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Article Deconstruction (vol. 5) - French fear

by Jerome a Paris Fri Mar 24th, 2006 at 07:21:03 AM EST

Philip Stephens, one of the smartest editorialists of the FT, but also the clear standard bearer of the establishment in power in London, weighs in on the protests in France. He is much less caricatural than the other commentators on France, but he still relays a number of misconceptions that I'd like to debunk.

Follow me below the fold.


Philip Stephens: France must change or live in fear

France is a nation afraid. As students and trade unionists take to the streets in defence of the past, the elites look on with a weary fatalism. What you must understand, I heard a member of Dominique de Villepin’s government lament the other day, is that people “are fearful of everything”.

I thought it strange that a minister would speak in those terms about his own country, even though the comments were not for attribution. Here was a seeming admission of the failure of political leadership alongside a transparently lame explanation for the government’s retreat into protectionism. But France has been that sort of place since the voters’ rejection last year of the European constitutional treaty. Talk to the alumni of the nation’s grandes écoles and one has a sense of a collective nervous breakdown.

He is right about that diagnosis. Fear. Failure of political leadership. Lame excuse for retreat into populism (I don't buy that "protectionism" meme and will not validate it either).

Where we will differ is on the causes of that situation.

Divisions between insiders and outsiders are growing wider. They were visible at the extreme during last autumn’s violent rioting by young, jobless immigrants in the banlieus. [sic - can't they get people that actually speak French to check what they write when they use a French word? That's so sloppy and unprofessional. Sigh. JaP] But there are other ruptures. One lies between the postwar baby boomers who grew prosperous in security and a new generation of young people taking to the streets to demand the same protection. Another is found between those cosseted in the service of the state and those employed in businesses exposed to the harsh forces of global competition.

Again, true, and a point I have flagged myself a while ago. France did make the choice 30 years ago, when unemployment first struck, to protect those in the work market and have flexibility borne by a small subset of the population: the old, the young and the immigrants. It has been trying to reverse course ever since, but the behaviors incentivised then (in particular, the preference by companies to invest in machines rather than hire people, while asking for more deductions on labors taxes and yet more freedom to fire people) have remained. The very real flexibility in the labor market thus leads only to precarity for those who bear that flexibility, without the concomitant easiness to be hired (other than in unstable, short term positions) that should go along.

The demonstrations against Mr de Villepin’s planned reform of French labour law have not yet marked a descent into anarchy. The tradition of violent protest is part of France’s genetic code. The television pictures have exaggerated the chaos.

Yes, again, correct.

Each time I visit, I am reminded of France’s contradictions. For a nation in decline it seems remarkably prosperous. What struck me most about Paris last week was the fur-coated tranquillity of the middle classes strolling on the city’s right bank even as the demonstrators gathered on the other side of the Seine. For all the talk of economic collapse, French companies still compete with remarkable success in global markets. This week Gordon Brown, Britain’s chancellor of the exchequer, boasted of the economic liberalism that has seen Britain leapfrog some of its rivals in the international productivity league. But it still lags behind statist France.

All true, and in need of being said.

Mr de Villepin’s proposals seem distinctly modest. He wants to introduce a flexible labour contract for those under 26. The aim is to reduce youth unemployment levels of 20 per cent and more. If employers are allowed to change their mind during a two-year probation period they are more likely to take on more workers. The government has already introduced a similar measure to encourage small companies to recruit. And it seems to be working.

I'll take an exception to that last sentence. A first study estimating the impact of the CNE, the existing measure for small companies, shows that net job creations appear to be minimal.

The new law, though, has become emblematic. The gathering storm on the streets speaks to a deepening aversion to change at the very moment it is becoming impossible to resist. It testifies also to a legacy of inertia. The political classes are as much to blame as the unions. One énarque – a graduate of the elite Ecole National D’Administration – told me only once in the past 25 years had a French political leader fought resolutely for economic and social reform.

