The Banana Republic of France
By Ender Posted in User Blogs — Comments (10) / Email this page » / Leave a comment »
I've been watching the latest events from France with increasing amusement and disbelief. Amusement because I have no particular love for France and derive at least some enjoyment from watching their economic policies catching up to them. Disbelief stems from seeing these events occurring in a supposedly 1st world, developed and civilized country.What has prompted the latest disturbances? France has been facing staggering unemployment, particularly felt among their youth - around 10% in the general population and 20-25% among the 15-25 age demographic. The new approach is to try to get employers to hire younger workers. Before the new law, it was very hard to fire anyone in France's labor market. Naturally many businesses are loathe to hire untested and unexperienced young workers without the ability to fire them if they do not work out. The risks were simply too great. The new law makes it possible to fire new workers under 26 in the first 2 years without cause.
While the law does not address many other severe problems of the incredible Welfare state of France and the ever increasing taxes already standing at 50% or higher, it would on it's face only benefit the younger workers, or at least those who are productive. It would make an average employer much less of a tied down victim and much more likely to bet on the youth. Of course the flip side of that is that those who are a waste now or in the future would be fired much quicker and without red tape.
French lazy and useless are up in arms. Apparently they are much more brazen in that country than we can imagine here in the States. They want to be able to stay at their jobs without any repercussions for their performance. And what is their preferred method for protesting this percieved injustice? Rioting and crippling strikes across the nation.
Now a rational country's leadership would understand the severe crisis that is facing them and would try to rectify it regardless of the public cost and the screams of the impotent trash. For a country so far gone, as the French seem to be, I predict full capitulation and withdrawal of this new law in short order.
These are the consequences of a much greater integration of socialism than in US. We are heading in that direction, but still have a while to go. What we are seeing is the continuing process of disintegration of an uncivilized country that has no serious regard for the virtues of work, production and personal responsibility. It is the inevitable consequence and without serious cultural sea change will not be reversed by the half baked attempts that this new law represents.
I've been following the France and GM stories and I am being inexorably drawn to an unpleasant conclusion: Union forces are dedicated to the collapse of capitalism and anything reinforcing capitalist doctrine.
The French protesters back this up by simply supporting the socialist status quo: denying employers the ability to adjust their labor pool in reaction to market realities. The UAW is simply hamstringing GM/Delphi with benefits packages that are unsustainable in the current economic environment. The obvious question is: why would the French protest a law that, on its face, would improve an abysmal employment situation and why would the UAW pursue a line of attack that could leave all of their workers unemployed (if, heavens forfend, GM goes under)?
I can only see two explanations for this: Either the protesters do not believe France or Delphi when they explain the dire straits they are in or they simply don't care. They'd rather see centrally-planned economies with no direction from people within the company. I think it's time to call a spade a spade and say that an anti-capitalist sentiment is driving these protests.
that the majorities of people in certain European countries reject Capitalism. France is one of those countries. The french have slowly been acclimated to the easy life of less work and more comfort. Note that the french work some of the lowest amount of hours per year in the world.
What that conditioning also taught them is that they can expect continued support from the government regardless of what they do in life. The right to welfare is absolute and the right to not be fired from whatever cushy job is almost as absolute. Central planning, already well implemented through government control of the labor market, is expected and expected to grow to insure further stability of everyone's station in life.
Anytime any of those absolutes are threatened. The right to stability, welfare, cheese and wine, french language, etc - the people are forced out of their stupor by their socialist masters to protect their livelihood. The situation in France is possible because the unproductive (even those with jobs) outnumber those who drive their pathetic economy.
Examples of what happens when a State company is privatized (as recently happened) only serve to show that capitalism fails and it's better to leave and further transfer the means of production to Father Government. When in reality it was not capitalism that failed but the fraudulent government simply put lipstick on a sacrificial pig without truly transferring control to private hands. They sure did reinforce the propaganda that capitalism does not work.
Other threats, like foreign competition and free trade, are dealt in the same fraudulent manner. France is going the way that Ayn Rand predicted in Atlas Shrugged to the eventual transition to a People's State. Can't say they don't deserve it.
Employees as their enemies. Perhaps even more so than in the past. We are spared the wider problems of European nations in that our Unions are not as well spread and have actually gradually faded from most of the major labor sectors. Our labor laws are also not as intensively focused on infringing on employees and businessmens rights when it comes to determining their workforce. At least not to the same degree as in France.
