

The number of people that goes to B&M stores is steadily declining and – to make things worse – real-life, offline shopping is turning into a generation thing: the older generation still mostly prefers visiting the B&M stores, while the younger generation prefers doing their total shopping online. So operating a B&M store alone and no omnichannel e-commerce platform, may get you stuck with an aging customer base and a bleak future in the end.

That is the diabolical dilemma of e-commerce today: losing money on your business or completely losing your business.

And this diabolical dilemma is not only the dilemma of small, online specialty stores (“mom & pop stores”) with a limited range of exclusive products, but also the dilemma of the largest online stores (Amazon, Zalando, Bol.com) and supermarket chains, like the one I am working for.

Especially the logistical issue (i.e. order collection and shipping) and cost-efficient e-commerce platform maintenance, in order to keep it up-to-date and customer-oriented, are almost impossible nuts to crack: for now and for the distant (?) future. There is no self-driving courier or robotized drone that will change this conundrum soon. And also no maintenance-free website that still features all your products and articles in a customer-friendly and topical way.

And that makes that the sheer profitability of e-commerce platforms and online stores will remain dubious in years to come. That is, until customers start to pay a fair price for collection and delivery of their ordered goods and stop returning so many of them.

But abolishing the online store is simply not an option, unless you only want to serve the elderly!

Ernst’s Economy present at the ‘For the Turnaround’ event, together with Paul van Liempt, Kim Putters, Harald Benink and Arend Jan Boekestijn

I am very blessed with the contacts that my personal blogsite ‘Ernst’s Economy for You’ (the one that you are reading now) has brought me in the six years of its existence. The advantage of getting to know new people, is that these people can bring you at places and events where other people don’t go, as they are unaware of them happening.

The distinguished Paul van Liempt, interviewer par excellence, TV-presenter at the Dutch business channel RTLZ and radio presenter at BNR News Radio is one of those people that added a little extra to my life.

The Freedom Lab where For the Turnaround was organized
Picture copyright of  Ernst Labruyère
Click to enlarge

Paul van Liempt, Interviewer par Excellence
Picture copyright of  Ernst Labruyère
Click to enlarge

Paul is someone, who does not only do his job in the meadi, but looks at his place in society and at the positive influence that he can have on other people.

Together with philosopher Ad Verbrugge, he started the initiative “Voor de Ommekeer” (i.e. ‘For the Turnaround’ ) as a discussion platform, aimed at the time after the crisis has been fully solved.

Philosopher Ad Verbrugge, co-founder of For the Turnaround
Picture copyright of  Ernst Labruyère
Click to enlarge

The people behind For the Turnaround [I use the English translation from now on – EL] are very aware of the fact that the world can’t just simply resume their ‘business as usual’ stance after the crisis and the depression coming out of it ended. 

Casual Discussions in and around The Freedom Lab
Picture copyright of  Ernst Labruyère
Click to enlarge

Casual Discussions in and around The Freedom Lab
Picture copyright of  Ernst Labruyère
Click to enlarge

Casual Discussions in and around The Freedom Lab
Picture copyright of  Ernst Labruyère
Click to enlarge

The leading countries in the world can’t act as if nothing happened at all during the last decade and the world did not come in the worst economic/financial crisis since eighty years. And in the grasp of mounting, violent nationalism, rising international tensions, the emergence of more powerful and ruthless dictators and erratic presidents all over the world and last, but not least, crumbling supranational organizations, like the European Union and the United Nations.

For the Turnaround therefore brings several thought leaders together for open discussions about the economy, the current societies and the international political and religious situation, hoping to find a way to make the world a better and more stable place after this all has ended.

Paul van Liempt invited me for this event, as he probably appreciates my original thinking and the fact that I dare to ask questions and give my opinions in the ongoing discussions. And Paul understands the fact that I try to change things for the better on my level and within my reach.

Among the guests of this event on Sunday May 21st, which was not televised and not recorded at all, were:

Kim Putters, Director of the Social-Cultural Planning Bureau
Picture copyright of  Ernst Labruyère
Click to enlarge

• Kim Putters, the distinguished director of the official Dutch ‘Social-Cultural Planning Bureau', which researches and publishes about the softer, less tangible, but nevertheless important sides (i.e. the social and cultural sides) of the Dutch society, next to the Central Planning Bureau (economic and financial outlook) and the Central Bureau of Statistics;

Arend Jan Boekestijn, a prominent member of the liberal-conservative of the VVD party

Picture copyright of  Ernst Labruyère
Click to enlarge

• Arend Jan Boekestijn, an eloquent and intelligent historian and former national VVD-politician (Dutch liberal-conservative party), with a much broader and more intelligent view on The Netherlands and the European Union than most of his party members;

Harald Benink, Professor in Banking and Finance in
discussion with Arend Jan Boekestijn,
Picture copyright of  Ernst Labruyère
Click to enlarge

• Harald Benink, a professor in Banking and Finance at the Tilburg University and someone as well with bright views on the Dutch and international economy.