That was Alain Juppé, Jacques Chirac’s prime minister in the mid-1990s. Mr Juppé’s attempt to overhaul France’s social security system ended in enforced retreat followed by electoral defeat. My interlocutor recalled that Mr de Villepin, at the time a senior adviser to President Chirac, had been almost alone in backing Mr Juppé. Perhaps that explains the prime minister’s resolve in recent weeks.

Here, we start getting slowly into ideological territory. The casual assertion that change is "becoming impossible to resist" enters the long list of unsubstantiated pronouncements on the need for "reform". This is reinforced by the notion that the only kind of reform is the liberalisation kind (that pursued by Villepin or, before him, Juppé).

Why gloss over so casually over Jospin's track record? He also set to reform the labor markets, and by all objective criteria, he succeeded. France created 2 million jobs in 5 years, unemployment went down from 12.5% to 8.5% in 4 years.

It's much too easy to say that he took advantage of world growth. The world is experiencing similar growth today, and that's obviously not enough. Why, again, is that period ignored? Because it was not "reform"? It worked!

France’s problems are not unique. The causes of its discontent are apparent across Europe. The accelerating erosion of state power by globalisation – never really admitted by the continent’s political leaders – has sparked nationalist reactions elsewhere.

State power is eroding because current leaders choose not to exercise it, for ideological reasons. Again, it's a choice, not an inevitable trend.

The Netherlands joined France in rejecting the constitutional treaty. Germany remains strongly resistant to changes in its social market model. Spain, Poland and Italy are among others dressing up protectionism as patriotism.

Who's missing in that list? One country that has no problems?

I sense a dawning realisation among Europe’s young people that they will not enjoy the assured prosperity and security of their parents. Yet, if the young are expected to eschew jobs for life, they must pay for the generous pension entitlements their parents have granted to themselves. There is something wrong with that bargain.

Yes, that generational conflict has yet to be resolved.

As ever in France, you can find another bundle of contradictions. Some of the young people who have failed to find work at home are prospering in the more flexible labour markets of London and New York. They exult in the precarious opportunities of Anglo-Saxon capitalism. But they are appalled at the idea that the same practices might be applied at home.

Let's please debunk the meme that jobs are going from France to London. As I have posted previously, France, like Germany, but unlike the UK, has a net brain gain

But of course, bankers are the poster boys of our globalised world, and it is true that these jobs are heavily concentrated in London. But there is more to our economies than finance!! (I should know)

France is a victim of its exceptionalism. More than anywhere else in Europe, the nation’s identity, its sense of itself, is invested in the authority of the state. A weakening of the state threatens the very fabric of the nation. The outcome of the referendum on the constitutional treaty testified to a crisis of confidence. If it could no longer set the direction of Europe, why should France continue to back the project? Globalisation makes it harder still to remain at once different and relevant.

Again, the French State has given up its authority, because French elites have been lured by the money promised to them, as part of the elites, in the globalised financial world. They've tried to keep the power and legitimacy the French State gave them, and grab the money they "deserve" as elites (on the back of the people) - and then they act surprised that the people, that used to have less power but a better access to wealth in France, are unhappy about that obvous breach in the French social contract?

Where all this now leads is less certain. Yesterday, perhaps under pressure from Mr Chirac, Mr de Villepin seemed to yield some ground. In any event, the consensus of the political establishment seems to be that, win or lose on this particular issue, Mr de Villepin’s presidential hopes have been irreparably damaged.

Nicolas Sarkozy, his rival for the candidacy of the right in next year’s election, likes to present himself as moderniser. But he is also an opportunist. On the employment contract he has presented himself as at once for and against Mr de Villepin. Some of the smart betting in Paris has now shifted to Ségolène Royal, at present bidding for the Socialist nomination. She could well take the crown in next year’s presidential poll. Yet her party is in disarray and few have a sense of how Ms Royal would govern.