It might be that the union in the Delphi case is more interested in demonstrating their power, as a warning to other American business. Sacrificial perhaps, but the Unions are brainstorming like crazy to try to stem their decline.
and hence a union member by necessity I can only hope the influence of the unions continues to decline. Especially the strangle hold they have on our public schools. If it were up to me, public employee unions would be disenfranchised.
...in any true sense of the word.
The state/government is no longer the sole sovereign force between France's borders. In fact, I don't think the state has any sovereign force anymore.
As goes France, so goes the rest of Europe in the next 2-3 decades...
with one catch: there's not enough work.
Forget about the elected leaders in the Elysee Palace and the Assemblee Nationale. Whether they are de droite (right) or de gauche (left), they will bow to the sovereign will of the labor unions, who can throw the country into chaos at the slightest provocation, and bring the government to its knees.
This is nothing new--it has been that way since at least 1981, when Francois Mitterrand was elected President, and possibly earlier. I lived there from 1985 through 1995, and I saw it first-hand.
A lot of what we see now had its roots in 1968...the "it is forbidden to forbid" crowd. De Gaulle had the guts to stand up to it, but he died two years later. Nobody since him has had the courage.
Nicolas Sarkozy looks promising, but can he be elected, and does he have the courage?
With the State Company "going private"? I hadn't heard of anything along these lines...
My friend told me the story about the French company, which might be Gaz de France - utility company. I sent him an email asking about the specifics of that case.
I just got from my friend on the subject, he is speaking about his professor from one of his MBA classes:
"He (professor) used as example GDF (Gaz de France), which is the gas compay in France,
that have been privatized in last couple years. Company had enormous IPOs,
but unlike US, where workers typically celebarate a chance to improve
earnings and make $ of stock, French workers and management that was in
place when company went public were the government bureaucrauts and union
employees who actually protested on the street and threatened walkouts to
idea of privatization because they would be required to actually do some
work.
At the end, the company went public, but the investors mostly got screwed
because employees and management were performing at level of givernment
owned company. Operations was underperforming some competitors by up to 75%
in worker productivity.
To make a long story short, the privatization reforms were lead by Chirac,
but the French Socialist Party is promising that if it comes to power in
2007, it will renationalize most of big French companies (meaning buy back
their stock from private investors). The punchline was that this will be
great news for stock-holders, since the only people who are dumb enough to
buy the stock now is the government.
Now, I do have to give them some credit, company had their stock (GAZ.PA)
bounce back in the last month or so. But that was after it tanked at IPO
(to compare - consider that most IPOs rise 26% on average in first week of
trading). The moral of the story remains the same, if you deal with
government owned companies and unions, do not expect major changes just by
changing company owners.
More, recently, in an even bigger privatization floatation, French electric
company, EDF (Electricite De France), went public. Again IPO was huge and
stock performed well so far, but the same problems were observed:
http://www.bloomberg.com/apps/news?pid=10000085&sid=auusAl3nEWWw&re
fer=europe
"

The new law does nothing more than establish a period of probation for those under 26. The lazy guy will eventually reach 26, but will be tagged with a poor working record. It seems that the proper response would be to gear up and work like heck for a few years and get a good reputation. Then you can be lazy if you wish. This is something most workers in the US must put up with every time they change jobs. And it is something the average worker understands. You have to work, and achieve at least as well as the permanent staff, (maybe even a little more). A good work ethic is healthy for a country.
But in union jobs in the US one can clearly see the emphasis is on not doing the employers any favors. (I well remember when I was pulled from a fork lift because they thought I was deliberately working through a break. - The truth is I did not hear the whistle.) The sad crisis being played out at GM could well be happening in France, and with this example from across the seas, the GM employees seem to be aware. Here is a recent news item from the front line in the GM - Delphi - bankruptcy negotiation:
The UAW represents 70% of Delphi's hourly workers, or about 24,000 people.
Delphi is trying to cut costs as it reorganizes in Chapter 11. In court documents filed last week, Delphi claimed its labor costs are three times that of its close competitors in the U.S. The supplier estimates billions of dollars in annual savings could be realized via union concessions on wages and benefits.
It remains to be seen if the union will allow a deal, even in the face of bankruptcy and the job losses that will occur.