Young rightwing, thought leader Sid Lukkassen, involved in the discussion at For the Turnaround
Picture copyright of  Ernst Labruyère
Click to enlarge

• Also another young thought leader was present: Sid Lukkassen, who replaced another guest who could not make it to the show. Sid Lukkassen is a right-wing thought leader and alderman for the VVD party in Duiven.

 

Paul van Liempt in discussion with Kim Putters
Picture copyright of  Ernst Labruyère
Click to enlarge

• Paul van Liempt and Ad Verbrugge acted both as discussion leaders and participants, even though the latter had some trouble with listening to his speaking partners, as he too often wanted to express his own opinions towards the other participants and the present public.

The original reason for this gathering of For the Turnaround was the strongly anticipated outcome of the French presidential elections. These elections were in advance considered as a touchstone for the real strength of the populist parties in Europe. 

When Marine Le Pen of Front National (French populist party) would have won these presidential elections and she would indeed effectuate her simmering plans for a French departure (i.e. Frexit) from the European Union, this could have become the beginning of the end for the EU and the Euro as a unity currency. France is one of the early founders of the European Economic Community and still one of the most influential and important members of the EU, whose departure from it would spell a dark future for the union. 

Fortunately, this did not happen as Emmanuel Macron of En Marche (a recently founded central-liberal movement), who is an avid supporter of the EU, won the elections and became the next president of France. Nevertheless, even though Macron won the second and decisive round with a landslide difference, it was a fact that Marine Le Pen was the runner up in these elections, making the Front National again a party to be reckoned with in France.

Therefore the main message that the people behind For the Turnaround wanted to express – now that the imminent danger of a Front National presidency was out of the way – was that this new, liberal president would not change much about the difficult political situation in France and the alienation between the different population groups in one of the largest countries in Europe. The symptoms perhaps vanished optically, but the disease was still very much there, waiting for another defining moment to come to the surface again.

France still has an issue with the often poor, poorly educated and unemployed people living in the banlieus in France – areas around the big cities with heavily populated blocks of flats, where many impoverished people from the former French colonies, like Algeria and Ivory Coast live. In these banlieus important factors like islamic radicalism, unemployment, poverty and hostile insurgence against the French government and the police cause many problems and turn the areas in ticking timebombs. 

Paul van Liempt in his trusted role as discussion leader
Picture copyright of  Ernst Labruyère
Click to enlarge

Violent protests coming out of nowhere, chaotic uprisings and publicly displayed contempt for the police have already emerged at quite a few occasions and they can come to a new outburst over and over again.

At the same time, there are the rural French areas which have their own battles with economic backwardedness, obsolescence and poverty. One of the factors, the outflow of youngsters to the large cities leaving only the elderly behind in their home towns and villages, leads to a smaller economic role in society for such towns and villages and towards an impoverishing area. It is probably caused by the absence of large employers, who can create sufficient jobs and a prosperous future for the people originally living in these areas. 

The idyllic, rural landscape and the small, picturesk villages with their French wine, baguettes and ‘joy de vivre’ might still attract loads of tourists, but they cannot disguise that such small areas go through difficult times, with a difficult future ahead.

Ad Verbrugge and the present crowd both listen to the discussions
Picture copyright of  Ernst Labruyère
Click to enlarge

Another complicating factor in France is the blatant allergy of the whole population for economic restructuring and societal changes and their ubiquitous proneness for protests and strikes against such changes. This makes it almost a political no go-area for politicians to endorse such radical, but probably necessary economic and social changes in the country, in order to prepare it for the 21st century. 

Most politicians simply don’t want to burn their fingers on such ‘hot potato’ topics and rather go with the flow of slow, slow change and even societal and political stand-still. And even when they try to change things more radically, their attempts mostly smother in the protests emerging all over the country. 