Ségolène is no liberaliser, so it's interesting to see her endorsed like this. Maybe Stephens believes the hype about her "approval or Blairism" (in fact, she said that he was unfairly demonised as he spent a lot more money than is usually acknowledged on public services, hardly a ringing endorsement of globalisation)

I heard no one in Paris say it is possible or desirable to turn back the economic tide.

Hear me, Mr Stephens!

The protectionism practised by the French government in its effort to close the door to globalisation is as futile as that of those on the streets.

Why tar this otherwise fine article with this - again - unsubstantiated statement?

The students have a point. The burden of insecurity is being unfairly distributed – as between those in work and those in the jobless queues, and as between the generations. But it is too late to reclaim the past.

That remains true. But the solution is not where he sees them. What is needed is a more confident, but more modest elite, to rebuild the old social compact that worked, and that will be still necessary at a time when an energy crisis looms (and the foresight of the French State in that sector will be thanked by all) and economic turbulences are very likely.

Now's not the time to give up.

Earlier deconstruction and CPE stories:

Language deconstruction of the day (vol. 1) (Ghost of August 1914 spooks EU)
Article Deconstruction (vol. 2) - EU energy regulator
Debunking the EU official line
Contrat Première Embûche
Article Deconstruction (vol. 3) - Student protests per IHT
Article deconstruction (vol. 4): French farce
It's the same fight
Triple Play (US articles on French protests)
IHT sees the light on French student protests
French employment and unemployment

Display:
I'll take an exception to that last sentence. A first study estimating the impact of the CNE, the existing measure for small companies, shows that net job creations appear to be minimal.

--

360 000 CNE contracts have been signed in 6 months, and 120 000 of these are new job creations (according to Villepin himself!). Now at first glance, this may mean 0.2/3% less unemployment (120 000 jobs) ... but it also means 0.4/6% of the active population shifting from better contracts towards a CNE.

And I am inclined to believe that job creations during the first 6 months correspond either to companies that all this time have been eager to recruit, and who thus won't recruit as much during the next 6 months, or to new jobs due to new company creations (ie some small companies die and appear all the time, if at each new appearance we cound a "new job creation" ... it's easier to obtain such figures). Basically I don't believe that it's going to create a lot of new jobs, it'll only reduce the number of people with better contracts.

by Alex in Toulouse on Fri Mar 24th, 2006 at 08:05:25 AM EST
Strauss Kahn said, that in the sector where the CNE is applied, 30 000 jobs were created in the first semester, when the CNE was not operating, and 30 000 in the second semester. I have no clue where he got these numbers from  , though.

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine
by UnEstranAvecVueSurMer (holopherne ahem gmail) on Fri Mar 24th, 2006 at 08:22:02 AM EST
[ Parent ]
From an article in Le Monde today:

Prudent, l'Insee juge que l'effet du CNE sur l'emploi est "difficile" à mesurer. Elle estime cependant qu'il devrait permettre, "selon une hypothèse raisonnable", la création nette de "10 000 à 20 000 emplois par trimestre"...

INSEE (national statistics) prudently considers that the effect of the CNE on employment is "difficult" to measure. It estimates however that it should lead, "in a reasonable hypothesis," to the net creation of "10,000 to 20,000 jobs per quarter"...

Thierry Breton (Finance Minister) claims the CNE has already created 400,000 jobs that "don't show up yet in the statistics". Obviously the government wants to claim as many jobs as possible for its own measures, when in fact the context is one of cyclical rise which is creating jobs.

As to whether the CNE is a success, I reported on another thread, from anecdotal evidence, that small employers were hesitating to use it because it carries fairly heavy severance obligations (compared to a straightforward indefinite contract).

by afew (afew(a in a circle)eurotrib_dot_com) on Fri Mar 24th, 2006 at 10:28:20 AM EST
[ Parent ]
Let's please debunk the meme that jobs are going from France to London.
There are lots of French servers in London restaurants and bars, but we wouldn't call that brain drain, now weould we?

