Chirac Caves, Hopes of Reform in France Drop Lower
Chirac caves in to misguided student protestors and labor unions:
PARIS - President Jacques Chirac caved in to protesters on Monday, canceling a law on youth employment that fueled nationwide unrest and raising questions about France’s ability to reform rigid labor laws in a globalized world.
Unions declared victory, but energized students decided to go ahead with a “day of action” Tuesday to try to knock down other measures — designed to reduce the 22 percent unemployment rate among youths — that are viewed as threatening coveted job protections.
The irony here is that this new law would have helped the students, not hurt them. But ones welfare state perks are like an addiction. It doesn’t matter if they are bad for you - you still want them. The students want their job protections - even if it hurts their prospects of finding a job in the first place.
Or maybe some think, “Hey, I’ll find a job. Tough luck for those that don’t because my job protections are driving up unemployment”. You know - let them eat cake.
There is not much altruistic to find in these French student protests.
French labor laws harm France. The standard of living is falling and unemployment is stuck permanently high. That even this timid proposal at labor law reform cannot survive does not bode well for the future of France. Sad.
April 11th, 2006 at 12:28 am
We should be grateful to the Franch people for making this sacrifice. Without their efforts, there was no way we can convince the rest of the world that there is no free lunch. Chirac, a democratically elected official is merely responding to the wishes of his people.
It looks like there has always been two choices.
1. Have a system where employment is readily available for those willing to work at low wages. This often creates a class of working poor. With full employment, everyone produces something.
2. Have a system where employment is not readily available, but the state will distribute income to those without it. This creates a class of persistant employed. Those idle hands produces nothing.
From a social stability point of view, option 2 looks like a real a bad idea. When people (specially the young) have no opportunity and no job to go to, you get the french riots. If they had regular employment, they wouldn’t have the time and energy to throwing rocks. One would think that a sociality would want every able member working to raise the standard of living for everyone (higher GDP) It is just amazing that Franch is supposedly the 5th largest economy entity in the world with their inflexibile labor system.
There is no doubt that the French system will have to be changed at some point in time given the globalization of labor market, the only question is when.
April 11th, 2006 at 7:38 pm
“they wouldn’t have the time and energy to be throwing rocks”
Same is true for the Muslim rioters a few months back.
I agree that it is surprising that France has the 5th largest economy in the world. I guess this shows that even a heavily regulated free-market economy still won’t do all that badly.
On the other hand, economists say that for every 10% that the government grows as a percentage of GDP, GDP growth rates will drop by 1%. With France’s government at 52% of GDP, they should expect very slow growth from now on - along with high unemployment.