This is the reason that France has a undeniable history of shooting itself in the foot. The country wants the economic situation to change for the better, but seemingly doesn't understand that in order to change things, it must change society itself. Yet is seems that France must change economically and societally to stay in the race for future economic prosperity and not become a relic of backwardedness in Europe, totally dependent on agricultural produce and tourism, while Germany becomes the sole winner of the economic crisis and the undisputed export champion that keeps the whole EU afloat.

All these factors together make the French economic and societal problems urgent, but nevertheless very hard to solve. And in the process, the French problems turn into European problems as well, for the simple reason that Europe needs France's leadership more than it has ever needed the British leadership for instance.

One of the most visible problems after the deadly IS attacks in Nice and at the Bataclan concert hall, is the problem that the muslims in the banlieus become more and more radical and hostile in their vision on the islam, according to the people behind For the Turnaround. 

These muslims increasingly alienate themselves from the Christian majority in France, while releasing themselves for the toxic views of the radical Salafist islam. They slowly become endorsers of IS and Al Qaida, in their hate-driven battle against the Western world and everything for which it stands. Especially in France with its large and strongly growing population of formerly Algerian and Morrocan citizens, this is a mounting problem, which is nearly impossible to solve.

While the ‘moral majority’ of France now still chooses for French unity, ‘liberté, egalité et fraternité’( i.e. freedom, equality and brotherhood), it is a fact that this mounting alienation between the radical islamic minority and the Christian majority could lead to many more violent incidents and also for a greater popularity of the radical Front National, when another big terrorist attack occurs.

And when France sneezes, the European Union catches a cold.

The For the Turnaround group is watching the economic, societal and demographic situation in France closely and they are hoping that Emmanuel Macron, the bright and charismatic young president, can turn the tides for this country.

The events in France cannot be seen loose from the situation in the other European countries, like Germany and The Netherlands, where societal tensions are also rising between groups within the population. Or for instance Italy and Spain, where the economic situation is still extremely difficult, with high unemployment and a grim economic outlooki in some impoverished areas of the country.

Or Eastern Europe, where increasingly radical and dictatorial leaders set new and dangerous standards for societies within the EU. Everywhere the poisonous mixture of economic hardship, massive unemployment, a disappointed population losing trust in their own policital leaders and soaring religious and demographical tensions within the society, could act as a ticking timebomb within countries and in between countries.

Arend Jan Boekestijn and Paul van Liempt both closely listening to the discussions
Picture copyright of  Ernst Labruyère
Click to enlarge

Arend Jan Boekestijn, a very prominent VVD member and definitely part of the intellectual thought leaders within this liberal-conservative party, blamed the Dutch Prime Minister Mark Rutte (also VVD) for his generally lackluster defence of the EU and for his sensitivity for populist statements by other parties, like Geert Wilders’ Party for Freedom (PVV) and the Forum for Democracy of young gun Thierry Baudet. This vulnerability for the populist voice made the general tone of voice of his own party more and more populist itself, making it sometimes quite hard to distinguish, whether a point of view came from the populist PVV or the mostly more moderate VVD itself.

Therefore it is so important, according to the For the Turnaround group that politicians speak out their confidence and trust into the European Union and make clear that they will go all the way to save this supranational institution that brought us all so many years of peace, friendship and prosperity between European countries. 

It is time that the European leaders become openly proud and protective of what they have and not threaten to ditch it all in cheap attempts to listen to the loudest ‘vox populis’. 

It was an interesting meeting in Amsterdam on May 21st and it is a good initiative to have such open discussions between  the thought leaders in Dutch society. Ernst's Economy for You will probably present again the next time of For the Turnaround.

Does the Euro survive the ignorance and superficiality of the European populist politicians, but even more the moderate goverment leaders and politicians who increasingly follow in their footsteps?

Suddenly the odds for the survival of the European Union seem considerably higher in 2017 than during the catastrophic year 2016, in which the future for the European Union was very bleak indeed.

2016 was the year of the Syrian and African refugee crisis, in which the usual solidarity and good relations between the European countries came under fierce pressure. Many European countries, not lying in the front line of refugee arrivals like Spain, Greece and Italy do, refused to accept their fair share from the influx of refugees numbers. This left especially Italy and Greece in problems, as they were stuck with large numbers of desperate refugees, with nowhere to go and nowhere to hide.

It was also the year in which the authoritarian voices of Viktor Orbán (Prime Minister of Hungary) and Jarosław Kaczyński (leader Law and Justice Party of Poland) sounded more shrill than ever in their battle against the free press and other vital ingredients of a democratic structure. Already this behaviour led to steadily mounting animosity within the European Union

On top of that, 2016 was the year in which the Dutch referendum about the EU-Ukraine Association Agreement ended in a blatant loss for the pro-agreement government of Dutch PM Mark Rutte. This forced PM Rutte to kick the can down the road with respect to the Association Agreement and play a game of hide and seek with the people from the anti-agreement coalition.