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 08:11:41 AM EST
actually, servers might have PhD's in literature and can't find jobs.  So, maybe it is a brain drain.

I, for one, know lots of very educated people doing manual labour.  

by manon (m@gmail.com) on Fri Mar 24th, 2006 at 09:00:18 AM EST
[ Parent ]
Well, yes, the infamous "polish plumbers" are not plumbers at all. They're usually more qualified in some other way and completely unqualified as plumbers.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 09:14:22 AM EST
[ Parent ]
actually, plumbers require a few years of education before being certified.  
by manon (m@gmail.com) on Fri Mar 24th, 2006 at 09:30:47 AM EST
[ Parent ]
I know, that's my point.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 09:34:08 AM EST
[ Parent ]
?????????????
by manon (m@gmail.com) on Fri Mar 24th, 2006 at 10:27:58 AM EST
[ Parent ]
Yes, when the british press talks about the invasion of the "Polish plumbers", it's not really plumbers we're talking about. It's people who are handy and think they can make a money in the UK by posing as plumbers for a few weeks.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 10:32:10 AM EST
[ Parent ]
I do agree to your conclusions, and most importantly, to the use of the expression social contract to talk about the current state of affairs.

I recently attended a conference by Louis Chauvel, a french sociologist mainly working on classes in france, along socio-economical lines as well as generation lines.

He made the quite obvious remark that those in power now are those who ingrained the contradiction of Mai 68 into french society, that these people know nothing about the Low Cost Generation that in turns knows nothing of continued growth. His conclusion, then, was that we could really see what was going on right now as the consequence of a generational conflict, in which the clear loosers are the young. They have less purchase power, less capacity to get property [a year of average salary could buy 9m2 in Paris in 1970. Today, it can buy 4; numbers' his].

However, he warns against a sort of new Mai 68 that would simply move the burden away from the young and not actually solve the true problem, being generational conflict.

It is here that he introduces the notion of a renewed social contract in which, to put it simply, the old soixant'huitard would start to understand what was going to on and start caring, and the young would not fall in the same trap as their parents [jeopardizing other people's future]. Basically, he presupposes the solution for the resolving of the problem.

All I try to say, then, is that it is crazy to expect a sort of symetrical discovery of the solution to the problems of the young. It is much realist to hope that the Elite will become a bit more modest and forget their personal upbringings and sense of class belongings, which would enable them to listen more. Thus, i totaly agree with your last paragraph.

Btw, i don't think I have missed a single piece you wrote in the last three months.

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine

by UnEstranAvecVueSurMer (holopherne ahem gmail) on Fri Mar 24th, 2006 at 08:19:02 AM EST
He made the quite obvious remark that those in power now are those who ingrained the contradiction of  Mai 68 into french society, that these people know nothing about the Low Cost Generation that in turns knows nothing of continued growth. His conclusion, then, was that we could really see what was going on right now as the consequence of a generational conflict, in which the clear loosers are the young. They have less purchase power, less capacity to get property [a year of average salary could buy 9m2 in Paris in 1970. Today, it can buy 4; numbers' his].

However, he warns against a sort of new Mai 68 that would simply move the burden away from the young and not actually solve the true problem, being generational conflict.

I wouldn't call that a generational conflict. I would call that a conflict between the gospel of continued economic growth and the reality of reaching the limits of growth. The younger generation knows about this, but the older generation is in denial, a denial that goes back to 1972.

Half a lifetime away, as a teenager, I started confronting my parents about the fact that the worldview that they ('68 generation as well, but in Spain) and society generally was trying to pass on to my generation (including expectations about life, career, and so on) was completely in contradiction with what I could already see looming. It's not a generational conflict, it's a reality check. But, as some prominent scientist (or philosopher of science) said once, the way new (presumably better) theories about the world are accepted is that the old scientists die off, not that they change their mind.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 08:27:07 AM EST
[ Parent ]
However much I would agree with the 'reality check' that you talk about, I think that there a distinction to be made between a generation that has a common experience and a generation that has the same opinion about this experience, that has the capacity to be united by a political party, etc. I have not seen yet any proofs of a widespread prise de conscience about the greater picture. Thus, most people see themselves as fighting a political order that just harms them, not a political system that is crooked in itself.

