Sta Hungry Stay Foolish

Stay Hungry. Stay Foolish.

A blog by Leon Oudejans


31 May 2016


Last Friday, Natalie Nougayrède wrote an interesting article in The Guardian: France’s chaos stems from its failure to adapt to globalisation. I doubt the words failure and globalisation are appropriate. I think it’s about a French unwillingness to adapt their way of life. In my (Dutch) view, the French prefer their way of life. However, even the French cannot deny that their way of life comes at a cost, and it’s the allocation of that cost that is the centre of the debate.

The classical French way of dealing with cost is raising taxes on the wealthy. In 2012, Mr Hollande promised a 75% top income-tax rate on those earning over €1m ($1.3m) a year, which means they would pay over 90% after social charges (Economist). In 2016, the same guy now proposes a draft law to relax rules around the 35-hour work week, weaken the power of unions, and leave workers less protected from layoffs (Guardian).
Many southern European countries have a similar two-tier labour market: “one part of the population benefits from strong protections and solid, open-ended contracts; the rest find themselves either out of work or in precarious jobs. French trade unions represent only 7% of the active population, mostly employees already in highly protected sectors – partly because trade union finances are closely connected to the public sector and large enterprises”. (Guardian).

In May 2016, the Economist reposted a March 2015 article in Facebook: Where is the best place in the world to be a working woman? France ranks at #5 worldwide. Their “glass-ceiling index, which shows where women have the best chances of equal treatment at work, combines data on higher education, labour-force participation, pay, child-care costs, maternity rights, business-school applications and representation in senior jobs”. Unfortunately, that glass-ceiling index ignores an essential aspect: getting that job in the first place.

A more telling tale are some other Economist articles: France and its jobs for life (2007), Elitism rules OK (2009), The French way of work (2011), and An inconvenient truth (2012).

Unlike the French, young Greek and young Italian people have protested against their rigid labour markets in recent years (eg, Greece-1, Greece-2, Italy-1). A higher level of French welfare may have prevented a similar protest in France. However, increasingly young French people look for jobs abroad (eg, L’Auberge Espagnole trailer).

Actually, it’s rather scary that a Socialist President has proposed this draft law. Given his political background such a proposal does not make any sense at all and especially not in view of his 2017 presidential re-election campaign. This could well imply that there is no more room for raising taxes. In that case, the French ticking time-bomb may be about to explode. 

Although I’m not a fan of the former Greek Finance Minister, Varoufakis, he recently did raise an interesting point: “91% of the 1st bailout went to German and French banks. The 2nd bailout, 100%. And the 3rd bailout, which I didn’t sign, [] it was $85 billion. Of that, precisely zero will go to Greece” (eg, Democracy NowHuffingtonNew Yorker).

Karl Otto Pöhl, head of the German central bank from 1980 to 1991: “It was about protecting German banks, but especially the French banks, from debt write offs. On the day that the rescue package was agreed on, shares of French banks rose by up to 24 percent. Looking at that, you can see what this was really about – namely, rescuing the banks and the rich Greeks” (Der Spiegel, 2010).

As a top French finance boss already stated in 2012: “The real risk for the euro zone now is not Greece, but France” (Economist).

Wende Snijders – Je suis comme je suis (2004) – artist, lyrics, video, Wiki-1, Wiki-2

Les Poppys – Non Non Rien N’a Changé (1971) –  artistslyricsvideoWiki


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