These people demanded an immediate withdrawal from the whole agreement by The Netherlands – including the trade parts of it that were outside the scope of the Dutch government. This was a demand that PM Mark Rutte could never meet, without causing enormous commotion in Europe and everybody and their sister knew that.

And last, but not least, 2016 was the year of the British referendum about their membership of the European Union. A referendum, that had been dreaded and cursed in advance by most continental politicians and that left many British citizens and almost all European leaders in shock and awe, when the British population voted in majority in favour of a Brexit, thus making the British exit from the EU inevitable.

This referendum made an immediate end to the political career of British PM David Cameron – as I accurately predicted a few days before the referendum took place – and it showed that the Brexit camp did not even have the slighest hint of a plan, when they would indeed win the referendum. The ideological leader of the Brexit camp Nigel Farage (UKIP’s ) left the British ravage for others to clean up and PM Theresa May – who was in fact against the Brexit herself – was appointed as ‘volunteer’ to clean up the mess, which she did in a very decisive and even reckless way.

At these very moments it seemed that the European Union was ‘a dead man walking’. The union, of which the raison d’etre and usefulness had never been in doubt in the previous 50-odd years of its existence, came under heavy crossfire from the populist movements everywhere in Europe, as well as from the middle-of-the-road politicians. These moderate politicians closely followed in the populists' footsteps in order to not lose their own grassroots to them, leading to an ubiquitous movement in more populist directions.

Except from the influx of African and Middle-Eastern refugees for which nobody seemed to have compassion, solidarity and understanding anymore, the main targets of these relentless attacks against the European Union by both the right- and leftwing populists and the moderate rightwing politicians were the open borders (i.e. ‘Schengen’) and… the Euro.

The mantras of these politicians were: the borders must be closed again, to stop the dangerous influx of refugees, as this creates havoc in the open and rich societies of Europe.

And especially the euro was “the most dangerous and crazy experiment” in their views, as:

• It started without a proper financial, economic and monetary union, which all are necessary as a foundation for a sound financial system;
• There was generally a Europe of two speeds, with the “frugal, conscious and successful” countries in the North of Europe (according to politicians in a.o Germany and The Netherlands) and the “wasteful, inconsiderate and backwarded countries” in the South (according to the same politicians in these two countries);
  
• Countries like Greece and Italy should never have been allowed in the Eurozone in the first place, as they were financially and economically unstable and they ‘had lied about their financial and economic situation’ by rigging their national statistics and national, financial reporting;

Summarizing, at the end of 2016 things seemed very dire for the European Union, with populism on the rise – also among moderate politicians – and the EU under general crossfire from right- and leftwing politicians, for the alleged mistakes that it made in past and present.

And with general elections soon to be held in The Netherlands (Party for Freedom (PVV) – Geert Wilders), France (Front National – Marine le Pen) and Germany (AfD – Frauke Petri), it seemed that the situation could only turn more awkward for the EU.

But look now in the first half of 2017: even though Geert Wilders of PVV has gained five more seats in parliament, it wasn’t by far the landslide increase in seats that everybody thought he would gain, according to earlier polls.

And in France, the social-democrat candidate for the presidency Emmanuel Macron seems a trustworthy and undisputed opponent for the anti-EU stance of Marine Le Pen.

Instead of protests against the European Union and the Euro, there is a growing number of protests in favour of the EU and the Euro, as many people now consider what they have and how valuable it is.

On top of that, everybody can nowadays see the ‘ultralarge-scale sociological experiment’ that is the Brexit; everybody can see how the British government is struggling to bring it to a good end. And how clueless the victors of this referendum were, when they had won it.

Perhaps is 2017 indeed the year of the turning point in populism. As many people have seen that he European populists are masters in asking the right (or wrong) questions, but utterly fail in addressing these questions in a structural, legal and acceptable way. And populists are also extremely poor in binding a nation together in a way that everybody can have a decent life in peace and prosperity.

In order for populists to be successful, there must be groups available to suffer for them: the scapegoats, on which anything being wrong in society can be blamed. This blame game is only successful when everybody (i.e. nearly the total lower and middle classes) is suffering from difficult economic circumstances, which can be blamed on these groups under fire. 