Louis Chauvel, as you have guessed, it for the CPE under the fallacious pretense that, if it doesn't pass, trying to help the youth will be considered too dangerous by politicians and that therefore the real problems won't be solved until 2016, or in his own words, 'maybe even in 2026'. He basically makes the bet that if the CPE passes, the right will be there to implement the other reforms we desperately need.

Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine

by UnEstranAvecVueSurMer (holopherne ahem gmail) on Fri Mar 24th, 2006 at 08:42:35 AM EST
[ Parent ]
Oh, there is clearly no prise de conscience, we're at best in a state of collective cognitive dissonance. The consequences of truly being at the limits of growth are too scary to consider.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 08:54:17 AM EST
[ Parent ]
Now you are really scaring me Migeru. Are you my doppelganger? My entire life has been dominated by my gut understanding that the conditions of life have changed compared to those assumed by previous generations.
by Metatone (metatone [a|t] gmail (dot) com) on Fri Mar 24th, 2006 at 09:57:11 AM EST
[ Parent ]
It's a generational thing.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 10:11:35 AM EST
[ Parent ]
a deepening aversion to change at the very moment it is becoming impossible to resist

This is the article's keystone. Pull it out and the rest crumbles.

When will we see some substantiation for this claim?

  1. Aversion to change? No, Mr Stephens, people are not averse to change. They are averse to getting a worse and worse deal and being told that they'd better get used to the idea that there's more of that coming. While the rich get richer.

  2. At the very moment? It's been a quarter of a century we've been hearing we have to accept tough "reforms"; and fifteen years that globalisation is an inevitable tide.

  3. Impossible to resist? We'll see about that.
by afew (afew(a in a circle)eurotrib_dot_com) on Fri Mar 24th, 2006 at 09:13:51 AM EST
One can translate this as

"a deepening aversion to being stiffed at a time when companies are increasingly successful at convincing politicians and pundits that it's a good thing to stiff workers"

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Fri Mar 24th, 2006 at 09:19:44 AM EST
[ Parent ]
At the bottom of all this is the threat of a capital flight away from the western economies. How realistic is the threat, I don't know. Our governments have been fighting people who get residency in tax havens for a long time. Now it seems they're going to have to start fighting the "national champions'" desire to do the same.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Mar 24th, 2006 at 09:25:21 AM EST
[ Parent ]
How realistic is the threat, I don't know.


Quite real as long sovereign entities continue to debase themselves by considering private entities as their equals or their superiors.
by Francois in Paris on Fri Mar 24th, 2006 at 02:05:52 PM EST
[ Parent ]
Who is Stephen Philips, what are his credentials?

How does he come to profess that "the" French are (like "the" Germans, too?) paralyzed by a sense of fear? Is he a scholar of American romantic literature of the first decades of the 18 hundreds?

Does he try to apply Edgar Alan Poe's definition of terror, the Angst of the unknown, and does he declare it to be the status quo of the collective psyche of the continental EU Member States' populations?

And if he does so: has he understood Edgar Alan Poe's writings correctly? Does he at all understand Poe's dynamic principle of interpretative imagination, the clear voyant - even lunatic (that is a person's capability to also see in the dark {Poe's recurrent black cat motive})- anticipation of the shaping of possible future events, which are triggered by the ONSLAUGHT of horror? Or is he not failing instead to perceive this intrinsic dynamic dimension and therefore falsely interpreting the French public's state of mind as a mental paralyses, a stand still?

Let me be clear.

Steve Philips doesn't understand shit. Not only does he not understand a person's power of imagination to overcome a situation of horror, far less still has he ever personally experienced the mental and bodily joy which flows from collectively imagening ways out of a situation of terror. He lacks the soul invigorating knowledge which stems from the willful, energetic action to collectively combat and to jointly OVERCOME the paralysing onslaught of terror.

Why is that so?

Well, there IS a reason why Steve Philips is blind to see what is going on in France. First of all it has to do with his socialisation, or better: his "isolisation". Steve went to an elite university and enjoyed (si fa' per dire!) an extremely sheltered social life on an isolated campus. He was also set apart from his fellow country (wo)men due to the financial privileges which allowed him to study there. Steve has not shared the life forming exposure of French, German, Italian, Spanish, Dutch, Belgian etc. students of his generation who went to universities which are situated RIGHT IN THE MIDDLE of big cities and who don't come of age in the atmosphere of the ego - cuddling Weltfremdheit of a segregated ghetto campus. Europe's student population is not segregated by elite universities. As a matter of fact there are no "elite" universities (with the exception of England).

See, Steve? For years you were succesfully and systematically "isolisated", you are definitely "elite" now.

European students on the other hand are not. Which is actually of great importance and has beneficial consequences when it comes to understanding ones own position in this world of terror (remember: Everything changed after 9/11.?)

And here is my central point for you, Steve. You are overwhelmed by what you see and what surrounds you. You are alone and you interprete the world in a bi-polar, static way. A world in the grip of terror. And you feel your personal weakness in the face of it. So you resort to the "invisible" powers, or more precisly to the "invisible hand" to rescue you. The "invisible power" of what? Yes, you got it, of the free markets!

See? That was easy!

You trust in and let it over to the unleashed, invisible economic forces to free you from fear. You are on the save side anyway, aren't you? But wait. Don't you have to offer something to your fellow country (wo)men and maybe the Europeans too? What is it Steve? Tell me. Oh yes, how could I forget President Bushes bullhorn speech on the rubble heeps of the WTC ? He had a clear message to all of us who are not elite: GO SHOPPING!

But here comes the surprise, Steve. European students have a different take on reality. Not only are they  not elitists like you, but they also don't go shopping in the face of danger and they don't trust in "invisibel hands".

Instead they take the responsibility for their life  prospects in their own hands and extend it to the  workers movements of their countries. They are not paralysed by terror. No, on the contrary: they become very active. Not only do they temporarily shut their schools, universities and companies and engage in a vivid national discussion about how to live their lives, no they enter into what Poe rightly describes as the dynamic phase of "acute and hightened awareness."

It is a phase which feels very much like that of a warrior who goes into battle. It is best described as a state of wilfully accepting the risk to die, of great fear even, but also, and more importantly, of total personal abandonment and of mobilising the inner strength to go forward, to make the one ultimate, decisive step yet and to give in into the risk of the immediate fate of was is going to happen NOW. This acute nervousness, the paralyzing nagging self doubts are suddenly blown away when the warrior goes on the assault and physically confronts his opponents. He enters a hightened state of being in tune with reality. All becomes easy now. He sees the terrain of the battle field with the utmost clearity and does things he has thought previously impossible. He rejoyces and commits acts that astound him. He is immersed in a world of total beauty, of liberty and of strength. Everything is possible now. It is a Zen exercise.

Beauty of action in the face of horror as Edgar Alan Poe saw it. It is a she:

 


"The USA appears destined by fate to plague America with misery in the name of liberty." Simon Bolivar, Caracas, 1819

by Ritter on Fri Mar 24th, 2006 at 11:48:13 AM EST
Jerome, I have been following your diaries and comments both on Eurotrib and Daily Kos for the past week or so, and it has been extremely informative.  However, the more I read -- on all sides of the issue -- the more confused I get, as I have never lived in Europe for more than 6 months (back in the early 90s) and have been "drinking the kool aid" of so-called "Anglo-Saxon neo-liberalism" since I have started to become aware of such issues back in the mid 90s.