Now that the economy is reluctantly, but steadily improving and joblessness is finally dropping, the feeding ground for populism is slowly disappearing. So perhaps, the worst in populism might indeed lie behind us. But that does not automatically apply to the Euro currency yet.

Due to the Eurozone’s inadequate strategy of kicking the can down the road with regards to especially Greece and Italy – temporary taking away the effects of the euro crisis without really solving the causes for the euro crisis itself – the confidence in the Euro, as the currency of choice for the European Union, is still at a low.

The debt level of Greece is nearly infinite until this day and the country is still in a very dire situation, without easy solutions. Instead of taking away the debt itself through a (partial) bail-out, the debt is rolled over to the future with yet again new loans, that will be as always very hard to pay back. In this way, the dire situation can last forever, as the tax collection in Greece, as well as the economic outlook for the country is still close to a disaster. And so the debt level of Greece remains a huge millstone for the future of the Eurozone and real solutions are still very hard to find.

And also Italy has still many rivers to cross before the country will be totally healthy, from a economic and financial point of view. In Italy there is always the difficult North-South situation with the rich and successful Northern provinces, against the poor and backwarded Southern provinces (‘according to many Italians, Africa starts directly under Rome’). On top of that there is the top-heavy political system and the still widespread corruption and extremely powerful organized crime that makes any change for the better very difficult in Italy.

Even though the economic situation in Spain and Portugal, and also in France, is slowly improving, the challenges ahead for the Euro as a unity currency are still enormous.

What does not help at such a moment is when the chairman of the Eurogroup, the rectilinear, ‘Calvinist’ swashbuckler Jeroen Dijsselbloem, states in an interview that the Southern European countries ‘have spent their emergency help money on "drinks and women" and now come begging for more’. This was not only a blatant lie, but leads to enormous anger in the Southern European countries, while diminishing the confidence in the Euro in the Northern European countries.

As this is the biggest danger for the Euro as a unity currency: the ignorance and superficiality (and sometimes sheer stupidity) of not only the populist politicians, but also the formerly moderate politicians, who all seem to do their best to weaken the position of the Euro, instead of reinforcing it.

It is not surprising that every now and then the same story comes around again that ‘Greece and Italy should be kicked out of the Eurozone’. This story is especially popular among more moderate politicians, as the populist politicians state that they and their countries want to leave the Eurozone themselves and return to their classic currencies.

The former, as well as the latter isn’t going to happen… at all! Forget it! Don’t even think about it!

The operation to reintroduce the old currencies in (some of) the Eurozone countries is the same, extremely expensive operation as the introduction of the euro between 1995 and 2002. And it will be equally difficult. 

One could think about all kinds of ‘paper drachmes’ and ‘paper lires’ for Greece and Italy, but the bottomline is that countries leaving the Eurozone would lead to economic havoc and ubiquitous uncertainty everywhere in Europe, with the extremely entangled financial and economic system that we have nowadays. 

There is absolutely no way to prevent that from happening!

We – the united people of Europe, represented by our own elected politicians and representatives – chose to introduce the Euro. Whether we like it or not, the Euro is here to stay and will never go away anymore, unless an economic cataclysm happens, like a war or a widespread and long depression in Europe.

You might ask: "Is the euro flawed?!" Yes, it undoubtedly is!

"Should the euro perhaps have started under different conditions?!" Perhaps, yes!

"But is there a better alternative available?!" No, there is not, in my humble opinion!

Every politician in Europe should accept that the Euro is here to stay and that replacing it for another currency is a nearly impossible challenge and - on top of that - a very dangerous one, from a political and economical point of view.

What politicians should do in order to save the Euro, is just stopping with weakening its position to begin with and instead looking for ways to improve it in its current, flawed, but yet unchangeable form. 

Just like the partners in an average marriage, the Euro is far from perfect, but just like the same partners, the Eurozone countries should try to make the best of it. That is what the European leaders should also try to do: make the best of it and lead it through the current, difficult crisis; hopefully towards a better and more prosperous future. That is in the interest of every European!

And of course the politicians should try to reinforce its foundations, by slowly, but surely working towards the monetary, financial and economic union as the best way to make the euro a more balanced currency. 

However, at this moment it will still be very hard to achieve that, under the still quite anti-EU stance of large groups in European society. Nevertheless, the leading politicians should hold on to this paramount strategy, as the best warranty for a more successful future. 

Like Bryan Ferry of Roxy Music sang in the Seventies: “Let’s stick together!”