Can you clear up a couple of questions I have?

  • Do you believe that unemployment (unemployment as number seeking employment as ratio of labor force/active population) is a chronic problem in France?  If so, do you believe it is a significant one that needs to be addressed?

  • What is the "old social compact that worked" in France, when did it work, and why did it stop working?

  • Related to the previous question:  You wrote above that
    France did make the choice 30 years ago, when unemployment first struck, to protect those in the work market and have flexibility borne by a small subset of the population
    and I think you implied that this was a mistake.  If so, what should France have done, and what should it do now to address the problem of unemployment (assuming you do believe that there is such a problem)?

  • I was intrigued to read that another reason you appear to be against the Anglo-Saxon neo-liberal model (besides its alleged unfairness to the non-elites, in particular to the unfair share of precariousness that they have to bear in that model) is that you anticipate a "future energy crisis" that the Anglo-Saxon model will not be able to meet as well as the "old social compact that worked in France".  Can you elaborate on that?

  • I work as a software programmer, and I love Paris, so one dream I have long held is to be able to start a high-tech company in Paris, probably around 2009/2010 (that timing being for personal reasons).  I have seen the wreckage of enough high-flying start-ups in the U.S. high-tech bubble, and was never personally interested in building to sell out and get rich anyway.  Rather, my goal would simply be to build a good, enduring company based on good products that would generate healthy profits, where people would enjoy working.  Do you think it would be easier to do this in France than in, for example, Germany, the U.K., Japan or the U.S. (all other countries I am also considering, though I would highly prefer to do this in France)?  Do you think I could this using the Contrat Nouvelle Embauche until I grow beyond 20 employees and then (necessarily) switch them to the standard Contrat à Durée Indéterminée?  Alternatively, would it be feasible -- as it has been in my experience in the U.S. and in Japan -- and even preferable to work with independent contractors (again, this would be high-tech sector, specifically software programming and the Internet) than hiring employees?

  • The American in me bristles at the word "elite" (in a sociopolitical context), so I was wondering how you define/use that word.  (I know, I know, obviously the U.S. has its most wealthy families and individuals, its most educated families and individuals, its most politically connected families and individuals.  But it does not automatically follow that these are "elite" in the sense that you mean the word, especially as it applies to France.)  Also, how do you propose to build/nurture/cultivate "a more confident, but more modest elite" in France?  Would you recommend that other EU countries -- indeed, even the EU itself -- do the same?

Sorry for the long post (if there is a different format/forum where I should have put it, please let me know!)

Bruno-Ken

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Fri Mar 24th, 2006 at 07:20:56 PM EST
I'm just about to go to bed, and this warrants a longer response, so I'll do it tomorrow. Thanks for your questions!

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Fri Mar 24th, 2006 at 07:32:04 PM EST
[ Parent ]

Do you believe that unemployment (unemployment as number seeking employment as ratio of labor force/active population) is a chronic problem in France?  If so, do you believe it is a significant one that needs to be addressed?

It is a problem, yes. We should be doing better. Part of it is an employment problem, i.e. a fairly low overall employment rate because older workers have been discouraged and young workers are not welcomed. Part of it is more the problem that this employment is borne by the same people all the time - some are never unemployed (the public sector workers, most well qualified workers), while some spend too much time alternating between employment, often in precarious jobs, and unemployment, and stay forever out of the system.

It's really that two-tier system which is the biggest issue


What is the "old social compact that worked" in France, when did it work, and why did it stop working?

To oversimplify: the 'elites' have the power to lead the country, no questions asked; in return, they treat workers well. Enlightened State paternalism, if you want, with the lites getting social recognition and State power. That compact is being breached because the elites are using their power, just like everywhere else, to grab more money (which usually means squeezing costs, including labor costs). workers are being squeezed, in the name of "globalisation", but see that the elites trying to keep all power as before. Thus that feeling that politicians are out of touch and cheating on them.


Related to the previous question:  You wrote above that


France did make the choice 30 years ago, when unemployment first struck, to protect those in the work market and have flexibility borne by a small subset of the population

and I think you implied that this was a mistake.  If so, what should France have done, and what should it do now to address the problem of unemployment (assuming you do believe that there is such a problem)?

It's hard to tell. what's clear today is that there were irreversible effects of the initial policies: companies have gotten used to hiring less, and hiring only via short term or similarly "flexible" contracts. Even when "normal" jobs get more flexible, they are still used as little as possible by companies which have learnt to behave differently (what Migeru calls an histeresis effect)


I was intrigued to read that another reason you appear to be against the Anglo-Saxon neo-liberal model (besides its alleged unfairness to the non-elites, in particular to the unfair share of precariousness that they have to bear in that model) is that you anticipate a "future energy crisis" that the Anglo-Saxon model will not be able to meet as well as the "old social compact that worked in France".  Can you elaborate on that?

The two questions are only partly related. I think France will be better prepared to face the energy crunch because the State has always been heavily involved in the sector, and has applied long term planning. Nuclear energy, diversification of gas supplies, network safety, strategic reserves, the constitution of very strong companies were made possible by the social compact that gave some (competent) people all the power and gave them the time to plan investments over very long time horizons.


I work as a software programmer, and I love Paris, so one dream I have long held is to be able to start a high-tech company in Paris, probably around 2009/2010 (that timing being for personal reasons).  I have seen the wreckage of enough high-flying start-ups in the U.S. high-tech bubble, and was never personally interested in building to sell out and get rich anyway.  Rather, my goal would simply be to build a good, enduring company based on good products that would generate healthy profits, where people would enjoy working.  Do you think it would be easier to do this in France than in, for example, Germany, the U.K., Japan or the U.S. (all other countries I am also considering, though I would highly prefer to do this in France)?  Do you think I could this using the Contrat Nouvelle Embauche until I grow beyond 20 employees and then (necessarily) switch them to the standard Contrat à Durée Indéterminée?  Alternatively, would it be feasible -- as it has been in my experience in the U.S. and in Japan -- and even preferable to work with independent contractors (again, this would be high-tech sector, specifically software programming and the Internet) than hiring employees?

I really can't say. France does have a strong software sector, so you should find the requisite competences, but beyond that I don't know. The real trigger level is 10 employees. From that point, you have a lot more compliance issues under labor laws (representation, consultation, etc...)


The American in me bristles at the word "elite" (in a sociopolitical context), so I was wondering how you define/use that word.  (I know, I know, obviously the U.S. has its most wealthy families and individuals, its most educated families and individuals, its most politically connected families and individuals.  But it does not automatically follow that these are "elite" in the sense that you mean the word, especially as it applies to France.)  Also, how do you propose to build/nurture/cultivate "a more confident, but more modest elite" in France?  Would you recommend that other EU countries -- indeed, even the EU itself -- do the same?

No, that comment about eliters was specific about France. If French elites want to keep the power they have historically had, and the public legitimacy that went with it, they have to keep their share of the deal, i.e. not sell out to financiers, and be prouder of what their forebears achieved and what they could achieve if they followed their history instead of the imported ideology of others.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sat Mar 25th, 2006 at 10:17:46 AM EST
[ Parent ]
Jerome, thank you very much for taking the time to answer those questions.  I am going to chew on your answers and follow the continuing conversations about the CPE and the demonstrations to see if I can digest all this information and figure out where I fall on this.

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire
by marco on Sat Mar 25th, 2006 at 12:38:17 PM EST
[ Parent ]
Thanks again, Jerome--very instructive!

Pogo: We have met the enemy, and he is us.
by d52boy on Sat Mar 25th, 2006 at 12:22:13 PM EST


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